Sears to close 100 to 120 Kmart, Sears stores

NEW YORK (AP) — Sears Holdings Corp. plans to close between 100 and 120 Sears and Kmart stores after poor sales during the holidays, the most crucial time of year for retailers.

The closings are the latest and most visible in a long series of moves to try to fix a retailer that has struggled with falling sales and shabby stores.

In an internal memo Tuesday to employees, CEO and President Lou D'Ambrosio said that the retailer had not "generated the results we were seeking during the holiday."

Sears Holdings Corp. said it has yet to determine which stores will close but said it will post on http://www.searsmedia.com when a final list is compiled. Sears would not discuss how many, if any, jobs would be cut.

The company has more than 4,000 stores in the U.S. and Canada. Its stock dropped $8.67, or 18.9 percent, to $37.18 in morning trading. The shares dipped to their lowest point in more than three years at $36.51 during the first few minutes of trading.

The company's revenue at stores open at least a year fell 5.2 percent to date for the quarter at both Sears and Kmart, the company said Tuesday. That includes the critical holiday shopping period.

Sears Holdings said the declining sales, ongoing pressure on profit margins and rising expenses pulled its adjusted earnings lower. The company predicts fourth-quarter adjusted earnings will be less than half the $933 million it reporter for the same quarter last year.

Sears Holdings also anticipates a non-cash charge of $1.6 billion to $1.8 billion in the quarter to write off the value of carried-over tax deductions it now doesn't expect to be profitable enough to use.

Sears said it will no longer prop up "marginally performing" stores in hopes of improving their performance and will now concentrate on cash-generating stores.

"These actions will better enable us to focus our investments on serving our customers," D'Ambrosio said.

The weaker-than-expected performance reflects what analysts say is a deteriorating outlook for the retailer.

The results point to "deepening problems at this struggling chain and renewed worries about Sears survivability," said Gary Balter, an analyst at Credit Suisse. "The extent of the weakness may be larger than expected but the reasons behind it are not. It begins and some would argue ends with Sears' reluctance to invest in stores and service."

Balter also said Sears' weakening performance may lead its vendors to start to worry about their exposure.

The company has seen rival department stores like Macy's Inc. and discounters like Target Corp. continue to steal customers. It's also contending with a stronger Wal-Mart Stores Inc., the world's largest retailer, which has hammered hard its low-price message and brought back services like layaway, which allows financially stressed shoppers to finance their holiday purchases by paying a little at a time.

The tough economy hasn't helped, either. Middle-income shoppers, the company's core customers, have seen their wages fail to keep up with higher costs for household basics like food.

But the big problem, analysts say, is Sears hasn't invested in remodeling, leaving its stores uninviting.

"There's no reason to go to Sears," said New York-based independent retail analyst Brian Sozzi, "It offers a depressing shopping experience and uncompetitive prices."

Sears Holdings Corp., based in Hoffman Estates, Ill., said that the store closings will generate $140 to $170 million in cash from inventory sales. The retailer expects the sale or sublease of real estate holdings to add more cash.

Sears Holdings appeared to stumble early in the holiday season, as it opened its Sears, Roebuck and Co. stores at 4 a.m. on Black Friday, the day after Thanksgiving. Rivals including Best Buy Co., Wal-Mart Stores Inc. and Toys R Us opened as early as Thanksgiving night. Sears stores had opened on Thanksgiving Day in 2010. Kmart has been opening on Thanksgiving for years.

A hint that trouble might be brewing came in mid-December when Sears Holdings unexpectedly announced that 260 of its Sears, Roebuck and Co. locations would stay open until midnight through Dec. 23.

Kmart's 4.4 percent decline in revenue at stores open at least a year was blamed on diminished layaways and a drop in clothing and consumer electronics sales. Part of Kmart's layaway softness likely stemmed from competitive pressure. Wal-Mart had said that its holiday layaway business had been popular. Toys R Us expanded its layaway services to include more items. Kmart's grocery sales climbed during the period.

Sears cited lackluster consumer electronics and home appliance sales for its 6 percent dropoff. Sears' clothing sales were flat. Sales of Lands' End products at Sears stores rose in the mid-single digits.

Sears Holdings said it also plans to lower its fixed costs by $100 million to $200 million and trim its 2012 peak domestic inventory by $300 million from 2011's $10.2 billion at the third quarter's end.

D'Ambrosio acknowledged in his internal memo that criticism over Sears Holdings' performance was likely to come, but that the company was prepared for the days ahead.

"We will bounce back and become stronger than ever," he said.

Afghanistan, China sign first oil contract

KABUL, Afghanistan (AP) -- Afghanistan's government signed a deal Wednesday with China's state-owned National Petroleum Corporation, allowing it to become the first foreign company to exploit the country's oil and natural gas reserves.

The contract, which covers the northeastern provinces of Sari Pul and Faryab, is the first of several such blocks to be put on the market in coming months, Afghan Minister of Mines Wahidullah Shahrani said during the signing ceremony.

Bidding information for blocks in neighboring Balkh province will be released at end of February, and for the western Herat province by next summer, he said.

The ministry listed the initial value of the project with CNPC as $700 million. But the total could be ten times greater if more reserves are found and developed, and if international oil prices remain at today's levels, Shahrani said.

The fuel pact allows the Chinese firm to research oil and natural gas blocks in Sari Pul and Faryab, an area known as the Amu Darya River Basin that was first explored by Soviet engineers in the 1960s. The Soviets estimated the reserves at about 87 million barrels, but both the Afghan and Chinese partners believe they will prove to be much larger.

CNPC will also build a refinery — Afghanistan's first — within the next three years, after the real size of the reserves is established with greater accuracy, said Lu Gong Xun, president of CNPC's international branch.

