Sears to Report First Profit Since 2012

Sears Holdings Corp. said Monday that a gain from the spinoff of some of its real estate will likely drive its first profit in three years, though the retailer said sales continued to slide in its second quarter.

Sears completed the spinoff 235 of its properties into a real-estate investment trust, Seritage Growth Properties, in July in a move to raise cash.

The retailer expects to book a total gain of $1.4 billion from the spin off, with $510 million recognized in the second quarter. Sears also said the sale triggered a tax benefit of $240 million.

For the period ended Aug. 1, Sears said it expects to post a profit of $1.46 to $1.92 a share.

Meanwhile, Sears said sales at stores open at least 12 months slid 10.6% through July 25. Same-store sales at Sears domestic stores fell 13.9%, while Kmart logged a 6.9% decline.

The declines are in-line with results from the first quarter.

Backing out consumer electronics, Sears said same-store sales would have been down 9.1%.

Sears expects to report results for the quarter on Aug. 20.

Sears has been slashing costs and selling off assets to bolster its cash position in the face of declining sales and shopper traffic.

Write to Chelsey Dulaney at [e-mail]

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