This excerpt taken from the SHLD 10-Q filed May 28, 2009.
Net Income (Loss) Attributable to Holdings Shareholders and Earnings (Loss) per Share Summary
Net income attributable to Holdings shareholders for the first quarter of 2009 was $26 million ($0.21 per diluted share) as compared to a net loss attributable to Holdings shareholders of $56 million ($0.43 loss per diluted share) in the first quarter of 2008, and was affected by a number of significant items. Excluding these items, net income attributable to Holdings shareholders for the first quarter of fiscal 2009 was $47 million, or $0.38 per diluted share. Significant items affecting our first quarter 2009 results include:
As we previously reported, the Company has a legacy pension obligation for past service performed by Kmart and Sears, Roebuck and Co. associates. The annual pension expense included in our financial statements related to these legacy domestic pension plans was relatively minimal in recent years. However, due to the severe decline in the capital markets that occurred in the latter part of 2008 our domestic pension expense will increase by an estimated $160 to $175 million in 2009.
In the second quarter of 2008, we realized a gain of $62 million ($37 million after tax or $0.29 per diluted share) from the overturning of an adverse jury verdict relating to the redemption of certain Sears, Roebuck and Co. bonds in 2004. We do not expect a similar event this year; whereas, we do expect domestic pension expense to increase in the second quarter of 2009 by an amount comparable to the increase experienced in the first quarter.