The troubled Sears Holdings (NASDAQ:SHLD) will be closing an additional 66 stores, according to a source close to the company. The new round of planned closures include 49 Kmart and 17 Sears stores. There are also reports that seven Sears Auto Centers are slated for closure.
The additional closures will be on top of the 180 closures already announced this year. Sears has nearly halved its store footprint since 2012, from 2,019 then to fewer than 1,200 this year once all of the planned closures have been completed. The stores will reportedly begin their liquidation sales on June 16 and are slated to close to the public in early September.
The source claimed that store associates at affected locations have already been notified. Eligible employees will receive severance and have the opportunity to apply for open positions at other Sears or Kmart stores. Its employee count has fallen dramatically over the last decade. In 2006, it had 355,000 employees. Today, it employs 140,000 workers.
The financial woes of the retailing icon have deepened dramatically in recent months. The company has suffered six straight years of plunging sales and profit losses. In its most recent annual report filing with the Securities and Exchange Commission, Sears expressed diminished hopes in its ability to continue operating. The announcement sent the company’s shares down 12.3 percent. The stock is currently down about 48 percent from a year earlier.
Sears has begun outsourcing its Kenmore home appliance brand and sold its popular Craftsman tools line to Black and Decker for $900 million towards the end of last year. The sale of Craftsman lifted Sears to a profit last quarter. However, the company posted a $2.2-billion loss for the fiscal year ended Jan. 28, double its previous year loss of $1.1 billion.
Sears Holdings announced in May that it would delay repaying a significant portion of a $500 million loan. It plans to repay $100 million of the loan on the debt’s initial maturity date in July. The remaining $400 million is not scheduled to come due until January of 2018. However, the company has the option of pushing the maturity date back a further six months to July of next year.