February 27, 2014
As far as sales go, Sears Holdings didn’t have a very happy holiday. But the company was still able to narrow its loss for the fourth quarter, as it lowered expenses and reduced inventory.
The company said the costs of transforming into a member-centric retailer using an integrated online platform and the omnichannel Shop Your Way membership program fueled its net losses. It attributed declining revenues to lower same store sales and having fewer stores in operation.
Sears lost $358 million for the period ended February 1, compared with a loss of $489 million a year ago.
Sales dropped 14% to $10.6 billion, from $12.3 billion. Same store sales fell 6.4%. At Sears stores, the metric was down 7.8%. It fell 5.1% at Kmart.
For the fiscal year, Sears reported a net loss of $1.4 billion, compared to a $930 million net loss in the previous fiscal year.
Revenues also declined during the fourth quarter and fiscal year. Quarterly revenues dropped 14% to $10.6 billion from $12.3 billion, and annual revenues declined 9% to $36.2 billion from $39.9 billion. Same store sales declined 3.8%, with decreases of 3.6% at Kmart and 4.1% at Sears Domestic.
“During 2013, we made progress in our continuing transformation into a member-centric retailer leveraging Shop Your Way and integrated retail, which we believe will position us for enhanced growth and profitability to create long-term shareholder value,” said Edward S. Lampert, Sears Holdings’ chairman and CEO. “Our full year results are impacted during this transformation as we continue supporting traditional promotional programs and marketing expenditures while we invest in our Shop Your Way program and integrated retail strategy. We have been investing hundreds of millions of dollars annually in our transformation and will continue to invest in the future of the company.”
The company said it continues to explore “strategic alternatives” for its auto centers and Lands’ End business.
Source: Retailing Today
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