Sears Slims Q4 Loss; Fiscal-Year Loss Increases
Posted on February 27, 2014 by
HOFFMAN ESTATES, Ill.-Sears Holdings said its fourth-quarter net loss fell from $489 million last year to $358 million in this year's quarter. Meanwhile, the company's net loss for the fiscal year ending on Feb. 1 rose from $930 million to $1.4 billion.
Edward Lampert, Sears Holdings' chairman and CEO, said the company's results continue to be affected by its transformation to a member-centric retail model focused on its Shop Your Way and integrated retail programs. Lampert said the company's retail chains, Sears and Kmart, continued to support traditional promotional programs and marketing expenditures while the parent invests in its new model.
"We have been investing hundreds of millions of dollars annually in our transformation, and will continue to invest in the future of the company," he said.
Revenues for the parent dropped 13.6 percent in the quarter, to $10.6 billion, and 9.2 percent for the year, to $36.2 billion. Same-store sales in the quarter were down 6.4 percent, including dropoffs of 5.1 percent at Kmart and 7.8 percent at Sears U.S. stores. For the year, overall same-store sales fell 3.8 percent, consisting of decreases of 3.6 percent for Kmart and 4.1 percent for Sears.
Gross margin in the quarter fell 240 basis points to 23.4 percent. Selling, general and administrative expenses were down 20.4 percent in dollars and 210 basis points as a percentage of sales, to 24.7 percent.
Lampert said the parent company's transformation efforts have borne some fruit, with sales from Shop Your Way members up 69 percent for the year and sales from its multichannel businesses increasing 10 percent for the year. "While transformations of this size are challenging, and our financial results do not currently reflect our progress in member engagement, we believe the changes we are making through Shop Your Way and integrated retail will benefit us in the changing retail landscape," he said.