Sears to close more stores |
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| Tuesday, 02 December 2008 | |
 Owner of Sears and Kmart, Sears Holdings Corporation, reported a third quarter loss as sales fell. Its shares rose, however, over 8 percent as it announced store closures and an expanded share buyback. The Hoffman Estates, Illinois-based firm reported a net loss of $146 million
compared with net income of $4 million, a year ago.
The retailer, which operates 3,900 stores in the US and Canada said its domestic same-store sales fell a further 8.7 percent during the month of November, with a drop of 7.8 percent at Sears Domestic and 10 percent at Kmart. Sales were down across most categories, led by products directly impacted by collapsing housing market, including home and household goods and lawn-and-garden items. Apparel sales also were hurt, the company said. Operating loss in the third quarter was $202 million, compared to an operating income of $51 million in the prior year period. The company abandoned its previously issued outlook after November sales continued to decline. However, shares, having lost two-thirds of their value this year, jumped 10 percent to $35 after the company said it's considering closing additional stores and the repurchase of up to $500 million of common shares This year, Sears Holdings has been rebuilding its management and expanding programs such as layaway in a bid to help consumers shaken by tighter lending standards and rising unemployment. On 2 December, it announced that three new executives will join the company, including former Lehman Brothers Holdings Inc Chief Administrative Officer Scott Freidheim, who will lead Sears Holdings' operating and support businesses. image: Sears shop |
Interim chief executive officer and president W. Bruce Johnson warned of a "difficult" holiday shopping season and said an earlier earnings forecast no longer applies. The retailer announced to close another eight underperforming stores.