TORONTO -- Sears Canada reported a $91.6-million loss in its second quarter on Wednesday, a turnaround from the profit it recorded in the same period a year earlier as it racked up severance and other costs associated with efforts to revitalize its business.
"The current performance of the business is unacceptable, but it was not entirely unexpected," executive chairman Brandon Stranzl said in a statement.
Net loss in this year's second quarter amounted to 90 cents per share, compared with net earnings of $13.5 million or 13 cents per share in last year's second quarter.
Last year's second quarter was profitable for the Toronto-based retailer due to a one-time gain of $67.2 million from the sale and leaseback of two logistics centres in Alberta and Ontario. No real estate gains were recorded in this year's second quarter.
Revenue and store sales were down for a variety of reasons, including fewer transactions of appliances and other big-ticket items due to the termination of a credit card agreement and less revenue than expected from a merchandise agreement.
Total revenue declined by 15.6 per cent to $648.5 million, from $768.8 million, while same-store sales -- those at outlets open for at least a year -- declined by 5.5 per cent overall.
Sears Canada said it had cut $128 million in costs on an annualized basis by the end of the second quarter, which ended July 30, and it working towards $155 million in annualized savings for the 2016 fiscal year.
"The current management team has set about amassing a substantial cash position and significantly reducing operating expenses in order to create the runway to establish and execute a business plan to reinvent Sears Canada," Stranzl said.
