EX-99 6 ch311148.txt EXHIBIT (A)(5)(D) Exhibit (a)(5)(D) SEARS Sears, Roebuck and Co. Acquisition of Lands' End Analyst Briefing Sears, Roebuck and Co. Acquisition of Lands' End Analyst Briefing May 13, 2002 Forward Looking Statements ----------------------------------------------------------------------------- This presentation includes forward looking statements, concerning the outlook for the remainder of 2002 and expectations about the company's plans and the impact of the Lands' End acquisition. The statements are based upon assumptions about the future, which are subject to risks and uncertainties, such as changes in consumer confidence, competitive conditions in the retail industry, changes in bankruptcy delinquency and charge-off trends, interest rates, and other credit trends, successful execution of and customer reactions to the company's products and strategic initiatives, including the fall line store strategy and the proposed acquisition of Lands' End; Sears ability to integrate and operate Lands' End successfully. Actual results could differ materially. The company intends these statements to speak only as of the date of this presentation and does not undertake to update them as more information becomes available. Additional Information ----------------------------------------------------------------------------- This presentation is neither an offer to purchase nor a solicitation of an offer to sell securities of Lands' End. At the time the offer is commenced, Sears will file a tender offer statement with the U.S. Securities and Exchange Commission and Lands' End will file a solicitation/recommendation statement with respect to the offer. Investors and Lands' End stockholders are strongly advised to read the tender offer statement (including an offer to purchase, letter of transmittal and related tender documents) and the related solicitation/recommendation statement because they will contain important information. These documents will be available at no charge at the SEC's website at www.sec.gov and may also be obtained by calling (800) 732-7780, and selecting option #3. Agenda ----------------------------------------------------------------------------- o Executive Summary o Lands' End - Overview o Strategic Positioning o Integration Plan o Summary Agenda ----------------------------------------------------------------------------- --------------------------- o Executive Summary --------------------------- o Lands' End - Overview o Strategic Positioning o Integration Plan o Summary Executive Summary ----------------------------------------------------------------------------- o Sears has entered into a definitive acquisition agreement with Lands End - Important milestone in Sears history - Joins two very strong and profitable companies - Cash transaction totaling $1.9B, $62 per share o Lands' End is a great fit - Outstanding brand equity, product quality - Established customer relationships - Excellent infrastructure and capabilities o Accelerates progress towards building a new Sears - Fills gap in current assortment - Enhances growth prospects of Full-Line Stores and Customer Direct Agenda ----------------------------------------------------------------------------- o Executive Summary ------------------------------- o Lands' End - Overview ------------------------------- o Strategic Positioning o Integration Plan o Summary Lands' End - Overview ----------------------------------------------------------------------------- Background o Founded in 1963 by Gary Comer in Chicago o $1.6B in Revenue; $67M Net Income o Over 8,300 employees worldwide Market o Primary distribution channel is direct to consumer o Largest U.S. specialty apparel catalog company o Largest internet seller of apparel Product o Classically styled Men's, Women's and Kid's apparel o Reputation for quality, satisfaction guaranteed Lands' End Customer Base ----------------------------------------------------------------------------- Affluent o Demographic overlap with Sears hardlines customer (but limited softlines overlap) Loyal o Average spend per customer over $200/yr o High customer retention rate Large & o 33M customer file Growing o Strong growth in active customer base U.S. Major Apparel Companies ----------------------------------------------------------------------------- 2001 Revenue ($M) -----------------
Jones Apparel Liz Polo Ralph Tommy Eddie Lands' Abercrombie LL Bean J. Crew Group Claiborne Lauren Hilfiger Bauer End & Fitch Group 4,073 3,449 2,266 1,849 1,599 1,,569 1,365 1,067 741
Well Established Direct to Customer Business ----------------------------------------------------------------------------- 2001 Revenue ------------ Distribution Channel Business Segment* -------------------- ----------------- Internet Catalog & Retail International Specialty $317.M $1,242M $142 $433M 21% 79% 10% 30% Apparel $873M 60% Notes: ----- International: Includes UK, Germany and Japan Retail: 16 Outlets in U.S.; 4 abroad * Excludes shipping and handling revenue Lands' End - A Strong Fit With Sears ----------------------------------------------------------------------------- Great Company o Strong heritage; represents quality, satisfaction guaranteed. o Exceptional multi-channel capabilities o Best-in-class product development, quality, fulfillment, customer service, and database capabilities Great Brand o High brand awareness and equity o Strong customer loyalty o Significant growth