NEW YORK (CNN/Money) - Sears Roebuck & Co. raised its first-quarter earnings expectations 52 percent beyond Wall Street estimates Wednesday, as the retailer slashed costs and managed inventory to counter declining sales.

The news sent Sears (S: up $2.96 to $54.16, Research, Estimates) shares soaring to a new 52-week-high of $55.20 Wednesday following the announcement.

Sears said it anticipates a first-quarter operating profit of 93 cents a share, sharply higher than the 45 cents it reported a year earlier and far above analysts' consensus forecast of 61 cents, according to earnings tracker First Call.

The company, which expects to report results April 18, also said it expects 2002 earnings excluding items to exceed analyst estimates, according to First Call.

Along with other traditional department stores, Sears has been struggling with declining sales amid growing competition from discount chains and moderately priced department stores such as Kohl's (KSS: up $0.61 to $74.58, Research, Estimates) and J.C. Penney (JCP: up $0.29 to $21.40, Research, Estimates). Specialty stores and home improvement chains such as Best Buy (BBY: up $0.53 to $78.37, Research, Estimates) and Home Depot (HD: up $0.50 to $49.58, Research, Estimates) also compete with Sears, which has substantial consumer electronics, hardware and home improvement offerings.

CEO Alan Lacy, who took the helm from Arthur Martinez a year ago, immediately launched a review and restructuring of the company's operations, resulting in its exit from the cosmetics business and a shift in focus to appliances and other "hard goods." Appliances and hardware have been much stronger performers for Sears than apparel, which typically accounts for about 80 percent of a department store's sales.

"While revenues continue to be soft, our focus on gross margin, inventory levels and operating expenses is driving substantial profit improvement," Lacy said in a statement.

Separately, Sears said March sales at stores open at least a year, a key retailing gauge known as same-store sales, fell 4.7 percent from a year earlier.

Including charges related to an accounting change and exiting an investment, Sears expects a first-quarter profit of 34 cents a share.

UBS Warburg raised its 2002 earnings estimate on Sears Wednesday to $5.04 a share from $4.78 a share and raised its 12-month price target, but maintained a "hold" rating on the company. Analyst Linda Kristiansen said in a research note that the primary risk to Sears is the possibility of a prolonged industry sales slowdown.