Sears Holdings Reports Third Quarter 2014 Results

HOFFMAN ESTATES, Ill., Dec. 4, 2014 /PRNewswire/ -- Sears Holdings Corporation (NASDAQ: SHLD) today announced financial results for its third quarter ended November 1, 2014 in line with the third quarter estimate provided on November 7, 2014. Net loss attributable to Sears Holdings' shareholders was $548 million ($5.15 loss per diluted share) for the third quarter of 2014, compared to $534 million ($5.03 loss per diluted share) for the prior year third quarter. Domestic Adjusted EBITDA was $(296) million for the third quarter of 2014, compared to $(310) million in the prior year third quarter. The tables attached to this press release provide a reconciliation of GAAP to as adjusted amounts, including Adjusted EBITDA.1  As a supplement to this announcement, a presentation, pre-recorded conference and audio webcast are available at our website http://searsholdings.com/invest.

"We remain intently focused on delivering an unparalleled integrated retail experience for our customers through Shop Your Way and above all, returning Sears Holdings to profitability," said Edward S. Lampert, Sears Holdings' Chairman and Chief Executive Officer. "During the quarter, we unveiled or expanded several Integrated Retail customer initiatives, which helped drive online and multi-channel sales. Our members are responding to our transformation, and we are encouraged by the year-over-year domestic Adjusted EBITDA trends, which mark a positive departure from the prior six quarters. At the same time, we continue to enhance the Company's capital structure and liquidity to support our transformation into an integrated membership-focused company."

Rob Schriesheim, Sears Holdings' Chief Financial Officer, said, "Over the past several months, we have taken a number of actions to enhance our financial flexibility, support our operations during the upcoming holiday and post-holiday season, and meet our obligations. We have proven that we are an asset-rich enterprise with multiple levers at our disposal to generate financial flexibility, while creating shareholder value. In total, the actions we have taken have generated $2.2 billion in liquidity in fiscal 2014 thus far. We will continue to strategically monetize assets and manage our resources more efficiently in order to redeploy capital in support of the transformation."

Third Quarter Highlights:

  • Online and multi-channel sales grew approximately 9% over the prior year third quarter and approximately 18% over the prior year first nine months as the Company continues to transform to an Integrated Retail Platform - with shopping at the store, online and on mobile;
  • Sales to Shop Your Way® members in Sears Full-line and Kmart stores were 72% of eligible sales, consistent with the third quarter last year;
  • Kmart comparable store sales increased 0.5% for the quarter, as compared to a 2.1% decline in the third quarter of last year. Apparel, outdoor living and toys were top performers. Excluding the impact of the consumer electronics and grocery & household goods businesses, comparable store sales would have increased 2.8%;
  • Sears Domestic comparable store sales decreased 0.7% for the quarter, as compared to a 4.0% decline in the third quarter of last year, reflecting the impact of consumer electronics industry trends. Excluding the impact of consumer electronics, Sears Domestic comparable store sales would have increased 1.0%;
  • The Company continues to demonstrate that it has the financial flexibility to fund its transformation and meet its obligations. As of December 3, 2014, we had approximately $1.5 billion in availability under our credit facility; and
  • Year-to-date, we closed, or announced for closure, approximately 235 underperforming stores, the majority of which are Kmart stores. The Company, which has more than 1,830 Sears and Kmart stores, expects to migrate the shopping activity of highly engaged members who previously shopped closed stores to alternative channels. As a result, we hope to retain a portion of the sales previously associated with these stores by nurturing and maintaining our relationships with the members that shopped these locations.

Financial Results

Revenues decreased approximately $1.1 billion to $7.2 billion for the quarter ended November 1, 2014, as compared to revenues of $8.3 billion for the quarter ended November 2, 2013. The majority of the decline related to the following significant items: $384 million from the separation of the Lands' End business, which was completed in the first quarter of 2014, $340 million in less revenue from fewer Kmart and Sears Full-line stores and $326 million associated with Sears Canada, which was de-consolidated in October 2014. For the quarter, domestic comparable store sales declined 0.1%, comprised of an increase of 0.5% at Kmart and a decrease of 0.7% at Sears Domestic.

