Hoffman Estates, Ill. -- Sears Holding Corp. reported Thursday that it recorded a bigger-than-expected loss in the first quarter as its shoppers cut back on spending. The chain said it lost $170 million, compared with net income of $16 million in the year-ago period.
The retailer had cautioned earlier in May that it expected a first-quarter loss due mainly to a drop in appliance, clothing and consumer electronic sales.
Kmart, which had been a strong performer for the company, saw sales drop 1.6% in the quarter on lower food, consumables and pharmacy revenue. At Sears' domestic stores, sales dropped 5.2% on weakened sales of appliances, clothing and consumer electronics.
Consolidated same-store sales declined 3.6%. Overall revenue fell 3% to $9.71 billion, missing Wall Street’s anticipated $9.73 billion, in part because of the weak results from its domestic stores, as well as having fewer Kmart and Sears stores open. The company also reported a 9.2% drop in same-store revenue from Sears stores in Canada.
President and CEO Lou D'Ambrosio, who took the helm in February, said that bad weather, economic pressures and the absence of the appliance rebate program hurt Sears' performance. But he also admitted that the company could have done a better job internally.
"We cannot control the weather or economy or government spending. But we can control how we execute and leverage the potent set of assets we have," D'Ambrosio said.