Kmart, Sears Same-Store Sales Drop

HOFFMAN ESTATES, IL-Both chains owned by Sears Holdings Corp. reported preliminary drops in year over year same-store sales during its first quarter, which ends May 5. Kmart posted a 4.7% slide, while Sears store experienced a 2.4% drop.

Executives attribute Kmart’s fall to lower sales transaction volumes, while the Sears dip occurred due to a drop in appliance sales and increased competition, though management says children’s apparel performed well.

The first quarter’s same-store sales results were in contrast to those in the fourth quarter, when Kmart only fell 0.7%, and Sears fell 4.9%. Apparel and pharmacy sales helped Kmart in that period, while Sears suffered setbacks in a number of categories.

For the first quarter, management expects net income to come in between $230 million and $235 million, up from $180 million during the same year-ago period. The increase this year is due to a combination of legal settlements, insurance recoveries, changes in benefits programs and other factors.

Sears Holdings operates 3,800 Kmart and Sears stores in the US and Canada. The two chains merged in March 2005.