20.08.2015, 14:49
Sears Holdings Reports Second Quarter 2015 Results
OREANDA-NEWS. Sears Holdings Corporation ("Holdings," "we," "us," "our," or the "Company")(NASDAQ: SHLD) today announced financial results for its second quarter ended August 1, 2015, which are in line with the guidance the Company provided on August 3, 2015.
Rob Schriesheim, Holdings' Chief Financial Officer, said, "In the second quarter of 2015, the Company completed its rights offering and sale-leaseback transaction with Seritage Growth Properties and received aggregate gross proceeds from the transaction of \\$2.7 billion. In addition, we completed an amendment and extension of the Company's existing asset-based credit facility. With the successful completion of the amendment and extension of the domestic credit facility and the Seritage transaction, we have substantially enhanced our financial flexibility and achieved our objective of reducing our reliance on inventory as a source of financing. We are pleased with the outcome of the Offer, which was in line with our expectations and helped mitigate our annualized cash interest expense. We intend to continue taking significant actions to alter our capital structure, as circumstances allow, to position Sears Holdings for success and profitability, which could include further reductions in debt or changes in the composition of our debt."
About Sears Holdings Corporation
Sears Holdings Corporation (NASDAQ: SHLD) is a leading integrated retailer focused on seamlessly connecting the digital and physical shopping experiences to serve our members - wherever, whenever and however they want to shop. Sears Holdings is home to Shop Your Way®, a social shopping platform offering members rewards for shopping at Sears and Kmart, as well as with other retail partners across categories important to them. The Company operates through its subsidiaries, including Sears, Roebuck and Co. and Kmart Corporation, with full-line and specialty retail stores across the United States.
- Domestic Adjusted EBITDA of \\$(200) million, excluding Seritage Growth Properties and joint venture rent, in the second quarter of 2015 compared to \\$(298) million in the prior year second quarter, which is the fourth consecutive quarter of improved EBITDA performance on a year-over-year basis;
- Net income attributable to Holdings' shareholders of \\$208 million (\\$1.84 earnings per diluted share) for the second quarter of 2015 compared to a net loss of \\$573 million (\\$5.39 loss per diluted share) for the prior year second quarter. Adjusted for significant items, we would have reported a net loss of \\$256 million (\\$2.40 loss per diluted share) for the quarter compared to a net loss of \\$293 million (\\$2.76 loss per diluted share) in the prior year quarter;
- Sales to Shop Your Way® members in Sears Full-line and Kmart stores were 74% of eligible sales for the second quarter;
- Kmart and Sears Domestic comparable store sales declined 7.3% and 14.0%, respectively, in the second quarter of 2015 driven in part by highly targeted promotional and marketing spend to better align with member needs, and a shift away from low margin categories, such as consumer electronics;
- Kmart's gross margin rate for the second quarter improved 80 basis points over the prior year second quarter, while Sears Domestic's gross margin rate improved 210 basis points;
- The completion on July 7, 2015 of the Company's rights offering and sale-leaseback transaction with Seritage Growth Properties, a recently formed, independent publicly traded real estate investment trust ("REIT") and received aggregate gross proceeds from the transaction of \\$2.7 billion;
- The completion on July 21, 2015 of an amendment and extension of our \\$3.275 billion domestic credit facility with approximately \\$2.0 billion maturing in 2020 and the remaining approximately \\$1.3 billion of the existing credit facility in place until April of 2016;
- The Company continues to demonstrate that it has the financial flexibility to fund its transformation and meet its obligations. As of August 1, 2015, the Company had \\$1.8 billion in cash, no revolver borrowings and \\$657 million of letters of credit outstanding. Availability under the Credit Agreement was approximately \\$1.2 billion; and
- Approximately \\$936 million principal amount of notes were validly tendered as part of our recent cash tender offer (the "Offer") for our 6 5/8% Senior Secured Notes due 2018.
Rob Schriesheim, Holdings' Chief Financial Officer, said, "In the second quarter of 2015, the Company completed its rights offering and sale-leaseback transaction with Seritage Growth Properties and received aggregate gross proceeds from the transaction of \\$2.7 billion. In addition, we completed an amendment and extension of the Company's existing asset-based credit facility. With the successful completion of the amendment and extension of the domestic credit facility and the Seritage transaction, we have substantially enhanced our financial flexibility and achieved our objective of reducing our reliance on inventory as a source of financing. We are pleased with the outcome of the Offer, which was in line with our expectations and helped mitigate our annualized cash interest expense. We intend to continue taking significant actions to alter our capital structure, as circumstances allow, to position Sears Holdings for success and profitability, which could include further reductions in debt or changes in the composition of our debt."
About Sears Holdings Corporation
Sears Holdings Corporation (NASDAQ: SHLD) is a leading integrated retailer focused on seamlessly connecting the digital and physical shopping experiences to serve our members - wherever, whenever and however they want to shop. Sears Holdings is home to Shop Your Way®, a social shopping platform offering members rewards for shopping at Sears and Kmart, as well as with other retail partners across categories important to them. The Company operates through its subsidiaries, including Sears, Roebuck and Co. and Kmart Corporation, with full-line and specialty retail stores across the United States.
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