Sears Canada profits plunge in 2Q

HTT Staff -- Home Textiles Today, 8/19/2010 12:19:08 PM

Toronto - Job fears and sagging consumer confidence continued to plague sales and earnings for Sears Canada.
Revenues for the 13-week period ending July 31 were C$1.21 billion, down 3% from the same period a year earlier, as same-store sales fell 2.4%. Net earnings for the company, Canada's largest home furnishings retailer, plummeted 41% to C$31.9 million or 29 cents per share.
Operating EBITDA (earnings before interest, taxes, depreciation and amortization) declined to C$74.3 million, from C$108.7 million a year earlier.
First-half revenues of C$2.28 billion were down 3.6% from the comparable 2009 period as same-store sales fall 2.2%. First-half earnings skidded 34.3%, to C$39.1 million or 36 cents per share.
Operating EBITDA for the half was C$120.9 million versus C$171 million a year ago.
"Our results reflect a continuing downward trend in consumer confidence caused by high unemployment and other factors," Sears Canada president and ceo Dene Rogers said in a statement.
He said the company is launching several initiatives to boost sales, including new financing terms that will offer customers zero interest and payment deferral for up to 36 months, along with Sears Club loyalty points and other benefits.
This fall, the merchant will launch a new "modern shop" to bring new brands to the floor including Kensie, Mac & Jac and Guess.
Sears Holding is the majority owner of Sears Canada. The Chicago-based company is also parent to the Sears, Roebuck & Co. and Kmart chains in the United States.