Sears Holdings Corp., in reporting a first-quarter loss, blamed cold, damp weather for hurting demand for spring and summer apparel. The retailer also said appliance sales were down from a year earlier, when the government offered a rebate program.
But the company also blamed itself.
Sears President and Chief Executive Lou D'Ambrosio, who was named to his post in February, acknowledged that beyond economic and weather factors outside the company's control, Sears needs some revamping.
We "fell short on executing with excellence," he said. "We cannot control the weather or economy or government spending. But we can control how we execute and leverage the potent set of assets we have."
Whether Mr. D'Ambrosio can turn around the department-store retailer remains to be seen, analysts said. Wall Street has repeatedly faulted Sears, which is majority owned by hedge-fund investor Eddie Lampert's ESL Investments, for skimping on investing in stores, which analysts said are key to attracting shoppers. Its customer service is also considered a weak spot.
Mr. D'Ambrosio said Sears is "extending" its leadership position in appliances, capitalizing on brands such as Kenmore, Craftsman, DieHard and Lands' End, focusing on home services and revitalizing its apparel business.
Sears, the parent of Sears department stores and the Kmart discount chain, is facing increased competition from Lowe'sCos. andHome Depot Inc. while Best Buy Co. andWal-Mart Stores Inc. have said they are expanding or exploring sales of large appliances.
Total sales and gross-income growth at Sears have declined in each of the past four years, according to FactSet data. Its profit margin also dropped to 1% from a peak of 4.6%.
The Sears chain has also lost market share to midpriced department-store rivals Kohl's Corp. and J.C. Penney Co., analysts said. Meanwhile, the company's Kmart chain has been facing strengthening competition from Wal-Mart and Target.
For the fiscal first quarter, the Hoffman Estates, Ill., retailer, posted a loss of $170 million, or $1.58 a share, compared with a profit of $16 million, or 14 cents a share, a year earlier. Revenue fell 3.4% to $9.71 billion. Earlier this month, Sears had projected a quarterly loss of $1.35 to $1.81 a share.
U.S. comparable-store sales fell 3.6%, including a 5.2% drop at the Sears chain and a 1.6% decrease at Kmart.
At Sears U.S., adjusted profit before interest, tax, depreciation and amortization sank to $21 million from $166 million. At Kmart, adjusted profit fell to $57 million from $91 million.
Sears Canada saw a loss of $15 million compared with a year-ago profit of $47 million. Same-store sales tumbled 9.2% at Sears Canada.
Gross margin narrowed to 26.8% from 28.2%. Selling, general and administrative expenses rose to 26.4% of sales from 25.4%.
As sales declined, inventory rose 6% to $9.88 billion.
But the company also blamed itself.
Sears President and Chief Executive Lou D'Ambrosio, who was named to his post in February, acknowledged that beyond economic and weather factors outside the company's control, Sears needs some revamping.
We "fell short on executing with excellence," he said. "We cannot control the weather or economy or government spending. But we can control how we execute and leverage the potent set of assets we have."
Whether Mr. D'Ambrosio can turn around the department-store retailer remains to be seen, analysts said. Wall Street has repeatedly faulted Sears, which is majority owned by hedge-fund investor Eddie Lampert's ESL Investments, for skimping on investing in stores, which analysts said are key to attracting shoppers. Its customer service is also considered a weak spot.
Mr. D'Ambrosio said Sears is "extending" its leadership position in appliances, capitalizing on brands such as Kenmore, Craftsman, DieHard and Lands' End, focusing on home services and revitalizing its apparel business.
Sears, the parent of Sears department stores and the Kmart discount chain, is facing increased competition from Lowe'sCos. andHome Depot Inc. while Best Buy Co. andWal-Mart Stores Inc. have said they are expanding or exploring sales of large appliances.
Total sales and gross-income growth at Sears have declined in each of the past four years, according to FactSet data. Its profit margin also dropped to 1% from a peak of 4.6%.
The Sears chain has also lost market share to midpriced department-store rivals Kohl's Corp. and J.C. Penney Co., analysts said. Meanwhile, the company's Kmart chain has been facing strengthening competition from Wal-Mart and Target.
For the fiscal first quarter, the Hoffman Estates, Ill., retailer, posted a loss of $170 million, or $1.58 a share, compared with a profit of $16 million, or 14 cents a share, a year earlier. Revenue fell 3.4% to $9.71 billion. Earlier this month, Sears had projected a quarterly loss of $1.35 to $1.81 a share.
At Sears U.S., adjusted profit before interest, tax, depreciation and amortization sank to $21 million from $166 million. At Kmart, adjusted profit fell to $57 million from $91 million.
Sears Canada saw a loss of $15 million compared with a year-ago profit of $47 million. Same-store sales tumbled 9.2% at Sears Canada.
Gross margin narrowed to 26.8% from 28.2%. Selling, general and administrative expenses rose to 26.4% of sales from 25.4%.
As sales declined, inventory rose 6% to $9.88 billion.