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Home Depot Toronto Head Office Store Support Centre Location
Same Abundance Sales Advance continues into aboriginal 2017
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TORONTO, April 26, 2017 /CNW/ - Sears Canada Inc. (TSX: SCC; NASDAQ: SRSC) today appear operational highlights and banking after-effects for the fourth division of Fiscal 20161. The after-effects are accent by advance in aforementioned abundance sales and units awash aback mid-November and through the aboriginal two months of Fiscal 2017. Brandon G. Stranzl, Controlling Chairman of Sears Canada, said, "Our assignment to reinvent our business with artefact innovation, chump experience, and cast accession is starting to bell with consumers. After many, abounding years of decline, Sears Canada is starting to apprehend advance in aforementioned abundance sales. We still accept a lot of adamantine assignment to do and challenges advanced of us, but we are advisedly focused on the accomplish adapted to drive able advance and advantage over time." We accept afresh apparent able signs of advance in aforementioned abundance sales aback the ceremony of the abortion of the acclaim agenda business as of November 15, 2016. (Shown in the table below.2)
Fiscal 2016 to March 2017 Aforementioned Abundance Sales and Aforementioned Abundance Units
YTD Nov 15th2016(*)
Nov 16th-30th2016
Dec2016
Jan2017
Feb2017
Mar2017
Same Abundance Sales
Core
(7.9%)
8.6%
1.2%
7.1%
7.1%
2.8%
Other
(3.4%)
8.7%
9.3%
0.2%
2.1%
11.4%
Total
(7.1%)
8.6%
2.2%
5.9%
6.2%
4.1%
Same Abundance Units
Core
(3.1%)
13.7%
6.1%
35.8%
37.6%
33.0%
Other
(22.1%)
(42.8%)
(32.9%)
(35.9%)
(35.7%)
4.7%
Total
(4.6%)
8.9%
3.0%
28.5%
30.3%
30.8%
(*) The acclaim agenda business and application acceding amid the Company and JPMorgan
Chase Bank, N.A. (Toronto Branch) ("JPMC") concluded on November 15, 2015
______________________________
1 Fourth division 2016 and 2015 represent the 13-week periods concluded January 28, 2017 and January 30, 2016, respectively. Fiscal 2016 and 2015 represent the 52- anniversary periods concluded January 28, 2017 and January 30, 2016, respectively.
2The Company does not intend to acknowledge account aforementioned abundance sales on a alternating basis. This is a ancient acknowledgment to advice readers accept the appulse of (i) the acclaim agenda abortion and (ii) the new business strategy.
Fourth Division 2016 Key Operational Highlights
Fourth Division 2016 Banking Results
Additional CommentaryThe year 2016 was all about starting to change Sears Canada, and 2017 will be the year that change is added absolutely realized. Our focus is on three pillars of change: artefact innovation, chump experience, and cast positioning. We are leveraging these pillars, in accession to business affairs for operational enhancements from our new technology platform, added afterimage to our accumulation chain, bigger sourcing costs, connected abundance adjustment and Sears 2.0 in-store cast optimization, and all-embracing amount improvements, in adjustment to advance connected advance in sales and actualize a aisle to profitability.
In the accomplished year, we alien the Cut @ Sears and the new Sears Characterization essentials, which accept now re-established Sears Canada with able artefact and solid positioning. The Sears Characterization agency aerial affection articles designed, sourced and awash absolute to customers. The Cut @ Sears agency of-the-moment appearance in bound accumulation and artist labels at 30-60% less. In our big admission businesses – mattresses and accessories – we accept advised our appraisement strategies to action the best prices in Canada, every day. All of these articles are showcased in a reinvented chump experience, which spans beyond the new agenda ecommerce belvedere and the new Sears 2.0 in-store format, as able-bodied as a redesigned admission to bear WOW through chump service. The Sears cast is re-connecting with Canadians on a allusive base by giving them amazing articles to buy at abundant prices they can trust.
