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Merchandising group at Sears reports profit

THE BALTIMORE SUN

Sears, Roebuck and Co. yesterday reported higher net income in the second quarter, after a deferred charge. Perhaps more significant, the retailer said its key merchandising group rebounded from a loss in the first quarter and posted a profit.

The company's net income rose 0.5 percent to $239.2 million, or 70 cents a share, after a deferred tax charge. Net had been $237.9 million, or 60 cents a share, in the corresponding part of last year. Before the $64.1 million deferred tax charge, this year's net income was up 27.5 percent, to $303.4 million.

Consolidated revenues rose 1.7 percent, to $14.09 billion, from

$13.85 billion in the same quarter last year.

The merchandising group, consisting of stores and catalog operations, is Sears' largest sales and profit contributor. It had a profit of $157 million, up 42.7 percent from $110 million in the 1990 quarter. In the first quarter of this year, the group posted a $37.4 million loss.

Analysts, noting that Sears had produced a profitable quarter despite a 2.9 percent sales decline, said that the giant Chicago-based company was making progress in reducing operating costs but still needed a more successful merchandising focus.

The company's stock rose 75 cents yesterday, closing at $38.50 on the New York Stock Exchange.

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