Canada NewsWire
TORONTO, Dec. 9, 2016
- Converted two stores to the new Sears 2.0 concept
- Announcing new partnerships with specialty supermarkets for re-development of several Sears 2.0 stores
- Launched new e-commerce platform nationally in November
- Soft launch of new off-price business
- Announcing $58 million in additional liquidity enhancing real estate transactions
- Billy Wong appointed Chief Financial Officer
TORONTO, Dec. 9, 2016 /CNW/ - Sears Canada Inc. (TSX: SCC; NASDAQ: SRSC) today announced operational highlights and financial results for the third quarter of Fiscal 20161.
Third Quarter 2016 Key Operational Highlights
Previously announced:
Announced today:
The above transactions total $152.2 million. Importantly, none of these transactions will result in store closures.
Third Quarter 2016 Financial Results
____________________________
1 | Third quarter 2016 and 2015 represent the 13-week periods ended October 29, 2016 and October 31, 2015, respectively. Fiscal 2016 and 2015 represent the 52-week periods ending or ended January 28, 2017 and January 30, 2016, respectively. |
2 | The core retail store network consists of Sears Canada's 95 full-line stores and 29 Sears Home stores, excludes the Outlet and Hometown stores. |
3 | The credit card marketing and servicing agreement between the Company and JPMorgan Chase Bank, N.A. (Toronto Branch) ("JPMC") terminated on November 15, 2015 |
4 | Previously announced sale-leaseback of logistics centre in Q2 2016 |
5 | Subject to completion of customary due diligence and satisfaction of customary closing conditions, as applicable. |
6 | Subject to completion of definitive documentation and customary due diligence. |
7 | Subject to completion of customary due diligence. |
Additional Commentary
"With the launch of Sears 2.0 in September, we have begun to reinvent how Sears Canada will go to market in bricks and mortar stores," said Brandon G. Stranzl, Executive Chairman, Sears Canada Inc. "Our new Sears 2.0 concept stores have been designed with our customers in mind, listening to what they want in a Sears Canada shopping experience, and working backwards from there to fulfill those needs. Based on early indicators such as an increase in sales per selling square foot, these stores are more productive and operationally efficient than our previous format. The new e-commerce platform advances Sears Canada's technology and allows the Company to be more agile in making improvements to our online shopping experience. Additionally, initial results of the new off-price business are encouraging.
"We are now in a process of constant innovation to deliver better products and experiences to customers, and thereby drive better business results over time," continued Mr. Stranzl, "We have much work to do and are fully committed to driving necessary change. We have adopted new principles of culture that are being embedded throughout the organization and we are thinking and acting differently than a year ago. I acknowledge our 17,000 associates who are working tirelessly to implement new initiatives in a speedy fashion and I look forward to sharing success with them as we continue to connect with the customers we are committed to serving."
Leadership Update
The Company is announcing the following two appointments:
About Sears Canada
Sears Canada is a multi-channel retailer with a network that includes 140 corporate stores, 71 Hometown stores, over 900 catalogue and online merchandise pick-up locations, 69 Sears Travel offices and a nationwide repair and service network. The Company also publishes Canada's most extensive general merchandise catalogue and offers shopping online at www.sears.ca.
Summary of Previously Announced Initiatives
As discussed in previous reports, the Company has organized its numerous re-engineering efforts into four primary workstreams:
Disclaimer and Cautionary Note Regarding Forward-Looking Statements
This release contains information which is forward-looking and is subject to important risks and uncertainties. Forward-looking information concerns, among other things, the Company's future financial performance, business strategy, plans, expectations, goals and objectives. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "scheduled", "estimates", "intends", "anticipates" or "does not anticipate" or "believes", or variations of such words and phrases, or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Although the Company believes that the estimates reflected in such forward-looking information are reasonable, such forward-looking information involves known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information and undue reliance should not be placed on such information.
