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Fewer Stores, Higher Sales at Gottschalks

Third quarter total sales for Gottschalks Inc. rang in a 1.4 percent increase and comparable-store sales came in a notch higher with 1.8 percent increases. The preliminary numbers were announced in advance of the company's full quarterly earnings report, which is scheduled for release Nov. 23.

The period's total sales increased to $147.9 million, from $145.9 million for the third fiscal quarter last year.

For the quarter, the company operated one less store than the same period of fiscal 2003, and year-to-date operated seven fewer stores.

“Our comparable-store sales increase of 1.8 percent for the third quarter was at the low end of our expected range,” said Jim Famalette, president and CEO. “However, with continued focus on inventory controls and increasing margins, we anticipate generating an improvement in our third quarter bottom-line results compared to the same period of 2003.”

On a year-to-date basis, same-store sales increased 1.7 percent. Total sales on a year-to-date basis increased 0.4 percent to $440.2 million compared to $438.5 million in the same period of fiscal 2003.

In October, same-store sales decreased 1.9 percent from the prior year. Total sales for the month decreased 2.3 percent to $43.8 million from $44.9 million in October 2003.

“Based on the strength of our final 100th anniversary promotional event in September, we reduced the level of promotional activity in the first two weeks of October,” Famalette said. “While we experienced softer-than-anticipated sales as a result, sales trends in the second two weeks of the month were positive.”

He added, “Looking forward, we are well positioned for the start of the holiday season and currently expect fourth quarter same-store sales to increase approximately 1.5 percent from the same period last year. Based on our results for the year thus far, including our expected third quarter results, we are increasing our full year guidance for fiscal 2004 to 43 to 45 cents diluted earnings per share.”

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