(Adds details from conference call, analyst comment, share movement)
By Nandita Bose and Siddharth Cavale
May 26 (Reuters) - Sears Holdings Corp on Thursday said it would seek partnerships or other arrangements to expand its home-improvement service business and some of its best-known brands, sending its shares up 6 percent.
Investors were cheered even though the U.S. retailer reported a bigger quarterly loss and said its chief financial officer would step down.
The company will look for deals to expand the Sears Home Services business and the unit that houses the Kenmore appliance, Craftsman tools and DieHard (KCD) vehicle battery brands beyond its Sears and Kmart stores.
"Sears has not shown any signs of improvement, but investors have been looking for ways to extract value out of the business, and the potential brand partnerships will help with that," said Neil Saunders, chief executive officer of retail consultancy Conlumino.
He said the brand partnerships could yield some additional revenue and cash, but the move could "represent the beginning of the end for Sears as it starts to sell off its family assets in a bid to ensure that it remains solvent over the medium term."
Once the largest U.S. retailer, Sears has lost its standing as customers move to online shopping or rivals such as Wal-Mart Stores Inc.
Sears has lost more than $8 billion over the last five years. The company has managed to post a quarterly profit just once in the last four years.
On a prerecorded conference call, Sears said it did not intend to borrow money to fund operating losses and expected to close unprofitable stores more aggressively. The main focus this year will be to generate positive earnings before interest, taxes, depreciation and amortization, it said.
The retailer's long-term debt increased to $3.4 billion on April 30 from $2.2 billion on Jan. 30, while cash balances rose to $286 million from $238 million.
The net loss attributable to Sears widened to $471 million, or $4.41 per share, in the first quarter ended on April 30 from $303 million, or $2.85 per share, a year earlier.
Revenue fell 8.4 percent to $5.4 billion. Sales at stores open at least a year declined 6.1 percent, mainly due to fewer mall-based locations, which traditionally attract large numbers of customers.
Sears said CFO Robert Schriesheim would leave to pursue other opportunities but would remain in his role until a replacement is found.
Shares of Sears were up 6 percent at $13.27 in morning trading. (Additional reporting by Amrutha Gayathri in Bengaluru and Nathan Layne in Chicago; Editing by Don Sebastian and Lisa Von Ahn)