Payless February Same-Store Sales Inch Up 0.4%

Payless ShoeSource, Inc. reported that same-store sales decreased 0.6 percent during the February reporting period, the four weeks ended March 1, 2003. Company sales totaled $175.3 million, a 0.4 percent increase from $174.6 million during fiscal February of last year.

Sales were as follows:

                       FEBRUARY SALES (DOLLARS IN MILLIONS)
      Fiscal 2003    Fiscal 2002     Percent Increase/    Same-Store Sales*
                                        (Decrease)        Percent Increase/
                                                             (Decrease)
        $175.3          $174.6             0.4%                (0.6)%

    *Same-store sales represent sales of those stores open during both
     periods.

Due to the shift in the Easter holiday to late April 2003 from March 2002, the company expects high-single digit negative same-store sales for March 2003, and high-single digit positive same-store sales in April.

For the first quarter 2003 Payless ShoeSource anticipates low single-digit positive same-store sales, and diluted earnings per share in the range of $1.15 – $1.25, calculated on a pre-split basis. The company recorded earnings per diluted share of $1.05 in the first quarter 2002.

For the fiscal year 2003, the company expects low single-digit positive same-store sales and diluted earnings per share in the range of $4.65 – $5.25, calculated on a pre-split basis. As previously announced, the company’s Board of Directors authorized a 3:1 split of the company’s common stock in the form of a stock dividend payable on March 27, 2003 to shareowners of record as of March 13, 2003. All of the share and per-share numbers presented in this press release are calculated on a pre-split basis. The company intends to begin reporting share and per share data on a post-split basis after March 27, 2003.