Sears Reports First-Quarter 2001 Net Income Of $176 Million

Apr 19, 2001, 01:00 ET from Sears, Roebuck & Co.

    HOFFMAN ESTATES, Ill., April 19 /PRNewswire/ -- Sears, Roebuck and Co.
 (NYSE:   S) reported first-quarter 2001 net income of $176 million or $0.53 per
 share, compared with 2000 first-quarter net income of $235 million or $0.65
 per share, a decrease of 18.5 percent on a per share basis.  Revenues for the
 quarter were $8.86 billion compared with $8.93 billion in the first quarter of
 last year.
     "In the first quarter, the credit business performed in line with
 expectations, reflecting continued strong portfolio quality," said Chairman
 and Chief Executive Officer Alan J. Lacy. "However, this was another difficult
 quarter for the retail industry.  Our domestic and Canadian retail businesses
 performed below the company's expectations, with comparable store sales
 declines in both domestic and Canadian stores.  In addition, pressure on
 margins and higher Canadian expenses also contributed to lower earnings."
 
     Retail and Related Services
     Retail and Related Services revenues for the first quarter of 2001 of
 $6.81 billion were slightly below last year's first quarter revenues of
 $6.83 billion.  Sales increases at The Great Indoors, Sears online business,
 and hardware stores were offset by declines in full-line stores, commercial
 sales and automotive stores.  "The slowing economy and colder than anticipated
 weather had an impact on both our hardlines and softlines businesses, as well
 as our specialty formats," said Lacy.  "In hardlines, we experienced strong
 growth in electronics, home appliances and sporting goods, offset by
 significant decreases in lawn and garden sales.  In softlines, sales increases
 in home fashions and fine jewelry were offset by lower than anticipated
 results among the other softlines categories."
     Retail and Related Services gross margin rate declined by 70 basis points
 to 24.3%, reflecting increased promotional markdowns particularly in softlines
 as well as a balance of sale shift to hardlines products.  Selling and
 administrative spending increased by 1.9 percent versus last year's quarter
 partly due to investments in The Great Indoors.  As a percent of revenue,
 selling and administrative expenses were 50 basis points higher than last
 year's first quarter.
     Retail and Related Services posted an operating loss of $56 million as
 compared with operating income of $21 million in the prior year period.  The
 $77 million decline is primarily due to lower than anticipated revenues and
 pressures on margins and expenses as well as investment in The Great Indoors.
 
     Credit and Financial Products
     First-quarter domestic credit and financial products revenues declined
 7.6 percent from a year ago, to $1.03 billion.  This decline is primarily due
 to a $1.7 billion reduction in average on-book owned credit card receivables.
 Revenues on the managed portfolio also declined.  While average and ending
 managed credit card receivable balances were slightly higher than last year,
 overall portfolio yield declined.
     Lower operating expenses and a lower provision for uncollectible accounts
 largely offset the revenue decline.  The continued strength of the receivables
 portfolio is reflected in the $54 million reduction in net charge-offs and
 related provision expense for on-book receivables.  The net charge-off rate
 for the managed portfolio declined to 5.07% from 5.69% a year ago.  Interest
 expense and funding rate were relatively flat with last year's quarter.
     The domestic allowance for uncollectible accounts decreased to
 $567 million from $649 million at year-end 2000.  The $82 million decrease is
 related to $2.0 billion of receivables transferred to the securitization
 Master Trust in the first quarter of 2001.  Apart from the effect related to
 the $2.0 billion securitization, the allowance is unchanged from year-end
 2000.  As previously announced, the company will record a one-time non-cash
 pretax charge of approximately $520 million in the second quarter to re-
 establish an allowance for uncollectible accounts related to approximately
 $12 billion of previously securitized receivables.
     Reported operating income from credit and financial products declined by
 $9 million or 2.2 percent.  First-quarter 2001 operating income includes
 $40 million of securitization income or 8 cents per share as compared with
 $19 million or 3 cents per share in the first quarter of 2000.
 
