News

Sears CEO 'encouraged' despite low Q1 numbers

Sears Hometown and Outlet Stores reported Monday that its operating income decreased 36.9 percent to $4 million and that comparable store sales decreased 1.2 percent.

June 9, 2015

Sears Hometown and Outlet Stores reported Monday that its operating income decreased 36.9 percent to $4 million and that comparable store sales decreased 1.2 percent.

Despite the low numbers, CEO Bruce Johnson said he was encouraged by several aspects of the business.

"During the quarter our core operations, which exclude franchise sales, generated higher profits than recent quarters due to a more moderate promotional environment and good expense controls," he said in a company statement. "We made important strides in improving our business."

Those strides included the launch of the company's "America's Appliance Experts" initiative in over 50 stores and the transformation of its information systems and operational processes.

"Also, we had strong cash flow that resulted in continued reductions in borrowings," Johnson said. "Our improved inventory sourcing in the Outlet segment and the conversion of five Hardware stores to Outlet Stores reduced capital tied up in inventory. Outstanding borrowings were down to $30 million at the end of the first quarter of 2015, which was a decrease of $68.1 million and $54.1 million compared to the first quarter of 2014 and the fourth quarter of 2014, respectively. Our strong liquidity will allow us the flexibility to make investments in the business, both in-store and online, that will be designed to improve operating performance."