Sunday, November 18, 2012

Northpark Mall anchor stores show troubling financial results

The latest financial reports are not good for two of Northpark Mall's longtime anchor stores.

Shares in Sears have fallen 16 percent since the company released its third quarter results:

Sears reported a third quarter net loss of $498 million, or $4.70 per share. That compares with a loss of $421 million, or $3.95 per share, a year ago.Excluding one-time items related to tax expenses, store closings and pension expense, Sears lost $1.99 per share, compared with $2.50 per share on the same basis last year.The company said revenue fell 5.8 percent from a year ago, to $8.86 billion.Sears’ revenues have fallen for the past five years, as the 126-year-old retailer has struggled to fend off more nimble, faster-growing rivals.Earnings before interest, taxes, depreciation and amortization increased by $34 million in the quarter, to a loss of $156 million compared with a year ago’s $190 million loss. Profits improved for appliances and home services, but results disappointed for electronics and household products. Sears reported a fifth straight quarter of increased apparel sales. Cash balances fell to $633 million in the quarter from $754 million as of Jan. 28. The cash position held steady from last year’s $632 million. Debt totaled $4 billion versus the year ago’s $3.5 billion on Jan. 28 and $4.5 billion a year ago.
Meanwhile, J. C. Penney, which has been in Northpark Mall since it opened four decades ago has also run into hard times as it tries to reinvent itself:

The first sign that things were falling apart came in May when rival Macy’s Inc. told analysts that sales were rising at its stores that share malls with Penney locations. A week later, Penney posted a $163 million quarterly loss. Revenue plunged 20 percent to $3.15 billion. The number of customers visiting stores fell 10 percent.Wall Street didn’t like the changes any more than Main Street did. A day after it posted the loss, Penney’s stock fell nearly 20 percent — its biggest one-day decline in four decades — to $26.75. That same month, Standard & Poor’s Ratings Services lowered its credit rating to junk status.

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