Hoffman Estates, Ill. – Sears Holdings Corp. on Thursday said it plans to close at least 80 stores this year as the retailer continues to deal with mounting losses. The retailer reported that its fiscal first quarter net loss grew to $402 million, from $279 million in the prior year first quarter.
Sears’ revenues declined 7% to $7.9 billion, from $8.5 billion. In one bright spot, same-store sales rose 0.2%. Higher tax rates and the effect of promotional transactions on gross margin helped increase net loss, while Sears cited the closure of Kmart and Sears full-line stores, as well as the separation of its Lands’ End business, as contributing to declining revenues.
Edward L. Lampert, chairman and CEO of Sears Holding Corp., said the company is experience struggles as it changes its business model.
"Sears is undergoing a significant transformation, and we fundamentally are changing the way we do business," said Lampert. "Our performance in the first quarter highlights the challenges we are facing as well as the progress we are making in this transformation. We are moving away from a company that was heavily based on selling products solely through a store-based network to a member-centric business model focused on providing benefits to our members anytime and anyplace. We are seeing progress in our transformation to a member-centric, integrated retailer, as we continue to invest heavily in driving our Shop Your Way program.”
In a pre-recorded call on Thursday Lampert told investors that Sears is shifting towards a model “that is focused on providing benefits to our members by forming individual relationships using our technology and platforms.
"Our new business model is less asset-intensive and variable in nature," Lampert said.