The bleeding at Sears Holdings (SHLD) shows no signs of stopping.
The long-struggling retailer said on Thursday it was closing another 28 Kmart stores, the latest in a string of recent announcements of store shutterings amid a severely deteriorating business. The company has already closed dozens of Sears department stores and Kmart discount stores this year.
Sears Holdings said comparable sales fell 13.2% at Sears, and 9.4% at Kmart, for a companywide decline of 11.5% in the quarter ended July 29. While Sears CEO Eddie Lampert in May invoked dwindling sales at many of the company’s rivals, Sears’ declines are far deeper than those of Macy’s and J.C. Penney.
Lampert, who says he is trying to turn Sears into a membership-based retailer with fewer and smaller stores, pointed to what he called “continued softness in store traffic and elevated price competition.” In the face of persistently awful results—Sears Holdings has yet to report a same-store sales increase since Kmart and Sears were merged in 2005—Lampert claimed the company is “making progress” on its long-vaunted—but so far disappointing—turnaround.
While Sears is showing no signs of winning back many of the legions of shoppers who have defected over the years, a consolation prize was a narrower loss in the quarter, thanks to a cost cutting program: Sears Holdings reported a net loss of $251 million, or $2.34 per share, compared to $395 million, or $3.70 per share, a year earlier. Revenue dipped to $4.37 billion from $5.66 billion, in part because of all the store closings.
Sears shares, very volatile this year, were up 8% in early trading.
In recent years, Sears, which in March recognized doubts in the marketplace about its long-term future and concerns about a possible bankruptcy, has sold off many core assets like its Lands’ End clothing brand, hundreds of stores, and its Craftsman brand to stave off a cash crunch. It has even borrowed from Lampert, a billionaire hedge fund manager. Recently it said it would start selling its Kenmore appliances on Amazon.com to extend that brand’s reach.
Lampert said at Sears’ annual shareholder meeting that the company was “fighting like hell” to turn itself around. But given that the business has been in decline for years, it’s clear he’ll have to fight even harder now.