Gottschalks Sees October Comps Decline 1.4%

Gottschalks Inc. reported that same-store sales for the month of October 2005 decreased 1.4% from the prior year. Total sales for the month increased 0.4% to $44.0 million from $43.8 million in October 2004. For the third fiscal quarter of 2005, same store sales decreased 0.5%, and total sales increased 2.3% to $151.3 million, compared to $147.9 million for the third fiscal quarter of 2004.

On a year-to-date basis, same store sales increased 0.6% from the comparable period of fiscal 2004. Total sales on a year-to-date basis increased 1.6% to $447.1 million compared to $440.2 million in the same period of the prior year.

Jim Famalette, president and chief executive officer of Gottschalks, said, “Our comparable store sales for October were lower than expected, due to reduced sales in our home division. While our furniture and mattress area turned in a solid performance, the changes to our promotions for the home division during the month did not generate the results we had anticipated. However, we continued to experience strength in soft fashion merchandise categories in October. Our best performing areas were shoes, accessories, special sizes and women's apparel. Comparable store inventory at the end of the quarter was even with last year, and we believe we are in a good position going into the important holiday season. We expect a solid comparable store sales performance in November, and we continue to anticipate achieving same store sales growth of approximately 1 to 2% for the full fiscal year in 2005.”

  Sales results:


                                                               Same Store
                                                                 Sales %
                         October 29,   October 30,  Total %     Decrease/
                            2005         2004      Increase     Increase
                                            (in 000's)

  Sales, 4 Weeks Ended     $44,009      $43,845      0.4%        (1.4%)

  Sales, 13 Weeks Ended   $151,314     $147,892      2.3%        (0.5%)

  Sales, 39 Weeks Ended   $447,055     $440,202      1.6%          0.6%

Reflecting the opening of the River Park lifestyle center store in August 2005 and the potential effect on other Fresno stores, the Company's comparable store base for October 2005, the third fiscal quarter and the fiscal year to date period is exclusive of all stores located in Fresno. The Company plans to continue to report same store sales exclusive of Fresno stores through September 2006.