Sears Holdings Corp Q3 Earnings Disappoint

Sears Holdings Corp Q3 Earnings Disappoint
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Sears Holdings Corp (NASDAQ:SHLD) third quarter earnings disappointed investors yet again, marking the iconic retailer’s eighth consecutive year of declining sales and the fourth consecutive year of losses. The firm has been trying to revamp its stores and turn things around for several years now, but competition from Wal-Mart Stores, Inc. (NYSE:WMT), Home Depot Inc (NYSE:HD) and ecommerce continues to hamper progress.

Details on Sears 3Q earnings report

For the three months ending November 1, Sears Holdings Corp (NASDAQ:SHLD), which also owns retailer Kmart, reported a loss of $548 million, or $5.15 per share. In the one year ago quarter, the firm reported a loss of $534 million, or $5.03 per share. Total revenues were down around 13% to just over $7.21 billion.

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In one bright spot that augurs well for the future, online sales were up more than 9% from a year ago.

Comparable store sales were, however, anemic. Sales at the firm’s Kmart locations open a year or more increased by 0.5% in the quarter. Comparable-store sales at Sears stores were disappointing as they slipped by 0.7%.

Firm has been raising cash

Sears Holdings Corp (NASDAQ:SHLD) has been raising cash for some time now. The firm received a $400 million loan from a hedge fund run by CEO Eddie Lampert earlier this fall, and the retailer is down from 3,523 stores just five years ago to under 2,000 stores today.

Sears also announced a few weeks ago that it could sell 200 to 300 of its properties to improve liquidity. This  would would mean creating a real estate investment trust that would hold the stores, and Sears would continue to operate the stores through a lease arrangement.

Sears also noted in its statement Thursday that its long-term debt has shrunk to $2.8 billion from $2.9 billion a year earlier. Of note, the firm has $2.2 billion in liquidity for fiscal 2014, and had $1.5 billion available in a credit facility as of Wednesday.

“Our stores are often in the wrong place and are often too large for our needs,” Lampert said in a recorded conference call Thursday morning.

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