Sears says Lands` End key to 2002 rise in profits
Sears, Roebuck and Co. is starting to get the push it needs from Lands` End, which helped Sears realize improved fourth-quarter profitability both corporate-wide and in its retail segment, the company said. "We`re pleased with Lands` End`s performance. It exceeded our expectations," Sears tells InternetRetailer.com.
In its year-end 2002 financial statement, Sears reported fourth-quarter net income of $848 million on $12.5 billion revenue, compared to $494 million on $12.2 billion in revenue in the year-ago period. Sears attributed much of the increase in profits to improved financial performance in its Retail and Related Services division, which was largely helped by sales of Lands` End products in stores and online. "Despite a challenging retail environment and soft sales, we made strong progress in improving our core retail operations," said Sears CEO Alan J. Lacy. "The acquisition of Lands` End, continued improvement in merchandise assortments, inventory management and vendor sourcing, and an improvement in the cost structure of the full-time stores all contributed to increased profitability."
Retail and Related Services revenue for the fourth quarter reached $9.7 billion, up 2.8% from $9.5 billion a year ago. The company said the gross margin rate for the Retail and Related Services rose 140 basis points to 29.4%, due to the inclusion of Lands` End and improved inventory management and product sourcing in full-line stores.
Although Sears doesn`t break out financial numbers for e-commerce sales, the company showed a profit from e-commerce operations in the fourth quarter, continuing a pace set earlier last year, the spokesman says.
The company`s fourth-quarter net income included a one-time after-tax gain of $179 million from the sale of Advance Auto Parts Inc. Without this and other one-time gains and charges, Sears posted Q4 net income of $669 million, up 1.8% from $657 million a year ago.
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