Sears Holdings Corp. reported today that second-quarter earnings will likely fall well below Wall Street expectations because of disappointing sales of home appliances and other products at both Sears and its chain of Kmart stores.
Sears expects to post earnings between $160 million and $200 million – or between $1.06 and $1.32 per share – for the quarter ending Aug. 4, executives at the Hoffman Estates, Ill.-based company said. Earlier analyst estimates expected $2.12 per share. Last year, the company’s second quarter income was $294 million.
“We are disappointed with our recent performance,” Chief Executive Aylwin Lewis said in a statement. “Although we believe our business has suffered from many of the same factors that have led other retailers to announce disappointing results and lowered expectations, our recent performance underscores our ongoing need to become more relevant to consumers while improving our discipline around expense management.”
During a nine-week period that ended July 7, same-store sales at Kmart’s U.S. locations fell 3.9 percent while same-store sales fell 4 percent at Sears.
In addition, Sears said it approved the purchase of up to $1 billion of its common shares, in addition to the $121 million worth of shares that remain available for repurchase under the company’s current buyback program. Since late 2005, Sears has repurchased nearly 14 million shares at a total cost of $1.9 billion.