Talbots Announces Additional Stock Repurchase Program; Company Cites Continued Strong Cash Flow

Business Wire, April 21, 2005

HINGHAM, Mass. -- The Talbots, Inc. (NYSE:TLB) announced today that its Board of Directors has approved an additional common stock repurchase program to acquire up to $50 million of its outstanding common stock. The program authorizes the Company to purchase the shares from time to time over a two-year period.

The Company has acquired a total of 22,360,602 shares of its outstanding common stock at a cost of approximately $523.0 million under its previous programs first initiated in February 1995.

Arnold B. Zetcher, Chairman, President and Chief Executive Officer commented, "The approval of this program underscores Talbots long-standing commitment to enhance shareholder value. This is the 12th extension of our share repurchase program and reflects the Board's confidence in our strong cash flow, which we believe will be sufficient to support our ongoing store expansion plans, the payment of regular quarterly dividends and this stock repurchase program. Our company fundamentals remain strong and we continue to be optimistic for a successful 2005."

The Company will purchase a pro rata number of shares from AEON (U.S.A.), Inc., so as to maintain substantially the same percentage ownership balance in the Company between AEON (U.S.A.), Inc. and the public shareholders. Currently, approximately 57% of Talbots outstanding shares are owned by AEON (U.S.A.), Inc., a wholly-owned subsidiary of AEON Co., Ltd, a Tokyo-based international retailer. The other 43% of the outstanding shares are publicly owned.

As under earlier repurchase authorizations in which AEON (U.S.A.), Inc. participated on this same pro rata basis, share repurchases from AEON (U.S.A.), Inc. under the extended program will be settled monthly based on the level of any open market purchases which the Company may make under the program for such month. The price of the shares purchased from AEON (U.S.A.), Inc. will be the weighted average price paid to the public shareholders for the month. AEON (U.S.A.), Inc. has participated on this same pro rata basis in all of the share repurchase programs established by the Company since 1995, with the exception of the $50 million share repurchase program established by the Company in October 2001, in which AEON (U.S.A.), Inc. did not participate.

Repurchased common shares will be held as treasury shares, a portion of which could be used to satisfy the Company's requirements under its equity incentive and other benefit plans. At April 20, 2005, the Company had 54,548,758 million shares of common stock outstanding.

Talbots is a leading national specialty retailer and cataloger of women's, children's and men's classic apparel, shoes and accessories. The Company currently operates 1,052 stores - 521 Talbots Misses stores, including 20 Talbots Misses stores in Canada and four Talbots Misses stores in the United Kingdom; 286 Talbots Petites stores, including four Talbots Petites stores in Canada; 41 Talbots Accessories & Shoes stores; 71 Talbots Kids stores; 97 Talbots Woman stores, including three Talbots Woman stores in Canada; 11 Talbots Mens stores; one Talbots Collection store; and 24 Talbots Outlet stores. Its catalog operation circulated approximately 46 million catalogs worldwide in fiscal 2004. Talbots on-line shopping site is located at www.talbots.com.

The foregoing contains forward-looking information within the meaning of The Private Securities Litigation Reform Act of 1995. These statements may be identified by such forward-looking terminology as "expect," "look," "believe," "anticipate," "outlook," "would," or similar statements or variations of such terms. All of the "outlook" information (including future revenues, future comparable sales, future earnings, future EPS, and other future financial performance or operating measures) constitutes forward-looking information.

Our outlook and other forward-looking statements are based on a series of expectations, assumptions, estimates and projections about our Company which involve risks and uncertainty, including assumptions and projections concerning store traffic, levels of store sales including regular-price selling and markdown selling, and customer preferences. All of our outlook information and other forward-looking statements are as of the date of this release only. The Company can give no assurance that such outlook or expectations will prove to be correct and does not undertake to update or revise any "outlook" information or any other forward-looking statements to reflect actual results, changes in assumptions, estimates or projections, or other circumstances occurring after the date of this release, even if such results, changes or circumstances make it clear that any projected results will not be realized.

Our forward-looking statements involve substantial known and unknown risks and uncertainties as to future events which may or may not occur, including effectiveness of the Company's brand awareness and marketing programs, effectiveness and profitability of new concepts including the Mens concept, effectiveness of its e-commerce site, acceptance of Talbots fashions including its spring 2005 fashions, the Company's ability to anticipate and successfully respond to changing customer tastes and preferences and to produce the appropriate balance of merchandise offerings, the Company's ability to sell its merchandise at regular prices as well as its ability to successfully execute its major sale events including the timing and levels of markdowns and appropriate balance of available markdown inventory, retail economic conditions including consumer spending, consumer confidence and a continued uncertain economy, and the impact of a continued promotional retail environment. In each case, actual results may differ materially from such forward-looking information.