Sears, Roebuck and Co. (NYSE: S) today announced that the company has reached final agreement with Computer Sciences Corporation (NYSE: CSC) to provide Sears with leading edge Information Technology infrastructure support services.
Under terms of the agreement, CSC will provide Sears with services including desktops, servers, systems that support Sears-related websites, voice and data networks, and decision-support technology. Effective June 12, CSC will hire substantially all of the Sears associates who previously managed Sears' technical infrastructure.
The $1.6 billion contract calls for CSC to provide Sears with Information Technology infrastructure support services for ten years. Sears retains responsibility for overall technology standards, architecture and service policies.
"The strategic alliance with CSC is the best choice for Sears, our associates, our customers and our shareholders," said Sears Chief Information Officer, Gerald F. Kelly, Jr. "The industry best practices and experience that CSC brings with them will heighten the stability and reliability of Sears' technical infrastructure and will provide a platform for future improvements at a lower cost."
Sears has sold certain assets to CSC for approximately $19 million as part of this agreement. During the second quarter of 2004, Sears will record approximately $35 million of additional depreciation expense related to the assets sold.
This release contains forward-looking statements regarding the future performance of the agreement by Sears and CSC and future payments to CSC, as well as a preliminary estimate regarding second quarter expenses. The forward-looking statements are based on assumptions about the future which are subject to risks and uncertainties, such as changes in availability or the costs of technology; future performance of the standard terms and conditions of the agreement; future technology needs; and the successful integration of Sears' retail businesses with CSC's operation of the technology infrastructure, which involves the integration of complex systems and processes. In addition, the preliminary estimate is based on assumptions about normal quarter-end accounting and valuation adjustments; and similar uncertainties. The company intends these forward-looking statements to speak only as of the time of this release and does not undertake to update or revise them as more information becomes available.
Sears, Roebuck and Co. is a leading broadline retailer providing merchandise and related services. With revenues in 2003 of $41.1 billion, the company offers its wide range of home merchandise, apparel and automotive products and services through more than 2,300 Sears-branded and affiliated stores in the U.S. and Canada, including approximately 1,000 full-line stores and 1,300 specialty stores. Sears also offers a variety of merchandise and services through sears.com, landsend.com, and specialty catalogs. Sears is the only retailer where consumers can find each of the Kenmore, Craftsman, DieHard and Lands' End brands together -- among the most trusted and preferred brands in the U.S. The company is the largest provider of product repair services with more than 14 million service calls made annually.
Founded in 1959, Computer Sciences Corporation is a leading global information technology (IT) services company. CSC's mission is to provide customers in industry and government with solutions crafted to meet their specific challenges and enable them to profit from the advanced use of technology.
With approximately 90,000 employees, CSC provides innovative solutions for customers around the world by applying leading technologies and CSC's own advanced capabilities. These include systems design and integration; IT and business process outsourcing; applications software development; Web and application hosting; and management consulting. Headquartered in El Segundo, Calif., CSC reported revenue of $14.8 billion for the 12 months ended April 2, 2004. For more information, visit the company's Web site at http://www.csc.com/ .
SOURCE: Sears, Roebuck and Co.
CONTACT: NEWS MEDIA, Chris Brathwaite of Sears, Roebuck and Co.,
+1-847-286-4681; or Mike Dickerson of Computer Sciences Corporation,