The loss in the first quarter for Sears widened as the retailer’s sales fell amidst its continual struggle to entice shoppers.
Sears Holdings Corp, which is the operator of its namesake and Kmart stores, has tried to cut costs, reduce inventory and sell assets in order to return to a profit. In addition, it is shifting from focusing on running a network of stores to member business.
The most recent results show big challenges remain.
Edward Lampert the CEO and chairman said Thursday that Sears was seeing progress while shifting to a member-focused business, as member sales for the first quarter comprised 74% of the eligible sales, the most to date.
Lampert said Sears’ biggest drag for sales occurred in its consumer electronics sector at its Sears and Kmart stores. The company, based in Illinois lost just over $402 million equal to $3.79 a share for the quarter ending May 3.
That was in comparison to a $279 million equal to $2.63 a share loss during the same reporting period one year ago. By excluding certain items, the loss decreased to $2.24 a share.
Revenue was down 7% to end the quarter at $7.88 billion in part because of fewer Sears and Kmart stores still open. The latest results also took into consideration the weaker revenue from Sears Canada and the Lands’ End spinoff in April.
Last week Sears announced it was considering selling its entire operation in Canada.
Sales at Sears stores in the U.S. opened at least 13 months was up by 0.2% during the quarter. Taking out the impact from the consumer electronics sector, that figure increased 0.8%.
In Kmart stores that were opened for at least 13 months, sales fell by 2.2%. Taking out the consumer electronics sector impact and its households and grocery category, the metric in Kmart was down 0.4%.
Sales at stores that are opened a minimum of 13 months is a critical indicator of the health of the retailer as it excludes results from stores just closed or recently opened.
Online sales were one positive area with sales increasing by 26%.
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