K mart Reports Record Profit

K mart Corp., the nation’s No. 2 retailer, said Thursday that its sales and profit hit record levels in the fiscal year ended Jan. 25, as new merchandising strategies and strong showings by specialty stores boosted earnings.

The retailer said fourth-quarter profit surged 22% to $393.2 million from $321.4 million, as sales rose to 8.5% to $8.42 billion.

For the year as a whole, profit rose 16% to $802.9 million and sales gained 6.5% to $27.3 billion.

The giant retailer, which ranks second in U.S. sales to Sears, Roebuck & Co., has sought in recent years to shed its discounter image and has upgraded its stores and goods to appeal to higher-income consumers as well as its traditional base.