Sears Holdings (shld) announced yet another round of store closings as it continues to shrink its fleet of stores amid chronic sales declines at its namesake department stores and the Kmart discount chain.
The retailer said it would close 68 Kmart locations and 10 Sears stores this summer. It had said in February, when it reported its 11th straight year of comparable sales decline, it would speed up the paring of its fleet.
The closings will leave Sears with fewer than 700 department stores, compared to 860 in 2008, while Kmart's store count will below 900, compared to almost 1,400 that same year.
"The decision to close stores is a difficult but necessary step as we take aggressive actions to strengthen our company, fund our transformation and restore Sears Holdings to profitability," said Eddie Lampert , Chief Executive of Sears Holdings and its top shareholder. Lampert claims that he is transforming the company into a membership-based retailer that will be less reliant on its physical stores.
The company, which in recent years has sold off many top assets, such as the Lands' End clothing brand, and hundreds of its best store locations to raise billions of dollars and stay solvent amid the sales bleed, said the closings would raise a lot of cash thanks to selling store inventory or selling or subleasing those locations.
Sears also said that money, combined with $1.2 billion in debt financing it recently raised would help it meet its financial obligations on the way to reaching its goal of returning to profitability this year.
Comparable sales have declined every year since 2005, and the retailer has logged a total of $8 billion in net losses since 2010. Sears and Kmart have struggled to keep pace with their respective competitors- in Sears' case, the brand has been faulted for not upgrading its stores or improving its merchandise to keep pace with everyone from J.C. Penney (jcp) to Home Depot, while Kmart, bigger than Walmart only 25 years ago, has been left behind by nimbler discounters.
For a link to the list of stores closing, please click here.
In the holiday quarter, Sears' comparable sales fell 6.9%, while at Kmart, they were down 7.2%.