     Sears Canada
     Sears Canada revenue increased 2.6 percent to $942 million in the first
 quarter of 2001.   The increase primarily reflects new store openings in 2000,
 as comparable store sales declined by 0.6%.  This comparison with last year's
 quarter was also adversely affected by a nearly 5 percent decline in the value
 of the Canadian dollar relative to the U.S. dollar.
     The segment reported an operating loss of $10 million, a $28 million
 decline from last year's quarter.  The decline is primarily due to higher
 selling and administrative spending to support stores opened in 2000,
 particularly the Eatons banner stores.  These increases were partly offset by
 the absence of spending on Eaton's integration.
 
     Corporate and Other
     Revenues from the home services businesses included in the Corporate and
 Other segment increased by almost 17 percent while profits improved by
 $6 million.  Corporate headquarters spending was even with last year's quarter
 due to the company's ongoing focus on productivity.  The company repurchased
 4.3 million shares of Sears common stock during the quarter at a cost of
 $168 million.
 
     Outlook
     "The trends seen in the first quarter are likely to continue through the
 second quarter," said Lacy.  "We are projecting a high-single to low-double
 digit percentage decline in second-quarter earnings per share excluding non-
 comparable items and securitization income.  We are more optimistic about the
 second half and are forecasting full-year earnings per share to be in line
 with last year excluding noncomparable items and net securitization income."
     Statements contained under the "Outlook" heading of this release are
 forward looking statements, based on assumptions about the future, which are
 subject to risks and uncertainties, such as competitive conditions in retail,
 changes in consumer confidence, changes in interest rates, delinquency and
 charge-off trends in the credit card receivables portfolio, the pace of
 development of new sites for The Great Indoors, consumer acceptance and use of
 the Sears Gold MasterCard, and normal business uncertainty.  In addition,
 Sears typically earns a disproportionate share of its operating income in the
 fourth quarter due to seasonal buying patterns, which are difficult to
 forecast with certainty.  The company believes its forward looking statements
 are reasonable but cautions that actual results could differ materially.  The
 company intends these forward looking statements to speak only at the time of
 this release and does not undertake to revise or confirm them as more
 information becomes available.
     Sears, Roebuck and Co. is a leading U.S. retailer of apparel, home and
 automotive products and services, with annual revenue of more than
 $40 billion.  The company serves families across the country through
 approximately 860 full-line department stores, approximately 2,100 specialized
 retail locations, and a variety of online offerings accessible through the
 company's Web site, sears.com.  Sears, Roebuck and Co. is the majority owner
 of Sears Canada Inc.
 
 
     SEARS, ROEBUCK AND CO.
     CONSOLIDATED INCOME
 
                                                For the 13 Weeks Ended
                                           March 31, 2001 and April 1, 2000
     (millions, except earnings per share)     2001       2000       % Change
 
      Revenues
        Merchandise sales and services        $7,754      $7,738        0.2%
        Credit and financial products
         revenues                              1,103       1,187       -7.1%
           Total revenues                      8,857       8,925       -0.8%
 
      Costs and expenses
        Cost of sales, buying and occupancy    5,836       5,783        0.9%
        Selling and administrative             2,031       1,989        2.1%
        Depreciation and amortization            215         212        1.4%
        Provision for uncollectible accounts     191         245      -22.0%
        Interest                                 312         316       -1.3%
           Total costs and expenses            8,585       8,545        0.5%
 
      Operating income                           272         380      -28.4%
      Other income, net                            1           1          -
 
      Income before income taxes and
       minority interest                         273         381      -28.3%
 
      Income taxes                               (98)       (140)     -30.0%
 
      Minority interest                            1          (6)         -
 
      Net income                                $176        $235      -25.1%
 
 
      Earnings per share:
        Basic                                  $0.53       $0.65      -18.5%
        Diluted                                $0.53       $0.65      -18.5%
 
      Average common and dilutive common
       equivalent shares outstanding           333.5       360.0
 
 
 
 
     SEARS, ROEBUCK AND CO.
     CONSOLIDATED BALANCE SHEET
 
           (millions)
                                            March 31,    April 1,     Dec. 30,
                                              2001         2000         2000
           Assets
            Current Assets
             Cash and cash equivalents         $510         $449         $842
             Retained interest in
              transferred credit card
              receivables                     3,863        3,036        3,105
             Credit card receivables,
              net                            14,730       17,049       17,317
             Other receivables                  459          299          506
             Merchandise inventories          6,019        5,738        5,618
             Prepaid expenses and
              deferred charges                  623          553          486
             Deferred income taxes              981          716          920
              Total current assets           27,185       27,840       28,794
 
