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Sears Hometown and Outlet down 28%

Staff writer ▼ | June 7, 2013
Sears Hometown and Outlet Stores' first quarter saw another decline: operating income decreased 28% to $24.7 million, compared to $34.5 million in the prior year.
Sears Hometown and Outlet Stores
Sears Hometown and Outlet StoresSears Hometown and Outlet Stores' first quarter saw another decline: operating income decreased 28% to $24.7 million, compared to $34.5 million in the prior year.


The company operate through two segments: Sears Hometown and Hardware segment and Sears Outlet segment.

Net sales in the first quarter of 2013, ended May 4, 2013, decreased $20 million, or 3.2%, to $601.1 million from the first quarter of 2012. This decrease was driven primarily by a 5% reduction in comparable store sales partially offset by new store sales (net of closures), a favorable impact from a fiscal calendar shift following the extra (53rd) week in fiscal 2012, and higher Outlet liquidation revenues.

Initial franchise revenues were $5.2 million in the first quarter of 2013 compared to $5 million in the first quarter of 2012.

The comparable store sales decrease of 5% was comprised of a 6.9% decrease in Hometown and a 1.2% increase in Outlet. The 5% decrease was primarily driven by lower sales of lawn and garden in Hometown due to colder weather conditions experienced in large portions of the U.S. delaying the start of the spring/summer season.

Excluding lawn and garden, the Company's comparable store sales increased 1.4%, led by appliances and mattresses. Growth in these categories was partially offset by lower consumer electronics sales due to our previously announced de-emphasis of the category, and lower Outlet apparel sales due to a narrower assortment.

"Sales were below last year due to the impact of unseasonably cool weather in February and March. Same store sales of lawn and garden, our second largest category, were down 45% in the first two months. We were pleased with the improvement during the latter portion of the quarter," said Bruce Johnson, chief executive officer and president.


 

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