US discount retailer Kmart has reported a fourth-quarter profit, the company’s first quarterly profit since emerging from bankruptcy protection last May.

Kmart posted net income of US$276m, or $2.78 per diluted share, for the fourth quarter to 28 January, compared to a year-earlier net loss of $1.1bn.

Income before interest expense, reorganisation items, income taxes and discontinued operations for the quarter was $503m, which includes gains on real estate transactions of $86m. Same-store sales and total sales for the period declined 13.5% and 25.8%, respectively.

Kmart filed for Chapter 11 bankruptcy protection in January 2002. When it emerged in May 2003, the company had a new management team, lower debt and 600 fewer stores, reported Reuters.