The initiatives include consolidating Sears and Kmart corporate and support functions; integrating and streamlining its pricing, sourcing, supply chain and inventory management operations; and using data analytics to identify its most popular and profitable products and merchandising categories. The target is for a reduction in debt and pension obligations of $1.5B in fiscal 2017.
The future of Sears real estate is among the key questions.
Sears Holdings Corp (NASDAQ:SHLD) has been teetering on the edge of bankruptcy for years, but a new restructuring plan was enough to make investors giddy.
Of course, he's been saying that for years with little improvement to show for it. Sears Holdings stock, about half of which is owned by Lampert, has been hit by concerns about the retailer's prospects amid chronic and deepening sales declines.
The news of the company moves sent shares up more than 40 percent in early morning trading, with the stock hovering around $7.10 a share.
Sears said it can save $1 billion through its restructuring plan, which includes cost cuts and asset optimization.
Create an incremental $140 million in liquidity by right-sizing its asset-based credit facility. Wall Street analysts were already estimating the company's fourth quarter revenue to be $5.69 billion and $21.77 billion for the full year.
"We believe the actions outlined today will reduce our overall cash funding requirements and ensure that Sears Holdings becomes a more agile and competitive retailer with a clear path toward profitability", Lampert said.
And the company estimate that its fourth-quarter net loss would range from $535 million to $635 million, including a non-cash writedown of the value of the Sears brand name totaling $350 million to $450 million.
Proceeds from the Craftsman sale and real estate transactions, along with hoped-for improved operating performance will be used to cut debt.