Shahrani said the deal calls for the Afghan government to receive 70 percent of the profits from the sale of the oil and natural gas. CNPC will also pay 15 percent in royalties, as well as corporate taxes and rent for the land used for its operations.

Afghanistan's army and police will set up special units to guard the project, Shahrani said.

The provinces of Sari Pul and Faryab are located hundreds of miles from the centers of fighting in the east and southeast and are considered relatively safe. As a result, the U.S.-led NATO force has already transferred or is turning over responsibility for security in large parts of the region to the Afghan army and police.

Surveys conducted by the Soviets have shown that Afghanistan sits on vast mineral wealth. Afghan and foreign companies already have shown interest, notably in its untapped copper, iron and oil deposits. But with poor infrastructure and security problems stemming from the 10-year war, most Western mining companies have shied away from firm commitments.

So far, companies from China — with which Afghanistan shares a small stretch of border in its east — have been in the forefront of investments in the nation.

Three years ago the China Metallurgical Construction Co. signed a contract to develop the Aynak copper mine in Logar province. Beijing's $3.5 billion stake in the mine is the largest foreign investment in Afghanistan so far.

COLO.MAN RETURNS $10000 FOUND AT VEGAS AIR PORT

GREENWOOD VILLAGE, Colo. (AP) — A Colorado man who found $10,000 before boarding a flight in Las Vegas says he returned the money to the owner because he wanted to show his children it was "the right thing to do."

Greenwood Village resident Mitch Gilbert told KUSA-TV he found two unmarked Caesar's Palace envelopes at the airport and realized there was money inside when he arrived home. The television station reported Monday (http://goo.gl/7aqpU ) that Gilbert called the airport and eventually got in touch with a man from El Paso, Texas, who reported the money missing.

Gilbert says he deposited the money in the man's bank account two days before Christmas. The man told the television station he won the money gambling and dropped it while running to catch a flight.

Vacation Vixen: Carole Lombard

Now that, that’s sexy in any era.

MAN TRIED TO TAKE 246 ANIMAL ON PLANE

A Czech national was nabbed in Argentina for trying to board atransatlantic flight with 247 live animals including poisonous snakes and endangered reptiles packed in a bulging suitcase, reports said Monday.

The man identified as Karel Abelovsky, 51, was caught while trying to board a flight for Madrid when shocked baggage X-ray technicians and staff at the Iberia Airlines desk at Ezeiza Airport in greater Buenos Aires noticed "organic substances moving inside," local media reported.

When they opened the bag, they found more than 200 reptiles and mollusks, among them nine species of poisonous snakes including South American pitvipers, packed in clear plastic containers.

There were also 15 venomous vipers, including two yararas -- which can measure up to 1.50 meters (five feet) -- and several young boas.

Some of the animals were reported to be extremely rare and protected by the Convention on International Trade in Endangered Species.

Two of the animals were found dead and most of the others could have suffered the same fate due to a lack of oxygen if the suitcase had been placed in the plane's cargo area.

The discovery was made on December 7 but only recently came to light. A judge has charged Abelovsky with attempted smuggling, and he faces up to 10 years in prison if convicted.

Researchers suspect that an exotic species smuggling ring was behind the trafficking attempt.

POLICE NEIGHBOR CHOPPED UP AS GIRL WITH HACKSAW

FORT WAYNE, Ind. (AP) — A babysitter and trusted neighbor has confessed that he bludgeoned a 9-year-old Indiana girl to death with a brick then dismembered her, hiding her head, hands and feet at his home and dumping the rest of her remains nearby, police said Tuesday.

Allen County sheriff's investigators said in an affidavit that 39-year-old Michael Plumadore admits he killed Aliahna Lemmon on Thursday.

According to the affidavit, Plumadore told police that after beating Aliahna to death, he stuffed her body into trash bags and hid her in the freezer at his home in a rundown trailer park in Fort Wayne. He said he later chopped up her body and stuffed her remains into freezer bags.

Police said Plumadore told them he had hidden Aliahna's head, feet and hands at his trailer and discarded her other remains at a nearby business. Police obtained a warrant to search his trailer on Monday and found the body parts.

The affidavit does not provide details about why Plumadore killed the child.

A judge ordered Plumadore held without bail or bond at an initial hearing Tuesday, sheriff's department spokesman Cpl. Jeremy Tinkel said. He has yet to be formally charged in Aliahna's death.

Aliahna and her two younger sisters were staying with Plumadore because their mother had been sick with the flu.

Plumadore told The Journal Gazette on Sunday that Aliahna disappeared from his home Friday morning while he was sleeping after having gone to a gas station about a mile (1.6 kilometers) away to buy a cigar. Authorities have said the store's surveillance video shows him there about that time.

Aliahna wasn't reported missing until Friday night. Plumadore said the younger girls told him their mother had picked her up and he didn't realize until hours later that this wasn't true.

On Saturday, more than 100 emergency workers searched for Aliahna around the trailer park on the city's north side where Aliahna and Plumadore lived. FBI agents were there Monday.

A state website shows that 15 registered sex offenders live in the park that numbers about two dozen homes. Plumadore is not on Indiana's registered sex offenders list. He has a criminal record in Florida and North Carolina that includes convictions for trespassing and assault.

The girl's relatives told the newspaper that Plumadore had cared for Aliahna's ailing grandfather until his death early this month and was living in her grandfather's mobile home.

"He was a trusted family friend," Aliahna's step-grandfather, David Story, told The Associated Press late Monday, saying he was surprised by the arrest.

Sheriff Ken Fries said investigators questioned Plumadore on Friday and Saturday and that he was arrested Monday after being interviewed by detectives for several hours more.

Vacation Vixen: Julianne Moore

I know it’s pretty un-PETA of me, but I just love the way skin looks against leather.