Gross margin decreased $330 million to $1.6 billion in the third quarter of 2014, as compared to the prior year quarter. Kmart's gross margin rate for the third quarter increased 50 basis points primarily driven by an increase in the apparel category due to lower promotional activity. Sears Domestic's gross margin rate declined 190 basis points for the quarter with decreases experienced in a majority of categories, most notably consumer electronics, home appliances (partially due to free delivery), tools and home.

Selling and administrative expenses decreased $251 million in the third quarter of 2014 compared to the prior year quarter. Excluding significant items noted in our Adjusted Earnings Per Share tables, domestic selling and administrative expenses declined $71 million primarily due to a decrease in advertising expenses.

Interest and investment income in the third quarter of 2014 included a gain of $70 million related to the de-consolidation of Sears Canada.

The Company reported an operating loss of $490 million for the third quarter of 2014 compared to $497 million for the prior year period.

The effective tax rate for the third quarter of 2014 was 33.9%, primarily due to a non-cash valuation allowance established on Sears Canada's deferred income taxes prior to de-consolidation.

Financial Position

As a result of the Sears Canada rights offering, the Company no longer consolidates the results of Sears Canada as of October 16, 2014. As such, the financial position as of the third quarter 2014 does not include Sears Canada.

The Company had cash balances of $326 million at November 1, 2014 compared with $384 million (domestic only) at November 2, 2013 and $577 million (domestic only) at February 1, 2014.

Short-term borrowings totaled $2.1 billion ($1.6 billion domestic credit facility, $400 million secured short-term loan and $91 million commercial paper) at the end of the third quarter of 2014 as compared to $1.8 billion ($1.6 billion domestic credit facility and $160 million commercial paper) at the end of the third quarter of 2013 and $1.3 billion ($1.3 billion domestic credit facility and $9 million commercial paper) at February 1, 2014.

At December 3, 2014, the amount available to borrow under our credit facility was approximately $1.5 billion.

Total long-term debt (long-term debt and capital lease obligations) was $2.8 billion at November 1, 2014 and $2.9 billion at both November 2, 2013 and February 1, 2014.

Merchandise inventories at November 1, 2014 were $6.5 billion, as compared to $8.0 billion (domestic only) at November 2, 2013. Excluding inventory from the Lands' End business of approximately $464 million, domestic inventory decreased approximately $1.1 billion driven by both improved productivity and store closures.

Forward-Looking Statements

Results are unaudited. This press release contains forward-looking statements, including about our transformation through our integrated retail strategy, our plans to redeploy and reconfigure our assets, our liquidity and our ability to exercise financial flexibility as we meet our obligations and possible strategic transactions. Forward-looking statements, including these, are based on  the current beliefs and expectations of our management and are subject to significant risks, assumptions and uncertainties that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. In addition, the statements concerning our evaluation of strategic alternatives for our Sears Auto Centers business or with respect to the sale-leaseback/real estate investment trust transaction regarding certain owned real estate also are subject to risks and uncertainties, including our ability to enter into or complete any such transaction on acceptable terms, on intended timetables or at all, the form or terms and conditions of any such transaction, and the impact of the evaluation and/or completion of any such transaction on our other businesses. There can be no assurance that any of these efforts will be successful. The following additional factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: our ability to offer merchandise and services that our customers want, including our proprietary brand products; our ability to successfully implement our integrated retail strategy to transform our business; our ability to successfully manage our inventory levels; our ability to successfully implement initiatives to improve our liquidity through inventory management and other actions; competitive conditions in the retail and related services industries; worldwide economic conditions and business uncertainty, including the availability of consumer and commercial credit, changes in consumer confidence and spending, the impact of rising fuel prices, and changes in vendor relationships; vendors' lack of willingness to provide acceptable payment terms or otherwise restricting financing to purchase inventory or services; possible limits on our access to our domestic credit facility, which is subject to a borrowing base limitation and a springing fixed charge coverage ratio covenant, capital markets and other financing sources, including additional second lien financings, with respect to which we do not have commitments from lenders; our ability to successfully achieve our plans to generate liquidity through potential transactions or otherwise; potential liabilities in connection with the separation of Lands' end, Inc. and disposition of a portion of our ownership interest in Sears Canada, Inc.; our extensive reliance on computer systems, including legacy systems, to implement our integrated retail strategy, process transactions, summarize results, maintain customer, member, associate and Company data, and otherwise manage our business, which may be subject to disruptions or security breaches; the impact of seasonal buying patterns, including seasonal fluctuations due to weather conditions, which are difficult to forecast with certainty; our dependence on sources outside the United States for significant amounts of our merchandise; our reliance on third parties to provide us with services in connection with the administration of certain aspects of our business and the transfer of significant internal historical knowledge to such parties; impairment charges for goodwill and intangible assets or fixed-asset impairment for long-lived assets; our ability to attract, motivate and retain key executives and other associates; our ability to protect or preserve the image of our brands; the outcome of pending and/or future legal proceedings, including product liability and qui tam claims and proceedings with respect to which the parties have reached a preliminary settlement; the timing and amount of required pension plan funding; and other risks, uncertainties and factors discussed in our most recent Annual Report on Form 10-K and other filings with the Securities and Exchange Commission. While we believe that our forecasts and assumptions are reasonable, we caution that actual results may differ materially.  We intend the forward-looking statements to speak only as of the time made and do not undertake to update or revise them as more information becomes available, except as required by law.

