Another quarter has come and gone and another round of horrible financial results was released by Sears Holdings.
The struggling retailer, which earlier in 2016 said there were doubts it could continue, once again on Thursday posted huge declines in sales as it lost a hold it has had in categories it once dominated like household appliances.
Sears Holdings suggested that additional store closings are likely. The company, which operates its namesake department stores as well as Kmart stores, said that its comparable sales had fallen by 12.4% at its Sears locations and by 11.2% at Kmart.
Many retailers have posted declining sales for their most recent quarters but the declines at Sears are much deeper that at J.C. Penney or Macy’s.
Sears did post its first profit for a quarter in nearly two years, but was helped by much lower expenses thanks to its plan of cost cutting that exceeds $1.25 billion.
Nevertheless, taking away the impact from certain one-off items, Sears posted a $230 million adjusted loss during the quarter that ended on April 29.
Sears over the past six years has lost close to $10 billion. Sears stock, which has been quite volatile amongst the concerns over cash levels, rose by 18% during trading before the opening bell on Thursday.
However, shares remain about 50% down from their high of 52 weeks,
Sears was given a boost this past week when it said that it was able to extend maturity dates on some debt. Earlier in 2017, several different credit agencies gave Sears debt a downgrade and one invoked a possibility it could file bankruptcy due to sales declines for many years.
Sears Holdings has closed stores over the years, shed important assets and borrowed money from its CEO and largest shareholder Eddie Lampert, to hold off shortages of liquidity.
Still, Sears’ business deterioration had accelerated over the past few quarters despite protests by Lampert that he had tried to transform it to become more focused on members while less reliant on its physical stores.
Lampert, who last week blamed the media for a number of problems Sears is facing and sued an important vendor, conceded that the company recognizes its efforts must be accelerated to improve operational performance.
Sears CFO Rob Riecker has said that the retailer is looking into more ways of improving liquidity and hinted there could be a possibility of more stores being shuttered.