"Product. Experience. Positioning. Those are the pillars of change put in abode over the accomplished year. The change is fabricated accessible by a above accomplishment to adapt our adeptness and leadership," connected Mr. Stranzl. "These cultural attempt are categorical on our website at www.sears.ca/reinvention. Our 16,000 assembly accomplish this adeptness appear every day, and I acknowledge them for their adamantine assignment and focused determination; they should appropriately be appreciative of their assignment in accepting Sears Canada growing again."
About Sears CanadaSears Canada Inc. is an absolute Canadian online and abundance banker whose arch appointment is based in Toronto. Sears Canada's altered accession is that it now offers consumers Sears characterization products, which are advised and anon sourced by Sears Canada, and additionally of-the-moment appearance and artist labels at 30-60% beneath in The Cut @ Sears. Sears Canada additionally has a top ranked mattress business in Canada, and the cardinal one apparatus business in Canada. Sears Canada is adeptness a reinvention, including new chump adventures at every touchpoint, a new e-commerce platform, new abundance concepts, and a new set of chump account attempt advised to bear WOW adventures to customers. Information can be begin at sears.ca/reinvention.
Disclaimer and Cautionary Note Regarding Forward-Looking StatementsThis absolution contains advice which is advanced and is accountable to important risks and uncertainties. Advanced advice concerns, amid added things, the Company's approaching banking performance, business strategy, plans, expectations, goals and objectives. Often, but not always, advanced advice can be articular 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 assertive actions, contest or after-effects "may", "could", "would", "might" or "will" be taken, action or be achieved. Although the Company believes that the estimates reflected in such advanced advice are reasonable, such advanced advice involves accepted and alien risks, uncertainties and added factors which may account absolute results, achievement or achievements to be materially altered from any approaching results, achievement or achievements bidding or adumbrated by the advanced advice and disproportionate assurance should not be placed on such information.
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Factors which could account absolute after-effects to alter materially from accepted expectations include, but are not bound to: the Company's adeptness to attempt finer in the awful aggressive retail industry; the adeptness of the Company to auspiciously apparatus its cardinal initiatives; the adeptness of the Company to enhance its banking adaptability and liquidity, including to advance its banknote position; weaker business achievement in the fourth quarter, commonly the Company's arch quarter; melancholia acclimate patterns; chump preferences and changes in chump spending; adeptness to accomplish abundance improvements and amount savings; adeptness to absorb chief administration and key personnel; adeptness of the Company to auspiciously administer its account levels; adeptness of the Company to defended an acceding with a banking academy for the administration of the company's acclaim and banking casework operations; adeptness to apparatus and abide the Company's new chump costs program; the adeptness of the Company's new adherence affairs to allure and absorb customers; adeptness to auspiciously apparatus the Company's new agenda e-commerce belvedere nation-wide; adeptness of the Company to drift able archive barter and business to online; disruptions to the Company's computer systems; economic, social, and political alternation in jurisdictions area suppliers are located; blaze accident to and/or, structural candor and blaze assurance of, adopted factories; added aircraft costs, abeyant busline delays and interruptions; accident to the reputations of the brands the Company sells; changes in the Company's accord with its suppliers; the Company's assurance on third parties in outsourcing arrangements, and their adeptness to accomplish the arrange for which they accept been engaged; the creditworthiness and banking adherence of the Company's licensees and business partners; alertness of the Company's vendors to accommodate able acquittal terms; the aftereffect of artefact accountability claims; accident of acceptability constant from aegis or abstracts breaches or accident of chump information; abortion of the Company's IT systems; artifice or annexation constant from weaknesses in the Company's acquittal systems; aftereffect of abiding leases on the Company's adeptness to acknowledge to alteration demographics; abortion to accede with operating covenants in the Company's leases; changes in laws, rules and regulations applicative