Operating Income
Operating income was $331 million for the 13 weeks ended April 29, 2006, as compared to $151 million for the 13 weeks ended April 30, 2005.
The increase in operating income was due to an increase of $135 million of Sears Domestic operating income, as well as a $47 million increase in Kmart operating income mainly due to lower expenses as a result of realizing merger synergies and improved expense management.
Financial Position
The Company's cash and cash equivalents balance is $3.2 billion at April 29, 2006 as compared to $1.9 billion at April 30, 2005 and $4.4 billion at January 28, 2006. The decline in cash from fiscal 2005 year end is due to the funding of seasonal working capital requirements and share repurchases.
Holdings' inventory level at April 29, 2006 was approximately $9.6 billion, as compared to $9.5 billion as of April 30, 2005. The increase reflects higher inventory in Kmart apparel and Sears Domestic hardlines businesses, partially offset by a reduction in Sears apparel inventory. Merchandise payables were $3.6 billion at April 29, 2006, as compared to $3.7 billion as of April 30, 2005.
Share Repurchase
During the first quarter of 2006, the company repurchased 3.3 million common shares at a total cost of $413 million, or an average price of $125.65 per share.
The remaining shares may be purchased in the open market, through self-tender offers or through privately negotiated transactions. Timing will dependon prevailing market conditions, alternative uses of capital and other factors.
Sears Holdings Corporation is the nation's third largest broadline retailer, with approximately $55 billion in annual revenues, and with approximately 3,900 full-line and specialty retail stores in the United States and Canada.
Sears Holdings is the leading home appliance retailer as well as a leader in tools, lawn and garden, home electronics and automotive repair and maintenance.
Sears Holdings Corporation
marketing@alchempro.com
