Sears executive defends conservative approach

HOFFMAN ESTATES, Ill. (AP) — The chairman of Sears Holdings Corp. went on the defensive Monday, saying the troubled retailer’s conservative approach to spending money will help it weather the nation’s rocky economic outlook.

Financier Edward Lampert told investors that Sears’ competitors have overextended themselves through a rash of store openings and debt acquisition.

“We do feel that because we’re not building a lot of new stores, that we can do a better job with the assets we have in place,” he said during the company’s annual shareholder meeting at its headquarters in suburban Chicago. “... Our focus is on upgrading the customer experience and being ready when the economic environment turns.”

The Hoffman Estates-based retailer is in the midst of a high-stakes restructuring aimed at reconnecting with customers and reinvigorate slumping same-store sales, which have fallen for the past eight consecutive quarters.

But investors and a growing chorus of critics have chided Sears for failing to use its once-hefty war chest to reinvigorate its tired stores or launch a major acquisition.

Instead, most of the company’s cash has been used to pay down debt and buy back stock. At end of the fiscal year, Sears said it had about $1.6 billion in cash on hand — far less than the $3.8 billion the company had last year.

But Lampert called the company’s strategy a sound, long-term investment, while acknowledging that 2007 was a year of poor performance for the company.

“2007 set us back,” he said. “Our strategy is designed to ensure we have enough financial strength to weather whatever economic situation comes our way.”

Sears is also searching for a new chief executive, after the company ousted Aylwin B. Lewis earlier this year.

Lampert said the CEO search was progressing but offered no time table for a permanent replacement.