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

  • Pipeline protesters to hold news conference after eviction notice

    Economic CTV News
    BURNABY, B.C. -- Protesters at an anti-pipeline camp in Burnaby, B.C., are set to hold a news conference to relay their side of the story this morning, instead of complying with an eviction notice handed down by the city. Source
  • Pipeline protesters defy city-issued eviction order, say they'll meet with officials

    Economic CTV News
    BURNABY, B.C. -- Protesters at an anti-pipeline camp in Burnaby, B.C., say they will meet with officials to discuss safety measures, but will not comply with a city-issued eviction order. The City of Burnaby says there are safety concerns surrounding "Camp Cloud," including a two-storey watch house and a fire that the protesters describe as sacred and ceremonial. Source
  • Edmonton man charged following investigation into alleged $5.5M Ponzi scheme

    Economic CTV News
    EDMONTON -- Police say a 59-year-old Edmonton man is facing charges after allegedly orchestrating a Ponzi scheme valued at $5.5 million. Investigators with the Edmonton police say the man used the company name "Wakina Consulting Inc. Source
  • Aeroplan wants to be your rewards program and travel agent. Will it work?

    Economic CBC News
    Aeroplan wants to be more than your rewards program; it also aims to serve as your travel agent. The program announced its ambitious plans this week, which include offering charter flights to sun destinations, opportunities to book travel with cash while earning points, and the ability to transfer miles to other loyalty programs. Source
  • Higher crude prices and weaker loonie could offer provinces royalty windfall

    Economic CBC News
    Resurgent oil prices this year could deliver three provinces unexpected windfalls — and maybe improved political fortunes — if crude stays strong. Sagging prices have weighed heavily on resource-based economies in recent years, putting the squeeze on provincial budgets that rely on petroleum revenues. Source
  • Aeroplan announces big plans for its revamped program but members still skeptical

    Economic CBC News
    Aeroplan wants to be more than your rewards program; it also aims to serve as your travel agent. The program announced its ambitious plans this week, which include offering charter flights to sun destinations, opportunities to book travel with cash while earning points, and the ability to transfer miles to other loyalty programs. Source
  • Canadian agriculture ministers briefed on trade-war contingency plan

    Economic CTV News
    VANCOUVER -- Federal Agriculture Minister Lawrence MacAulay emphasized the importance of the provinces working together as an escalating trade war with the United States puts some farmers on edge. The minister said his provincial and territorial counterparts discussed trade negotiations and the contingency plan during their conference that wrapped up Friday in Vancouver. Source
  • Teamsters members at CP Rail ratify new contract

    Economic CBC News
    Unionized conductors and locomotive engineers at Canadian Pacific Railway Ltd. have voted in favour of a new four-year collective agreement. Members of the Teamsters Canada Rail Conference (TCRC), which represents about 3,000 workers at CP, voted 64.7 per cent to ratify the new contract. Source
  • Pipeline protesters say they're willing to defy eviction notice

    Economic CTV News
    BURNABY, B.C. - Protesters at an anti-pipeline camp in Burnaby, B.C., say they are ready to defy an eviction notice handed out from the city. The City of Burnaby issued a 72-hour notice to those occupying "Camp Cloud" on Wednesday, but protesters say in a news release that isn't enough time to comply with concerns raised over safety. Source
  • Japan resumes Canadian wheat imports after suspension

    Economic CBC News
    Ottawa says Japan has ended its temporary suspension of Canadian wheat imports. Japan had halted shipments after some unauthorized genetically modified wheat was found in southern Alberta. Ottawa says the decision marks an end to all international trade actions arising from the discovery on June 14. Source