SEARS CEO “REMAINS COMMITTED TO RESTORING PROFITABILITY” AMONG ANOTHER QUARTER OF SALES DECLINE
Sears Holdings Corporation has reported yet another loss for its third quarter ended October 29.
The company reported a net loss attributable to Holdings’ shareholders of $748 million ($6.99 loss per diluted share) for the third quarter of 2016 compared to a net loss attributable to Holdings’ shareholders of $454 million ($4.26 loss per diluted share) for the prior year third quarter.
Revenues decreased approximately $721 million to $5.0 billion for the quarter, compared to revenues of $5.8 billion for the quarter ended October 31, 2015. The year-over-year decline in revenues was primarily driven by having fewer Kmart and Sears full-line stores in operation, which accounted for $323 million of the decline, as well as a 7.4 percent decline in comparable store sales during the quarter, which accounted for $304 million of the revenue decline.
At Kmart, comparable store sales decreased 4.4 percent. While the company experienced an overall comparable store sales decline in its Kmart segment driven by declines in the grocery and household, consumer electronics and pharmacy categories, Sears Holdings remains encouraged by the comparable store sales increases experienced in several categories this quarter, including apparel, jewelry and outdoor living. Sears Domestic comparable store sales decreased 10.0 percent during the third quarter of 2016, primarily driven by decreases in the home appliances, apparel and consumer electronics categories.
“We remain fully committed to restoring profitability to our company and are taking actions such as reducing unprofitable stores, reducing space in stores we continue to operate (including through the Seritage lease arrangement), reducing investments in underperforming categories and improving gross margin performance and managing expenses relative to sales in key categories,” said Edward S. Lampert, Holdings’ chairman and chief executive officer. “While many observers have acknowledged the significant asset base of our company, we understand the concerns related to our operating performance and are committed to transforming our company through our Shop Your Way membership program and our Integrated Retail investments. At the same time, we will continue to explore options to recognize the inherent asset value in a manner that complements our transformation.”
