American holding company Sears has announced financial results for its first quarter ended April 29, 2017. During the quarter under review, the company generated revenues of US $ 4.3 billion compared to US $ 5.4 billion in the corresponding quarter of 2016. The year-over-year decline in revenues was primarily driven by having fewer Kmart and Sears full-line stores in operation, which accounted for US $ 557 million of the decline, as well as an 11.9 per cent decline in comparable store sales during the quarter, which accounted for US $ 417 million of the decline.
At Kmart, comparable store sales decreased 11.2 per cent during the first quarter of 2017, primarily driven by declines in the grocery & household, pharmacy, apparel and home categories. Sears Domestic comparable store sales decreased 12.4 per cent during the quarter.
During the first quarter, gross margin decreased US $ 247 million compared to the prior year first quarter due to the above noted decline in sales, as well as a drop in gross margin rate in both the Kmart and Sears Domestic segments, which was largely attributed to a decrease in occupancy leverage.
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Commenting on the results, Edward S. Lampert, Chairman and Chief Executive Officer of the company said, “While this was certainly a challenging quarter for our Company, it was also one that clearly demonstrated our commitment to return Sears Holdings to solid financial footing. We recognize that we need to accelerate our efforts to improve our operational performance and are moving decisively with our US $ 1.25 billion restructuring programme.”
