Sears Canada reports third quarter results
Sears Canada Inc. announced its unaudited third quarter results. Total revenues for the 13-week period ended October 31, 2009 were $1.309 billion compared to $1.442 billion for the 13 weeks ended November 1, 2008, a decrease of 9.2%. Same store sales decreased 6.3%. Total expenses for the quarter were reduced by 11.5%.
Operating net earnings for the third quarter were $47.1 million or 44 cents per share compared to $58.2 million or 54 cents per share in the third quarter last year. There was an unusual item (gain) in the quarter last year of $1.1 million, net of taxes; there were no unusual items in the quarter this year. Consequently, net earnings for the third quarter were $47.1 million or 44 cents per share compared to $59.3 million or 55 cents per share in the third quarter last year.
Operating EBITDA was $103.7 million for the quarter compared to $115.5 million for the same period last year, a decrease of 10.2%. Operating EBITDA and operating net earnings are non-GAAP measures; please refer to the "Reconciliation of Net Earnings to Operating EBITDA" table attached.
Cash, restricted cash and investments increased $304.4 million to $1,113.8 million as at October 31, 2009 compared to $809.4 million as at November 1, 2008. Total debt is $360.3 million as at October 31, 2009.
Total revenues for the 39-week period ended October 31, 2009 were $3.676 billion compared to $4.117 billion for the 39-week period ended November 1, 2008. Same store sales decreased 8.8%. Total expenses were reduced by 9.7%.
Operating net earnings for the first nine months this year were $113.0 million compared to $162.2 million for the same period in 2008. The 39-week period this year included an unusual expense of $6.5 million, net of tax, related to restructuring activities taken in the first quarter. The 39-week period last year included an unusual gain of $28.3 million, net of tax, related to property transactions including the sale of a Company property in Calgary, Alberta. Consequently, net earnings for the 39-week period ended October 31, 2009 were $106.5 million or 99 cents per share compared to $191.6 million or $1.78 per share for the 39-week period ended November 1, 2008.
For the 39-week period ending October 31, 2009, Operating EBITDA was $274.7 million compared to $334.9 million for the same period last year. As previously mentioned, please refer to "Reconciliation of Net Earnings to Operating EBITDA" attached.
Commenting on the third quarter and first nine months of the year, Dene Rogers, President and Chief Executive Officer, Sears Canada Inc., said, "The recession is continuing with increasing unemployment resulting in retracted consumer spending. On a positive note, the same store sales decrease of 6.3% is a 410 basis point improvement over Q1 and a 370 basis point improvement over Q2. These results are due to the efforts and skill of the thousands of Sears associates across the country. Sears remains determined to become Canada's No. 1 retailer by improving the lives of Canadians."
"The economic uncertainty continued to affect consumer confidence during the third quarter especially as it relates to future employment," continued Mr. Rogers. "Sears will be aggressively marketing in the fourth quarter to convey to customers that we have the Holiday Season's most wanted products at prices that can't be beat. This will be done in a responsible manner with a focus on driving customer traffic and profitability."
Sears Canada Inc