            Property and equipment, net       6,499        6,361        6,653
            Deferred income taxes               255          302          174
            Other assets                        967        1,463        1,278
              Total assets                  $34,906      $35,966      $36,899
 
           Liabilities
            Current liabilities
             Short-term borrowings           $3,412       $3,027       $4,280
             Current portion of long-
              term debt and capitalized
              leases                          2,313        2,444        2,560
             Accounts payable and other
              liabilities                     6,311        6,443        7,336
             Unearned revenues                1,079        1,007        1,058
             Other taxes                        446          420          562
              Total current liabilities      13,561       13,341       15,796
 
            Long-term debt and
             capitalized leases              11,623       12,614       11,020
            Postretirement benefits           1,913        2,135        1,951
            Minority interest and other
             liabilities                      1,362        1,362        1,363
              Total liabilities              28,459       29,452       30,130
 
           Commitments and Contingent
            Liabilities
 
           Shareholders' Equity
            Common shares                       323          323          323
            Capital in excess of par
             value                            3,528        3,549        3,538
            Retained income                   7,079        6,105        6,979
            Treasury stock - at cost         (3,862)      (3,053)      (3,726)
            Deferred ESOP expense               (85)        (126)         (96)
            Accumulated other
             comprehensive loss                (536)        (284)        (249)
              Total shareholders'
               equity                         6,447        6,514        6,769
 
              Total liabilities and
               shareholders' equity         $34,906      $35,966      $36,899
 
              Total common shares
               outstanding                    329.8        352.6        333.2
 
 
     SEARS, ROEBUCK AND CO.
     SUPPLEMENTAL INFORMATION
 
     (millions, except number of stores)
                                              For the 13 Weeks Ended
                                         March 31, 2001 and April 1, 2000
 
                              Retail and Related Services   Corporate and Other
     (millions, except number
      of stores)                 2001    2000   % Change   2001  2000  % Change
 
     Total Revenues            $6,806  $6,826     -0.3%    $84    $72  16.7%
 
     Costs and expenses
        Cost of sales, buying
         and occupancy          5,153   5,121      0.6%     37     33  12.1%
        Selling and
         administrative         1,530   1,502      1.9%    100    100   0.0%
        Depreciation and
         amortization             176     179     -1.7%     14     12  16.7%
        Interest                    3       3      0.0%      -      -     -
               Total costs and
                expenses        6,862   6,805      0.8%    151    145   4.1%
 
     Operating income            $(56)    $21       -     $(67)  $(73)  8.2%
 
 
                                 Credit and Financial
                                       Products              Sears Canada
     (millions)                  2001    2000   % Change  2001   2000  % Change
 
     Total Revenues            $1,025  $1,109     -7.6%   $942   $918   2.6%
 
     Costs and expenses
        Cost of sales, buying
         and occupancy            -       -         -      646    629   2.7%
        Selling and
         administrative           155     170     -8.8%    246    217  13.4%
        Depreciation and
         amortization               5       4     25.0%     20     17  17.6%
        Provision for
         uncollectible
         accounts                 181     235    -23.0%     10     10   0.0%
        Interest                  279     286     -2.4%     30     27  11.1%
               Total costs and
                expenses          620     695    -10.8%    952    900   5.8%
 
     Operating income            $405    $414     -2.2%   $(10)   $18    -
 
 
                                      March 31,  April 1,
                                        2001      2000
 
        Domestic inventories  -LIFO    $5,328    $5,102
                              -FIFO    $5,906    $5,710
 
 
                                    For the 13 Weeks Ended
                               March 31, 2001 and April 1, 2000
 
        Pretax LIFO charge                $12       $12
 
 
 
                                    December 30,              March 31,
        Domestic retail
         stores:                         2000    Opened  Closed  2001
 
          Full-line stores                863         1     (4)   860
          Specialty formats             2,158         6    (37) 2,127
                  Total                 3,021         7    (41) 2,987
 
          Gross square feet             147.3       0.1   (1.4) 146.0
 
 
 
     SEARS, ROEBUCK AND CO.
     SUPPLEMENTAL INFORMATION - DOMESTIC CREDIT CARD RECEIVABLES
     (millions)
 
     The following credit information relates to the domestic managed
     portfolio of credit card receivables which is comprised of on-book
     credit card receivables, credit card receivables underlying retained
     interest securities and securities which have been sold to third parties.
     The effective financing rate is based on both domestic on-book debt of
     the company and securitization interest of the Sears Master Trust.
 
