Saks Incorporated Announces Resignation of Jennings as President of SFAE; CEO Sadove to Assume Responsibility for the Majority of Jennings's Direct Reports

Business Wire, August 21, 2006

BIRMINGHAM, Ala. -- Retailer Saks Incorporated (NYSE: SKS)(the "Company") today announced that Andrew Jennings has resigned as President of Saks Fifth Avenue Enterprises ("SFAE"). Stephen I. Sadove, Chief Executive Officer of Saks Incorporated, will assume responsibility for the majority of Jennings's direct reports.

Jennings, who joined SFAE as President in February 2004, has made a personal decision to leave SFAE and return overseas, where he spent the majority of his distinguished 30-year retail career. Reflecting on his tenure at SFAE, Jennings noted, "I will always value my time at Saks Fifth Avenue and have great confidence in the future of this legendary American brand."

Sadove commented, "I respect Andrew's decision, and he has graciously agreed to a month-long transition to make this a smooth and orderly process. Andrew has made many contributions to SFAE which have helped position the Company for renewed growth and profitability. Andrew's deep operating experience and disciplined management style have made him a valued colleague. We appreciate his contributions to the business and wish him the very best."

The Company does not intend to replace Jennings's role within the Company at this time. The majority of his direct reports will report to Sadove. Sadove noted, "We have a talented, experienced, and focused leadership team in place at SFAE, and I am confident that we will be able to continue to improve our operating performance and create shareholder value with this business."

Company Information

Saks Incorporated currently operates Saks Fifth Avenue Enterprises (SFAE), which consists of 54 Saks Fifth Avenue stores, 50 Saks Off 5th stores, and saks.com. The Company also operates 38 Parisian stores and 62 Club Libby Lu specialty stores. On August 2, 2006, the Company announced plans to sell its Parisian business to Belk in a transaction expected to close in the third quarter of 2006.

Steve Sadove joined the management team of Saks Incorporated in January 2002 as Vice Chairman and assumed the additional role of Chief Operating Officer in March 2004. He was named Chief Executive Officer of the Company in January 2006. Before joining Saks, Sadove built a marketing and consumer products career spanning over 25 years with key roles at General Foods USA and Bristol-Myers Squibb.

Forward-looking Information

The information contained in this press release that addresses future results or expectations is considered "forward-looking" information within the definition of the Federal securities laws. Forward-looking information in this document can be identified through the use of words such as "may," "will," "intend," "plan," "project," "expect," "anticipate," "should," "would," "believe," "estimate," "contemplate," "possible," and "point." The forward-looking information is premised on many factors, some of which are outlined below. Actual consolidated results might differ materially from projected forward-looking information if there are any material changes in management's assumptions.

The forward-looking information and statements are or may be based on a series of projections and estimates and involve risks and uncertainties. These risks and uncertainties include such factors as: the level of consumer spending for apparel and other merchandise carried by the Company and its ability to respond quickly to consumer trends; adequate and stable sources of merchandise; the competitive pricing environment within the retail sector; the effectiveness of planned advertising, marketing, and promotional campaigns; favorable customer response to relationship marketing efforts of proprietary credit card loyalty programs; appropriate inventory management; effective expense control; successful operation of the Company's proprietary credit card strategic alliance with HSBC Bank Nevada, N.A.; geo-political risks; changes in interest rates; the outcome of the formal investigation by the Securities and Exchange Commission and the inquiry the Company understands has been commenced by the Office of the United States Attorney for the Southern District of New York into the matters that were the subject of the investigations conducted during 2004 and 2005 by the Audit Committee of the Company's Board of Directors and any related matters that may be under investigation or the subject of inquiry; the ultimate amount of reimbursement to vendors of improperly collected markdown allowances; the ultimate impact of improper timing of recording of inventory markdowns; the ultimate impact of incorrect timing of recording of vendor markdown allowances; the outcome of the shareholder litigation that has been filed relating to the matters that were the subject of the Audit Committee's initial investigation; and the successful consummation of the Parisian transaction. For additional information regarding these and other risk factors, please refer to Exhibit 99.1 to the Company's Form 10-K for the fiscal year ended January 28, 2006 filed with the SEC, which may be accessed via EDGAR through the Internet at www.sec.gov.