Sears New Release

Sears Updates Segment Reporting; Adopts New Accounting Standard

Resulting In One-Time Non-Cash Charge Of $520 Million In Second Quarter

HOFFMAN ESTATES, Ill., April 12 /PRNewswire/ -- Sears, Roebuck and Co.

(NYSE: S) announced total domestic store revenues for the five weeks ending

April 7, 2001 were $2.56 billion. Comparable domestic store revenues

decreased 5.3 percent. Total domestic store revenues decreased 5.1 percent

compared with $2.7 billion for the five weeks ending April 8, 2000.

"March retail sales fell below expectations, with the slowing economy and

colder than anticipated weather having an impact on both our hardlines and

softlines businesses," said Chairman and Chief Executive Officer Alan J. Lacy.

"Weather-related seasonal apparel and lawn and garden merchandise accounted

for over one-third of the comparable store sales decline. Among the better

performing businesses was Home Appliances, which continues to gain market

share. The Great Indoors format and sporting goods businesses also performed

well."

Sears, Roebuck and Co.

5 Weeks 9 Weeks

2001 Domestic Store Revenues $2,563,400,000 4,530,800,000

2000 Domestic Store Revenues 2,701,000,000 4,697,600,000

Percent Change (5.1)% (3.6)%

Comparable Domestic Stores Percent Change (5.3)% (3.9)%

Preliminary Earnings Announcement

The company anticipates that earnings per share for the first fiscal

quarter of 2001, ended March 31, will be approximately $0.53, versus $0.65 in

the first quarter of last year.

In the first quarter, the credit business performed in line with

expectations, reflecting continued strong portfolio quality. However,

operating income from the credit business for the first quarter will be

slightly below last year, mainly due to lower revenues. The domestic retail

business did not meet the company's expectations in the first quarter due to

sales and margin shortfalls resulting from the slowing economy and cooler than

expected spring weather in much of the country.

Sears Revises Segment Reporting

FASB Statement No. 131 prescribes accounting guidance for segment

reporting and requires that a company's externally reported segments be

consistent with its internal management structure. Consequently, effective

for the first quarter of 2001, Sears is modifying its externally reported

segments to reflect the company's integrated retail and related services

strategy and to align externally reported business segments with changes that

have occurred in the company's internal structure over the past several

months. The company's four new segments are as follows:

- Retail and Related Services -- This segment consists of merchandise

sales and related services, including service contracts, delivery and

product installation and repair services. It covers all Sears selling

channels, including specialty and full-line stores as well as direct-to-

customer operations which includes online, catalogs and clubs and