Sears Holdings Corp. (SHLD) announced a number of actions intended to improve its financial flexibility and accelerate its transformation into a leading Integrated Retailer that fosters relationships with members through ourShop Your Wayplatform.
The company said it is evaluating separating both its Lands' End business and Sears Auto Center or SAC business. It believes separating the management of these two businesses from the company would allow them to pursue their own strategic opportunities, optimize their capital structures, and allocate capital in a more focused manner while bringing its business unit structure to life outside of the company portfolio.
With regard to its domestic operations, the company said it will continue to evaluate its stores in the context of its Integrated Retail strategy. It will review each location, including leased locations that are set to expire, and decide whether or not to renew such leases. It expects to improve its financial performance by removing unprofitable locations, and redeploying the capital tied up in those locations, while sharpening its focus around existing Sears and Kmart stores that have higher levels of profitability.
Sears Canada Inc. (SCC.TO) announced the sale of five store leases to Cadillac Fairview Corporation Limited for total consideration of $400 million Canadian. The transaction is expected to close in the next ten business days.
Sears Holdings said that it will work with Sears Canada with a goal of increasing the value of its 51% interest and realizing significant cash proceeds to support its transformation and to create value for its shareholders.
Edward Lampert, Sears Holdings' Chairman and Chief Executive Officer, said, "The current market value of our 51% interest in Sears Canada is over $675 million. We believe that the maximization of value of our stake in Sears Canada will improve our financial position and our ability to execute on our strategic transformation."
Sears Holdings announced an update regarding its operating performance for the third quarter ending November 2, 2013. Comparable store sales for the twelve-week period ended October 26, 2013 declined 3.7%, with a decline of 4.8% for Sears Domestic stores and 2.6% for Kmart stores.
Sears Holdings expects third quarter Adjusted EBITDA to be in an approximate range of between negative $250 million to $300 million versus the prior year's quarter Adjusted EBITDA of negative $156 million, which consisted of negative $164 million for SHC Domestic and positive $8 million for Sears Canada. It expects net loss attributable to shareholders to be in the range of $532 million - $582 million for the third-quarter.
by RTT Staff Writer
For comments and feedback: firstname.lastname@example.org