NEW YORK – Sears, Roebuck & Co. (S), the largest U.S. department store chain, Thursday posted a third-quarter loss as its sales continued to slide, prompting the company to cut its full-year profit forecast.
The Hoffman Estates, Ill.-based company posted a net loss of $61 million, or a loss of 29 cents a share, for the quarter ending Oct. 2, compared with net income of $147 million, or 52 cents per share, a year earlier.
The third-quarter earnings included a pretax charge of $141 million, or 32 cents a share, related to the company's restructuring of its Great Indoors (search) home decoration chain.
Analysts on average expected Sears to report earnings of 1 cent per share, according to Reuters Estimates.
"A number of factors contributed to a disappointing third quarter, including softer retail demand, larger-than-expected costs associated with the seasonal transitions, and a slower ramp-up of sales following certain business resets," Chairman and Chief Executive Alan Lacy said in a statement.
Domestic same-store sales — a key measure of retail strength — fell 4 percent in the quarter from a year earlier with total revenue down to $8.3 billion from $9.8 billion.
Sears had already warned that third-quarter same-store sales could be down by a low single-digit percentage and flagged earnings of nil to 10 cents per share.
Lacy said based on the sales and margin performance of the past two quarters, the company was adopting a more cautious holiday outlook and more conservative view for the fourth quarter when it expected same-store sales to be flat.
He said for the full year Sears now expected earnings per share of between $1.46 and $1.66, down from an earlier forecast range of $2.66 to $2.86 per share.