FINANCE

Stein Mart profit edges up in Q1; plans increased POS spending

BY CSA STAFF

Jacksonville, Fla. — Stein Mart reported Thursday that net income for the first quarter rose to $15.9 million from $14.3 million in 2010.

Sales edged up 0.8% to $303.5 million, and same-store sales increased 1.5%.

The retailer said it is increasing its plan for capital expenditure in 2011 by $5 million to a range of $30 to $35 million. Stein Mart said the increased spending is for POS hardware in all stores toward increasing operational efficiency.

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FINANCE

Sears posts $170 million loss on weak sales

BY CSA STAFF

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.

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News

Sears Holdings meets low expectations in Q1

BY CSA STAFF

HOFFMAN ESTATES, Ill. —Sears Holdings reported a first-quarter net loss of$170 million, or $1.58 per diluted share, in line with the company’s expectations for a net loss in the range of $145 million and $195 million, or between $1.35 and $1.81 per diluted share. The company reportednet income of $16 million, or 14 cents per diluted share, in 2010.

The company reported that total revenues decreased $341 million to $9.7 billion for the quarter, as compared with total revenues of $10.0 billion for the same period last year. The decline in total revenue for the quarter was primarily a result of a 3.6% decrease in domestic comparable-store sales and the effect of having fewer Kmart and Sears full-line stores in operation, in addition to a 9.2% decline in comparable-store sales at Sears Canada, partially offset by an increase of $54 million due to changes in the Canadian foreign exchange rate.

The domestic comparable-store sales results included a decrease at Sears domestic of 5.2% and Kmart of 1.6%. Decreases in sales for the quarter at Sears domestic were primarily driven by the appliance, apparel and consumer electronics categories, partially offset by increases in the home, sporting goods, jewelry and footwear categories. Appliances experienced a low double-digit decline and benefited in the prior year from the cash for appliances rebate programs.
Apparel experienced slow spring/summer sales due in part to worse weather than the prior year. The Kmart quarterly decrease in comparable-store sales was primarily driven by decreases in the food and consumables and pharmacy categories.

"Our first quarter was adversely impacted by unfavorable weather, economic pressures facing our customers, and comparisons to last year’s government-sponsored stimulus program relating to the purchase of appliances. However, we also fell short on executing with excellence. 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," said Lou D’Ambrosio, Sears Holdings’ CEO and president.

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