Sears Q2 net loss narrows
Hoffman Estates, Ill.-based Sears Holdings reported a second-quarter net loss of $132 million, compared with a loss of $146 million in the year-ago period.
Revenues totaled $9.5 billion for the quarter ended July 28, down 6% from $10.1 million in the second quarter of 2011. The company cited lower domestic comparable-store sales for the quarter and the effect of having fewer Kmart and Sears Full-line stores in operation. Sears Canada's comparable-store sales also decreased and included a decline of $55 million due to changes in foreign currency exchange rates.
"We continue to make progress against the priorities we outlined in our fourth quarter earnings release and call. In particular, we have improved our profit position, as we reduced expenses and expanded margin rate through more effective promotional design,” said Lou D'Ambrosio, Sears Holdings' CEO and president. “We have also successfully lowered inventory, reduced debt from year end, and enhanced our liquidity. In addition, the Sears Hometown transaction remains on track to close in the third quarter."
Domestic-comparable store sales declined 3.7%, comprised of declines of 2.9% at Sears Domestic and 4.7% at Kmart. The largest impact was in consumer electronics. Lawn and garden also declined due to drought conditions.
Earlier this week, Sears also announced that it would be spinning off its Hometown and Outlet stores, along with some hardware stores, into a separate, publicly traded company.
For the first 26 weeks, Sears reported net income of $57 million, compared with a loss of $316 million in the prior-year period. Revenues for this period totaled $18.7 million, down 5% from $19.7 million in 2011.