Net income for the fourth quarter of 2004 was $10.5million, or 27 cents per diluted share, a 15% decreasefrom $12.5 million, or 31 cents per diluted share forthe same period last year. For the entire year, netincome also was down 15% to $28.6 million or 72 centsper diluted share compared to $33.7 million or 85cents per diluted share for fiscal 2003.

On a comparable store basis, sales increased 0.3% forthe quarter, while comp store sales for the entireyear increased 2.2% over the prior year. One brightspot for the discount retailer was its total sales,which rose 9% to $410.3 million versus $378 millionlast year. For fiscal 2004, total sales increased 11%to $1.4 billion compared with $1.3 billion for theprevious year.

CEO Michael J. Hayes attributes the poor quarterlyresults to a shift in sales mix to lower-marginproducts. Moreover, the retailer missed its salesgoals, which in turn impacted operating efficiencies.However, he says that he sees the quarter's results asa mere stumbling block since comparable store salesgrowth and traffic returned to plan for January andFebruary 2005.