 
                                     For the 13 Weeks ended
                                March 31, 2001 and April 1, 2000
                                         2001         2000
     Average domestic credit card
      receivables:
        Managed credit card
         receivables                   $26,340       $26,094
        Securitized balances sold       (7,816)       (6,443)
        Retained interest in
         transferred
          credit card receivables       (3,638)       (3,106)
        Owned credit card
         receivables                   $14,886       $16,545
 
 
                                       March 31,     April 1,
                                          2001         2000
     Ending domestic credit card
      receivables:
        Managed credit card
         receivables                   $25,699       $25,451
        Securitized balances sold       (8,143)       (6,301)
        Retained interest in
         transferred
          credit card receivables       (3,863)       (3,036)
        Other receivables                   95           107
        Owned credit card
         receivables                   $13,788       $16,221
 
 
                                        For the 13 Weeks ended
                                  March 31, 2001 and April 1, 2000
     Domestic managed credit card
      receivables-                       2001          2000
     Net interest margin:
     Portfolio yield                    19.13%        20.29%
     Effective financing rate            6.06%         5.93%
     Net interest margin                13.07%        14.36%
 
     Domestic managed net charge-
      off rate                           5.07%         5.69%
 
                                         2001                    2000
                                   Mar. 31, Dec. 30, Sep. 30,  July 1,  Apr. 1,
                                     2001     2000     2000     2000     2000
 
     Domestic managed credit card
      receivables-
     Delinquency rate               7.50%     7.56%    7.47%   7.15%    7.20%
 
     Allowance for uncollectible
      accounts                       $567      $649     $624    $725     $725
 
     Allowance % of domestic
      owned credit card receivables  4.14%     4.03%    4.18%   4.46%    4.48%
 
 
 
     SEARS, ROEBUCK AND CO.
     SECURITIZATION ACCOUNTING
     QUARTERLY IMPACT INCLUDED IN REPORTED RESULTS
 
     Note: Adding numbers shown below to reported results eliminates the impact
     of securitization accounting included in the previously reported results.
     (millions)
 
 
                                         Qtr 1   Qtr 2   Qtr 3  Qtr 4
     Quarter ended March 31, 2001        2001    2001    2001    2001  2001 YTD
 
     Total revenues                       $275      $-      $-      $-    $275
 
       Selling and administrative           39       0       0       0      39
       Provision for uncollectible
        accounts                           153       0       0       0     153
       Interest                            123       0       0       0     123
               Total costs and expenses    315       0       0       0     315
 
     Operating income                      (40)      0       0       0     (40)
 
     Net income                           $(26)     $-      $-      $-    $(26)
 
     EPS - Diluted
       Reported                         $(0.08)     $-      $-      $-   (0.08)
       Excluding non-comp items         $(0.08)     $-      $-      $-   (0.08)
        shares o/s                       333.5       -       -       -   333.5
 
 
     Year Ended December 30, 2000        Qtr 1   Qtr 2   Qtr 3   Qtr 4
                                         2000    2000    2000    2000  2000 YTD
 
     Total revenues                       $252    $212    $255    $250    $969
 
       Selling and administrative           32      32      34      37     135
       Provision for uncollectible
        accounts                           136     115     137     134     522
       Interest                            103     102     110     125     440
               Total costs and expenses    271     249     281     296   1,097
 
     Operating income                      (19)    (37)    (26)    (46)   (128)
 
     Net income                           $(12)   $(23)   $(17)   $(30)   $(82)
 
     EPS - Diluted
       Reported                         $(0.03) $(0.06) $(0.05) $(0.09) $(0.24)
       Excluding non-comp items         $(0.03) $(0.06) $(0.05) $(0.09) $(0.24)
        shares o/s                       360.0   348.4   341.8   334.9   346.3
 
