LOS ANGELES--(BUSINESS WIRE)--Jan. 8, 2003--Guess?, Inc. (NYSE:GES) today reported that total December retail sales for the fiscal month ended December 31, 2002 were $58.8 million, an increase of 6.8% from sales of $55.0 million for the month ended December 31, 2001.

Comparable store sales for the December period decreased 1.1%. Comparable store sales for the Company's full priced retail stores decreased 2.7%, and comparable store sales at the factory outlet stores increased 3.5%.

Fiscal December 2002 included 31 days compared to 30 days in the December 2001 fiscal period. On a comparable 30-day basis, comparable store sales for December 2002 declined 2.8%; comparable store sales for the Company's full priced retail stores decreased 4.6%; and comparable store sales at the factory outlet stores increased 2.2%.

Carlos Alberini, President and Chief Operating Officer, commented, "Guess?' performance for December reflects a challenging holiday selling season, marked by heightened promotional activity and lower consumer spending. This environment affected both sales and margins in our retail and wholesale businesses. During the fourth quarter, we continued to keep a careful eye on inventory levels and have entered the new year with a clean inventory position. As anticipated, the Company had no domestic borrowings under its $85 million credit facility, and inventory levels were flat to last year despite a net increase of 22 stores during the year."

For the fourth quarter ended December 31, 2002, total retail sales increased 6.8% to $130.9 million compared to $122.5 million for the fourth quarter of 2001. Comparable store sales decreased 0.9% during the fourth quarter of 2002.

For the fiscal year ended December 31, 2002, total retail sales increased 1.1% to $384.6 million compared to $380.6 million for the prior fiscal year. Comparable store sales decreased 4.1% for the 2002 fiscal year.

Fourth Quarter/Full Year Earnings Outlook

As stated, profitability in both the retail and wholesale segments were negatively impacted in the fourth quarter by increased pricing pressures due to the ongoing highly promotional conditions in the retail industry. The Company also incurred higher than anticipated operating costs during the quarter. As a result of these factors, the Company now expects its diluted earnings per share for the fourth quarter to be in the range of $0.01 to $0.03 versus previously announced expectations of $0.10 to $0.13. Additionally, as previously disclosed in the Company's third quarter earnings release, the Company will record a pretax charge in the fourth quarter of approximately $10.0 million, or $6.7 million after tax, for the closure or disposition of certain corporate facilities and a few under-performing retail locations, certain asset write-offs and the elimination of certain administrative and support positions. Based on the revised fourth quarter outlook, the Company now expects to report a loss for fiscal 2002 in the range of $0.12 to $0.14 per share, excluding the impact of the fourth quarter charge described above.

Guess?, Inc. designs, markets, distributes and licenses one of the world's leading lifestyle collections of contemporary apparel, accessories and related consumer products.

Except for historical information contained herein, certain matters discussed in this press release including but not limited to the Company's expected results of operations and plans to reduce costs and estimated charges, are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are only expectations, and involve known and unknown risks and uncertainties, which may cause actual results in future periods and other future events to differ materially from what is currently anticipated. Factors which may cause actual results in future periods to differ from current expectations include, among other things, the continued availability of sufficient working capital, the successful integration of new stores into existing operations, the continued desirability and customer acceptance of existing and future product lines, possible cancellations of wholesale orders, the success of competitive products, and the availability of adequate sources of capital. In addition to these factors, the economic and other factors identified in the Company's most recent annual report on Form 10-K for the fiscal year ended December 31, 2001 including but not limited to the risk factors discussed therein, could affect the forward-looking statements contained herein and in the Company's other public documents.

--30--FLB/ny*