When Sears Holdings (NASDAQ:SHLD) reported its first-quarter 2012 results, it saw a drop in overall sales, a decline in same-store sales, and negative earnings. The company reported that revenue decreased $270 million to $9.3 billion while same-store sales declined by 1.3% — 1% at Sears and 1.6% at the company’s Kmart locations. The company lost $0.31 per share from continuing operations, but offset that by selling $233 million in assets, producing $189 million in profits.
Selling off assets to make up for sales and revenue shortfalls would become standard operating procedure for the chain over the next five years, but in 2012, then-CEO Lou D’Ambrosio probably had no idea that the worst was yet to come. In fact, in the Q1 2012 earnings release he made comments that sound a lot like what current CEO Eddie Lampert says about each quarter now.
We are pleased with the results for the first quarter and our progress toward restoring profit growth and transforming our company. Our actions were driven by a focus on three core priorities: 1. enhancing financial and operational discipline; 2. improving our core retail operations; and 3. leading customer based innovation through integrated retail and an engaging membership program, Shop Your Way Rewards.
Five years later, profit growth remains a distant goal and Shop Your Way has yet to build any sort of meaningful audience. Sears has changed in the past half-decade, but it’s closer to a bankruptcy filing than profitability and it’s less than half the company it used to be by a number of different measures.