Sears Holdings Corp. announced Tuesday it will shutter 100 to 120 of its more than 4,000 Sears and Kmart stores in the United States and Canada as a cost-cutting measure. Locations of store closures have not yet been announced. The company operates one Sears and one Kmart outlet in the Santa Clarita Valley.
Sears stock plunged 27 percent to its lowest level since 2008 on the news that its same-store, pre-Christmas sales fell 5.2 percent. Leading the decline for Kmart were the consumer electronics and apparel categories, while Sears saw its biggest drop in consumer electronics and home appliances. Kmart also saw fewer layaway sales.
“Given our performance and the difficult economic environment, especially for big-ticket items, we intend to implement a series of actions to reduce ongoing expenses, adjust our asset base, and accelerate the transformation of our business model,” CEO Lou D’Ambrosio said in a statement.
He said the store closures should generate $140 million to $170 million in cash as their inventory is sold off. The company would then sell or sublease its shuttered locations.