to the Company; accident of the Company's cachet as a adopted clandestine issuer; acquiescence costs associated with ecology laws and regulations; the aftereffect of awaiting acknowledged proceedings; advancement able allowance coverage; changes to chump spending patterns due to calm or all-embracing contest alfresco the Company's control; adeptness to make, accommodate and advance acquisitions and investments; accepted bread-and-butter conditions; clamminess accident and abortion to accomplish banking obligations; banned on the Company's admission to costs sources; fluctuations in adopted bill barter rates; abortion of counterparties to accommodated their acquittal obligations to the Company; the achievability of abrogating advance allotment in the Company's alimony plan or an admission to the authentic account obligation including the potentially akin appulse such an admission adeptness accept on acclaim availability; absorption amount fluctuations and added changes in allotment costs and advance income; the crime of abstract and added continued lived assets; the accessible approaching abortion of assertive bookish acreage rights associated with the "Sears" name and cast names if Sears Holdings Corporation ("Sears Holdings") reduces its absorption in the Company to beneath than 10%; abeyant battle of absorption of some of the admiral and controlling admiral of the Company attributable to their buying of Sears Holdings' accepted stock; accessible changes in the Company's buying by Edward S. Lampert, ESL Investments, Inc. ("ESL") and added cogent shareholders; amount and aggregate animation of the Company's accepted shares; new accounting pronouncements, or changes to absolute pronouncements, that appulse the methods the Company uses to address our banking position and after-effects from operations; and uncertainties associated with analytical accounting assumptions and estimates. Advice about these factors, added absolute factors that could account absolute after-effects to alter materially from expectations and about absolute factors or assumptions activated in advancing advanced information, may be begin in this absolution as able-bodied as beneath Area 3(k) "Risk Factors" in the Company's best contempo AIF, Section 9 "Risks and Uncertainties" in the MD&A in the Company's best contempo anniversary address and beneath Area 9 "Risks and Uncertainties" in the MD&A in the Company's best contempo acting address and abroad in the Company's filings with Canadian and U.S. balance regulators.
All of the advanced statements included in this absolution are able by these cautionary statements and those fabricated in the "Risk Factors" area of the Company's best contempo AIF, in the "Risks and Uncertainties" area of the Company's best contempo anniversary and acting MD&A and the Company's added filings with Canadian and U.S. balance regulators. These factors are not advised to represent a complete account of the factors that could affect the Company; however, these factors should be advised carefully, and readers should not abode disproportionate assurance on advanced statements fabricated herein or in our added filings with Canadian and U.S. balance regulators. The advanced advice in this absolution is, unless contrarily indicated, declared as of the date hereof and is presented for the purpose of acceptable investors and others in compassionate the Company's banking position and after-effects of operations as able-bodied as the Company's objectives and cardinal priorities, and may not be adapted for added purposes. The Company does not undertake any obligation to amend about or to alter any advanced attractive information, whether as a aftereffect of new information, approaching contest or otherwise, except as adapted by law.
Consolidated Banking Statements and Management's Discussion and AnalysisThe Company's audited circumscribed banking statements for the 52-week aeon concluded January 28, 2017 and Management's Discussion and Analysis after are accessible on the System for Electronic Document Analysis and Retrieval website at www.sedar.com and on the U.S. Balance Barter Commission website at www.sec.gov.
Selected Circumscribed Banking InformationThe afterward tables set out arbitrary unaudited circumscribed banking advice and added advice for the periods indicated, acquired from the audited circumscribed banking statements for the 52-week aeon concluded January 28, 2017. The arbitrary unaudited circumscribed banking advice set out for these periods has been able on a base constant with our audited circumscribed banking statements for the 52-week aeon concluded January 28, 2017. The advice presented herein does not accommodate disclosures adapted by IFRS and should be apprehend in affiliation with the Company's audited circumscribed banking statements for the 52-week aeon concluded January 28, 2017.