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. For more information, visit www.searsholdings.com.

1We believe that our use of Adjusted EBITDA, Domestic Adjusted EBITDA and Adjusted EPS provides an appropriate measure for investors to use in assessing our performance across periods, given that these measures provide adjustments for certain significant items which may vary significantly from period to period, improving the comparability of year-to-year results and is therefore representative of our ongoing performance. Therefore, we have adjusted our results for them to make our statements more useful and comparable. However, we do not, and do not recommend that you, solely use Adjusted EBITDA or Adjusted EPS to assess our financial and earnings performance. We also use, and recommend that you use, diluted earnings per share in addition to Adjusted EPS in assessing our earnings performance.

NEWS MEDIA CONTACT:
Sears Holdings Public Relations
(847) 286-8371

 


Sears Holdings Corporation

Consolidated Statements of Operations

(Unaudited)














Amounts are Preliminary and Subject to Change




13 Weeks Ended


39 Weeks Ended

millions, except per share data


November 1,
 2014


November 2,
 2013


November 1,
 2014


November 2,
 2013

REVENUES













Merchandise sales and services


$

7,207



$

8,272



$

23,099



$

25,595


COSTS AND EXPENSES













Cost of sales, buying and occupancy


5,606



6,341



17,928



19,322


Gross margin dollars


1,601



1,931



5,171



6,273


Gross margin rate


22.2

%


23.3

%


22.4

%


24.5

%

Selling and administrative


2,011



2,262



6,218



6,771


Selling and administrative expense as a percentage of total revenues


27.9

%


27.3

%


26.9

%


26.5

%

Depreciation and amortization


148



181



455



559


Impairment charges




6



25



14


Gain on sales of assets


(68)



(21)



(148)



(276)


Total costs and expenses


7,697



8,769



24,478



26,390


Operating loss


(490)



(497)



(1,379)



(795)


Interest expense


(78)



(61)



(221)



(181)


Interest and investment income


97



8



133



29


Other income


2



1



4




Loss before income taxes


(469)



(549)



(1,463)



(947)


Income tax (expense) benefit


(159)



2



(188)



(19)


Net loss


(628)



(547)



(1,651)



(966)


(Income) loss attributable to noncontrolling interests


80



13



128



(41)


NET LOSS ATTRIBUTABLE TO HOLDINGS' SHAREHOLDERS


$

(548)



$

(534)



$

(1,523)



$

(1,007)















NET LOSS PER COMMON SHARE ATTRIBUTABLE TO HOLDINGS' SHAREHOLDERS













Diluted loss per share


$

(5.15)



$

(5.03)



$

(14.33)



$

(9.49)


Diluted weighted average common shares outstanding


106.4



106.1



106.3



106.1


 

Sears Holdings Corporation

 Condensed Consolidated Balance Sheets

(Unaudited)











