Sears Holdings Corp., the retailer run by hedge fund manager Edward Lampert, posted a $454 million third-quarter loss as its shrinking store base hurt sales.
The net loss of $4.26 a share compares with a loss of $5.15 a share, or $548 million, a year earlier, the company said.
The results show Sears has a long way to go to returning to profitability. Lampert has spun off assets and sold stores, leaving a stripped-down retailer that continues to post declining same-store sales. Sears also is suffering from problems that are ailing the whole industry, including slowing mall traffic and consumers who are choosing to save more and to spend on experiences and services instead of goods.
“Sears has very weak company-specific fundamentals, but now you’re combining that with an industry backdrop across the department store space that’s also quite bad,” said Matt McGinley, an analyst at Evercore ISI.
Comparable store sales fell 7.5 percent at Kmart and 9.6 percent at Sears for an 8.6 percent decline companywide. Revenue is declining as the retailer pulls back on unprofitable categories like consumer electronics and clothing, McGinley said. Sears had $294 million of cash at the end of the quarter.
“We remain focused on restoring profitability to the company,” chief financial officer Rob Schriesheim said on a recorded conference call released Thursday.
Sears has posted five quarters in a row of improved performance on an adjusted earnings before interest, taxes, depreciation and amortization basis, he said.
In June, Sears formed a real estate investment trust with about 250 of its stores, a move that raised $2.7 billion. While proceeds from that move and other asset sales have mitigated the company’s cash consumption, Sears has posted a combined $7.12 billion of losses in the previous four fiscal years.