 
 

SOURCE Sears, Roebuck & Co.
    HOFFMAN ESTATES, Ill., April 19 /PRNewswire/ -- Sears, Roebuck and Co.
 (NYSE:   S) reported first-quarter 2001 net income of $176 million or $0.53 per
 share, compared with 2000 first-quarter net income of $235 million or $0.65
 per share, a decrease of 18.5 percent on a per share basis.  Revenues for the
 quarter were $8.86 billion compared with $8.93 billion in the first quarter of
 last year.
     "In the first quarter, the credit business performed in line with
 expectations, reflecting continued strong portfolio quality," said Chairman
 and Chief Executive Officer Alan J. Lacy. "However, this was another difficult
 quarter for the retail industry.  Our domestic and Canadian retail businesses
 performed below the company's expectations, with comparable store sales
 declines in both domestic and Canadian stores.  In addition, pressure on
 margins and higher Canadian expenses also contributed to lower earnings."
 
     Retail and Related Services
     Retail and Related Services revenues for the first quarter of 2001 of
 $6.81 billion were slightly below last year's first quarter revenues of
 $6.83 billion.  Sales increases at The Great Indoors, Sears online business,
 and hardware stores were offset by declines in full-line stores, commercial
 sales and automotive stores.  "The slowing economy and colder than anticipated
 weather had an impact on both our hardlines and softlines businesses, as well
 as our specialty formats," said Lacy.  "In hardlines, we experienced strong
 growth in electronics, home appliances and sporting goods, offset by
 significant decreases in lawn and garden sales.  In softlines, sales increases
 in home fashions and fine jewelry were offset by lower than anticipated
 results among the other softlines categories."
     Retail and Related Services gross margin rate declined by 70 basis points
 to 24.3%, reflecting increased promotional markdowns particularly in softlines
 as well as a balance of sale shift to hardlines products.  Selling and
 administrative spending increased by 1.9 percent versus last year's quarter
 partly due to investments in The Great Indoors.  As a percent of revenue,
 selling and administrative expenses were 50 basis points higher than last
 year's first quarter.
     Retail and Related Services posted an operating loss of $56 million as
 compared with operating income of $21 million in the prior year period.  The
 $77 million decline is primarily due to lower than anticipated revenues and
 pressures on margins and expenses as well as investment in The Great Indoors.
 
     Credit and Financial Products
     First-quarter domestic credit and financial products revenues declined
 7.6 percent from a year ago, to $1.03 billion.  This decline is primarily due
 to a $1.7 billion reduction in average on-book owned credit card receivables.
 Revenues on the managed portfolio also declined.  While average and ending
 managed credit card receivable balances were slightly higher than last year,
 overall portfolio yield declined.
     Lower operating expenses and a lower provision for uncollectible accounts
 largely offset the revenue decline.  The continued strength of the receivables
 portfolio is reflected in the $54 million reduction in net charge-offs and
 related provision expense for on-book receivables.  The net charge-off rate
 for the managed portfolio declined to 5.07% from 5.69% a year ago.  Interest
 expense and funding rate were relatively flat with last year's quarter.
     The domestic allowance for uncollectible accounts decreased to
 $567 million from $649 million at year-end 2000.  The $82 million decrease is
 related to $2.0 billion of receivables transferred to the securitization
 Master Trust in the first quarter of 2001.  Apart from the effect related to
 the $2.0 billion securitization, the allowance is unchanged from year-end
 2000.  As previously announced, the company will record a one-time non-cash
 pretax charge of approximately $520 million in the second quarter to re-
 establish an allowance for uncollectible accounts related to approximately
 $12 billion of previously securitized receivables.
     Reported operating income from credit and financial products declined by
 $9 million or 2.2 percent.  First-quarter 2001 operating income includes
 $40 million of securitization income or 8 cents per share as compared with
 $19 million or 3 cents per share in the first quarter of 2000.
 