Factors which could cause actual results to differ materially from current expectations include, but are not limited to: the proposed real estate transactions in this release, which are subject to closing conditions, not closing on the agreed terms or at all; the Company's inability to compete effectively in the highly competitive retail industry; weaker business performance in the fourth quarter, traditionally the Company's strongest quarter; the ability of the Company to successfully implement its strategic initiatives; changes in consumer spending; ability to retain senior management and key personnel; ability of the Company to successfully manage its inventory levels; customer preference toward product offerings; ability to implement and continue the Company's new consumer financing program; ability of the Company's loyalty program to attract and retain customers; ability to successfully implement the Company's new digital e-commerce platform nationwide; ability of the Company to migrate sufficient catalogue customers and business to online; disruptions to the Company's computer systems; economic, social, and political instability in jurisdictions where suppliers are located; fire to, structural integrity and safety of, foreign factories; increased shipping costs, potential transportation delays and interruptions; damage to the reputations of the brands the Company sells; changes in the Company's relationship with its suppliers; the Company's reliance on third parties in outsourcing arrangements, and their ability to perform the arrangements for which they have been engaged; willingness of the Company's vendors to provide acceptable payment terms; the outcome of product liability claims; any significant security compromise or breach of the Company's customer, associate or Company information; the outcome of pending legal proceedings; compliance costs associated with environmental laws and regulations; maintaining adequate insurance coverage; seasonal weather patterns; ability to make, integrate and maintain acquisitions and investments; general economic conditions; liquidity risk and failure to fulfill financial obligations; fluctuations in foreign currency exchange rates; the credit worthiness and financial stability of the Company's licensees and business partners; possible limits on our access to capital markets and other financing sources; interest rate fluctuations and other changes in funding costs and investment income; the possibility of negative investment returns in the Company's pension plan or an increase to the defined benefit obligation including the potentially restrictive impact such an increase might have on credit availability; the ability of the Company to successfully negotiate with its lenders to increase availability under its Amended Credit Facility and/or to arrange alternative financing that provides more credit availability relative to the collateral available; the impairment of intangible and other long lived assets; the possible future termination of certain intellectual property rights associated with the "Sears" name and brand names if Sears Holdings Corporation ("Sears Holdings") reduces its interest in the Company to less than 10.0%; potential conflict of interest of some of the directors and executive officers of the Company owing to their ownership of Sears Holdings' common stock; possible changes in the Company's ownership by Edward S. Lampert, ESL Investments and other significant shareholders; productivity improvement and cost reduction initiatives and whether such initiatives will yield the expected benefits; competitive conditions in the businesses in which the Company participates; new accounting pronouncements, or changes to existing pronouncements, that impact the methods the Company uses to report our financial position and results from operations; uncertainties associated with critical accounting assumptions and estimates; and changes in laws, rules and regulations applicable to the Company. Information about these factors, other material factors that could cause actual results to differ materially from expectations and about material factors or assumptions applied in preparing forward-looking information, may be found in this release as well as under Section 3(k) "Risk Factors" in the Company's most recent AIF, Section 10 "Risks and Uncertainties" in the MD&A in the Company's most recent annual report and under Section 9 "Risks and Uncertainties" in the MD&A in the Company's most recent interim report and elsewhere in the Company's filings with Canadian and U.S. securities regulators.
All of the forward-looking statements included in this release are qualified by these cautionary statements and those made in the "Risk Factors" section of the Company's most recent AIF, in the "Risks and Uncertainties" section of the Company's most recent annual and interim MD&A and the Company's other filings with Canadian and U.S. securities regulators. These factors are not intended to represent a complete list of the factors that could affect the Company; however, these factors should be considered carefully, and readers should not place undue reliance on forward-looking statements made herein or in our other filings with Canadian and U.S. securities regulators. The forward-looking information in this release is, unless otherwise indicated, stated as of the date hereof and is presented for the purpose of assisting investors and others in understanding the Company's financial position and results of operations as well as the Company's objectives and strategic priorities, and may not be appropriate for other purposes. The Company does not undertake any obligation to update publicly or to revise any forward looking information, whether as a result of new information, future events or otherwise, except as required by law.
Unaudited Condensed Consolidated Financial Statements and Management's Discussion and Analysis
The Company's unaudited interim condensed consolidated financial statements for the 39-week period ended October 29, 2016 and Management's Discussion and Analysis thereon are available on the System for Electronic Document Analysis and Retrieval website at www.sedar.com and on the U.S. Securities Exchange Commission website at www.sec.gov.
Selected Consolidated Financial Information
The following tables set out summary unaudited consolidated financial information and supplemental information for the periods indicated, derived from the unaudited interim condensed consolidated financial statements for the 39-week period ended October 29, 2016. The summary unaudited consolidated financial information set out for these periods has been prepared on a basis consistent with our audited consolidated financial statements for the 52-week period ended January 30, 2016. The information presented herein does not contain disclosures required by IFRS and should be read in conjunction with the Company's unaudited interim condensed consolidated financial statements for the 39-week period ended October 29, 2016.
SEARS CANADA INC.
RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA
For the 13 and 39-week periods ended October 29, 2016 and October 31, 2015
Unaudited
| Third Quarter | | Year-to-Date | |||||||
(in CAD millions, except per share amounts) | 2016 | 2015 | | 2016 | 2015 | |||||
Net loss | $ | (120.0) | $ | (53.2) | | $ | (275.2) | $ | (98.8) | |
| Transformation expense1 | 10.7 | 6.8 | | 34.9 | 6.8 | ||||
| Gain on sale and leaseback transactions2 | (5.4) | — | | (46.0) | (67.2) | ||||
| Assets held for sale impairment3 | 5.0 | — | | 6.0 | — | ||||
| Other asset impairment4 | 12.4 | — | | 16.3 | — | ||||
| Lease exit costs5 | 1.8 | — | | 9.7 | — | ||||
| Gain on settlement of retirement benefits6 | — | — | | — | (5.1) | ||||
| TBI costs7 | — | — | | — | 6.4 | ||||
| Environmental remediation costs for assets held for sale8 | 1.3 | — | | 1.8 | — | ||||
| Depreciation and amortization expense Werbung Mehr Nachrichten zur Sears Canada Aktie kostenlos abonnieren
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