Gottschalks same store sales for the month of October
2004 decreased 1.9% from the prior year. Total sales for the month decreased 2.3% to $43.8 million from $44.9 million in October 2003. For the month theCompany operated one less store than the same period of fiscal 2003.

For the third fiscal quarter of 2004, same store sales increased 1.8%, and
total sales increased 1.4% to $147.9 million, from $145.9 million for the
third fiscal quarter last year. On a year-to-date basis, same store sales
increased 1.7% from the comparable period of fiscal 2003. Total sales on a
year-to-date basis increased 0.4% to $440.2 million compared to $438.5 million
in the same period of fiscal 2003. For the quarter the Company operated one
less store than the same period of fiscal 2003, and year-to-date operated
seven fewer stores compared to the same period last year.

Jim Famalette, president and chief executive officer of Gottschalks, said,
“Based on the strength of our final 100th Anniversary promotional event in
September, we reduced the level of promotional activity in the first two weeks
of October. While we experienced softer than anticipated sales as a result,
sales trends in the second two weeks of the month were positive. The best
performing merchandise categories for the month were shoes, better sportswear,
juniors, intimate apparel and dresses. Our comparable store sales increase of
1.8% for the third quarter was at the low end of our expected range. However,
with continued focus on inventory controls and increasing margins, we
anticipate generating an improvement in our third quarter bottom line results
compared to the same period of 2003.

“Looking forward, we are well positioned for the start of the holiday
season and currently expect fourth quarter same store sales to increase
approximately 1.5% from the same period last year. Based on our results for
the year thus far, including our expected third quarter results, we are
increasing our full year guidance for fiscal 2004 to $0.43 to $0.45 diluted
earnings per share.”

Sales results are summarized as follows:

Same Store

Total % Sales %

October 30, November 1, Increase/ Increase/

2004 2003 Decrease Decrease

  • (in 000's) 
        Sales, 4 Weeks Ended     $43,846      $44,887        (2.3%)      (1.9%)
    
    Sales, 13 Weeks Ended   $147,893     $145,928          1.4%        1.8%
    
    Sales, 39 Weeks Ended   $440,203     $438,519          0.4%        1.7%