Sears 4Q loss widens after retailer limps through the holidays

NEW YORK -- Sears' fourth-quarter loss widened despite deep cost cuts and, after the struggling retailer limped through the crucial holiday shopping season, it promised to tighten spending even more this year.

See Full Article

Chairman and CEO Edward Lampert pointed to a warm winter that drove down sales for seasonal goods and brutal competition with other retailers, almost all of whom were forced into clear inventory by marking down prices drastically.

Shares rose 4 per cent before the opening bell Thursday after the company announced that a major shareholder in the company would take a seat on the board, which will be increased to 10 seats.

One of those seats will be occupied by Bruce Berkowitz, chief investment officer at Fairholme Capital Management LLC.

Fairholme owns a 26.3 per cent stake in the Hoffman Estates, Illinois, company, according to the data firm FactSet.

For the period ended Jan. 30, Sears, which also owns Kmart, lost $580 million, or $5.44 per share, compared with a loss of $159 million, or $1.50 per share, a year earlier.

If a one-time $180 million charge related to the impairment of the Sears trade name is removed, the per-share loss would have been $1.70 per share.

Revenue declined to $7.3 billion from $8.1 billion.

Sales at Kmart stores open at least a year dropped 7.2 per cent, while sales at Sears stores fell 6.9 per cent. Both were hit with weak consumer electronics sales, though the company said that that was actually an improvement from the first three quarters of the year.

Sears said earlier this month that it would accelerate the shuttering of some stores following the challenging holiday season.

The company for years has been searching for ways to compete with the Home Depots and Wal-Marts down the street, and with Amazon.com online.

Sears stores in many locations appear run down and it has tried to revitalize its image, but it's doing so in an environment in which it must reduce costs to mitigate its losses.

The company lowered expenses by about $150 million in the fourth quarter and estimates that it will further cut costs by $550 million to $650 million this year.

At the same time, it is promising to shake up sourcing, pricing and inventory to reinvigorate clothing sales.

Sears Holdings Corp. reported a full-year loss of $10.59 per share on revenue of $25.15 billion.



Advertisements

Latest Economic News

  • Extra EI help to hard-hit regions tops $1 billion, surpassing budget estimates

    Economic CTV News
    OTTAWA -- The federal government says it has paid out more than $1 billion in extra employment insurance benefits to out-of-work Canadians in the hardest-hit economic regions of the country, blowing past what the Liberals estimated the program would cost. Source
  • Home Capital says founder Gerald Soloway to leave board, CFO to change role

    Economic CBC News
    Home Capital Group Inc. said Monday that two people named in an Ontario Securities Commission action against the company will be moving out of their roles. The embattled mortgage lender said chief financial officer Robert Morton will shift out of that role after the company files its first-quarter results. Source
  • Notley says Canada will have lots of allies if Trump goes after energy trade

    Economic CTV News
    GUANGZHOU, China -- Alberta Premier Rachel Notley says U.S. President Donald Trump is likely to have some unhappy supporters south of the border if he goes after Canadian energy with trade sanctions. Notley, who is on a trade mission in China, says she doesn't know what Trump was talking about last week when he lumped energy in with other trade irritants, including softwood lumber and dairy. Source
  • U.S. justices turn away GM appeal over ignition switches

    Economic CTV News
    WASHINGTON -- The U.S. Supreme Court on Monday turned away an appeal from General Motors Co. seeking to block dozens of lawsuits over faulty ignition switches that could expose the company to billions of dollars in additional claims. Source
  • After 4 straight gains, Canadian wholesale trade ticks down to $58.9B in February

    Economic CBC News
    Wholesale trade between Canadian businesses inched down by 0.2 per cent to $58.9 billion in February, a step back after four straight months of gains. Economists had expected the number to decline, but had anticipated a larger decrease. Source
  • Hamilton, Lindsay, Thunder Bay to test basic income in three-year pilot project

    Economic CTV News
    HAMILTON -- Residents of Hamilton, Lindsay and Thunder Bay areas will be the first Ontarians to receive a guaranteed minimum income as part of a new provincial pilot project. Premier Kathleen Wynne announced the details of the province's three-year basic income project today in Hamilton. Source
  • Trump sons seek to extend family brand into domestic markets

    Economic CTV News
    NEW YORK -- Apprentices no more, Eric and Donald Trump Jr. are now at the helm of the Trump Organization and adjusting to the reality presented by their father's presidency. They're eyeing ways to use the new lease on the family fame by expanding the brand into parts of the United States that embrace him. Source
  • Transaction declined: The sad saga of North Korea's ATMs

    Economic CBC News
    ?No modern airport terminal is complete without an ATM, and Pyongyang's now has two. But they don't work — because of new Chinese sanctions, according to bank employees — and it's not clear when they will. Source
  • World financial markets higher after French centrist Macron comes out on top

    Economic CBC News
    European stock markets and the euro ratcheted higher Monday, particularly in France, after the first round of the country's presidential election saw centrist Emmanuel Macron emerge on top — stoking hopes that he will defeat far-right Marine Le Pen in the run-off in two weeks' time. Source
  • Financial markets higher after French centrist Macron comes out on top

    Economic CBC News
    European stock markets and the euro ratcheted higher Monday, particularly in France, after the first round of the country's presidential election saw centrist Emmanuel Macron emerge on top — stoking hopes that he will defeat far-right Marine Le Pen in the run-off in two weeks' time. Source