News

Sears chairman takes blame for first-quarter losses

May 3, 2011

According to Reuters, Sears Holdings Corp. Chairman Edward Lampert took the blame for the company's first-quarter losses during the annual shareholders meeting on Tuesday, May 3.

Sears shares fell about 10 percent Tuesday, the biggest drop in one day since last May. The first quarter is the worst sales showing since Sears 2005 merger with Kmart.

"In many of our businesses, even in a tougher environment, we ought to be doing a lot better," Lampert said.

On Monday, Sears announced it expected to post a loss of $1.35 to $1.81 per share for the first quarter ended April 30. Sears shares dropped 9.9 percent to close at $75.88. The stock is down 38 percent from a year ago. Last year's first-quarter sales were bolstered by shoppers taking advantage of the government appliance rebates incentives.

In February and March, Sears sold 5.7 percent more appliances, but the average price was down 7.5 percent, according to new CEO and president Lou D'Ambrosio. D'Ambrosio was named CEO and president in late February.

Investors praised him at the annual meeting, where he outlined plans such as a rewards program, new apparel lines and new high-tech appliances.

D'Ambrosio cited selective discounting and appliance innovation as top priorities, leveraging Sears 30 percent share of the appliance market. He also discussed expansion of Sears' services business, and the possibility of outsourcing home improvement services to outside firms.

Both executives talked about the new apparel lines Sofia, inspired by "Modern Family" star Sofia Vergara, and the Kardashian Kollection from reality stars Khloe, Kim and Kourtney Kardashian.

"We view our company as a set of very compelling assets," D'Ambrosio said.

D'Ambrosio said he expects the company to "survive and thrive."