Sears Hometown and Outlet Net Falls 27.2 Percent in Q1

HOFFMAN ESTATES, Ill.-Falling sales and rising expenses both cut deeply into net income for Sears Hometown and Outlet Stores in its fiscal first quarter.

Net income totaled $15 million, down 27.2 percent, in the quarter which ended on May 4. Net sales were off 3.2 percent to $601.1 million. Same-store sales fell 5 percent, which included a 6.9 percent decrease in same-store sales in the Hometown stores plus a 1.2 percent bump-up in same-store sales at the Outlet locations.

Bruce Johnson, Sears Hometown and Outlet president and CEO, attributed the sales drops to unseasonably cool weather in February and March. In particular, the weather hurt the company's lawn and garden category, its second largest, for which same-store sales plummeted 45 percent in those two months.

Selling, general and administrative expenses increased 4.3 percent in dollars and gained 153 basis points as a percentage of sales, to 21.2 percent. Expenses rose in part due to higher operating costs incurred from Sears Hometown and Outlet operating as a public company independent of Sears Holdings, from which it separated last October. Gross margin edged up 11 basis points to 25.7 percent, somewhat offsetting the effect of the climb in SG&A.

HFN Staff | News & Commentary

HFN provides detailed information on the key home classifications: Housewares, Tabletop, Floor Covering & Rugs, Furniture, Home Textiles, Lighting, Home Decor, Mattresses & Bedding, Gifts, Major Appliances and Consumer Electronics as well as Business, Finance and Retail.

Videos

  • Von Tobel Cites Brass Textures Among Top Trends

    Camera Icon   More Videos

Subscribe to
HFN Omnichannel
Receive the news you need to know about the trends in the industry delivered right to your inbox.

Current Issue

  • HFN cover for September 2017

    HFN's DIGITAL EDITION

    September 2017


    COVER STORY:

    2017 State of the Industry Report
    Cautious Optimism, Mixed Results

    Many expected 2016 would be a banner year, but the political and economic climate softened consumer confidence. It was also a year consumers spent more lavishly on home remodeling rather than decorating.


    ALSO IN THIS ISSUE:

    •  TJX Unveils First U.S. Homesense Store - In a time when retailers are reducing store counts, TJX continues to get physical.
    •   Ikea’s Fluid Spaces - The retailer’s new intros reflect multifunctional rooms.
    •  N.Y. Home Fashions Market Preview - Textile textures get soft and cozy, colors warmer.