Gottschalks announced that its December 2003 same store sales increased 0.6% from December 2002. Total sales for December decreased 2.3% to $125.8 million from $128.7 million in the prior year. For the year-to-date,
same store sales decreased 1.2%, while total sales decreased 3.7% to $631.4 million, from $655.9 million for the same period last year. The decrease in total sales for the month and year-to-date periods are partially
attributable to the Company operating eight fewer stores than in the
comparable periods of 2002.

Jim Famalette, president and chief executive officer of Gottschalks, said,
“Our December sales were in line with our expectations. We experienced a
gradual increase in sales as the holiday selling period progressed, with the
last two weeks being very strong. The merchandise categories which performed
the best during December were cosmetics, accessories, juniors, dresses, men's
and furniture.”

    Sales results are summarized as follows:

                                                               Same Store
             January 3,      January 2,       Total %             Sales %
               2004            2003    Increase/(Decrease) Increase/(Decrease)
                    (in 000's)
      5 Weeks
      Ended   $125,771       $128,680        (2.3%)                0.6%
      48 Weeks
      Ended   $631,365       $655,897        (3.7%)               (1.2%)

Gottschalks also announced today that it plans to close an under
performing store at the Crossroads Center in Seattle, Washington at the end of
January 2004. The Company has agreed with its landlord to an early
termination of its lease, which was scheduled to expire at the end of 2004.
Gottschalks does not expect to incur any material costs in connection with the
closure of this store.