Sears Reports Lower Sales, Losses In Qtr., Fiscal Year - Twice

Sears Reports Lower Sales, Losses In Qtr., Fiscal Year

Hoffman Estates, Ill. — Sears Holdings reported lower sales while net losses continue.
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Hoffman Estates, Ill. — Sears Holdings reported lower sales while net losses continue.

The company, which operates Sears and Kmart, reported a net loss of $358 million for the fourth quarter and $1.4 billion for the full year of 2013. This compares with net loss of $489 million and $930 million, respectively, for the prior year fourth quarter and full year.

Fourth-quarter revenues decreased $1.7 billion to $10.6 billion for the quarter, ended Feb. 1, compared with revenues of $12.3 billion for last year’s final quarter.

For the year, revenues decreased $3.7 billion to $36.2 billion, compared with revenues of $39.9 billion in the prior fiscal year.

The company said Q4 revenue decreased due to lower domestic comp-store sales, which accounted for approximately $600 million of the decline, as well as the effect of having fewer Kmart and Sears full-line stores in operation, which accounted for approximately $320 million of the decline. The fourth quarter of 2012 also benefited from revenues of approximately $500 million due to the 53rd week.

Sears Holdings said fewer Sears and Kmart full-line stores hurt full-year revenues, which accounted for approximately $1.1 billion of the decline, as well as lower domestic comp-store sales, which accounted for approximately $1 billion of the decline. Revenues for the year were also impacted by approximately $490 million attributable to the separation of Sears Hometown and Outlet Stores, which occurred in the third quarter of 2012. The full year of 2012 also benefited from the above-noted revenue attributable to the 53rd week.

The company said comp-store sales were down in CE and major appliance at Sears while, at Kmart, CE sales were disappointing.

For the quarter, domestic comp-store sales declined 5.1 percent at Kmart and 7.8 percent at Sears. For the year, domestic comp-store sales declined 3.6 percent at Kmart and 4.1 percent at Sears.

While Edward S. Lampert, Sears Holdings' chairman/CEO, continued to promote consumer acceptance of the company’s “Shop Your Way” member program and other promotions in the company’s statement and letter to investors, the comopany also reported that the gross margin rate for both Kmart and Sears for the year were impacted by transactions that offer both traditional promotional marketing discounts and Shop Your Way points.

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