West Marine net sales for the four weeks ended August 28, 2004 were $56.8 million, a 4.1% decrease compared to net sales of $59.2 million for the same four-week period a year ago. Comparable store net sales for August decreased 6.4% compared to the same period a year ago.

Net sales for the thirty-four weeks ended August 28, 2004 were $510.4 million, an increase of 6.5% over net sales of $479.5 million for the same period a year ago. Comparable store net sales for the latest thirty-four weeks increased 2.0% compared to the same period a year ago.

John Edmondson, CEO of West Marine, said, “Sales in August continued the soft trend that we first observed in the latter part of June. August comparable store sales by region were as follows: Western -4.0%, Northeast -9.1% and Southeast -4.5%. Late in the month, Hurricane Charley affected a number of stores in our Southeast region, including the closure of one store. Sales in affected areas usually improve following a hurricane as boat owners make necessary repairs. Historically, the net effect of hurricanes on our business has been mostly neutral.

“Although our gross margin remained strong compared to last year, it was not enough to offset the lower sales. As a result, we do not expect to meet our previous earnings guidance for the third quarter of $0.43 to $0.44 per share. We will update our earnings guidance in mid-September, allowing us to consider activity over the important Labor Day weekend.

“Over 70% of the merchandise we sell is related to maintenance and repair, and as a result our customers typically make purchases as the need arises. Consequently, it is becoming increasingly apparent to us that our comparable store sales over the entire year can usually be expected to remain relatively flat. We remain committed to expanding our earnings by 18% to 20% annually. We believe that growing sales and earnings by gaining market share is the correct strategy and, toward this end, we are on track for opening 35 new stores this year and increasing our annual new store growth rate to between 50 and 55 new stores in 2005.

“Beginning in 2005, we plan to report sales for each quarter rather than for every month. We believe this approach will better emphasize trends in our business, as it removes some of the short-term effects that weather has in monthly sales results.”