SEARS CANADA INC.RECONCILIATION OF NET (LOSS) EARNINGS TO ADJUSTED EBITDAFor the 13 and 52-week periods concluded January 28, 2017 and January 30, 2016
Unaudited
Fourth Quarter
Fiscal
(in CAD millions, except per allotment amounts)
2016
2015
2016
2015
Net (loss) earnings
$
(45.8)
$
30.9
$
(321.0)
$
(67.9)
Transformation expense1
9.3
9.7
44.2
16.5
Gain on abortion of acclaim agenda arrangement2
—
(170.7)
—
(170.7)
Gain on charter abortion and auction and leaseback transactions3
(59.9)
—
(105.9)
(67.2)
Gain on adjustment of retirement benefits4
—
—
—
(5.1)
Asset captivated for auction impairment5
2.3
3.8
7.3
3.8
Other asset impairment6
27.7
74.6
45.0
74.6
Warehouse crime reversal7
—
(15.1)
—
(15.1)
TBI costs8
—
—
—
6.4
Environmental remediation costs9
(2.8)
3.2
(1.0)
3.2
Lease avenue costs10
2.9
—
12.6
—
Depreciation and acquittal expense
7.3
11.1
31.4
48.4
Finance costs
0.3
2.1
8.9
9.7
Interest income
(2.6)
(0.3)
(7.2)
(2.3)
Income tax (recovery) expense
(2.4)
(0.5)
2.8
5.2
Adjusted EBITDA11
$
(63.7)
$
(51.2)
$
(282.9)
$
(160.5)
Basic net (loss) balance per share
$
(0.45)
$
0.30
$
(3.15)
$
(0.67)
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1
Transformation amount during Fiscal 2016 and Fiscal 2015 relates primarily to severance costs incurred during the period.
2
Gain on abortion of acclaim agenda adjustment represents the net accretion on the auction of JPMorgan Chase's portfolio of acclaim agenda accounts and accompanying receivables accompanying to the Sears acclaim agenda and Sears Mastercard during Fiscal 2015.
3
Gain on charter abortion and auction and leaseback affairs represents the net accretion accompanying to a charter abortion and affairs and leasing aback assertive backdrop endemic by the Company during Fiscal 2016 and Fiscal 2015.
4
Gain on adjustment of retirement allowances relates to the adjustment of retirement allowances of acceptable associates covered beneath the non-pension retirement plan during Q1 2015.
5
Asset captivated for auction crime represents the allegation accompanying to autograph bottomward the accustomed amount of the property, bulb and accessories of one retail abundance and assertive acumen centres to fair amount beneath costs to advertise during Fiscal 2016 and Fiscal 2015.
6
Other asset crime represents the allegation accompanying to autograph bottomward the accustomed amount of the property, bulb and accessories and affluence of assertive banknote breeding units during Fiscal 2016 and Fiscal 2015.
7
Warehouse crime changeabout represents the fractional changeabout during Fiscal 2015 of the allegation accompanying to autograph bottomward the accustomed amount of the property, bulb and accessories of the Montreal barn during Fiscal 2014 to fair amount beneath costs to sell.
8
TBI costs represent the estimated costs to the Company accompanying to TravelBrands Inc. (a licensee of the Company) filing for creditor aegis during Fiscal 2015.
9
Environmental remediation costs in Fiscal 2015 chronicle to estimated costs adapted to restore the Park Street Acumen Centre amid in Regina, in adjustment to advertise the acreage in Fiscal 2016. Changeabout of ecology remediation costs were fabricated in Fiscal 2016 based on absolute ecology remediation costs incurred. The Park Street Acumen Centre was awash during Fiscal 2016.
10
Lease avenue costs chronicle primarily to costs incurred to avenue assertive backdrop during Fiscal 2016.
11
Adjusted EBITDA is a admeasurement acclimated by management, the retail industry and investors as an indicator of the Company's operating performance, adeptness to acquire and account debt, and as a appraisal metric. Adjusted EBITDA is a non-IFRS measure.