Amounts are Preliminary and Subject to Change











millions


November 1,

2014


November 2, 

2013


February 1, 

2014

ASSETS










Current assets










Cash and cash equivalents


$

326



$

599



$

1,028


Restricted cash




8



10


Accounts receivable


546



541



553


Merchandise inventories


6,464



8,912



7,034


Prepaid expenses and other current assets


255



468



334


Total current assets


7,591



10,528



8,959


Property and equipment, net


4,561



5,682



5,394


Goodwill


269



379



379


Trade names and other intangible assets


2,104



2,858



2,850


Other assets


644



762



679


TOTAL ASSETS


$

15,169



$

20,209



$

18,261












LIABILITIES










Current liabilities










Short-term borrowings


$

2,096



$

1,751



$

1,332


Current portion of long-term debt and capitalized lease obligations


75



82



83


Merchandise payables


2,431



3,517



2,496


Other current liabilities


2,100



2,510



2,527


Unearned revenues


825



912



900


Other taxes


406



473



460


Short-term deferred tax liabilities


481



430



387


Total current liabilities


8,414



9,675



8,185


Long-term debt and capitalized lease obligations


2,769



2,862



2,834


Pension and postretirement benefits


1,320



2,387



1,942


Other long-term liabilities


1,830



2,039



2,008


Long-term deferred tax liabilities


710



919



1,109


Total Liabilities


15,043



17,882



16,078


EQUITY










Total Equity


126



2,327



2,183


TOTAL LIABILITIES AND EQUITY


$

15,169



$

20,209



$

18,261












Total common shares outstanding


106.5



106.5



106.4


 

Sears Holdings Corporation

Segment Results

(Unaudited)













Amounts are Preliminary and Subject to Change














13 Weeks Ended November 1, 2014

millions, except store data

Kmart


Sears
Domestic


Sears
Canada


Sears
Holdings

Merchandise sales and services

$

2,707



$

3,889



$

611



$

7,207














Cost of sales, buying and occupancy

2,147



3,002



457



5,606


Gross margin dollars

560



887



154



1,601


Gross margin rate

20.7

%


22.8

%


25.2

%


22.2

%













Selling and administrative

708



1,131



172



2,011


Selling and administrative expense as a percentage of total revenues

26.2

%


29.1

%


28.2

%


27.9

%

Depreciation and amortization

25



110



13



148


Gain on sales of assets

(24)



(44)





(68)


Total costs and expenses

2,856



4,199



642



7,697


Operating loss

$

(149)



$

(310)



$

(31)



$

(490)














Number of:












  Kmart Stores

1,050







1,050


  Full-Line Stores



751



113



864


  Specialty Stores



30



305



335


  Total Stores

1,050



781



418



2,249



























13 Weeks Ended November 2, 2013

millions, except store data

Kmart


Sears
Domestic


Sears
Canada


Sears
Holdings

Merchandise sales and services

$

2,916



$

4,419



$

937



$

8,272














Cost of sales, buying and occupancy

2,327



3,326



688



6,341


Gross margin dollars

589



1,093



249



1,931


Gross margin rate

20.2

%


24.7

%


26.6

%


23.3

%













Selling and administrative

745



1,244



273



2,262


Selling and administrative expense as a percentage of total revenues

25.5

%


28.2

%


29.1

%


27.3

%

Depreciation and amortization

31



128



22



181


Impairment charges

3



2



1



6


Gain on sales of assets

(19)



(2)





(21)


Total costs and expenses

3,087



4,698



984



8,769


Operating loss

$

(171)



$

(279)



$

(47)



$

(497)














Number of:












  Kmart Stores

1,183







1,183


  Full-Line Stores



785



118



903


  Specialty Stores



50



338



388


  Total Stores

1,183



835



456



2,474


 


Sears Holdings Corporation

Segment Results

(Unaudited)













