Hoffman Estates, IL, May 18, 2006--Sears Holdings posted a strong jump in first-quarter earnings Thursday, citing better profitability from both its Kmart and Sears Domestic operations, mainly due to reduced expenses.
The company reported a profit of $180 million, or $1.14 a share, for the quarter ended April 29, up from a year-ago loss of $9 million, or $0.07 a share.
Excluding the charge, Sears earned $81 million, or $0.65 a share, last year.
On a pro forma basis, as if Kmart and Sears were combined as of the beginning of fiscal 2004, the company earned $12 million, or $0.07 a share, in last year's first quarter, excluding the impact of the accounting change.
The average estimate of analysts was for a profit of $0.65 a share in the April period.
Total revenue rose in the latest three months to $12 billion from $7.63 billion a year ago, primarily due to the inclusion of Sears operations for the full 13-week period in the latest quarter. Sears Domestic same-store sales fell 8.4% in the quarter, while Kmart's comparable stores slipped 0.2%.
"While we're pleased with the progress we're making, we continue to look for ways to be more efficient and effective in our business," said Aylwin Lewis, Sears Holdings' chief executive officer and president.
Lewis added, "With a goal of dramatically improving the customer experience at all of Sears Holdings' touch points, we are starting with the basics and working with our associates to drive the culture shift necessary to become a great retail company."
The company attributed the dip in same-store sales at Kmart to lower transaction volumes within home goods, while it said the decline in Sears Domestic comparable sales was due to drops across all categories and formats, except home appliances.
