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TROY, Mich. - Bankrupt discount retailer Kmart Corp. here lost $3.22 billion for the last fiscal year, but still expects to emerge from bankruptcy by April 30. The retailer also said it has completed its switch from Fleming as its grocery supplier.
For the fiscal year ended Jan. 29, Kmart's sales fell to $30.76 billion, from $36.15 billion in 2001, primarily the result of store closings. Kmart has closed 283 stores, about 13 percent of its store base, and is in the final stages of shuttering an additional 300 units, cutting as many as 35,000 jobs.
"As we draw closer to our emergence from Chapter 11, we remain focused on achieving a cost structure and organization that is aligned with our reduced store base," said Kmart president and CEO Julian Day. "Our objective is to ensure that the Company emerges from the reorganization process with a restructured balance sheet, stronger store portfolio, and an efficient, cost-effective organization positioned to compete in the discount retail sector."
In a conference call yesterday afternoon, Day also announced that Kmart's transition to non-Fleming food distribution is complete. He also said future rollout of the experimental Store of the Future merchandising concepts is on hold.
Day said the retailer's 59 remaining SuperKmart stores are now using a combination of six "outside wholesalers" of perishable food, as well as more than 100 smaller companies. While Day did not divulge the names of suppliers, he said that despite a few kinks, such as the "cardinal sin" of running out of milk in a few stores, the transition away from Fleming is going fairly well. As previously reported, the Fleming/Kmart deal was terminated earlier this year.
Overall, Day said stores' in-stock levels are "at least as good" as they were when Fleming was providing perishables. "The Fleming transition has and continues to go extraordinarily well," he added. ""Internally, I tell the team that it's a good example of what this company can do when it brings great focus to a task."