Kmart realizes full-year sales decline of 15.6%, but comps moving in right direction

HOFFMAN ESTATES, Ill. - Sears Holdings on Thursday revenue of $25.1 billion, representing a decline of 18.8%. for its full year ended Jan. 30, 2016. 

 

Specifically at Kmart, full-year revenue totaled $10.2 billion, a decline of 15.6%, while fourth-quarter revenue totaled $3.1 billion, a decline of 11.9%. 

 

Kmart comparable store sales declined 7.2% in the fourth quarter of 2015, which was an improvement from the trend in the first three quarters of 2015. 

 

"Our fourth quarter comparable store sales were improved over the prior three quarters and January 2016 was our best monthly comparable store sales performance of the year (at minus 4.5%)," noted Edward Lampert, Sears Holdings chairman and CEO. "As we head into 2016, we remain committed to restoring Sears Holdings to profitability. Generating positive Adjusted EBITDA is our most important area of focus, and to that end, we plan to accelerate our transformation into a leading member-centric integrated retailer and take action, where necessary, to optimize our cost structure and improve our gross margin realization."

 

At Kmart, comparable store sales decreases were experienced in several categories during the fourth quarter, most notably in the consumer electronics, apparel, grocery and household and home categories. These decreases were partially offset by positive comparable store sales in the seasonal, mattresses and home appliances categories. 

 

Excluding the impact of consumer electronics, which is a business in flux within Kmart, comparable store sales would have decreased 5%. 

 

For the full year, Kmart experienced positive comparable store sales performance in the home appliances, mattresses and seasonal categories, which were more than offset by declines in the consumer electronics, apparel, grocery and household and drug store categories. Excluding the impact of consumer electronics, Kmart comparable store sales would have decreased 5.5%. 

 

In related news, Sears announced Thursday the election of Bruce Berkowitz and Alesia Haas to membership on the Sears Holdings board of directors.

 

"I am very pleased to welcome Bruce and Alesia to our board," Lampert said. "Bruce has been a long-time investor in Sears Holdings and has been very supportive of our transformation, and he is one of the most respected businessmen in his field in the country. Alesia is an extremely accomplished financial and strategy professional, and will bring tremendous acumen and expertise to our board."

 

Berkowitz serves as the chief investment officer of Fairholme Capital Management, an investment adviser registered with the SEC, and is the president and a director of Fairholme Funds, an SEC-registered investment company providing investment management services to three mutual funds. 

 

Haas until recently served as CFO of OneWest Bank, a $22 billion commercial bank, which was acquired by CIT Group in August 2015. She was formerly the head of strategy for OneWest Bank, and her prior experience includes various investment banking, strategy and other roles with Merrill Lynch and General Electric. 

 

The election of Berkowitz and Haas increases the size of Sears Holdings' board of directors to 10.