Sears Canada posts steepest fall in sales in five years
(Reuters) - Sears Canada Inc (SCC.TO: Quote) posted its steepest fall in quarterly sales in almost five years, denting the struggling department store chain's turnaround efforts.
Sears Canada's shares were little changed, but shares of Sears Holdings Corp (SHLD.O: Quote), which said last week it was looking to sell its 51 percent stake in Sears Canada, fell as much as 4.7 percent.
Sears Canada, whose sales have declined for six straight years, echoed its Canadian rivals in blaming a prolonged winter in the country for its net loss more than doubling in the first quarter ended May 3.
"Sales of Spring merchandise were below last year, as winter-like weather was prevalent in most parts of the country well into the new season, with cooler temperatures and significantly more snow in many areas," CEO Douglas Campbell said in a statement.
Sears Canada, which traces its Canadian roots back to the early 1950s, has fallen on hard times in recent years as it lost market share to U.S. rivals such as Wal-Mart Stores Inc (WMT.N: Quote) and Target Corp (TGT.N: Quote), who have been aggressively expanding in the country.
Target, itself grappling with mounting losses in Canada, on Wednesday cut its full-year sales forecast for the country, a day after firing the president of its Canadian operation.
Sears Canada has eliminated some 3,000 positions since November, sold several of its most valuable leases over the past year and closed several stores last year as it tries to navigate a turnaround.
The company said on Wednesday same-store sales fell 7.6 percent, while total revenue fell 11 percent to C$771.7 million ($705.8 million) in the quarter. This was the steepest fall in sales after a 12 percent fall in the second quarter of fiscal 2010.
Sears Canada's net loss widened to C$75.2 million, or 74 Canadian cents per share, from C$31.2 million, or 31 Canadian cents per share, a year earlier. Continued...