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Sears Holdings profits jump as sales sag

Hoffman Estates,Ill.– Sales were down but profits up in the first quarter at Sears Holdings, the company reported today.

The 3,800-store retailer said nothing about home category performance at Sears, but did note, “Kmart experienced lower transaction volumes across most merchandise categories, most notably within home goods, health and beauty products, and food and consumables.”

In the toughest measure, U.S. comparable store sales fell 3.9%, with Sears stores off 3.4% and Kmart doors down 4.4% in the quarter. Overall sales dropped 2.5% to $11.7 billion, compared to $12.0 billion for the same period one year ago.

Operating profit rose to $393 million, up $62 million or 18.7% from $331 million last year – but not without a total of $72 million gained by: a legal settlement, a benefit plan pruning, and a hurricane insurance windfall.

All told, net income jumped 20.0% to $216 million from $180 million last year.

Some of Sears Holdings shareholders who are not named Eddie Lampert were miffed at the report: the stock price fell about 2.3% by midday .

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