Cache Reports September 2004 Comparable Store Sales Decline By 2%; Company Reiterates Comfort With Third Quarter And Full Year Guidance

Business Wire, Oct 7, 2004

NEW YORK -- Cache Inc., (NASDAQ:CACH), a specialty chain of women's apparel stores with 276 stores open, reported September 2004 sales figures.

Comparable Store Sales: (sales for stores open at least one year or more)

--Decreased 2% during the five week September 2004 period;

--Decreased 2% during the 13 week period ended September 25, 2004, as compared to the same period in 2003; and

--Increased 4% during the 39 week period ended September 25, 2004, as compared to the same period in 2003.

Total Sales:

--Increased $645,000 or 3% to $21.7 million for the five week period ended September 25, 2004;

--Increased $2.1 million or 4% to $49.4 million for the 13 week period ended September 25, 2004; and

--Increased $17.1 million or 11% to $168.7 million for the 39 week period ended September 25, 2004.

Mr. Brian Woolf, Cache's Chairman commented: "As we previously announced, September comparable store sales results were tempered by hurricanes, which reduced traffic and caused store closings in the Southeast, our largest sales region. Our September comparable store sales decline of 2% was slightly below our expectation of flat to a down 1% due to the unanticipated change of course of hurricane Jeanne during the last weekend of the month. Excluding the impact of hurricanes, we estimate that September comparable store sales would have increased by approximately 1% to 2%."

"As we look ahead, we continue to believe that we are positioned to report comparable store sales gains in the fourth quarter," Mr. Woolf continued. "Our expectation is based on the consumer acceptance of our fall sportswear assortments, our upcoming marketing efforts and stabilization within our dress business. This expectation is also consistent with the trends we have experienced in the first ten days of October. To this end, we are currently on track to achieve our sales plan despite the impact of hurricane Jeanne, which forced the closing of twenty Florida-based stores during the first day of the month."

The Company also noted that it remains comfortable with the sales and earnings guidance it provided on September 24 2004 for its third quarter, fourth quarter and fiscal 2004 year. Specifically, for the third quarter of fiscal 2004, the Company continues to estimate diluted earnings (loss) per share in the range of ($0.03) to ($0.04), as compared to actual third quarter fiscal 2003 diluted earnings per share of $0.04. In addition, the Company continues to estimate fourth quarter fiscal 2004 net sales in the range of $78 million to $81 million, as compared to actual fourth quarter fiscal 2003 net sales of $64.5 million. Included in this estimate is for comparable store sales to increase in the low-to-mid-single digit range. Fourth quarter fiscal 2004 diluted earnings per share continue to be estimated in the range of $0.37 to $0.39, as compared to actual fourth quarter fiscal 2003 diluted earnings per share of $0.34.

In total, the Company continues to estimate fiscal 2004 net sales in the range of $247 million to $252 million, as compared to actual fiscal 2003 net sales of $216.3 million. Fiscal 2004 diluted earnings per share continue to be estimated in the range of $0.80 to $0.83, as compared to actual fiscal 2003 diluted earnings per share of $0.75. The Company indicated further that all actual and estimated per share figures are reflective of the 3-for-2 stock split completed on June 18, 2004. The Company is scheduled to report actual results for the third quarter, ending September 25, 2004, during the week of October 17, 2004.

During September 2004, the Company opened 3 new Cache stores and 2 new Lillie Rubin stores. In total, the Company currently operates 276 stores, including 245 Cache and 31 Lillie Rubin locations.

Certain matters discussed within this press release may constitute forward looking statements within the meaning of the federal securities law. Although Cache, Inc. believes the statements are based on reasonable assumptions, there can be no assurance that these expectations will be attained. Actual results and timing of certain events could differ materially from those projected in or contemplated by the forward-looking statements due to a number of factors, including, without limitation, industry trends, merchandise trends, competition and consumer spending patterns, as well as other risks outlined from time to time in the filings of Cache, Inc. with the Securities and Exchange Commission.

For further information contact Thomas E. Reinckens, President, Chief Operating Officer, Cache, Inc., 1440 Broadway, New York, New York 10018, (212) 575-3246.