TORONTO --- Even though Sears Canada narrowed its net loss by almost half despite falling sales in the third quarter, its CEO said it's taking too long to implement his turnaround plan for the multi-channel retailer.
Revenues for the 13 weeks ending Oct. 27 were C$1.04 billion, down 6.8% from the comparable period last year. Same-store sales decreased 5.7%.
The net loss was C$21.9 million or 22 cents per share, about half the net loss of C$44.1 million or 42 cents per share for the comparable period. Included in the net loss for last year's third quarter was a C$45.6 million pre-tax charge relating to the disposition of excess inventory and internal restructuring costs.
Revenues for the 39 weeks ended Oct. 27 were C$3, a decrease of 7.7%. Same store sales fell 6.4%.
Net earnings for the period were C$61.3 million or 60 cents per share, compared with a net loss of C$91.3 million or 87 cents per share for the 39 weeks ended Oct. 29, 2011. This year's net earnings include a pre-tax gain of C$167.1 million relating to the early surrender and return of leases on four properties.
In a statement, Sears Canada President and CEO Calvin McDonald attributed the revenue decrease to a significant reduction in promotion and clearance sales in apparel, declines in pre-season sales of snowblowers, falling television sales and the planned exit from certain product lines.
"We continue to make progress in our transformation strategy and are seeing positive signs of success," McDonald said. "For example, even though we cycled over our attack plan from last year in major appliances and mattresses, we continue to see strength in these two key hero categories."
He also said the Baby's Room - a merchandising initiative launched in June focusing on furniture and other products for babies and young children - turned in positive sales increases. The company's Back to School program also performed well.
"Although we made progress in the quarter, we can and must do more. Our plan is working; however, our pace of execution has not met our expectations," McDonald said. "Recent changes to our management team have been made that are designed to lead the organization effectively through the transformation and help us achieve our operational and financial objectives."
During the third quarter, Sears Holdings Corp., which also owns the Sears, Kmart and Lands' End in the United States, reduced its holdings in Sears Canada to 51% by transferring 45.1 million shares to its stockholders.
At the end of its fiscal third quarter, Sears Canada's network included 195 corporate stores, 269 hometown dealer stores, and more than 1,500 catalog and online merchandise pickup locations across the country.
