Sears is looking into alternate options for improving on its falling sales after losing $471 million in its first quarter of this year.
The loss indicates Sears’ deepening problem, as just last year the company lost $303 million in the same quarter. Its share value suffered a loss of about $3.20 per share. The company’s total revenue fell from $5.88 billion to $5.39 billion — a little better than the analysts’ prediction of $5.3 billion.
Its same-store sales fell 6.1 percent, falling 7.1 percent at Sears locations and 5 percent at Kmart stores, Chain Store Age reported. The decline in revenue partly came from its shrinking footprint of Sears and Kmart stores — an initiative under which the company plans to shutter another 78 stores in 2016 and accelerating the closure of 50 stores that it had originally planned.
“Our operating performance still remains well below our goals,” stated chairman and CEO Eddie Lampert. “Our Sears Domestic and Kmart apparel businesses continue to be negatively impacted by a heavily promotional competitive environment.”
To improve on its shrinking sales, the Illinois-based company announced plans to expand the distribution network of its top brands outside the Sears network. It is now considering making some of its popular labels such as Kenmore, Craftsman and DieHard (KCD) available outside the store.
While the company didn’t give any further details, it said, it has hired Citigroup and LionTree Advisors to aggressively evaluate its alternatives.
“Our iconic KCD brands are beloved by the American consumer and we believe that we can realize significant growth by further expanding the presence of these brands outside of Sears and Kmart,” the retailer said. “Similarly, our SHS business, which is the nation’s leading provider of in-home services, has greater potential than what we have delivered in the past.”
The company also announced that its CFO Robert Schriesheim is leaving the company to pursue other opportunities. Schriesheim is credited with Sears’ cash-raising efforts. He helped the company spin off its real estate holdings to secure more debt by pledging valuable store assets.
For now, Schriesheim has agreed to stay with the company until they can find a replacement.