Sears Holdings sees income fall 62 percent
Hoffman Estates, Ill.-based Sears Holdings took another blow in the second quarter, with hits particularly in home improvement- related goods at its stores in the United States.
Net income fell 62 percent to $65 million from $173 million in the year-ago period at the company, which includes Sears, Sears Canada and Kmart stores.
Sears reported second-quarter sales of $11.8 billion, down 4 percent from $12.3 billion last year. Domestic same-store sales dropped 6.2 percent, including a 5.6 percent drop at Kmart stores and a 6.7 percent decline at Sears locations.
Sears also benefited from a one-time, pre-tax gain of $62 million, following the reversal of a 2007 jury verdict on the redemption of bonds issued by former Sears, Roebuck and Co.
The company said the decline in sales and earnings came from lower performance at Sears domestic stores and Kmart. Still, the company saw improved results in its Sears Canada stores.
"Our second-quarter results reflect the continued effects of a slowing economy which contributed to the earnings declines we have experienced since the third quarter of 2007," said W. Bruce Johnson, Sears Holdings' interim CEO and president.
The comparable-store sales declines at both Kmart and Sears stores in the United States “continue to reflect increasing competition and weakness in the general economy,” the company said. Additionally, the comparable-store sales declines were driven by categories directly impacted by housing market conditions, the company said, including appliances and tools.