99 Cents Only expects lower loss

CITY OF COMMERCE, Calif. 99 Cents Only Stores announced today that it anticipates a net loss for the quarter ended March 31 of approximately 1 cent per share compared to a net loss of 2 cents per share for the quarter ended March 31, 2006. The company also expects net income for the fiscal year ended March 31 to be approximately 14 cents per share compared to net income of 16 cents per share for the fiscal year ended March 31, 2006. As previously reported, for the quarter ended March 31, net sales increased 9.4% to $277.9 million compared to $254.1 million for the same quarter last year, and same-store-sales for the fourth quarter ended March 31 increased 2.9% versus the same quarter last year. For the fiscal year ended March 31, net sales were $1.1 billion, up 7.9% over sales of $1.02 billion for the fiscal year ended March 31, 2006.

The slight improvement in the fiscal 2007 fourth quarter net loss compared to the fiscal 2006 fourth quarter net loss is primarily due to higher overall gross profit driven by lower product cost, reduction in excess and obsolete inventory, and improvement in the overall rate of shrink and scrap. The company also reduced consulting expenses and corporate temporary labor expense.