Sales dwindle at both Kmart grocery chain and eponymous department store business

Sears Holdings has posted declining sales for its second quarter, with both its Kmart grocery chain and Sears department stores underperforming.

Operating income slid US$178 million (£88.2 million) to US$339 million (£167.9 million), compared with US$517 million (£256.1 million) the previous year, following dwindling sales across the group.

For the 13 weeks to August 4, Kmart's like-for-like sales fell 3.8 per cent, with declines in most categories. Department store chain Sears reported a 4.3 per cent drop in like-for-likes. The group said it experienced lower sales across most merchandise categories at both Kmart and Sears. Total sales fell US$600 million (£297.2 million) to US$12.2 billion (£6.04 billion).

Sears Holdings chief executive and president Aylwin Lewis said: "We are disappointed. Our gross margins came under pressure from sales declines and increased promotional activity and, as a result, our net income was significantly below last year and our expectations. In response, we are enhancing our marketing message to more clearly articulate the advantages of our products and service offerings."