Sears Holdings Corp. cut its second-quarter loss by more than half as profit margins perked up at its Kmart chain, the retailer said Thursday.
Still, weak shopper spending amid a tough economy led to a decline in an important revenue measure.
For the three months that ended in late July, the owner of Sears and Kmart lost $39 million, or 35 cents per share. That's better than last year's loss of $94 million, or 79 cents per share last year. Excluding one-time adjustments the current quarter's loss amounted to 19 cents per share.
Revenue slipped slightly to $10.46 billion, down from $10.55 billion last year.
Analysts expected the company led by billionaire Edward Lampert to post better results. Those surveyed by Thomson Reuters said they predicted Sears would lose 18 cents per share with revenue of $10.62 billion.
Those estimates typically exclude one-time items.
Interim CEO W. Bruce Johnson said the company's long-struggling Kmart brand was able to improve its profit margins during the quarter.
Revenue at stores open at least a year, declined 1.4 percent at the brand. It was Kmart's first decrease in the measure in three quarters and came as the discount chain recorded lower sales of food.
The measure fell 2.8 percent at Sears as shoppers spent less on lawn and garden items, tools and consumer electronics.
Revenue at stores open at least a year is considered an important measure of retailer performance because it excludes stores that open or close during the year.
Competitor Target Corp. has made expanded food sections a priority.
Sears operates nearly 4,000 stores and is based in the Chicago suburb of Hoffman Estates, Ill.
The company was formed by Lampert who acquired Kmart out of bankruptcy in 2003 and added Sears, Roebuck and Co. in 2005.
Its shares closed Wednesday at $67.25.
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