Amounts are Preliminary and Subject to Change














39 Weeks Ended November 1, 2014

millions, except store data

Kmart


Sears
Domestic


Sears
Canada


Sears
Holdings

Merchandise sales and services

$

8,527



$

12,484



$

2,088



$

23,099














Cost of sales, buying and occupancy

6,790



9,552



1,586



17,928


Gross margin dollars

1,737



2,932



502



5,171


Gross margin rate

20.4

%


23.5

%


24.0

%


22.4

%













Selling and administrative

2,128



3,487



603



6,218


Selling and administrative expense as a percentage of total revenues

25.0

%


27.9

%


28.9

%


26.9

%

Depreciation and amortization

72



334



49



455


Impairment charges

2



8



15



25


(Gain) loss on sales of assets

(76)



(73)



1



(148)


Total costs and expenses

8,916



13,308



2,254



24,478


Operating loss

$

(389)



$

(824)



$

(166)



$

(1,379)














Number of:












  Kmart Stores

1,050







1,050


  Full-Line Stores



751



113



864


  Specialty Stores



30



305



335


  Total Stores

1,050



781



418



2,249



























39 Weeks Ended November 2, 2013

millions, except store data

Kmart


Sears
Domestic


Sears
Canada


Sears
Holdings

Merchandise sales and services

$

9,187



$

13,709



$

2,699



$

25,595














Cost of sales, buying and occupancy

7,184



10,163



1,975



19,322


Gross margin dollars

2,003



3,546



724



6,273


Gross margin rate

21.8

%


25.9

%


26.8

%


24.5

%













Selling and administrative

2,205



3,800



766



6,771


Selling and administrative expense as a percentage of total revenues

24.0

%


27.7

%


28.4

%


26.5

%

Depreciation and amortization

97



390



72



559


Impairment charges

3



10



1



14


Gain on sales of assets

(47)



(48)



(181)



(276)


Total costs and expenses

9,442



14,315



2,633



26,390


Operating income (loss)

$

(255)



$

(606)



$

66



$

(795)














Number of:












  Kmart Stores

1,183







1,183


  Full-Line Stores



785



118



903


  Specialty Stores



50



338



388


  Total Stores

1,183



835



456



2,474


 

Sears Holdings Corporation

Adjusted EBITDA


Amounts are Preliminary and Subject to Change



13 Weeks Ended


39 Weeks Ended

millions

November 1, 

2014


November 2, 

2013


November 1, 

2014


November 2,

2013

Net loss attributable to Holdings per statement of operations

$

(548)



$

(534)



$

(1,523)



$

(1,007)


Income (loss) attributable to noncontrolling interests

(80)



(13)



(128)



41


Income tax expense (benefit)

159



(2)



188



19


Interest expense

78



61



221



181


Interest and investment income

(97)



(8)



(133)



(29)


Other income

(2)



(1)



(4)




Operating loss

(490)



(497)



(1,379)



(795)


Depreciation and amortization

148



181



455



559


Gain on sales of assets

(68)



(21)



(148)



(276)


Before excluded items

(410)



(337)



(1,072)



(512)














Closed store reserve and severance

70



4



138



27


Domestic pension expense

22



41



67



122


Other expenses(1)

9





9




Impairment charges



6




25




14


Adjusted EBITDA


(309)




(286)




(833)




(349)














Lands' End separation



(29)



(10)



(70)


Adjusted EBITDA as defined(2)

$

(309)



$

(315)



$

(843)



$

(419)














Sears Canada segment

13



5



71



21


Domestic Adjusted EBITDA as defined(2)

$

(296)



$

(310)



$

(772)



$

(398)




(1)

Consists of transaction costs associated with strategic initiatives and other expenses.

(2)

Adjusted to reflect the results of the Lands' End business which were included in our results of operations prior to the separation.

 

Sears Holdings Corporation

Adjusted EBITDA



















Amounts are Preliminary and Subject to Change


13 Weeks Ended


November 1, 2014


November 2, 2013

millions

Kmart

Sears

Domestic

Sears

Canada

Sears

Holdings


Kmart

Sears

Domestic

Sears

Canada

Sears

Holdings

Operating loss per statement of operations

$

(149)


$

(310)


$

(31)


$

(490)



$

(171)


$

(279)


$

(47)


$

(497)


Depreciation and amortization

25


110


13


148



31


128


22


181


Gain on sales of assets

(24)


(44)



(68)



(19)


(2)



(21)


