Tags: Sears | Shares | Jobs | Land

Sears Shares Surge After $1 Billion Cost-Cutting Plan

Sears Shares Surge After $1 Billion Cost-Cutting Plan

 (AP/Elise Amendola)

Friday, 10 February 2017 10:59 AM

Struggling retailer Sears Holdings Corp. reported a 10.3 percent drop in comparable store sales for the holiday quarter, and said it would cut debt and pension obligations by at least $1.5 billion this year.

Shares of the company (SHLD), which has been struggling with years of losses and falling sales, were up 39 percent at $7.70 in premarket trading on Friday.

The company - controlled by its billionaire chief executive, Edward Lampert - announced a new plan to cut costs by at least $1 billion in 2017 by reducing overhead, improving merchandise at its stores and through better inventory management.

Once the largest U.S. retailer, Sears has lost its standing as customers move to online shopping or rivals such as Wal-Mart Stores Inc.

To cope with the slump, Sears has cut costs, spun off some of its stores into a real estate investment trust, raised debt from Lampert's hedge fund and put some brands on sale.

The company has, however, failed to turn a profit in more than a year and said in December there was no guarantee when it would return to profitability.

Sears said on Friday it sold five Sears full-line stores and two Sears Auto Centers for $72.5 million in January and engaged Eastdil Secured to raise at least $1 billion from the sale of its real estate.

The retailer said last month it sold its lawn and garden equipment brand, Craftsman, to Stanley Black & Decker Inc.

Sears said it would use proceeds from these sales, improving profitability and working capital management to reduce its debt and pension obligations by $1.5 billion in fiscal 2017.

The company had pension and post-retirement benefit liabilities of $2 billion as of Oct. 29.

Sears also estimated revenue of $6.1 billion and a loss of $535-$635 million in the fourth quarter ended January.

© 2021 Thomson/Reuters. All rights reserved.


   
1Like our page
2Share
Companies
Sears may sell more locations, cut more jobs and put more of its famous brands on the block in an attempt to revive the faltering retail chain.
Sears, Shares, Jobs, Land
303
2017-59-10
Friday, 10 February 2017 10:59 AM
Newsmax Media, Inc.
 
Newsmax TV Live

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved