so whats left.
Assets
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circa 200 unencumbered stores- if sold at same price as seritage these are worth $2 billion
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kenmore and diehard - kenmore has double the sales of craftsmen, but half the net profit. No sales outside of sears to warrant a premium like craftsmen- $500 million. diehard- circa 4.5% of US battery linkd to sears and its demise -$50 million
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Sears auto- linked to sears demise and tainted by the name- token $100 million
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Sears home services- linkd to sears whe sears dies so does it- no value
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Innovel solutions- majority of business is sears own.. but say $500 million
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125 stores held in a bankruptcy remote vehicle - net book value in 2015 $700 million
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circa $500 million cash from eddie's recent lending efforts
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inventory is falling with less stores and has all been tapped out by eddie to secure various loans
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leases where market value is above sears rent- hard to quantify given poor location but token $500 million.
Liabilities
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$500 million loan due july 2017
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assume that pension contribution covered by all the craftsmen proceeds to date.
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capital requirement for 2017 to cover losses circa $2 billion same for 2018.
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long term debt of $3.4 billion with $1.3 billion due ocotber 2018.
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Pension defict of $2.1 billion
so where does that leave us, strip out the bankruptcy remote 125 stores and kd as they are pledged to the pbgc, and will not cover the deficit currently, leaving nothing.
total assets that can be monetized- circa $3.1 billion. Cash needed in 2017 to keep the lights on circa $2.5 billion, and in 2018 circa $3.8 billion (operating cash losses, pension contribution, repayment of $1.3 billion bonds and loan).
Should be obvious that if everthing is monetized and burn't, sears cannot make it past mid 2018 at the latest- certainly no chance of paying off the $1.3 billion loans and bonds due.
Finally, the losses will continue, you cannot cut your way to grwoth and profit. In 6 years they have dumped 2500 stores, yet the losses increase and the same store sales crater- if you have not stemmed the losses now you never wil. As the revenue and inventory drops the ability to repay the crippling debt diminshes. Every closed store costs money to close, every real estate sale adds to the interest pile.
My guess is they will limp on for the rest of this year, but early 2018 they will literally have nothing left. Certainly there is no scenario currently that sees them through 2018 and to be able to pay the $1.3 billion debt due. They cannot close loss making stores fast enough to save themselves.
Good luck all, whether you work there, or are long or short the stock.