NEW YORK (Reuters) - Sears Holdings Corp reported a 38 percent fall in quarterly profit as higher costs and more markdowns weighed on margins, and its shares fell.
The retailer, run by hedge fund manager Edward Lampert, was also hurt by a jump in the Canadian dollar and weakness in its business there. Earlier this week, Sears Canada
The operator of Sears department stores and Kmart discount stores said its net income fell to $16 million, or 14 cents a share in the first quarter ended May 1, from $26 million, or 21 cents a share, a year earlier.
Net sales fell slightly to $10.05 billion. Same-store sales rose 1.7 percent at Kmart and 1.2 percent at Sears Domestic.
Kmart saw strength in categories like apparel, home and toys, while food was weak. Sales of appliances were strong at its Sears Domestic segment, while demand for tools was weak.
For the quarter, Hoffman Estates, Illinois-based Sears' gross margin was $2.8 billion versus $2.9 billion a year ago.
Its shares were down in pre-market trading.
(Reporting by Dhanya Skariachan and Shradhha Sharma; Editing by Aradhana Aravindan, Dave Zimmerman)
