Sears Reports Strong 4Q Income Gains

Sears, Roebuck and Co. (Hoffman Estates, Ill.) reported that net income for the fourth quarter ended Jan. 3, 2004, soared by more than 200 percent.

However, much of that was the result of a pretax gain of $4.1 billion related to the sale of the company's domestic Credit and Financial Products business; and a pretax gain of $81 million from the sale of its National Tire & Battery business.

Same-store sales for the quarter decreased 2.1 percent, impacted, the company noted, by “later-than-anticipated consumer seasonal purchases and a difficult promotional environment.”

In the home group, Sears said, the lawn and garden business continued to experience strong performance throughout the quarter. Sales of consumer digital products and tools also did well in the quarter. Within the apparel and accessories group, same-store sales increased in the core women's ready-to-wear and footwear categories.

“Overall, we made progress in our full-line stores again this year,” said chairman and ceo Alan Lacy. “We enhanced the overall customer proposition of our home appliance business, delivered exceptional sales across every major category of lawn and garden and saw apparel sales trends improve throughout much of the year, especially in our core women's ready-to-wear business. Lands' End generated more than $400 million of in-store sales in 2003, with our Covington, Apostrophe and Canyon River Blues brands also contributing to the improved apparel momentum.”

Nevertheless, the company expects flat domestic same-store sales in the first quarter of 2004 and has lowered its estimates for earnings in the first quarter and throughout 04.