     Sears Canada
     Sears Canada revenue increased 2.6 percent to $942 million in the first
 quarter of 2001.   The increase primarily reflects new store openings in 2000,
 as comparable store sales declined by 0.6%.  This comparison with last year's
 quarter was also adversely affected by a nearly 5 percent decline in the value
 of the Canadian dollar relative to the U.S. dollar.
     The segment reported an operating loss of $10 million, a $28 million
 decline from last year's quarter.  The decline is primarily due to higher
 selling and administrative spending to support stores opened in 2000,
 particularly the Eatons banner stores.  These increases were partly offset by
 the absence of spending on Eaton's integration.
 
     Corporate and Other
     Revenues from the home services businesses included in the Corporate and
 Other segment increased by almost 17 percent while profits improved by
 $6 million.  Corporate headquarters spending was even with last year's quarter
 due to the company's ongoing focus on productivity.  The company repurchased
 4.3 million shares of Sears common stock during the quarter at a cost of
 $168 million.
 
     Outlook
     "The trends seen in the first quarter are likely to continue through the
 second quarter," said Lacy.  "We are projecting a high-single to low-double
 digit percentage decline in second-quarter earnings per share excluding non-
 comparable items and securitization income.  We are more optimistic about the
 second half and are forecasting full-year earnings per share to be in line
 with last year excluding noncomparable items and net securitization income."
     Statements contained under the "Outlook" heading of this release are
 forward looking statements, based on assumptions about the future, which are
 subject to risks and uncertainties, such as competitive conditions in retail,
 changes in consumer confidence, changes in interest rates, delinquency and
 charge-off trends in the credit card receivables portfolio, the pace of
 development of new sites for The Great Indoors, consumer acceptance and use of
 the Sears Gold MasterCard, and normal business uncertainty.  In addition,
 Sears typically earns a disproportionate share of its operating income in the
 fourth quarter due to seasonal buying patterns, which are difficult to
 forecast with certainty.  The company believes its forward looking statements
 are reasonable but cautions that actual results could differ materially.  The
 company intends these forward looking statements to speak only at the time of
 this release and does not undertake to revise or confirm them as more
 information becomes available.
     Sears, Roebuck and Co. is a leading U.S. retailer of apparel, home and
 automotive products and services, with annual revenue of more than
 $40 billion.  The company serves families across the country through
 approximately 860 full-line department stores, approximately 2,100 specialized
 retail locations, and a variety of online offerings accessible through the
 company's Web site, sears.com.  Sears, Roebuck and Co. is the majority owner
 of Sears Canada Inc.
 
 
     SEARS, ROEBUCK AND CO.
     CONSOLIDATED INCOME
 
                                                For the 13 Weeks Ended
                                           March 31, 2001 and April 1, 2000
     (millions, except earnings per share)     2001       2000       % Change
 
      Revenues
        Merchandise sales and services        $7,754      $7,738        0.2%
        Credit and financial products
         revenues                              1,103       1,187       -7.1%
           Total revenues                      8,857       8,925       -0.8%
 
      Costs and expenses
        Cost of sales, buying and occupancy    5,836       5,783        0.9%
        Selling and administrative             2,031       1,989        2.1%
        Depreciation and amortization            215         212        1.4%
        Provision for uncollectible accounts     191         245      -22.0%
        Interest                                 312         316       -1.3%
           Total costs and expenses            8,585       8,545        0.5%
 
      Operating income                           272         380      -28.4%
      Other income, net                            1           1          -
 
      Income before income taxes and
       minority interest                         273         381      -28.3%
 
      Income taxes                               (98)       (140)     -30.0%
 
      Minority interest                            1          (6)         -
 
      Net income                                $176        $235      -25.1%
 
 
      Earnings per share:
        Basic                                  $0.53       $0.65      -18.5%
        Diluted                                $0.53       $0.65      -18.5%
 
      Average common and dilutive common
       equivalent shares outstanding           333.5       360.0
 
 
 
 
     SEARS, ROEBUCK AND CO.
     CONSOLIDATED BALANCE SHEET
 
           (millions)
                                            March 31,    April 1,     Dec. 30,
                                              2001         2000         2000
           Assets
            Current Assets
             Cash and cash equivalents         $510         $449         $842
             Retained interest in
              transferred credit card
              receivables                     3,863        3,036        3,105
             Credit card receivables,
              net                            14,730       17,049       17,317
             Other receivables                  459          299          506
             Merchandise inventories          6,019        5,738        5,618
             Prepaid expenses and
              deferred charges                  623          553          486
             Deferred income taxes              981          716          920
              Total current assets           27,185       27,840       28,794
 
