Skip to main content

Sears Canada Inc. says colder weather was to blame for a chunk of the $49.5-million loss the retailer booked in its first quarter as sales of its summertime merchandise underwhelmed expectations.

The department store chain, which makes much of its money on seasonal items such as barbecues, lawnmowers and camping gear, said its total revenues were down to $992.5-million, compared to $1-billion during the same time period last year.

"A cold spring in most of the country which affected apparel and other seasonal categories (impacted our results)," Dene Rogers, president and CEO of Sears Canada said in a statement.

Mr. Rogers also said record-high fuel costs and other household expenses have cut into Canadians discretionary income, and imminent interest rate increases are also affecting customer spending levels.

"These factors have combined to create a very competitive retail climate," Mr. Rogers added.

He said Sears' Home maintenance business was also stung by the end of government sponsored home energy rebate programs.

The national retailer said its $49.5-million loss is equal to 47 cents per share.

The current loss is about six times more than Sears recorded at the same time last year, when it lost $8.8 million or eight cents per share.

The store saw a 7.1-per-cent decline in first-quarter revenue, as sales at locations open for at least a year dropped 9.2 per cent.

Last week, Canadian Tire also blamed unseasonably bad weather for making it harder for customers to shop at its stores.

Sears Canada operates 196 corporate stores, 272 dealer stores, 1,800 catalogue order pickup locations and a travel agency and home maintenance and repair business.

The publicly traded company is a subsidiary of Sears Holdings, which owns both the Sears and Kmart retail chains in the United States. The parent company owns about 90 per cent of Sears Canada's stock.

Interact with The Globe