Sears Holdings Corp said second-quarter profit fell 62 percent as the retailer continues to struggle to attract customers to its stores despite a high-stakes restructuring.
The company also said that it expects that its sales and gross profit margins will continue to be pressured as it sees no near-term improvement in the economy.
The Hoffman Estates, Illinois-based retailer, which operates Kmart and Sears, Roebuck and Co stores, said yesterday that it earned US$65 million, or 50 cents per share, in the three-month period ended on August 2. That compares with US$173 million, or US$1.15 per share, in the period a year ago.
The second-quarter 2008 results included the positive impact of the reversal of a US$62-million reserve because of the overturning of a February 2, 2007 adverse jury verdict related to the redemption of certain Sears, Roebuck and Co bonds in 2004.
Excluding the item, earnings per share were 21 cents for the second quarter of 2008.
Revenue declined to US$11.76 billion from US$12.26 billion in the period a year ago. Same-store sales, or sales at stores opened at least a year, dropped 6.2 percent in the US Same-store sales are considered a key indicator of a retailer's health. Analysts surveyed by Thomson Reuters expected 33 cents per share on revenue of US$11.7 billion.
Led by financier Edward Lampert, who acquired Kmart in 2003 and Sears, Roebuck and Co in 2005, Sears is in the midst of a high-stakes restructuring operation.
