Florida Hardest Hit by Sears Store Closures
Sears Holdings (NASDAQ:SHLD) has identified 79 of the stores it plans to close, with nearly half being Kmart stores and a majority of the layoffs coming from Florida, according to The Wall Street Journal.
The retailer, which announced on Tuesday that it planned to close between 100 and 120 stores and record up to $2.4 billion in charges after a weaker-than-expected holiday season, says closures will affect 25 states.
Florida will take the biggest loss with 11 closures, followed by six each for Ohio, Michigan and Georgia. While the closures were spread across the U.S, the Northeast seemed to escape virtually unscathed, with only Pennsylvania and New Hampshire each losing only two stores so far.
Sears said employment totals varied and thus the company couldn't provide an estimate of how many layoffs would occur. However, it noted a typical store employs between 40 and 80 associates, which means layoffs could range from 4,000 workers to as many as 9,600 in total.
The company plans to lose 38 Kmart stores, 25 Sears full-line shops and two Sears hardline-only locations. It will also close 14 Grand/Essentials stores, a new store format Sears had tried years ago to try and compete better against Wal-Mart (NYSE:WMT) and Target (NYSE:TGT).
Standard & Poor’s on Thursday placed Sears Holdings on review for a possible downgrade, saying the retailer’s plan to close stores may do little to improve its poor performance.
On Thursday, Fitch Ratings slashed its long-term-issuer-default rating on Sears by three notches, citing poor sales and the company’s “lack of visibility to turn operations around.”
Shares of Sears were down more than 1% on Friday morning to $32.51. Its stock price has tumbled nearly 30% this week alone.