Sears Reports $112M Q3 Loss
By Alan Wolf -- TWICE, 11/23/2009
Hoffman Estates, Ill. — Sears Holdings reported a net loss of $112 million for its fiscal third quarter, ended Oct. 31, citing soft sales and higher costs due to store closings, severance payments and pension plan obligations.
Total revenues fell 4.7 percent to $10.2 billion, due primarily to lower comp-store sales at Sears and 56 fewer Kmart and Sears full-line stores than the year-ago period.
The sales decline was partially offset by an increase of $42 million due to the favorable impact of foreign currency exchange rates.
Domestic comp-store sales declined 2.3 percent, reflecting flat comps at Kmart and a 4.6 percent decline in comp sales at Sears. The latter were due in part to decreases in Sears' major appliance business, although majap sales declines have lessened from previous quarters, the company said.
The company cut its operating loss by $96 million year over year, to $106 million, which included expenses of $54 million related to domestic pension plan obligations and store closings and severance. The retailer closed seven underperforming stores during the quarter and 14 locations during the year-ago period.
As part of its Holiday strategy Sears offered a 50-inch, 1080p LG plasma TV for $880 this past Saturday as part of the chain's fourth weekend of pre-Black Friday promotions. The deal represents one of the industry's deepest discounts this month, based on current sales events and leaked Black Friday circulars.
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