Sears Holdings says it will cut about 400 full-time jobs as part of the troubled retailer's plan to turn its business around.
The company, which owns the Sears and Kmart chains, says the cuts include some at its corporate offices in Hoffman Estates, Illinois, support functions globally, certain field operations positions and jobs related to store closures. The eliminated jobs represent less than half a percent of the 140,000 full-time and part-time employees it had at the end of January.
Sears Holdings Corp. said Tuesday that the job cuts are part of its previously announced plans to save $1.25 billion in costs a year. The retailer, which has been losing money for years, has been closing stores, selling locations and putting some of its famous brands up for sale. The company is reportedly closing an additional 66 stores by early September. That's on top of the 150 stores that closed in April.
"We are making progress with the fundamental restructuring of our operations that we initiated in February," Edward S. Lampert, chairman and CEO of Sears Holdings, said in a statement. "We remain focused on realigning our business model in an evolving and highly competitive retail environment. This requires us to optimize our store footprint and operate as a leaner and simpler organization."
The news comes as Sears Canada, a separate publicly traded company that was spun off from Sears Holdings in 2012, separately announced that it was studying its strategic options, including the possible sale of the company.
Sears Canada said that based on management's current assessment, cash and forecasted cash flows from operations are not expected to be sufficient to meet its obligations over the next 12 months.
Sears has been struggling with a sales malaise that extended during the first quarter. The storied retailer vowed to make additional spending cuts to offset its slowing business.
The company reported in May that its operating loss widened to $222 million, or $2.15 per share, on weak sales in the latest quarter. A year ago, it reported a loss of $181 million.
Revenue fell 20 percent, to $4.3 billion, and sales at established stores fell 11.9 percent.
In March, Sears Holdings said that there was "substantial doubt" it could continue as a viable concern, with intense pressure coming from companies like Wal-Mart, Target and Amazon.com. It has insisted that its actions to turn around its business should help reduce that risk.
Shares of Sears Holdings shed 15 cents to $6.88 in morning trading.