Sears same-store sales fall as demand for electronic goods wane
(Reuters) - Sears Holdings Corp (SHLD.O) reported a smaller-than-expected quarterly loss, but poor demand for popular consumer electronic products took a toll on its same-store sales, triggering a 6 percent fall in the retailer's shares.
The growing popularity of smartphones as a multi-purpose device is eating into the sales of other best-selling electronic items such as digital cameras, MP3 players and camcorders, leading to a fall in their prices.
"The retail industry continues to change dramatically and rapidly. It will never go back to what it was and we have seen the consequences for those that have not changed fast enough," Chief Executive Louis D'Ambrosio said on a conference call with analysts.
Same-stores sales at J.C. Penney (JCP.N), which are located next to Sears in most malls, fell 26.1 percent in its most recent quarter, its worst drop since CEO Ron Johnson began his radical transformation of the department store chain earlier this year.
U.S. same-store sales at Sears, which is controlled by hedge fund manager Edward Lampert, fell 3.1 percent, including a 1.6 percent decline at Sears' namesake department stores and a 4.8 percent fall at Kmart.
Sears Canada's (SCC.TO) comparable store also fell 5.7 percent due to slowing demand for snow throwers, men's and women's apparel, and home decor.
Sears has been closing stores, tightly managing inventory, selling some real estate and shedding assets to turn its business around.
Sears spun off its Orchard Supply Hardware Stores unit in December. In February, it announced plans to sell some prime real estate and spin off its Sears Hometown and Outlet businesses and certain hardware stores. In May, it said it would spin off a large chunk of its stake in its Canadian unit, Sears Canada.
The company's third-quarter net loss from continued operations widened to $498 million, or $4.70 per share, from $410 million, or $3.85 a share, a year earlier.
On an adjusted basis, the loss was $1.99 per share.
Analysts on average had expected a loss of $2.18 per share, according to Thomson Reuters I/B/E/S.
Sales fell 6 percent to $8.86 billion as it shuts underperforming stores. Analysts expected sales of $8.59 billion.
Sears shares, which have fallen more than 9 percent in the past year, were down at $55.25 after market. They closed at $58.48 on the Nasdaq on Thursday.
(Additional reporting By Dhanya Skariachan in New York and Ranjita Ganesan in Bangalore; Editing by Maju Samuel and Anil D'Silva)
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