Sears Holdings (NASDAQ: SHLD) was able to narrow its losses in the fourth quarter, but reports indicate the retailer is still in desperate need of a turnaround.
Sears said its fourth-quarter losses were $358 million, or $3.37 a share, compared with $489 million, or $4.61 per share, last year. Total sales fell 13.6 percent to $10.59 billion, from $12.26 billion, hurt by lower same-store sales and fewer Kmart and Sears full-line stores in operation. U.S. same-store sales slid by 6.4 percent, comprising decreases of 5.1 percent at Kmart and 7.8 percent at Sears. Sears Canada had an equally rough quarter and posted a 6.4 percent drop in same-store sales.
The quarterly earnings echo Sears' Jan. 10 report that sales tanked during the critical November and December selling period. Sears CEO Edward Lampert even admitted that it was a "tough-to-terrible" holiday season for both Sears and Kmart. The year-end period failed to draw customers into the retailer's stores, despite its valiant efforts, including a 41-hour Black Friday marathon and Kmart's catchy, yet controversial, "Show Your Joe" holiday ad campaign.
The recent quarter also saw the liquidation of its flagship store on State St. in Chicago's Loop as the company ramped up its efforts to cut expenses and close underperforming doors. Sears admitted that the iconic Chicago store, which opened in May 2001, has lost "millions of dollars" over the years.
Sears is planning to rebound in the coming months by pouring more resources into digital and omnichannel strategies, said Lampert. The company's e-commerce and mobile investments may pay off this year as customers take advantage of services such as drive-up merchandise pickup and additional features that have been added to the Shop Your Way loyalty program.
Going forward, Sears said that February has already started to show positive signs of recovery. Last year, Sears announced plans to separate its Lands' End clothing brand and auto-service centers, which the company says will help the chain raise $1 billion this fiscal year.
-See this Sears earnings statement
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