Arden Group, Inc. Announces Third Quarter Earnings.

Business Editors

LOS ANGELES--(BUSINESS WIRE)--Oct. 30, 2002

Arden Group, Inc. (Nasdaq:ARDNA) today released its sales and income figures for the third quarters ended September 28, 2002 and September 29, 2001, respectively.

Arden Group, Inc. is the parent company of Gelson's Markets which operates 16 Gelson's and two Mayfair supermarkets in Southern California.

            ARDEN GROUP, INC. AND CONSOLIDATED SUBSIDIARIES
                         THIRD QUARTER REPORT

(In Thousands, Except
Share and Per Share Data)                 (Unaudited)

                              Thirteen Weeks       Thirty-Nine Weeks
                                  Ended                  Ended
                          Sept. 28,   Sept. 29,  Sept. 28,   Sept. 29,
                            2002        2001       2002        2001

Sales              (a)   $ 98,207    $ 96,920    $297,477    $288,239

Operating income   (b)      5,234       5,284      17,114      16,152
Interest, dividend
 and other income
 (expense), net    (c)        373         421         827       1,172

  Income before
   income taxes             5,607       5,705      17,941      17,324
Income tax
 provision                  2,285       2,325       7,310       7,059

  Net income             $  3,322    $  3,380    $ 10,631    $ 10,265

Net income per
 common share:
  Basic                  $   0.99    $   1.01    $   3.17    $   3.02
  Diluted                $   0.99    $   1.01    $   3.16    $   3.01

Weighted average
 common shares
 outstanding:
  Basic                 3,361,069   3,347,569   3,352,874   3,403,122
  Diluted               3,371,691   3,351,123   3,364,192   3,406,676


(a) Sales increased 1.3% in the third quarter and 3.2% in the first
    nine months over the prior year. Same store sales declined 0.9% in
    the quarter and increased 1.1% in the first nine months. Total
    sales increased as a result of the Company's September 2001 store
    opening in Pasadena, California. The Pasadena store continues to
    perform below management's original expectations. Competitor
    openings resulted in a decline in same store sales during the
    quarter.

(b) Operating income declined $50,000 in the third quarter 2002
    reflecting the favorable impact of improved gross profit offset by
    higher delivery, selling, general and administrative ("DSG&A")
    expenses. Gross profit improved as a result of product pricing
    decisions, increased buying allowances and lower supply costs. The
    May 2002 reinstatement of union pension contributions to a
    multi-employer trust fund covering the majority of the Company's
    employees and incremental operating costs associated with the
    Pasadena store which opened late third quarter 2001 resulted in
    higher DSG&A expenses over the prior year.

    Operating income increased $962,000 in the first nine months over
    the prior year. Improved gross profit resulting from product
    pricing decisions, increased buying allowances and lower supply
    costs contributed significantly to the improvement.

(c) Lower overall interest rates partially offset by higher average
    levels of interest bearing investment contributed to the decline
    in interest, dividend and other income in 2002.