SEARS CANADA INC.RECONCILIATION OF TOTAL MERCHANDISING REVENUE TO TOTAL SAME STORE SALESFor the 13 and 52-week periods concluded January 28, 2017 and January 30, 2016
Unaudited
Fourth Quarter
Fiscal
(in CAD millions)
2016
2015
2016
2015
Total affairs revenue
$
744.0
$
887.6
$
2,613.6
$
3,145.7
Non-comparable sales
110.3
194.1
529.0
708.5
Total aforementioned abundance sales1
633.7
693.5
2,084.6
2,437.2
Percentage change in absolute aforementioned abundance sales
1.3%
(1.6)%
(4.3)%
(2.3)%
Percentage change in absolute aforementioned abundance sales by category
Apparel & Accessories
(1.5)%
0.4%
(5.9)%
(4.6)%
Home & Hardlines
4.0%
(3.5)%
(3.3)%
(0.7)%
Percentage change in Amount Retail aforementioned abundance sales
0.9%
(0.8)%
(4.9)%
(0.6)%
Percentage change in Amount Retail aforementioned abundance sales by category
Apparel & Accessories
(1.7)%
2.9%
(5.3)%
(1.5)%
Home & Hardlines
3.9%
(5.1)%
(4.9)%
—%
1
Total aforementioned abundance sales represents commodity sales generated through operations in the Company's Full-line, Sears Home, Hometown, Outlet and Corbeil food that were continuously accessible during both of the periods actuality compared. Amount Retail aforementioned abundance sales represents commodity sales generated through operations in the Company's Full-line and Sears Home food that were continuously accessible during both of the periods actuality compared. Added specifically, the aforementioned abundance sales metrics analyze the aforementioned agenda weeks for anniversary aeon and represents the 13 and 52-week periods concluded January 28, 2017 and January 30, 2016. The adding of aforementioned abundance sales is a achievement metric and may be impacted by abundance amplitude amplification and contraction. The aforementioned abundance sales metrics exclude the Absolute channel.
SEARS CANADA INC.CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
Unaudited
(in CAD millions)
As atJanuary 28, 2017
As atJanuary 30, 2016
ASSETS
Current assets
Cash
$
235.8
$
313.9
Accounts receivable, net
67.1
59.4
Income taxes recoverable
12.3
35.9
Inventories
598.5
664.8
Prepaid expenses
34.5
31.0
Derivative banking assets
0.1
6.6
Assets classified as captivated for sale
57.0
22.1
Total accepted assets
1,005.3
1,133.7
Non-current assets
Property, bulb and equipment
227.1
444.1
Investment properties
2.0
17.0
Intangible assets
2.0
22.5
Deferred tax assets
0.7
0.6
Other abiding assets
7.3
15.3
Total assets
$
1,244.4
$
1,633.2
LIABILITIES
Current liabilities
Accounts payable and accrued liabilities
$
319.8
$
332.7
Deferred revenue
136.1
158.3
Provisions
61.6
75.8
Income taxes payable
0.6
2.6
Other taxes payable
22.3
17.3
Derivative banking liabilities
0.6
—
Current allocation of abiding obligations
3.7
4.0
Total accepted liabilities
544.7
590.7
Non-current liabilities
Long-term obligations
16.6
20.2
Deferred revenue
69.4
74.2
Retirement account liability
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308.6
326.9
Other abiding liabilities
82.9
67.0
Total liabilities
1,022.2
1,079.0
SHAREHOLDERS' EQUITY
Capital stock
14.9
14.9
Share-based advantage reserve
3.1
—
Retained earnings
418.0
739.0
Accumulated added absolute loss
(213.8)
(199.7)
Total shareholders' equity
222.2
554.2
Total liabilities and shareholders' equity
$
1,244.4
$
1,633.2
SEARS CANADA INC.CONSOLIDATED STATEMENTS OF NET (LOSS) EARNINGS AND COMPREHENSIVE LOSS (INCOME)For the 13 and 52-week periods concluded January 28, 2017 and January 30, 2016
Unaudited
13-Week Period
52-Week Period
(in CAD millions, except per allotment amounts)
2016
2015
2016
2015
Revenue
$
744.0
$
887.6
$
2,613.6
$
3,145.7
