Pacific Sunwear of California, Inc. reported that net income for the fourth quarter increased 48% to $34.3 million, or $.44 per share, basic, and $.43 per share, diluted, compared to $23.2 million, or $.31 per share, basic and diluted, for the fourth quarter of fiscal 2002.

Total sales for the fourth quarter (13 weeks) ended January 31, 2004 were $326.3 million, an increase of 22.9% over total sales of $265.6 million for the fourth quarter (13 weeks) ended February 1, 2003. Same-store sales increased 12.0% for the comparable thirteen-week period ended January 31, 2004.

“I am pleased to report record quarterly earnings for PacSun of $34.3 million, which was a 48% increase over fourth quarter last year,” stated Greg Weaver, Chairman and CEO. “For fiscal 2003, we achieved a 61% increase in net earnings with operating income of $128.2 million, or 12.3% of sales. At PacSun, we are improving market share with the help of multiple brands and the strength of our footwear and accessory businesses. At d.e.m.o., we substantially improved our overall merchandising in 2003, particularly in our girls and accessory businesses. d.e.m.o. same store sales grew 21% in 2003 on top of a 12.4% same store sales increase in 2002. For 2003, average new d.e.m.o. store sales are trending at nearly $1.1 million. Sales per square foot for the d.e.m.o. chain were $405 per foot for the year. For fiscal 2004, we plan to open 110 net new stores and expand or relocate approximately 35 stores with square footage growing approximately 15%. The 110 net new stores include 65 PacSun stores, 5 PacSun Outlet stores, and 40 d.e.m.o. stores. This will take the year-end 2004 store count to 987. Our financial guidance for fiscal 2004 is for earnings per share growth of 20% or better compared to 2003. Earnings growth of 20% equates to $1.22 and assumes same store sales growth of approximately 5%. The $1.22 equates to a pre-tax margin of approximately 13%,” concluded Mr. Weaver.

Total sales for fiscal 2003 (52 weeks) were $1.04 billion, an increase of 22.9% over sales of $846.4 million for fiscal 2002 (52 weeks). Same-store sales increased 13.1% for the comparable fifty-two week period ended January 31, 2004. Net income for fiscal 2003 increased 61% to $80.2 million, or $1.05 per share, basic, and $1.02 per share, diluted, compared to $49.7 million, or $0.67 per share, basic, and $0.66 per share, diluted, for fiscal 2002. 

                  PACIFIC SUNWEAR OF CALIFORNIA, INC.
                      SUMMARY STATEMENT OF INCOME
                              (unaudited)
             (in $000's, except share and per share data)


                        FOURTH QUARTER ENDED    TWELVE MONTHS ENDED
                         01/31/04    02/01/03    01/31/04    02/01/03
Net sales                 326,318     265,590   1,040,294     846,393
Gross margin              119,011      94,997     363,317     283,683
Selling, G&A expense       64,569      57,320     235,068     202,445
Operating income           54,442      37,677     128,249      81,238
Interest income/(expense)     391          (1)        732        (594)
Income before taxes        54,833      37,676     128,981      80,644
Income tax expense         20,487      14,467      48,768      30,967
Net income                 34,346      23,209      80,213      49,677
Net income per share,
 basic (a)                   0.44        0.31        1.05        0.67
Net income per share,
 diluted (a)                 0.43        0.31        1.02        0.66