A letter from Eddie

Sears chairman Edward Lampert's quarterly letter to investors is being eagerly awaited, according to Financial Times, who cite the 12% drop in same-store sales in November-December, the 10%+ drop in stock price since the merger, the abandonment of the Sears Essentials format, and the departure of several key executive merchandisers. "Over the past six months, it has lost the head merchants for its clothing, electronics, and hardware departments. Luis Padilla, the chief merchandising officer who joined Sears from Target in 2004, left in October and has not yet been replaced."

The performance has dismayed some industry observers. "We don't think that the direction that Sears is headied in under its current management makes any sense from a retail perspective," says Will Anders, senior partner at McMillan Doolittle, the retail consultants. Sears, he argues, is being run as a holding company focused on its shareholders, and has lost its touch as a retailer.

So far, though, Mr Lampert has not pursued widesread store closures to realise potential real estate value that he used during Kmart's bankruptcy, or other asset sales that some Wall Street analysts had expected.