Gloom and Doom at Sears and Kmart

The news has not been good for Sears and Kmart for quite some time. It didn’t get any better on Thursday with the release of first quarter financial results.

Store closings had been the primary point of discussion since Sears April 22announcement that it would accelerate its transformation by closing 78 stores – 68 Kmart and 10 Sears locations. In reality, net store closings in the near term will be more significant than the April 22 announcement suggests.

Comparing Sears Holdings Q1 financials to the year-end reports released in January 2016, we see 50 total store closings through April 30, 2016. The majority of these 50 stores are in addition to the 78-store set announced in April, as these stores were not set to begin their liquidation sales to the public until April 29 (Kmart) and May 12 (Sears), meaning they were not closed by the April 30 end to Q1.

Historical Data Source: Chain Store Guide Department Store Database. *CSG projection based upon company financial reports and statements.

Tack on those 68 Kmart and 10 Sears closings to the Q1 2016 tally seen above, and the footprint shrinks even more considerably in the first half of year.

Historical Data Source: Chain Store Guide Department Store Database. *CSG projection based upon company financial reports and statements.

Additional negative notes were sounded by the company on Thursday as losses mount. Sears announced that CFO Robert Schriesheim would be leaving the company as soon as a replacement is found and that its three iconic brands – Kenmore, Craftsman and DieHard – could be up for sale.