Gottschalks May Same-Store Sales Rise 3.4%

Gottschalks Inc. announced that May 2003 same store sales increased 3.4% from the prior year. Total sales increased 0.7% to $50.1 million from $49.7 million in May 2002. The Company’s best performing merchandise categories for the month were swimwear, juniors, women’s sportswear and men’s casual. During the month the Company operated seven fewer stores than in the same period of 2002.

“We are very pleased with the increase in comparable store sales we achieved in May,” said Mr. Jim Famalette, president and chief executive officer of Gottschalks. “Weather in our Western markets warmed considerably during the month, and we experienced strong performances from all of our apparel areas. Our juniors, women’s sportswear and swimwear divisions were key drivers behind our 3.4% comparable store sales increase. In addition, our GK Kids line met our sales plan for the month. As previously discussed, we introduced our new private label men’s brand, Smart Khaki, at the start of May and this new brand contributed solidly to the double-digit comparable sales increase we generated in men’s casual merchandise for the month.”

On a year-to-date basis, same store sales decreased 2.1% from the same period of the prior year. Total sales decreased 4.3% to $190.7 million from $199.3 million for the same period of fiscal 2002. On a year-to-date basis the decrease in total sales is partially attributable to the closure of seven stores which were open in the comparable period last year.

Sales results are summarized as follows:

                         May 31,   June 1,    Total %      Same Store
                         2003       2002       Increase/    Sales % Increase/
                           (in 000's)         (Decrease)    (Decrease)

     Sales, 4
     Weeks Ended        $50,091    $49,739     0.7%         3.4%

     Sales, 17
     Weeks Ended        $190,710   $199,299    (4.3%)       (2.1%)