On Tuesday (June 13), Sears Canada released some dismal results for the first quarter of 2017, warned about the company’s financial future, and postponed a shareholders’ meeting.
Despite efforts to reinvigorate its brand as “Sears 2.0” — including plans to open 10 “new format” stores this summer — the company continues to suffer from weak performance in the retail sector.
Since 2014, Sears Canada has reported recurring operating losses and negative cash flows and the trend continues in 2017.
Sears reported revenue of $505.5 million, a decline of 15.2% compared to the same quarter last year. The net loss for the first quarter was $144.4 million ($1.42 per share) compared to a net loss of $63.6 million (62 cents per share) in the same quarter last year.
The results were so bad that Sears Canada included a warning in its June 13th financial results:
“Cash and forecasted cash flows from operations are not expected to be sufficient to meet obligations coming due over the next 12 months,” the statement says.
“There are material uncertainties as to the Company’s ability to continue to satisfy its obligations and implement its business plan in the ordinary course. Accordingly, such conditions raise significant doubt as to the Company’s ability to continue as a going concern.”
Sears Canada has also postponed its 2017 annual meeting of shareholders, originally scheduled for Wednesday (June 14).
In the Kawarthas, Sears Canada operates one department store at Lansdowne Place in Peterborough and two “hometown stores” in Bancroft and Haliburton (selling appliances, tools, and lawn and garden equipment).
This story will be updated as more information becomes available.