            Property and equipment, net       6,499        6,361        6,653
            Deferred income taxes               255          302          174
            Other assets                        967        1,463        1,278
              Total assets                  $34,906      $35,966      $36,899
 
           Liabilities
            Current liabilities
             Short-term borrowings           $3,412       $3,027       $4,280
             Current portion of long-
              term debt and capitalized
              leases                          2,313        2,444        2,560
             Accounts payable and other
              liabilities                     6,311        6,443        7,336
             Unearned revenues                1,079        1,007        1,058
             Other taxes                        446          420          562
              Total current liabilities      13,561       13,341       15,796
 
            Long-term debt and
             capitalized leases              11,623       12,614       11,020
            Postretirement benefits           1,913        2,135        1,951
            Minority interest and other
             liabilities                      1,362        1,362        1,363
              Total liabilities              28,459       29,452       30,130
 
           Commitments and Contingent
            Liabilities
 
           Shareholders' Equity
            Common shares                       323          323          323
            Capital in excess of par
             value                            3,528        3,549        3,538
            Retained income                   7,079        6,105        6,979
            Treasury stock - at cost         (3,862)      (3,053)      (3,726)
            Deferred ESOP expense               (85)        (126)         (96)
            Accumulated other
             comprehensive loss                (536)        (284)        (249)
              Total shareholders'
               equity                         6,447        6,514        6,769
 
              Total liabilities and
               shareholders' equity         $34,906      $35,966      $36,899
 
              Total common shares
               outstanding                    329.8        352.6        333.2
 
 
     SEARS, ROEBUCK AND CO.
     SUPPLEMENTAL INFORMATION
 
     (millions, except number of stores)
                                              For the 13 Weeks Ended
                                         March 31, 2001 and April 1, 2000
 
                              Retail and Related Services   Corporate and Other
     (millions, except number
      of stores)                 2001    2000   % Change   2001  2000  % Change
 
     Total Revenues            $6,806  $6,826     -0.3%    $84    $72  16.7%
 
     Costs and expenses
        Cost of sales, buying
         and occupancy          5,153   5,121      0.6%     37     33  12.1%
        Selling and
         administrative         1,530   1,502      1.9%    100    100   0.0%
        Depreciation and
         amortization             176     179     -1.7%     14     12  16.7%
        Interest                    3       3      0.0%      -      -     -
               Total costs and
                expenses        6,862   6,805      0.8%    151    145   4.1%
 
     Operating income            $(56)    $21       -     $(67)  $(73)  8.2%
 
 
                                 Credit and Financial
                                       Products              Sears Canada
     (millions)                  2001    2000   % Change  2001   2000  % Change
 
     Total Revenues            $1,025  $1,109     -7.6%   $942   $918   2.6%
 
     Costs and expenses
        Cost of sales, buying
         and occupancy            -       -         -      646    629   2.7%
        Selling and
         administrative           155     170     -8.8%    246    217  13.4%
        Depreciation and
         amortization               5       4     25.0%     20     17  17.6%
        Provision for
         uncollectible
         accounts                 181     235    -23.0%     10     10   0.0%
        Interest                  279     286     -2.4%     30     27  11.1%
               Total costs and
                expenses          620     695    -10.8%    952    900   5.8%
 
     Operating income            $405    $414     -2.2%   $(10)   $18    -
 
 
                                      March 31,  April 1,
                                        2001      2000
 
        Domestic inventories  -LIFO    $5,328    $5,102
                              -FIFO    $5,906    $5,710
 
 
                                    For the 13 Weeks Ended
                               March 31, 2001 and April 1, 2000
 
        Pretax LIFO charge                $12       $12
 
 
 
                                    December 30,              March 31,
        Domestic retail
         stores:                         2000    Opened  Closed  2001
 
          Full-line stores                863         1     (4)   860
          Specialty formats             2,158         6    (37) 2,127
                  Total                 3,021         7    (41) 2,987
 
          Gross square feet             147.3       0.1   (1.4) 146.0
 
 
 
     SEARS, ROEBUCK AND CO.
     SUPPLEMENTAL INFORMATION - DOMESTIC CREDIT CARD RECEIVABLES
     (millions)
 
     The following credit information relates to the domestic managed
     portfolio of credit card receivables which is comprised of on-book
     credit card receivables, credit card receivables underlying retained
     interest securities and securities which have been sold to third parties.
     The effective financing rate is based on both domestic on-book debt of
     the company and securitization interest of the Sears Master Trust.
 
