99 Cents Only Stores reports pro- forma earnings per share of 23 cents and pro-forma net income of $3.1 million for the second quarter ending June 30, 1996, representing an increase of 44.1 percent over second quarter 1995 pro-forma net income of $2.2 million.

CITY OF COMMERCE, Calif.--(BUSINESS WIRE)--Aug. 7, 1996--99 Cents Only Stores (NYSE:NDN) reported pro-forma net income for the quarter ended June 30, 1996, or $3.1 million on net sales of $43.2 million, compared with pro-forma net income of $2.2 million on net sales of $36.3 million in the second quarter of 1995.

This represents a 44.1 percent increase in pro-forma net income.

Pro forma earnings per share were 23 cents in the second quarter of 1996.

Net sales increased $6.8 million or 18.8 percent over net sales for the second quarter of 1995, and net sales in comparable stores increased by 0.4 percent, as previously reported. Gross margins for the quarter increased from 33.2 percent to 34.6 percent compared with the same quarter last year primarily due to a changing mix of merchandise.

Year-to-date net sales and pro-forma net income in 1996 increased 22.2 percent to $85.4 million and 36.5 percent to $5.6 million, respectively, compared with net sales and pro-forma net income through the second quarter of 1995 of $69.9 million and $4.1 million, respectively. Year-to-date pro-forma earnings per share were 42 cents.

David Gold, chief executive officer of the company said, "We are pleased to announce favorable results our first quarter following our initial public offering. Our expansion is proceeding in accordance with plan. We opened a 26,000 square foot store in July 1996 and plan four to five additional stores by year end."

Prior to May 1, 1996, the company was treated as an S corporation for tax purposes. The pro-forma net income and pro- forma earnings per share data reflect a provision for income taxes as if the company were a C corporation for all periods presented. Pro- forma earnings per share for the fiscal 1996 period were computed using a weighted average number of 13.7 million shares and 13.2 million shares for the second quarter and year-to-date, respectively. At June 30, 1996, the company had 14.8 million shares outstanding. The full impact of this increase in the number of shares will not be reflected in earnings per share data until the third quarter 1996.

The company is a leading deep-discount retailer of primarily name brand, consumable general merchandise, at the 99 cents price point. 99 Cents Only Stores operates 39 retail stores, all in Southern California and a wholesale division under the name of Bargain Wholesale. -0-

                           99 Cents Only Stores
                           Statements of Income
                               (unaudited)

                            Three months              Six months
                           Ended June 30,           Ended June 30,
                         1996         1995         1996        1995
Net sales:
 99 Cents Only
   Stores            $34,136,000  $29,807,000  $66,392,000  $56,899,000
 Other retail                  0      165,000            0      492,000
 Bargain Wholesale     9,037,000    6,370,000   19,057,000   12,508,000
                      43,173,000   36,342,000   85,449,000   69,899,000

Cost of sales         28,239,000   24,291,000   57,049,000   46,721,000
 Gross profit         14,934,000   12,051,000   28,400,000   23,178,000
Selling, general
  and administrative
  expenses             9,607,000    8,302,000   18,673,000   16,055,000
 Operating income      5,327,000    3,749,000    9,727,000    7,123,000
Interest expense, net     63,000      189,000      252,000      378,000
 Income before pro-
   forma provision
   for income taxes    5,264,000    3,560,000    9,475,000    6,745,000
Pro-forma provision
  for income taxes     2,162,000    1,408,000    3,881,000    2,646,000
Pro-forma net income $ 3,102,000  $ 2,152,000  $ 5,594,000  $ 4,099,000
Pro-forma earnings
  per common share   $      0.23               $      0.42
Pro-forma weighted
  average number of
  common shares
  outstanding         13,698,000                13,247,000

NOTE:  Total common shares outstanding at June 30, 1996 were
       14,816,635.

CONTACT: 99 Cents Only Stores, City of Commerce

Eric Schiffer, 213/980-8145