Sears reports $2.4 billion Q4 loss
Sears Holdings Corp. has reported a loss of $2.4 billion in the fourth quarter, compared with a profit of $374 million in the year-ago period. And in a move long anticipated by some analysts, the chain also announced plans to tap into its massive real estate holdings to help make up for its faltering retail performance.
Revenue slipped 4% to $12.5 billion from $13 billion. Same-store sales fell 4.1% during the quarter at Sears and 2.7% at Kmart.
The parent to Sears and Kmart disclosed that it plans to separate its smaller Hometown and Outlet stores as well as some hardware stores to raise $400 million to $500 million, and will sell 11 stores to mall owner General Growth Properties to raise $270 million. That deal, which includes stores that are currently located on GGP properties, is expected to close in April. The stores will continue to operate as Sears locations into 2013 with final closing dates to be determined and announced later this year, according to Sears Holdings.
"We're executing actions to unlock the value of our portfolio and assets," said Sears CEO Lou D'Ambrosio in a call with analysts.
The plans, which follow news in December that the company would close at least 100 stores to raise cash, are part of the retailer’s aggressive turnaround strategy, which has also included job cuts.
Sears said its quarterly performance was hurt by high costs for cotton and fuel, too-high inventory, and unseasonable weather that led to lower sales of winter gear. The company also cited low consumer demand for two of its biggest categories, appliances and consumer electronics.
For the year, net loss totaled $3.1 billion, compared with net income of $133 million.
Revenue fell 3% to $41.57 billion from $42.66 billion a year ago.