Sears Holdings reports major third-quarter declines
Sears Holdings reported net income of $2 million for its third quarter ended Nov. 3, down from $196 million in the same quarter last year.
The company reported net sales of $11.55 billion, a 3.2 percent decrease from $11.94 billion for last year.
“We are very disappointed in our performance for the third quarter,” said Aylwin Lewis, Sears Holdings’ CEO and president. “We cannot blame our results entirely on the retail and macro-economic environments. We have much on which to improve and are working hard to do so.”
The company said the year-over-year decline in income is primarily the result of a $223 million decline in gross margin, reflecting both sales declines, as well as an overall decline in its gross margin rate for the quarter.
Sears Domestic’s comparable-store sales declined 4.2 percent for the quarter, while Kmart’s comparable-store sales declined 5.0 percent.
According to the company, overall comparable-store sales results reflect increased competition; the negative impact of unfavorable economic conditions, such as a weak housing market and growing consumer credit concerns; as well as the unfavorable impact of unseasonably warm weather, prevalent during much of the third quarter, on sales of apparel and other seasonal merchandise.
Sears Holdings is the nation’s fourth largest broadline retailer, with more than $50 billion in annual revenues and approximately 3,800 full-line and specialty retail stores in the United States and Canada.
Wal-Mart eyes big investment in Brazilian market
Retail giant Wal-Mart has announced a planned increased investment in the Brazilian market, to the tune of $649 million.
In a news conference held this week in Brasilia, Brazil, Vincente Trius, CEO of Wal-Mart’s Brazilian unit, said, “We are very committed to growth in Brazil. It is a strategic market for Wal-Mart. Brazil has increased in importance for us in the last few years.”
Wal-Mart’s competitors in Brazil include French retail chain Carrefour and Brazil’s Companhia Brasileira de Distribuicao. Wal-Mart has other lower-end banners in the country, including Todo Dia and Maxxi. The new Brazilian stores reportedly will be in various formats, including hypermarkets, supermarkets and wholesale outlets.
Wal-Mart operates in several countries in South and Central America, including Argentina, Brazil, Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua.
Median home prices higher or stable in third quarter
Median home, condo and co-op prices rose or remained stable in most metropolitan areas in the third quarter compared to a year ago, according to the latest report on median home prices by the National Association of Realtors.
Despite a broad decline in existing-home sales, 93 out of 150 metropolitan statistical areas showed increases in median existing single-family home prices from a year earlier. Six areas showed double-digit annual gains, 21 showed increases of 6 percent or more, 54 had price declines and three were unchanged.
The national median existing single-family home price declined 2 percent in the quarter — from $225,300 to $220,800 — impacted by a disruption in higher priced sales.
Regionally, the median existing single-family home price in the Northeast rose 3.2 percent to $286,300 in the third quarter from the same period in 2006. In the Midwest, the median existing single-family home price increased 0.5 percent to $170,800 in the third quarter from the same period in 2006.
The median existing single-family home price in the South was $180,800 in the third quarter, which is 3.6 percent below a year earlier. The median existing single-family home price in the West was $338,100 in the third quarter, down 3.8 percent from a year ago.
The condo sector, including metro area condominium and cooperative prices — covering changes in 59 metro areas — showed the national median existing condo price was $226,900 in the third quarter, up 2 percent from $222,500 in the third quarter of 2006. Forty-one metros showed annual increases in the median condo price, including six areas with double-digit gains; 18 areas had price declines.
“Some metro areas are hot, while others are experiencing localized problems,” said NAR chief economist Lawrence Yun. “The report also shows that home prices in the vast midsection of America — from the Appalachians to the Rockies — are affordable and, perhaps, even undervalued.”