Gottschalks May Comps Drop 7.6%

Gottschalks same store sales for the month of May 2004 decreased 7.6% from the prior year. Total sales for the month decreased 8.9% to $45.7 from $50.1 in May 2003. On a year-to-date basis, same store sales increased 1.5% from the same period of fiscal 2003, and total sales decreased 0.3% to $190.2 compared to $190.7 for the same period of fiscal 2003. For the month the Company operated four fewer stores compared to the same period of the prior year, and year-to-date operated seven fewer stores compared to the same period in fiscal 2003.

Jim Famalette, president and chief executive officer of Gottschalks said, “As anticipated, the calendar shift of the promotional events surrounding the Memorial Day weekend from May to June impacted our sales results for May. In addition, last year May was the month of our largest comp store sales increase of 2003 at 3.4%. We anticipate that the combined sales results for May and June will provide a more accurate same store sales comparison. In May we did experience strong performances in accessories, cosmetics, women's better sportswear, dresses and juniors. We continue to expect same store sales for the second quarter to increase approximately 1% over the prior year.”

   Sales results are summarized as follows:

                                                               Same Store

                                                   Total %      Sales %

                          May 29,       May 31,    Increase/    Increase/

                           2004          2003      Decrease     Decrease

                               (in 000's)
  Sales, 4 Weeks Ended    $45,652      $50,091      (8.9%)       (7.6%)
  Sales, 17 Weeks Ended  $190,185     $190,710      (0.3%)         1.5%