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Sears tops 2Q forecasts
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July 21, 2000: 11:26 a.m. ET
Nation's second-largest retailer sees gains in store sales, credit operations
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NEW YORK (CNNfn) - Sears Roebuck & Co. beat second-quarter earnings forecasts Friday, lifted by strong results from both retail and credit operations.
 The retailer posted net income of $388 million, or $1.11 per share, beating the $1.05 a share estimate of analysts surveyed by earnings tracker First Call. A year earlier, the company earned $331 million, or 86 cents a share.
Sears said credit operating income increased 26.3 percent due to higher revenue, improved portfolio quality and lower operating costs. Operating income from retail operations increased 9.8 percent, partly through cost reduction efforts there as well.
The nation's second-largest retailer, behind Wal-Mart Stores Inc. (WMT: Research, Estimates), said revenue rose 4.6 percent to $10.1 billion. Sales at U.S. stores open at least a year, a closely watched measure known as same-store sales, increased 2.7 percent.
"We continue to benefit from the strength of our retail and credit businesses, which both contributed to strong growth in operating income and record earnings this quarter," Arthur Martinez, Sears' chairman and chief executive officer said. "In our retail business, we posted solid sales growth and lower selling and administrative expenses, while our credit business saw further improvement in portfolio quality and lower operating costs."
The company attributed the26.3 percent increase in its credit division to higher revenue, improved portfolio quality and reductions in selling and administrative expenses.
Sears also repurchased more than 10 million shares of its stock during the quarter.
Sears is the only major retailer to report results on a calendar year basis, rather than a fiscal year that starts in February. Its report, therefore, is one of the first views of retail earnings in the period.
For the first six months, net income rose to $623 million, or $1.76 a share, from $477 million, or $1.24 a share, a year earlier. Year-to-date revenue gained 4.2 percent to $16.8 billion from $16.1 billion.
Shares of Sears (S: Research, Estimates) fell 7/8 to 32-7/8 in trading Friday. 
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