Sears losses mount, weighs sale of unit to shore up liquidity
By Siddharth Cavale
(Reuters) - U.S. retailer Sears Holdings (SHLD.O: Quote) cast bigger doubts on the progress of its turnaround after reporting a bigger-than-expected quarterly loss, hurt by cooler spring weather.
Shares of the company, which also said it was considering selling its service contracts business, fell 12 percent to $51.41 in heavy trading after the bell.
The disappointing results came just months after Chairman and controlling shareholder Eddie Lampert took over as chief executive from Louis D'Ambrosio, who stepped down due to a family member's health issue.
Some on Wall Street saw D'Ambrosio's departure as adding to Sears' risks, and worried that Lampert's lack of retail sales experience could hurt the company's attempt to turn around its core Sears department stores and Kmart chains.
The retailer is trying to revive itself after suffering from declining sales since 2005, when the hedge fund manager merged the two iconic U.S. retail chains in an $11 billion deal.
It has been closing stores, tightly managing inventory, selling real estate and shedding assets.
"(We) intend to reduce our expenses by $200 million and did so by $46 million in the first quarter. We plan to reduce our inventory at peak by $500 million (in the year)," Chief Financial Officer Robert Schriesheim said on a post-earnings call with analysts.
BRIGHT SPOT Continued...