Gottschalks January 2004 same store sales increased
8.6% from January 2003. Total sales for January increased 1.9% to $36.2 million from $35.5 million in the prior year. Fourth quarter fiscal 2003 same store sales increased 1.6%, while total sales decreased 1.7% to $229.0 million, from $232.9 million for the same period of fiscal 2002. Same store sales for the full 2003 fiscal year decreased 0.7% from fiscal 2002.

For the 52-week fiscal year, total sales decreased 3.5% to $667.6 million this
year compared to $691.4 million in fiscal 2002. The decrease in total sales
for fourth quarter and the fiscal year is 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,
“We are pleased with January's strong comparable store sales increase. We
enjoyed a very good finish to fiscal 2003, achieving higher total sales for
the month of January compared to the same month of the prior fiscal year when
we operated eight more stores. Sales were strong across almost all
merchandise categories, with accessories, dresses, juniors, men's, textiles
and housewares being the best areas. Our inventory level at the end of
January was 4% below the same period in 2002. In the last year, we have
focused on improving the financial and operational performance of the Company
and we are currently on target to accomplish both those objectives. We expect
that full year earnings will be improved from fiscal 2002, and we are
forecasting earnings for fiscal 2003 to be in the range of $0.10 to $0.12
cents per diluted share.”

“We are encouraged by the trend we have experienced with a second month of
positive comparable store sales, and are hopeful that we may be seeing an
indication that the overall retail environment is showing some improvement,”
concluded Mr. Famalette. 

     Sales results are summarized as follows:
                                                                  Same Store
                                                      Total %        Sales %
                          January 31,   February 1,   Increase/     Increase/
                              2004         2003       (Decrease)    (Decrease)
                                  (in 000's)
    Sales, 4 Weeks Ended    $36,189      $35,531         1.9%         8.6%
    Sales, 13 Weeks Ended  $229,034     $232,892        (1.7%)        1.6%
    Sales, 52 Weeks Ended  $667,553     $691,428        (3.5%)       (0.7%)