How did Sears Credit do last year?
We had a very successful year. We grew operating profits 8 percent to $1.1 billion, excluding noncomparable items, largely by effectively addressing our bad debt performance through improved collection activities and risk management. We delivered strong free cash flow to the corporation to reinvest in other growth initiatives at Sears. We were pleased to put our problems with risk management and reaffirmation behind us. We also improved our support of the growth initiatives of other Sears businesses and put in place a solid infrastructure that supports quality growth of credit. The only disappointment was a slowdown in receivables growth, due in part to a reduced share of business transacted on Sears Card.

How do you plan to revitalize your receivables growth?
Sears Card has been a dynamic product that has met the needs of a large number of our customers very effectively. But clearly it hasn't met the needs of all our customers. In 1999, we will take advantage of the flexibility our new credit operations system provides us and introduce new Sears Card features and reward programs that will better meet more customers' needs. Examples will include access to better retail values and reward programs that are tailored to customers' shopping behaviors.

Why does Sears have such a large and profitable credit business compared with other retailers?
We've built a very successful and profitable credit business partly because of our history of being a retailer of big-ticket durables, where the ability to finance appliances, electronics and other major purchases is important. We have done a good job of integrating the credit product into the company's day-to-day promotional activities and have made it convenient to open Sears Card accounts at the point of sale.

What role does Sears Credit play in Sears, Roebuck and Co.?
Credit has provided significant sales and promotional support to the retail and services business by offering financing to consumers. In addition, Sears Credit provides specific information and direct marketing opportunities that improve the company's ability to develop and target additional valuable promotions and offers to our most loyal customers.

Financially, Sears Credit is a very profitable business and provides a source of earnings and cash flow that is unique to retail companies. This allows us to implement Sears overall plans and investment strategies more aggressively.