Kmart Restates Results, Posts Wider 2001 Loss

Kmart Corp. said Wednesday that its loss ballooned to $2.42 billion in 2001 after it restated results for the first three quarters, following an accounting investigation.

Separately, Federated Department Stores Inc. said first-quarter operating earnings were flat as sales dipped. Nordstrom Inc. and AnnTaylor Stores Corp. posted profit gains in the quarter.

Until now, Troy, Mich.-based Kmart had not reported results for full-year 2001, so the financial figures shed additional light on what went so wrong at the retailer, now in bankruptcy proceedings.

“These results reconfirm the significant difficulties Kmart experienced last year, including unsuccessful sales and marketing initiatives, an erosion in supplier confidence, and below-plan sales and earnings performance in the fourth quarter,” Chief Executive James Adamson said.

In the fiscal year ended Jan. 30, Kmart said its loss widened to $2.42 billion, or $4.89 a share, from a loss of $244 million, or 48 cents, the previous year. Excluding various one-time items, Kmart’s loss was $987 million, or $2 a share, in fiscal 2001. It earned $219 million, or 47 cents, the previous year.

Sales in 2001 fell 2.4% to $36.2 billion.

Kmart said its probe of how the company was run under former CEO Chuck Conaway is continuing and includes the U.S. attorney’s office in eastern Michigan.

Kmart shares ended off 5 cents at $1.17 on the New York Stock Exchange.

Among other retailers:

* Federated, parent of Macy’s, Bloomingdale’s and other chains, said net income for the quarter ended May 4 was $89 million, or 43 cents a share. Profit in the year-earlier quarter was $58 million, or 29 cents a share, but excluding one-time charges in that period per-share results were 42 cents.

Sales in the latest quarter fell 2.9% to $3.5 billion.

Profit per share was 1 cent higher than the average estimate of analysts surveyed by Thomson Financial/First Call. Analysts said the firm has benefited from lean inventories.

Federated shares rose 19 cents to $43.17 on the NYSE.

* Nordstrom said it had a profit, excluding one-time costs, of $30.4 million, or 22 cents a share, in the period ended April 30, compared with $24.8 million, or 18 cents, a year earlier. Sales rose 2.3% to $1.25 billion.

* AnnTaylor said profit in the quarter ended May 4 jumped to $20.9 million, or 67 cents a share, from $13.7 million, or 46 cents, a year ago, using similar accounting. Sales rose 12.5% to $345 million.