Business Services Industry

Federated's Same-Store Sales Down 2.4% in August

Business Wire, Sept 2, 2004

CINCINNATI -- Federated Department Stores, Inc. (NYSE:FD)(PCX:FD) today reported total sales of $1.047 billion for the four weeks ended August 28, 2004, a decrease in total sales of 2.7 percent compared to total sales of $1.077 billion in the same period last year. On a same-store basis, Federated's August sales were down 2.4 percent.

For the year to date, Federated's sales totaled $8.112 billion, up 4.0 percent from total sales of $7.802 billion in the first 30 weeks of 2003. On a same-store basis, Federated's year-to-date sales also were up 4.0 percent.

Terry J. Lundgren, Federated's chairman, president and chief executive officer, called August sales disappointing, citing weakness in back-to-school areas of juniors and young men's, as well as in furniture. In addition, August sales in the company's Florida stores were negatively impacted by Hurricane Charley.

"August's same-store sales comparisons also were affected by the shift of Labor Day into the September reporting period this year," Lundgren said. "Additionally, because August is a clearance month, tight seasonal inventories in our stores are reflected to some degree in our weaker-than-anticipated sales during the month.

"As we look to September, we are somewhat encouraged by sales trends we have seen in fall fashions, accessories and cosmetics," Lundgren said. "This leads us to remain hopeful of attaining a same-store sales increase of approximately 2 percent for the month."

Lundgren said the company continues to anticipate a same-store sales increase of 1.5 to 3 percent for the third and fourth quarters.

Federated, with corporate offices in Cincinnati and New York, is one of the nation's leading department store retailers, with annual sales of more than $15.2 billion. Federated operates more than 450 stores in 34 states, Guam and Puerto Rico under the names of Macy's, Bloomingdale's, Bon-Macy's, Burdines-Macy's, Goldsmith's-Macy's, Lazarus-Macy's and Rich's-Macy's. The company also operates macys.com and Bloomingdale's By Mail. www.fds.com

NOTE: This release contains certain forward-looking statements that reflect current views of the financial performance and other events of Federated. The words "may," "will," "could," "expect," "plan," "anticipate," "believe" and other similar expressions identify forward-looking statements. Any such forward-looking statements are subject to risks and uncertainties. Future results or outcomes could differ materially from current expectations because of a variety of factors that affect the company, including competitive pressures from specialty stores, general merchandise stores, manufacturers' outlets, off-price and discount stores, new and established forms of home shopping (including the Internet, mail-order catalogs and television) and general consumer spending levels, including the impact of the availability and level of consumer debt, the effect of weather and other factors identified in documents filed by the company with the SEC.

Additional information on Federated, including past news releases, is available at www.fds.com/pressroom.>