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HOFFMAN ESTATES, Ill. — Sears Holdings Corp. has announced another round of Sears and Kmart stores to be shut in the coming months.
Employees have been notified that more than 30 Sears and Kmart locations will be closed in the early part of 2017. Florida, with seven Kmart stores slated for closing, and Kentucky, with six Kmart stores and one Sears, appear to be the hardest hit.
Most of the stores will start liquidation sales in January and go out of business between late March and mid-April.
This is not the first series of store closings for the company, and this latest round of closures brings to more than 200 the total number of stores shuttered this fiscal year by Sears Holdings.
The company closed 82 Kmart stores and seven Sears stores during the three months ended in October. That came on top of the 58 Kmart stores and 23 Sears stores closed in the first six months of the year. The two chains had 4,000 stores as recently as 2011, but they are now down to 1,500 stores.
“We will continue to accelerate the closing of underperforming stores,” chief financial officer Jason Hollar said in a statement. “We do not intend to borrow money to fund continued operating losses,” he noted.
The company is closing the stores to mitigate losses from declining sales numbers. According to figures from the most recent fiscal quarter, the company’s revenue fell 13% to $5 billion and the company’s losses widened to $748 million from $454 million in the same period last year. Sears has experienced six straight years of losses.
Additionally, same-store sales for the company dropped 7.4%, including a 10% decrease at Sears stores and a 4.4% decrease at Kmart stores.
On Thursday, Sears Holdings said it has obtained a secured standby letter of credit facility, providing additional liquidity to fund its operations. Sears can request standby letters of credit of up to $200 million initially. The facility can be expanded, at Sears’ request and with the consent of the lenders, by up to an additional $300 million.
“This new standby letter of credit facility further demonstrates that Sears Holdings has numerous options to finance our business strategy,” according to Hollar.
