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HOFFMAN ESTATES, Ill. — Black turned to red for Kmart parent company Sears Holdings as the company reported losses of $279 million for first-quarter 2013, compared with a $189 million profit in first-quarter 2012.
At the same time, despite a 3.6% decline in comps during the quarter for the company's U.S. business, online business for its Sears.com and Kmart.com website grew by 20%, and members of its Shop Your Way loyalty program generated more than 60% of sales.
"Our recent financial performance has not been acceptable, although we have seen some positive momentum as sales per member increased, and our online business grew 20% in the quarter," Sears Holdings chairman and CEO Eddie Lampert said. "During the quarter, we have accelerated our activity to transform Sears Holdings into a leading integrated retailer that fosters relationships with members through our Shop Your Way platform."
Part of that, Lampert said, includes new mobile services like Member Assist, which allows members of the loyalty program to communicate directly with its store staff remotely.
During the quarter, the whole company had sales of $8.5 billion, down by $818 million from first-quarter 2012, primarily due to there being fewer Kmart and Sears stores in operation, lower comps and the separation of the Sears Hometown and Outlet businesses that occurred last year. Comps for Kmart, which was operating 1,211 stores as of May 4, decreased by 4.6%, while total sales were $3.1 billion, compared with $3.4 billion last year, when it had 1,290 stores.