Before excluded items

(148)


(244)


(18)


(410)



(159)


(153)


(25)


(337)




















Closed store reserve and severance

48


20


2


70



17


(32)


19


4


Domestic pension expense


22



22




41



41


Other expenses(1)

3


3


3


9







Impairment charges






3


2


1


6


Adjusted EBITDA

(97)


(199)


(13)


(309)



(139)


(142)


(5)


(286)




















Lands' End separation







(29)



(29)


Adjusted EBITDA as defined(2)

$

(97)


$

(199)


$

(13)


$

(309)



$

(139)


$

(171)


$

(5)


$

(315)


% to revenues(3)

(3.6)%


(5.1)%


(2.1)%


(4.3)%



(4.8)%


(4.2)%


(0.5)%


(4.0)%





















39 Weeks Ended


November 1, 2014


November 2, 2013

millions

Kmart

Sears

Domestic

Sears

Canada

Sears

Holdings


Kmart

Sears

Domestic

Sears

Canada

Sears

Holdings

Operating income (loss) per statement of operations

$

(389)


$

(824)


$

(166)


$

(1,379)



$

(255)


$

(606)


$

66


$

(795)


Depreciation and amortization

72


334


49


455



97


390


72


559


(Gain) loss on sales of assets

(76)


(73)


1


(148)



(47)


(48)


(181)


(276)


Before excluded items

(393)


(563)


(116)


(1,072)



(205)


(264)


(43)


(512)




















Closed store reserve and severance

84


27


27


138



33


(27)


21


27


Domestic pension expense


67



67




122



122


Other expenses (1)

3


3


3


9







Impairment charges

2


8


15


25



3


10


1


14


Adjusted EBITDA

(304)


(458)


(71)


(833)



(169)


(159)


(21)


(349)




















Lands' End separation


(10)



(10)




(70)



(70)


Adjusted EBITDA as defined(2)

$

(304)


$

(468)


$

(71)


$

(843)



$

(169)


$

(229)


$

(21)


$

(419)


% to revenues(3)

(3.6)%


(3.8)%


(3.4)%


(3.7)%



(1.8)%


(1.8)%


(0.8)%


(1.7)%




(1)

Consists of transaction costs associated with strategic initiatives and other expenses.

(2)

Adjusted for the results of the Lands' End business which were included in our results of operations prior to the separation.

(3)

Excludes revenues of the Lands' End business which were included in our results of operations prior to the separation.

 

Sears Holdings Corporation

Adjusted Earnings per Share


Amounts are Preliminary and Subject to Change


13 Weeks Ended November 1, 2014




Adjustments



millions, except per share data

GAAP

Domestic
Pension
Expense

Domestic Closed Store Reserve and Severance

Domestic Gain on Sales of Assets

Other Expenses

Gain on Sears Canada Disposition

Domestic Tax Matters

Sears Canada Segment

As Adjusted(1)

Gross margin impact

$

1,601


$


$

41


$


$


$


$


$

(154)


$

1,488


Selling and administrative impact

2,011


(22)


(27)



(6)




(172)


1,784


Depreciation and amortization impact

148



(6)






(13)


129


Gain on sales of assets impact

(68)




42






(26)


Operating loss impact

(490)


22


74


(42)


6




31


(399)


Interest expense impact

(78)








1


(77)


Interest and investment income impact

97






(70)



(12)


15


Other income impact

2








(2)



Income tax expense impact

(159)


(8)


(28)


16


(2)


26


180


148


173


Loss attributable to noncontrolling interest impact

80








(80)



After tax and noncontrolling interest impact

(548)


14


46


(26)


4


(44)


180


86


(288)


Diluted loss per share impact

$

(5.15)


$

0.13


$

0.43


$

(0.25)


$

0.04


$

(0.41)


$

1.69


$

0.81


$

(2.71)




(1)

 Adjusted for the results of the Sears Canada business which were included in our results prior to the disposition.

