CHICAGO -- Helped by strong apparel sales, profits at Sears Merchandise Group more than doubled in the first quarter ended April 2.
In the quarter, the Merchandise Group, which includes merchandising, credit and international operations, earned $129.5 million against $63.6 million a year earlier.
Sales rose 12.4 percent, to $6.9 billion from $6.1 billion. Merchandise sales climbed 13.1 percent, to $6 billion, while credit revenues advanced 7.9 percent, to $878 million.
Same-store sales rose 13 percent.
Edward A. Brennan, Sears Roebuck & Co.'s chairman and chief executive officer, said the group's strong performance was led by domestic merchandising, with broad-based sales gains in apparel.
"Apparel is going to be an increasing portion of the business, as Sears [tries to attract women] to the stores," said Steven Kernkraut, retail analyst at Bear Stearns & Co. He said Sears will be expanding its apparel, cosmetics and jewelry businesses and trimming areas like home and gardening. He was cautious about the new cosmetics line, noting, "I'm not sure private label is the way to go."
Overall, Sears, Roebuck & Co. had a net loss of $97.9 million in the latest quarter, battered by pretax catastrophe losses of $1.1 billion at Allstate Insurance Group, mainly from the California earthquake and severe winter weather. A year ago, Sears earned $435 million, or $1.13 a share, including a $118 million charge from discontinued operations. Revenues in the latest quarter rose 8.6 percent, to $12.3 billion from $11.3 billion.
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