(Reuters) - U.S. retailer Sears Holdings reported a bigger-than-expected quarterly loss as cooler weather hurt sales at its stores, indicating that the company's turnaround could take much longer than expected.
Shares of the company, which also said it was considering selling its service contracts business, fell 12 percent to $51.41 in heavy trading after the bell.
The disappointing results came just months after Chairman and controlling shareholder Eddie Lampert took over as chief executive from Louis D'Ambrosio, who stepped down due to a family member's health issue.
Some on Wall Street saw D'Ambrosio's departure as adding to Sears' risks, and worried that Lampert's lack of retail sales experience could hurt the company's attempt to turn around its core Sears department stores and Kmart chains.
The retailer is trying to revive itself after suffering from declining sales since 2005, when the hedge fund manager merged the two iconic U.S. retail chains in an $11 billion deal.
It has been closing stores, tightly managing inventory, selling real estate and shedding assets.
The company reported a net loss of $279 million, or $2.63 per share, compared with a profit of $189 million, or $1.78 per share, a year earlier. Analysts on average had expected a loss of 60 cents per share.
Same-stores sales fell 3.6 percent in the United States. Overall sales fell 9 percent to $8.5 billion, missing the average analyst estimate of $8.74 billion, according to Thomson Reuters I/B/E/S.
The company said it was evaluating strategic options, including a sale, for its protection agreement unit. The business provides customers with service contracts that include repair services and product replacements for damaged goods.
The company launched in November a plan to shore up liquidity by at least $500 million by the end of 2013. (Reporting by Siddharth Cavale in Bangalore; Editing by Saumyadeb Chakrabarty)