Cold weather delivers ‘unacceptable’ Q1 results for Sears
HOFFMAN ESTATES, Ill. — Sears Holding Corp. reported a bigger-than-expected net loss of $279 million for the first quarter of fiscal 2013, compared to net income of $189 million in the first quarter of fiscal 2012.
The retailer also said that it is considering selling its protection-agreement business in an ongoing effort to raise cash as it struggles to improve its profits.
Domestic same store sales fell 3.6%, which the company largely attributed to cold weather, and revenues dropped about 9% to $8.45 billion from $9.27 billion. In one positive result, the company’s online business on sears.com and kmart.com grew 20% from the same quarter a year earlier.
Eddie Lampert, Sears Holdings chairman and CEO, termed the quarter’s results “unacceptable” in comments to shareholders, but highlighted positive developments in the company’s online business and in its “Shop Your Way” membership program, as well as in emerging technology areas.
“During the quarter, we have accelerated our activity to transform Sears Holdings into a leading integrated retailer that fosters relationships with members through our Shop Your Way platform” Lampert stated. “We launched new mobile capabilities, like Member Assist, which allows our members to communicate directly with our consultative store sales staff remotely in a manner most convenient for our members. We believe that if we leverage technology to provide our members with the easiest, most seamless shopping experience possible, we will be successful."
On the company’s quarterly call with investors, Lampert said that Sears would continue to offer service agreements to customers even if it sold the business.
Sears executives also said on the call that Sears has $7 billion of liquidity or assets that can be converted to cash very quickly if needed.