 
                                     For the 13 Weeks ended
                                March 31, 2001 and April 1, 2000
                                         2001         2000
     Average domestic credit card
      receivables:
        Managed credit card
         receivables                   $26,340       $26,094
        Securitized balances sold       (7,816)       (6,443)
        Retained interest in
         transferred
          credit card receivables       (3,638)       (3,106)
        Owned credit card
         receivables                   $14,886       $16,545
 
 
                                       March 31,     April 1,
                                          2001         2000
     Ending domestic credit card
      receivables:
        Managed credit card
         receivables                   $25,699       $25,451
        Securitized balances sold       (8,143)       (6,301)
        Retained interest in
         transferred
          credit card receivables       (3,863)       (3,036)
        Other receivables                   95           107
        Owned credit card
         receivables                   $13,788       $16,221
 
 
                                        For the 13 Weeks ended
                                  March 31, 2001 and April 1, 2000
     Domestic managed credit card
      receivables-                       2001          2000
     Net interest margin:
     Portfolio yield                    19.13%        20.29%
     Effective financing rate            6.06%         5.93%
     Net interest margin                13.07%        14.36%
 
     Domestic managed net charge-
      off rate                           5.07%         5.69%
 
                                         2001                    2000
                                   Mar. 31, Dec. 30, Sep. 30,  July 1,  Apr. 1,
                                     2001     2000     2000     2000     2000
 
     Domestic managed credit card
      receivables-
     Delinquency rate               7.50%     7.56%    7.47%   7.15%    7.20%
 
     Allowance for uncollectible
      accounts                       $567      $649     $624    $725     $725
 
     Allowance % of domestic
      owned credit card receivables  4.14%     4.03%    4.18%   4.46%    4.48%
 
 
 
     SEARS, ROEBUCK AND CO.
     SECURITIZATION ACCOUNTING
     QUARTERLY IMPACT INCLUDED IN REPORTED RESULTS
 
     Note: Adding numbers shown below to reported results eliminates the impact
     of securitization accounting included in the previously reported results.
     (millions)
 
 
                                         Qtr 1   Qtr 2   Qtr 3  Qtr 4
     Quarter ended March 31, 2001        2001    2001    2001    2001  2001 YTD
 
     Total revenues                       $275      $-      $-      $-    $275
 
       Selling and administrative           39       0       0       0      39
       Provision for uncollectible
        accounts                           153       0       0       0     153
       Interest                            123       0       0       0     123
               Total costs and expenses    315       0       0       0     315
 
     Operating income                      (40)      0       0       0     (40)
 
     Net income                           $(26)     $-      $-      $-    $(26)
 
     EPS - Diluted
       Reported                         $(0.08)     $-      $-      $-   (0.08)
       Excluding non-comp items         $(0.08)     $-      $-      $-   (0.08)
        shares o/s                       333.5       -       -       -   333.5
 
 
     Year Ended December 30, 2000        Qtr 1   Qtr 2   Qtr 3   Qtr 4
                                         2000    2000    2000    2000  2000 YTD
 
     Total revenues                       $252    $212    $255    $250    $969
 
       Selling and administrative           32      32      34      37     135
       Provision for uncollectible
        accounts                           136     115     137     134     522
       Interest                            103     102     110     125     440
               Total costs and expenses    271     249     281     296   1,097
 
     Operating income                      (19)    (37)    (26)    (46)   (128)
 
     Net income                           $(12)   $(23)   $(17)   $(30)   $(82)
 
     EPS - Diluted
       Reported                         $(0.03) $(0.06) $(0.05) $(0.09) $(0.24)
       Excluding non-comp items         $(0.03) $(0.06) $(0.05) $(0.09) $(0.24)
        shares o/s                       360.0   348.4   341.8   334.9   346.3
 
 
 SOURCE  Sears, Roebuck & Co.