...2013 EBITDA Turns Negative: EBITDA for Sears Holdings Corporation (Sears or Holdings) is expected to be negative $800 million¡negative $900 million in 2014 and potentially worse at over negative $1 billion in 2015, after turning negative $337 million in 2013. Fitch Ratings expects top-line contraction of around 10% in 2014 due to estimated domestic comparable store sales (comps) of negative 3%¡negative 5%, loss of Lands' End business (4.3% of 2013 consolidated sales), and ongoing store closings. Shrinking Assets Fund Operations: Sears has injected 2.5 billion in liquidity in 2013 and $2.0 billion in 2012 given the significant FCF shortfall. Given that Sears needs to generate a minimum EBITDA of $1 billion¡$1.1 billion in 2014 and 2015 to service interest expense, capex, and pension plan contributions, FCF is expected to be about negative $2.0 billion annually. Sears will need to fund operations with further cuts in inventory buys, asset sales, and increased borrowings, including the potential...
