By  on March 14, 2018

Sears Holdings Corp. said it completed a secured loan to enhance its liquidity at the same time it reported fourth-quarter results.The loan — with gross proceeds of $440 million — helps the company unlock nearly $980 million of appraised asset values and is in connection with its agreement with the Pension Benefit Guaranty Corp. last year to prefund contributions to its pension plan for the next two years. The agreement releases 140 Sears properties so they can be sold. From the $440 million in proceeds, $407 million will be made to the PBGC to satisfy the company’s pension obligations. Sears said proceeds from the sale of the underlying properties would enable it to pay down the loan.For the three months ended Feb. 3, net income was $182 million, or $1.69 a diluted share, against a net loss of $607 million, or $5.67, a year ago. Total revenues fell 27.7 percent to $4.38 billion from $6.05 billion. Merchandise sales dropped 30 percent to $3.59 billion from $5.13 billion. The company said total comparable-store sales fell 15.6 percent for the quarter, with Kmart comps down 12.2 percent and Sears stores declining 18.1 percent. Earnings were buffeted by a $470 million boost from federal tax changes.Earlier this year, the company said it would shutter 64 Kmart stores and 39 Sears locations.Edward S. Lampert, chairman and chief executive officer, said the company last year made progress in increasing its liquidity and fund its ongoing transformation of the company.“We also recognize that we need to do more if we are to deliver on our commitment to return to profitability in 2018. We will work to build on the progress we made in 2017, including ongoing actions to improve or close unprofitable stores and to unlock the value in our assets. Importantly, to ensure our long-term viability, we must substantially improve our sales and gross margin performance, including adjustments to our business model,” Lampert said.At the end of the quarter, Sears Holdings operated 432 Kmart stores and 547 Sears full-line stores, as well as 23 Sears specialty stores. The total store count for the quarter ended Feb. 3 is 1,002.Shares of Sears fell 5.1 percent to $2.42 in Nasdaq trading. The shares rose 9.1 percent to $2.64 in after hours trading. Sears reported the completion of its secured loan transaction and earnings results after the markets ended their trading sessions for the day.

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