FINANCE

Sears net income falls on lower margins

BY CSA STAFF

Hoffman Estates, Ill. Sears Holdings Corp.’s first-quarter net income fell 38% on thinner profit margins at its Sears chain, squeezed by discounts on appliances. The chain said its net income fell to $16 million in the quarter ending May 1, down from $26 million a year earlier.

Revenue fell slightly to $10.05 billion from $10.06 billion a year ago because the company has 63 fewer stores than in last year’s first quarter.

The appliance price discounts offset a turnaround in revenue at the retailers’ Sears and Kmart stores, breaking a long string of declines at Sears stores. It was Kmart’s third consecutive quarter of rising revenue at stores open at least a year. The thinner profit margins are a setback to a company that has posted rising net income in recent quarters, a result of closing stores and slashing expenses.

Same-store sales at Sears stores rose 1.2%, fueled by appliance purchases under the government’s cash for appliances program, which offers rebates on energy-efficient items. Kmart’s same-store sales rose 1.7%, driven by increases in clothing, home items and toys.

Sears plans to focus on its long-struggling clothing business in hopes of attracting new and younger shoppers, officials told investors at the shareholders’ meeting, the Associated Press reported.

The company will add a line of trendier clothing to Lands’ End, which also has its own stores and is an increasing presence inside Sears stores, to draw younger customers. It also plans a line of store-brand products at Kmart.

Additionally, Sears plans to reinvent much of its Kenmore line of appliances, expand layaway at both Sears and Kmart and add more high-end fitness equipment at Sears.

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Toys’R’Us raises $1.8M for Autism Speaks

BY CSA STAFF

WAYNE, N.J. Toys“R”Us, U.S. announced that its fourth annual nationwide in-store fundraising campaign to benefit Autism Speaks, North America’s largest autism science and advocacy organization, raised nearly $1.8 million.

“For the fourth consecutive year, our customers and employees demonstrated their desire to help solve the autism puzzle by generously supporting our campaign to benefit Autism Speaks,” said Jerry Storch, chairman and CEO of Toys“R”Us. “At Toys“R”Us, we are committed to improving the lives of children and families in need, and we’re proud that our efforts will help Autism Speaks fund much-needed research, as well as advocacy efforts.”

During the campaign, the company said it created several programs to help parents and caregivers of children with autism. In collaboration with Autism Speaks and the National Lekotek Center, a nonprofit organization dedicated to making play accessible for children with disabilities, the company identified toys that can help children with autism develop crucial skills while playing alongside siblings and friends.  The “Ten Toys That Speak To Autism,” a special subset of the annual Toys“R”Us Toy Guide for Differently-Abled Kids, provides toy suggestions specifically for families and friends of children with autism.  With guidance from leading safety organizations and Autism Speaks, Toys“R”Us also developed Safe Play Tips that are relevant for children with autism. The “Ten Toys That Speak To Autism” and Safe Play Tips are available year-round at Toysrus.com/AutismSpeaks. 

Since the partnership launched in 2007, Toys“R”Us, the Toys“R”Us Children’s Fund and customer contributions have combined to provide Autism Speaks with more than $8.4 million. 

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BJ’s quarterly income up, raises FY guidance

BY CSA STAFF

NATICK, Mass. BJ’s Wholesale Club reported net income for the first quarter of 2010 of $26.1 million, or 49 cents per diluted share. For the first quarter of 2009, the company reported net income of $24.3 million, or 45 cents per diluted share.

Net sales for the first quarter of 2010 increased by 12.9% to $2.55 billion and comparable-club sales increased by 7.8%, including a contribution from sales of gasoline of 3.6%. Excluding the impact of gasoline, merchandise comparable-club sales increased by 4.2%. Net sales for the first quarter of 2009 increased by 0.2% to $2.26 billion and comparabl- club sales decreased by 1.5%, including the negative impact from sales of gasoline of 9%. Excluding the impact of gasoline, merchandise comparable-club sales increased by 7.5%.

The company also announced revised earnings guidance. For the year ending Jan. 29, 2011, the company now expects to report earnings per diluted share in the range of $2.58 to $2.68 and net income in the range of $136.9 million to $141.9 million. Previous guidance was for earnings per diluted share in the range of $2.54 to $2.64 and net income in the range of $133.1 million to $138.1 million.

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