‘Hold on a minute,’ says Sears
Sears Holding Corp. tried to walk back the uproar it caused early Tuesday morning when the struggling retailer included cautionary language about whether it would be able to continue as a "going concern” in its annual 10-K filing.
On Tuesday afternoon, the chain released a detailed statement from CFO Jason Hollar in which he explained the inclusion of the language that caused the uproar was meant to adhere to “regulatory standards.
“To clarify, the comments from our Annual Report quoted by the media are in line with regulatory standards that require management to assess and disclose potential risks the company could face within one year from the reported financial statements,” Hollar stated. “As 2016 proved to be another challenging year for most “bricks-and-mortar” retailers, our disclosures reflected these developments.”
He noted that media reports generated by the filing failed to include the actions Sears is taking to mitigate its financial risks and boost its liquidity. These include the recent sale of its Craftsman tool brand, the selling of select real estate assets, and a restructuring program targeted to deliver at least $1 billion in annual cost savings.
“In line with these initiatives, despite the risks outlined we remain confident in our financial position and remain focused on executing our transformation plan,” Hollar stated.
To read Hollar’s full statement, click here.
The media reports I've read HAVE mentioned the Craftsman sale and other bailout measures. The problem is, Sears has been sinking so long that it's a wonder they waited till now to issue the warning!
Having grown up shopping at Sears and waiting for the Christmas catalog and now in adulthood been involved in financing a few of their real estate locations it is disappointing to see another American institution succumb to the ravages of time and trends. It appears that Sears will be leaving another big hole in the retail real estate footprint along with other retailers that have announced store closings. While E commerce has taken a bite out of the conventional retail market it seems that the appeal of mall shopping has declined over the years. Where malls used to be a prime destination to shop and spend time, many seem to be overrun with kiosks selling knockoff perfume. Some markets have found opportunities to reconfigure and reuse retail space but often space is vacant and unused. As real estate professionals I hope that we can find solutions that while might not be the most profitable in the short term will create better solutions for the communities that are affected. Randy Bacon http://libertyrealtycapital.com