 


13 Weeks Ended November 2, 2013




Adjustments



millions, except per share data

GAAP

Domestic Pension Expense

Domestic Closed Store Reserve, Store Impairments and Severance

Domestic Tax Matters

Sears Canada Segment

Lands' End Separation

As Adjusted(2)

Gross margin impact

$

1,931


$


$

13


$


$

(249)


$

(150)


$

1,545


Selling and administrative impact

2,262


(41)


28



(273)


(121)


1,855


Depreciation and amortization impact

181



(3)



(22)


(5)


151


Impairment charges impact

6



(5)



(1)




Operating loss impact

(497)


41


(7)



47


(24)


(440)


Interest expense impact

(61)





(4)



(65)


Interest and investment income impact

8





(6)



2


Income tax benefit impact

2


(15)


3


200


(11)


9


188


Loss attributable to noncontrolling interest   impact

13





(13)




After tax and noncontrolling interest impact

(534)


26


(4)


200


13


(15)


(314)


Diluted loss per share impact

$

(5.03)


$

0.25


$

(0.04)


$

1.88


$

0.12


$

(0.14)


$

(2.96)




(2)

Adjusted for the results of the Lands' End and Sears Canada businesses which were included in our results prior to the separation/disposition.

 

Sears Holdings Corporation

Adjusted Earnings per Share


Amounts are Preliminary and Subject to Change



39 Weeks Ended November 1, 2014




Adjustments



millions, except per share data

GAAP

Domestic
Pension
Expense

Domestic Closed Store Reserve, Store Impairments and Severance

Domestic Gain on Sales of Assets

Other Expenses

Gain on Sears Canada Disposition

Domestic Tax Matters

Sears Canada Segment

Lands' End Separation

As Adjusted(1)

Gross margin impact

$

5,171


$


$

58


$


$


$


$


$

(502)


$

(87)


$

4,640


Selling and administrative impact

6,218


(67)


(53)



(6)




(603)


(77)


5,412


Depreciation and amortization impact

455



(7)






(49)


(3)


396


Impairment charges impact

25



(10)






(15)




Gain on sales of assets impact

(148)




65





(1)



(84)


Operating loss impact

(1,379)


67


128


(65)


6




166


(7)


(1,084)


Interest expense impact

(221)








5



(216)


Interest and investment income impact

133






(70)



(38)



25


Other income impact

4








(4)




Income tax expense impact

(188)


(25)


(48)


25


(2)


26


554


136


3


481


Loss attributable to noncontrolling interest impact

128








(128)




After tax and noncontrolling interest impact

(1,523)


42


80


(40)


4


(44)


554


137


(4)


(794)


Diluted loss per share impact

$

(14.33)


$

0.40


$

0.75


$

(0.38)


$

0.04


$

(0.41)


$

5.21


$

1.29


$

(0.04)


$

(7.47)


 


39 Weeks Ended November 2, 2013




Adjustments



millions, except per share data

GAAP

Domestic Pension Expense

Domestic Closed Store Reserve, Store Impairments and Severance

Domestic Gain on Sales of Assets

Domestic Tax Matters

Sears Canada Segment

Lands' End Separation

As Adjusted(1)

Gross margin impact

$

6,273


$


$

28


$


$


$

(724)


$

(408)


$

5,169


Selling and administrative impact

6,771


(122)


22




(766)


(338)


5,567


Depreciation and amortization impact

559



(5)




(72)


(16)


466


Impairment charges impact

14



(13)




(1)




Gain on sales of assets impact

(276)




55



181



(40)


Operating loss impact

(795)


122


24


(55)



(66)


(54)


(824)


Interest expense impact

(181)






(2)



(183)


Interest and investment income impact

29






(17)



12


Other income impact






1



1


Income tax expense impact

(19)


(45)


(10)


21


406


(1)


21


373


Income attributable to noncontrolling interest impact

(41)






41




After tax and noncontrolling interest impact

(1,007)


77


14


(34)


406


(44)


(33)


(621)


Diluted loss per share impact

$

(9.49)


$

0.73


$

0.13


$

(0.32)


$

3.82


$

(0.41)


$

(0.31)


$

(5.85)




(1)

Adjusted for the results of the Lands' End and Sears Canada businesses which were included in our results prior to the separation/disposition.

 

SOURCE Sears Holdings Corporation








©2017 Sears Brands, LLC