prospects Great Fit with Apparel Strategy o Adds recognized brand o Creates differentiation and Sears-specific draw o Improves quality, consistency, and value of offering Agenda ----------------------------------------------------------------------------- o Executive Summary o Lands' End - Overview ------------------------------ o Strategic Positioning ------------------------------ o Integration Plan o Summary Lands' End - An Important Element In Our Proprietary Brand Offering ----------------------------------------------------------------------------- SEARS Quality, Value Satisfaction Guaranteed Hardlines Softlines --------- --------- Craftsman Lands' End Kenmore Covington The Next Generation Canyon River DieHard apostrophe(R) SEARS Quality, Value, Satisfaction Guaranteed ----------------------------------------------------------------------------- Craftsman Lands' End Direct Merchants Kenmore GE Nike Covington The Next Generation DieHard Levi's Dockers' BOSE MAYTAG Canyon River Whirlpool JOHN HENRY GOODYEAR Mudd Hanes MICHELIN SONY apostrophe(R) carter's celebrating imagination(TM) Sears and Lands' End ----------------------------------------------------------------------------- Positioning o Sears "Best" quality flagship apparel brand o Same great quality product that customers find in the catalog today Target o Existing: - Lands' End customers - Sears hardlines, non-apparel customers - Sears apparel customer o New customers Product o Available in all Full-line Stores o Best sellers and focused key items o Offerings in Women's, Men's, and Kid's Proprietary Brand Positioning - Future State ----------------------------------------------------------------------------- Women's Future State --------------------------------------------------------- | Career | Casual | --------------------------|------------------------------ | | | Update Apostrophe | | --------------------------|------------------------------ | Classic Laura Scott | Covington Lifestyle | Lands' End | Lands' End | --------------------------|------------------------------ |Traditional Modern Essentials | Classic Elements | | | ------------|-------------|---------------|-------------- | Good Better Best | Good Better Best | | --------------------------- ------------------------------ Price/Quality Price/Quality Sears and Lands' End ----------------------------------------------------------------------------- In Store o Prominent integrated positioning in Women's, Men's and Experience Kid's assortment o Ability to return Lands' End product from catalog/online to Sears Full-Line Stores Pricing o Everyday competitive pricing with seasonal clearance o Consistent with Lands' End catalog/online pricing Marketing o Increased brand awareness through integrated marketing program Sears Will Help Lands' End Grow ----------------------------------------------------------------------------- o Broad retail access o Increased brand awareness - Increased marketing investment - Product presence in approximately 870 Full-line stores - Inclusion in up to 90M pre-prints per week - Inserts in 26M credit card statements per month o Targeted prospecting of 130M Sears customers o 3M+ unique visitors to sears.com each month o Logical brand expansions (e.g. sporting gear, camping, patio...) Agenda ----------------------------------------------------------------------------- o Executive Summary o Lands' End - Overview o Strategic Positioning --------------------------------- o Integration Plan --------------------------------- o Summary Integration Plan ----------------------------------------------------------------------------- o Core Lands' End business to remain intact - Organizational structure will remain largely unchanged - Will assume responsibility for Sears Customer Direct businesses o Sears to leverage Lands' End capabilities - Product development - Quality o Capture "easy" cost synergies - Paper and non-merchandise procurement - Administrative SG&A o Highly structured / programmatic approach - Fully resourced team - Extensive management experience Transaction Detail ----------------------------------------------------------------------------- o Cash transaction totaling $1.9B, $62 per share - Premium of 21.5% over Friday's close of $51.02 and a 26% premium vs. the 90-day average of $49.03 o Transaction to close this summer o Minimal incremental leverage to Sears to fund purchase - Lands' End has no public market debt - Transaction has been reviewed with rating agencies o Maintaining previous 2002 comparable EPS growth guidance of 17% - No material impact to 2002 or 2003 earnings - No special charge for transaction Agenda ----------------------------------------------------------------------------- o Executive Summary o Lands' End - Overview o Strategic Positioning o Integration Plan -------------------------------- o Summary -------------------------------- Summary ----------------------------------------------------------------------------- o Lands' End is an outstanding fit with Sears - Common brand heritage representing outstanding quality and value - Strength in casual, classic merchandise dovetails with Sears apparel strategy - Excellent infrastructure and business capabilities o Enhances both companies' growth prospects - Accelerates Customer Direct growth for both Sears and Lands' End - Provides exclusive retail distribution channel for Lands' End - Competitively differentiates Sears Apparel offerings SEARS LANDS' END