Sears Holdings Corp. and Kohl’s Corp. both posted fourth-quarter results Thursday, with the former narrowing its loss and the latter hurt by slower sales early in the quarter.
At Sears, the company showed improved quarterly results by narrowing its loss to $489 million, or $4.61 a diluted share, for the period ended Feb. 2, from the loss of $2.4 billion, or $22.63, a year ago. Revenues fell 1.8 percent to $12.26 billion from $12.48 billion. Comparable-store sales at the Kmart nameplate fell 3.7 percent, while comps at domestic Sears stores rose 0.8 percent. Comps at the Sears Canada operation decreased 3.8 percent. For the year, the loss narrowed to $930 million, or $8.78 a diluted share, on a 4.1 percent decrease in net revenues to $39.85 billion.
Edward S. Lampert, Sears Holdings’ chairman and chief executive officer, said in his annual letter to shareholders that Sears Holdings made progress in 2012 but there’s more work to be done this year.
“Sears Holdings is becoming a membership company,” Lampert wrote, saying that the transformation that began three years ago with the Shop Your Way loyalty program includes a social commerce platform and allows shoppers to shop in the stores and online and win products and points.
He added that the company has invested significantly in its online e-commerce platforms, which has helped boost the Shop Your Way membership program and helped “drive over 50 percent of revenues at domestic Sears stores and at Kmart.”
Sears has also added mobile checkout at many stores, as well as rolled out tablets and mobile devices in 2012 to allow store associates to provide a better shopping experience, such as search for inventory that’s not in a particular store.
He noted that both the Sears and Kmart apparel businesses improved in 2012, helped by declining cotton prices and better inventory management. In addition, two new apparel lines, with Nicki Minaj and Adam Levine, will be part of the Shop Your Way program at Sears.
He pointed to the changes in the retail landscape, such as new ceos at J.C. Penney Co. Inc., Staples Inc. and Best Buy Co. Inc., stating, “I believe we are seeing an enormous shift in the type of talent that will be running retail enterprises in the future, similar to the shift that Google brought to the advertising business,” noting that Sears Holdings was early in changes it saw on the talent front and that the turnover experienced “is a product of this change.”
Separately, Sears’ chief financial officer, Rob Schriesheim, said the firm expects to “generate at least $500 million of additional liquidity” after it monetizes assets over the next 12 months. The company owns unencumbered real estate assets, as well as Lands’ End and Sears Canada.
At Kohl’s, net income for the three months ended Feb. 2 fell 16.9 percent to $378 million, or $1.66 a diluted share, from $455 million, or $1.81, a year ago. Sales rose 5.4 percent to $6.34 billion from $6.02 billion, with comp sales up 1.9 percent. For the year, net income was down 16.7 percent to $1 billion, or $4.17 a diluted share, on a sales gain of 2.5 percent to $19.28 billion.
Kevin Mansell, Kohl’s chairman, president and ceo, said, “Sales for the fourth quarter developed very late and, as a result, came at a cost to profitability.”
In response to a question during a conference call to Wall Street, Mansell said the chain doesn’t need to become more promotional just because its competitor J.C. Penney is tweaking its plan and bringing back promotions.
He also told analysts that “women’s and men’s apparel were both above the company average for the quarter,” with active apparel in women’s the strongest category with an increase in the high teens. The junior business continues to be challenging, and accessories was the only line that did not post a positive comp for the quarter.
E-commerce sales have an annual growth rate of more than 50 percent, and all stores are now Wi-Fi-enabled. Mansell said Kohl’s will pilot mobile point of sale in the third quarter. The company also tested a loyalty program in 100 stores during the quarter for shoppers who don’t qualify for a Kohl’s credit card or just prefer not to pay by credit, and plans to roll out the program to more stores this spring.
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews
“Stranger Things” is getting a new cast member for season 2. Meet @sadiesink_, the 15-year-old who will be joining the Netflix series for its new season. You may recognize her from “The Glass Castle” with Brie Larson and Woody Harrelson, but the Texas native’s next role goes in an entirely different direction. She describes her character, Max, as “a rough and tumble skater girl [who] becomes friends with the boys at school.” The second season debuts on October 27. (📷: @jgreenery) #wwdeye
Amid the Harvey Weinstein controversy, there’s another sector that’s being put under the spotlight for sexual abuse: the modeling industry. While rumors about abuse and sexual harassment of female and male models — and the photographers, agents and others who perpetrated it — have circulated within the fashion world for years, model @cameronrussell started posting stories from models on Instagram last week about abusive situations they’ve encountered — from sexual harassment and molestation to attempted rape. Over 75 have weighed in so far. Read more on WWD.com. Link in bio. #wwdnews
To celebrate its 16th anniversary, @dylanscandybar tapped designers and celebrities to create mosaics out of candy. The mosaics will be auctioned off to support the philanthropic cause of each participant’s choice. Pictured here is the mural created by @aliceandolivia's Stacey Bendet. For a first look at some of the other artwork being unveiled tonight, go to WWD.com. #wwdeye
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye
"Nowadays when life is not so happy with everything going on in the world, I think people come to me for a little bit of whimsy and color and fun." - Designer Rebecca De Ravenel on her cult-favorite jewelry line. (📸 : @vsteves) #wwd40
“Everyone is talking about how the retail industry is struggling, but I think it’s an incredible time because brands who are doing something different and innovative are setting themselves up for the future,” said @adamgoldston, who founded the luxury athletic brand @apl with his brother @ryangoldsten. The Goldston’s are part of WWD’s 40 under 40: a group of industry notables. See the rest of the list on WWD.com. (📷: @vsteves) #wwd40
@eyeswoon blogger Athena Calderone debuted her first-ever cookbook, “Cook Beautiful,” which is heavily centered on the presentation and visual expression of food. Pictured here are her miso glazed carrots from the book. Get the recipe on WWD.com. (📷: @johnny_miller_) #wwdeye