Local Kmart will lay off 52 employees

Officials said the Kmart store located at 2960 Derr Road in Springfield has announced that it will lay off 52 employees and close in April.

In December, the retailer, which operates both Sears and Kmart stores, announced plans to shutter up to 120 locations after a sharp drop in sales during the holiday season.

Kmart's Upper Valley Pike location will remain open.

While the closures represent a fraction of the total stores, Sears has underscored the retailer's precarious financial position. The company, which has been slow to renovate rundown stores and improve customer service, expects earnings to fall by more than 50 percent in the fourth quarter, far worse than expected.

"They're not going out of business tomorrow. But here is a company that is deteriorating in front of our eyes, and it could cost a lot of jobs," said Gary Balter, an analyst at Credit Suisse. "Somebody should be worried about that."

Sears has struggled for years. In 2005, hedge fund manager Edward S. Lampert pushed the storied retailer to merge with Kmart, figuring that the combination would wrench savings and bolster profits. His bet drew comparisons to the strategy of Warren E. Buffett, the chairman of Berkshire Hathaway, who takes concentrated positions in companies that he believes will increase in value and generate cash.

Sears Holdings was thought to be something of a Berkshire vehicle - a public entity through which to acquire businesses.

But the merger has been an albatross for Lampert, who is chairman of Sears. Since their 2007 peak, shares in Sears had dropped from $192 to less than $46 in December. 

The New York Times contributed to this report.