Sears Projects Profit for First Quarter
HOFFMAN ESTATES, Ill.-Sears Holdings said it expects to post net income from continuing operations of from $155 million to $195 million for its first quarter, which ended on April 28.
In a statement issued in advance of its annual shareholders meeting, which is scheduled for tomorrow, the parent of Sears and Kmart said this profit figure compares with a net loss from continuing operations of $165 million in its first quarter of last year. The income range for this year includes about $235 million, after tax and minority interest, of gains from the sale of certain U.S. and Canadian stores--transactions that generated $440 million of cash for Sears Holdings.
Sears also said the company as a whole reported a same-store sales decline of 1.3 percent for its U.S. stores in the first quarter. This broke down as a 1 percent comparable-store drop for Sears domestic stores and a 1.6 percent decrease for Kmart stores. The company also said Sears Canada expects to report a same-store sales fall of 6.2 percent for the quarter.
In a separate statement, Sears said it filed a registration statement with the U.S. Securities and Exchange Commission yesterday for the separation of its Sears Hometown and Outlet Stores business from Sears Holdings. This will take place through a rights offering to holders of Sears Holdings' common stock, and will entitle stockholders to purchase shares of common stock in Sears Hometown and Outlet.
The transaction is expected to raise about $400 million to $500 million for Sears Holdings.