P.M. BRIEFING : Sears Tells 39% Earnings Drop

Sears, Roebuck & Co. today reported a 39% drop in second-quarter earnings, blaming the weakness on high insurance payouts and a decline in retailing income.

The retailing and financial services conglomerate reported earnings of $237.9 million, or 69 cents per share, for the three months ending June 30 vs. $391.2 million, or $1.11 per share, for the same period a year ago.

Revenues rose 4.3% to $13.9 billion from $13.3 billion, Sears said in a statement.

The year-ago results included a gain of $56.3 million, or 16 cents per share, from discontinued operations.

Ten days ago, Sears announced that it expected second-quarter earnings to be about 65 cents per share.

Sears said earnings were depressed by unexpected catastrophe-related losses in its Allstate Insurance Group. The company also cited a weaker performance by its Sears Merchandise Group, the nation’s largest retailer. The retailing operation reported a 32% drop in operating income.