Sears Holdings earnings down in Q1

HOFFMAN ESTATES, Ill. Sears Holdings reported that net income for the first quarter was $16 million, or 14 cents per diluted share, in 2010 and $26 million, or 21 cents per diluted share, in 2009.

According to the company, the domestic comparable-store sales results included an increase at Kmart of 1.7% and an increase at Sears Domestic of 1.2%. The Kmart quarterly increase in comparable-store sales was primarily driven by increases in apparel, home and toys categories, partially offset by a decline in the food and consumables category. Increases in sales for the quarter at Sears Domestic were primarily driven by the home appliance category, partially offset by declines in the tools and home electronics categories. 

"Kmart registered a comparable-store sales increase for the third consecutive quarter and Sears posted its first quarterly increase in several years as we effectively partnered with state agencies to sell energy-efficient appliances. Sears, however, also experienced lower margin rates during the quarter," said W. Bruce Johnson, Sears Holdings' interim chief executive officer and president. "On the other hand, our Kmart format performed very well during the quarter, achieving margin rate improvement on top of its increase in sales and nearly doubling its adjusted EBITDA. Furthermore, we continued to increase our investment in our multi-channel capabilities and ShopYourWay rewards program, while at the same time reducing our expenses."