Sears posts $146 million loss
Hoffman Estates, Ill.-based Sears Holdings Corp. posted a third-quarter loss of $146 million, compared to a profit of $4 million in the same quarter last year. Same-store sales declined 10.6 percent at Sears department stores in the United States and were down 7 percent at Kmart.
The company’s revenues dropped more than 8 percent to $10.66 billion.
The company’s results included a charge of $101 million related to costs associated with the closure of 14 stores. Additionally, the company is closing eight underperforming stores and considering more closings.
“We believe we have positioned ourselves well for a difficult holiday shopping season,” said W. Bruce Johnson, Sears Holdings’ interim chief executive officer and president.
“We have reduced our inventory levels, cut expenses and announced the closing of select underperforming stores as part of our ongoing review.”
The company said its comparable-store sales declines continue to be driven by categories directly affected by housing market conditions and a slowdown in consumers’ discretionary spending (including home and household goods and apparel at both Sears Domestic and Kmart and lawn and garden at Sears Domestic).
The company also said Tuesday that Scott Freidheim, 43, formerly chief administrative officer at Lehman Brothers Holdings Inc., will be its new executive vp-operating and support businesses.
Bailey’s Lumber to close Gulfport store
Bailey’s Lumber and Supply is closing its Gulfport, Miss., store, but will remain headquartered in Gulfport, according to The Clarion-Ledger newspaper.
Bailey’s owner Woody Bailey said store employees in Gulfport will be offered jobs at Bailey’s stores in Bay St. Louis, Miss.; Ocean Springs, Miss.; Jackson, Miss.; Brandon, Miss.; or Meridian, Miss.
Bailey’s, which sells mainly to home builders and contractors, hopes to reopen the Gulfport store once the economy improves, Woody Bailey said.
LP announces cost-reduction measures
Louisiana-Pacific Corp., a leading supplier of engineered wood products and other building materials, has announced a plan to reduce its capital spending to $25 million a year for the next several years.
“LP is now in the midst of a right-sizing effort to reflect current business conditions,” said company CEO Rick Frost. For comparison’s sake, he noted that the capital spending for 2008 is expected to reach $170 million.
Among the planned actions are a 14 percent cut in the salaried workforce, approximately 200 positions. Flight operations have been shut down, research and development has been “put into hibernation,” and IT operations are now in “maintenance mode,” Frost said. Marketing and sales expenditures have been reduced, and salaries have been frozen.
Taken together, these initiatives should save Louisiana-Pacific between $30 and $35 million a year, Frost said.
Over the past several quarters, the Nashville, Tenn.-based company has also curtailed operations at four oriented strand board (OSB) mills and taken downtime at other production facilities.
On Nov. 4, Louisiana-Pacific reported a third-quarter loss of $100 million. Sales declined to $389.6 million from $472.5 million during the same period last year.