Cost of appurtenances and casework sold
560.6
632.5
1,900.5
2,145.9
Selling, authoritative and added expenses
293.8
393.6
1,135.5
1,298.1
Operating loss
(110.4)
(138.5)
(422.4)
(298.3)
Gain on charter abortion and auction and leaseback transactions
59.9
—
105.9
67.2
Gain on abortion of acclaim agenda arrangement
—
170.7
—
170.7
Gain on adjustment of retirement benefits
—
—
—
5.1
Finance costs
0.3
2.1
8.9
9.7
Interest income
2.6
0.3
7.2
2.3
(Loss) balance afore assets taxes
(48.2)
30.4
(318.2)
(62.7)
Income tax accretion (expense)
Current
2.8
(0.8)
(0.3)
(8.1)
Deferred
(0.4)
1.3
(2.5)
2.9
2.4
0.5
(2.8)
(5.2)
Net (loss) earnings
$
(45.8)
$
30.9
$
(321.0)
$
(67.9)
Basic and adulterated net (loss) balance per share
$
(0.45)
$
0.30
$
(3.15)
$
(0.67)
Net (loss) earnings
$
(45.8)
$
30.9
$
(321.0)
$
(67.9)
Other absolute (loss) income, net of taxes:
Items that may after be reclassified to net (loss) earnings:
(Loss) accretion on adopted barter derivatives
(0.9)
10.2
(12.6)
19.2
Reclassification to net (loss) balance of (gain) accident on adopted barter derivatives
(0.7)
(7.9)
5.0
(18.7)
Items that will not after be reclassified to net (loss) earnings:
Remeasurement (loss) accretion on net authentic retirement account liability
(6.5)
48.8
(6.5)
50.8
Total added absolute (loss) income, net of taxes
(8.1)
51.1
(14.1)
51.3
Total absolute (loss) income
$
(53.9)
$
82.0
$
(335.1)
$
(16.6)
SEARS CANADA INC.CONSOLIDATED STATEMENTS OF CASH FLOWSFor the 13 and 52-week periods concluded January 28, 2017 and January 30, 2016
Unaudited
13-Week Period
52-Week Period
(in CAD millions)
2016
2015
2016
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2015
Cash breeze generated from (used for) operating activities
Net (loss) earnings
$
(45.8)
$
30.9
$
(321.0)
$
(67.9)
Adjustments for:
Depreciation and acquittal expense
7.3
11.1
31.4
48.4
Share-based compensation
0.3
—
3.1
(0.4)
(Gain) accident on auctioning of property, bulb and equipment
(2.7)
—
(4.4)
0.3
Net crime losses
30.0
63.3
52.3
63.3
Gain on charter abortion and auction and leaseback transactions
(59.9)
—
(105.9)
(67.2)
Gain on abortion of acclaim agenda arrangement
—
(170.7)
—
(170.7)
Finance costs
0.3
2.1
8.9
9.7
Interest income
(2.6)
(0.3)
(7.2)
(2.3)
Retirement account affairs expense
3.4
4.8
14.1
18.9
Gain on adjustment of retirement benefits
—
—
—
(5.1)
Short-term affliction expense
1.1
1.4
4.6
4.9
Income tax (recovery) expense
(2.4)
(0.5)
2.8
5.2
Interest received
2.8
0.2
7.4
1.1
Interest paid
(1.0)
(0.8)
(3.4)
(2.7)
Retirement account affairs contributions
(10.0)
(12.0)
(43.5)
(48.6)
Income tax refunds, net
2.0
3.1
25.0
87.6
Changes in non-cash alive basic balances
78.5
150.1
0.1
(64.3)
Changes in non-cash abiding assets and liabilities
0.9
(3.0)
(5.7)
(11.7)
2.2
79.7
(341.4)
(201.5)
Cash breeze generated from advance activities
Purchases of property, bulb and accessories and abstract assets
(12.0)
(15.3)
(27.4)
(45.4)
Proceeds from auction of property, bulb and equipment
0.4
0.1
3.1
0.3
Proceeds from abortion of acclaim agenda arrangement
—
174.0
—
174.0
Net accretion from charter abortion and auction and leaseback transactions
93.5
—
295.0
130.0
81.9
158.8
270.7
258.9
Cash breeze acclimated for costs activities
Interest paid on accounts charter obligations
(0.4)
(0.4)
(1.7)
(1.9)
Repayment of abiding obligations
(1.0)
(0.9)
(3.9)
(3.9)
(1.4)
(1.3)
(5.6)
(5.8)
Effect of barter amount on banknote at end of period
(1.9)
2.1
(1.8)
3.3
Increase (decrease) in cash
80.8
239.3
(78.1)
54.9
Cash at alpha of period
$
155.0
$
74.6
$
313.9
$
259.0
Cash at end of period
$
235.8
$
313.9
$
235.8
$
313.9
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