Sears Canada reports quarterly loss as sales drop

Tue Nov 13, 2012 8:02am EST
 

(Reuters) - Canadian department store chain Sears Canada Inc SCC.TO reported a smaller net loss on Tuesday, and had an adjusted loss versus a year-ago profit.

Sears Canada, majority-owned by Sears Holdings Corp (SHLD.O: Quote), said sales at established stores dropped 5.7 percent, following a 7.8 percent decline in the same quarter last year.

Chief Executive Calvin McDonald, more than a year into a three-year turnaround plan that includes refocusing on categories in which Sears is strongest, like mattresses and major appliances, said the company had made management changes.

"Although we made progress in the quarter, we can and must do more. Our plan is working, however our pace of execution has not met our expectations," he said in a statement.

McDonald said revenue fell as the chain rolled back discounting, sold fewer snowblowers and televisions and cut some product lines.

The net loss for the third quarter ended on October 27 narrowed to C$21.9 million ($21.9 million), or 22 Canadian cents a share, from C$44.1 million, or 42 Canadian cents a share, a year earlier.

In the previous year, results were hit by a C$45.6 million pre-tax charge related to restructuring and inventory disposition.

The company reported a loss of C$3.0 million, adjusted to exclude interest, taxes, depreciation, amortization and non-operating activities, compared to earnings of C$14.5 million in the year earlier. Revenue fell 6.8 percent to C$1.04 billion.

($1 = $1.00 Canadian)

(Reporting by Allison Martell; Editing by Lisa Von Ahn, Janet Guttsman and Jeffrey Benkoe)