HOFFMAN ESTATES, Ill. – Sears Holdings Corp. Chairman Edward Lampert told shareholders Friday the retail giant is eyeing numerous possibilities for acquisitions or investments two years after the parent of Sears and Kmart stores was created.
But the billionaire investor and hedge-fund manager gave no indication at the company’s annual meeting that a move is imminent. Wall Street has been eagerly waiting for Sears Holdings to use its large stash of cash.
Responding to a shareholder question about his plans for the company’s more than $2 billion in cash, Lampert said there are “a variety of options to deploy that.”
“What will shake out, especially this year, really is going to depend on what the opportunity set is,” he said.
Sears was rumored last year to be a potential bidder for companies as diverse as Home Depot Inc. and Anheuser-Busch Cos., but no large investment has surfaced yet.
While Lampert wouldn’t tip his hand on what companies could be targeted, the company disclosed plans for its first big marketing campaign of his tenure to be rolled out beginning Sunday.
The Kmart brand is getting a new mascot – a talking light bulb called “Mr. Blue Light.” The Sears brand will be promoted in commercials and ads under the tag line: “Sears: Where it begins.”
Chief Executive Aylwin Lewis said the company is intent on doing a better job in promoting its leading brands in appliances, tools, and lawn and garden.
The ad campaign “won’t solve all the issues we face, but … it’ll go a long way toward telling the public what do we stand for, what do we want to be famous for,” Lewis said. “We think it’ll be a real turning point in continuing to build a great company.”
Sales at stores open at least a year, widely seen as a key barometer of retail performance, declined at Sears Holdings in the first quarter, according to data the company released Thursday. But Lampert said the measure is overrated.
“They don’t matter as much as people have said,” he said during two hours of answering shareholders’ questions. “It’s not the be-all and end-all.”
Despite weak sales, Sears’ financial performance has been improving impressively, thanks to cost controls and improved margins. The company’s net income jumped 74 percent to $1.49 billion last year and its revenue rose 8 percent to $53 billion.
The company said Thursday that its first-quarter income is expected to be $200 million to $235 million, up from $180 million a year earlier, as a result of one-time items, including a gain from a legal settlement and a dividend from its stake in Sears Mexico.
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