Loss Widens at Sears

Sears Holdings the former powerhouse in retail has for the past year attempted to liquidate assets to raise cash.

However, some have questioned whether the efforts will work quickly enough.

That speculation was ignited even more Thursday when the retailer reported that its loss for the third quarter widened from the same reporting period of last year.

The company disclosed as well that it was planning to close as many as 235 stores in 2015.

In an attempt to strengthen its balance sheet, Sears sold assets such as Land’s End and a stake in its operation in Canada. However, at the same time, the retailer has fallen deeper into debt.

Sears on Thursday disclosed that its debt for the short term has increased to over $2.1 billion during the third quarter that November 1. That was up from debt of $1.8 million during the same period one year ago.

Some of the money came from Edward Lampert the manger of hedge funds and the CEO and largest shareholder at Sears.

Lampert lent Sears over $400 million using 25 stores as collateral.

Sears has cash that totals $326 million on its books, which is down from the same period last year when cash was $384 million.

Sears in November announced it would consider the step of selling up to 300 stores to an real estate investment trust also know as an REIT.

Sears, which owns Kmart the budget chain as well, has over 1,800 stores of which 700 it owns.

One analyst warned that the problem with REIT is that it is effectively an end game. If Sears does go through with its sales, its equity would be near zero.

In a call to speak about the results, Lampert said Sears is confident a sale would result in significant liquidity for Sears Holdings.

For the November 1 ending quarter, Sears posted a $548 million loss on revenue of $7.2 billion, compared to a loss of $534 million on revenue of $8.3 billion for the same period a year ago.

Latest News

Instacart the Grocery Delivery Startup Raises $210 Million
Instacart the Grocery Delivery Startup Raises $210 Million
China Will Relax Regulations on Banks Renminbi Trading
China Will Relax Regulations on Banks Renminbi Trading
Subway in Safety Scandal in China over Food
Subway in Safety Scandal in China over Food
UPS and FedEx Make Improvements During Holiday Season
UPS and FedEx Make Improvements During Holiday Season
MasterCard Spending Report for Holidays Shows Weak Electronics
MasterCard Spending Report for Holidays Shows Weak Electronics
Gift Cards Have Become Hugely Popular, but Have Risks
Gift Cards Have Become Hugely Popular, but Have Risks


Leave a Reply

Advertisement
Advertisement
© 2006-2015 Leoncheng.