Hoffman Estates, Ill. – Sears Holdings’ same-store sales continued to decline during its fiscal second quarter, as chairman, CEO and chief investor Eddie Lampert furthers his long-term digital focus.
For the three months ended July 25, total same-store sales declined 10.6 percent, comprised of a 6.9 percent decrease at Kmart and a 13.9 percent drop at Sears.
Much of the downturn was attributable to CE, which Sears is revamping under electronics chief Ryan Ciovacco as part of an over-arching connected product and services strategy.
Excluding electronics, comps would have decreased 5.4 percent at Kmart, 12.5 percent at Sears, and 9.1 percent in total.
The update was part of a second-quarter earnings preview that heralded a return to profitability with projected net income ranging between $155 million and $205 million, compared to a prior-year net loss of $573 million.
The change of fortune reflects Lambert’s efforts to monetize Sears’ real estate by selling off property to Seritage, its own recently-formed real estate investment trust (REIT), reaping a “significant” tax benefit from the lease-back deal, and by sub-letting stores to other REITs, retailers and commercial property management companies.
Sears said the moves were designed to enhance liquidity and business operations and improve its financial position. They also support the chain’s “transformation from a traditional store network-based retail business model to an asset-light, member-centric retailer.”
The company expects to formally announce its Q2 results around Aug. 20.
In other Sears news, former Gymboree COO Joelle Maher joined the company last month as president and chief member officer of its Sears business.
“Joelle’s depth and breadth of retail and business experience and ability to achieve superior results in established organizations make her a strong fit for this member-focused role at Sears Holdings,” Lampert said. “She will work closely with me and our business unit leaders to lead our iconic Sears brand in its continued transformation as an integrated retail format.”
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