Net income rose to US$161 million (£87.4 million) in the company's first full quarter following Kmart's merger with Sears, Roebuck & Co in March. Sales in the period to July 30 were US$13.2 billion (£7.16 billion).
The company also announced that former Kmart CEO Aylwin Lewis will become group CEO on September 30, replacing Alan Lacy.
Sears chairman Edward Lampert is attempting to reverse years of falling same-store sales by adding exclusive clothing brands and household goods by designer Ty Pennington. The company is also converting more than 400 former Kmart stores to the new Sears Essentials format, which mixes food, clothing and general merchandise.
Sears has also been hurt by weak sales at fashion retailer Lands' End, which it bought for US$1.9 billion (£1.03 billion) in 2002.
Sears Holdings is adding fashionable clothing and private brands, including three new lines introduced last week: Belongings, c.l.o.t.h.e.s and Latina Life. Liz Claiborne designed the Belongings brand and Jones Apparel Group created c.l.o.t.h.e.s and Latina Life.
The retailer's remodelled stores, named Sears Grand and Sears Essentials, will mainly be located in affluent areas and outside of malls to make them more convenient for shoppers. The company is aiming for 50 conversions by the end of the year.
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