Sears Canada sales down 16% is merchandise stays on shelves
Retail chain Sears Canada saw more red ink during its most recent quarter, with sales down 15.6 per cent.
Traffic for big-ticket items like major appliances were lower because of the end of a credit card agreement. And lower than expected sales of other merchandise combined with the appliance woes to push overall same-store sales down 5.5 per cent.
Last year, Scotiabank announced it would be taking over PMorgan & Chase Co's Canadian credit card portfolio associated with the retailer. That transaction finally took effect during the last quarter, which impacted the numbers.
The company also saw higher severance costs during the quarter, related to its efforts to turn around its operations.
While the reasons may be new, overall the chain's results are in keeping with a recent pattern.
Sears Canada, hit by increasing competition from U.S. retail giants such as Wal-Mart Stores Inc, has been shutting down stores and cutting jobs.
The company said it cut $128-million in costs for the first half of this year and said it was planning cost cuts at the higher end of its previously announced $127-million-$155-million forecast.
Sears Canada posted a net loss of $91.6-million, or 90 cents per share, for the second quarter ended July 30, compared with a profit of $13.5-million, or 13 cents per share, a year earlier.
Last year's second quarter was profitable due to a one-time gain of $67.2 million from the sale and leaseback of two logistics centres in Alberta and Ontario
Revenue fell to $648.5-million from $768.8-million.
With files from Reuters