Bernard Chaus, Inc. Announces Results For Fiscal Second Quarter 1997.

NEW YORK--(BUSINESS WIRE)--February 4, 1997--Bernard Chaus, Inc. (NYSE: CHS) today announced results for its fiscal second quarter ended December 31, 1996. Net sales for the second quarter of fiscal 1997 were $38.1 million, resulting in net loss of $4.3 million, or $0.16 per share. In the comparable period of the previous year, the Company reported a net loss of $3.9 million, or $0.17 per share.

For the six-month period ended December 31, 1996, the Company reported net sales of $86.1 million resulting in a net loss of $3.9 million, or $0.15 per share. For the comparable six-month period of the previous year, the company reported a net loss of $4.3 million, or $0.20 per share.

Josephine Chaus, Chairwoman, and Andrew Grossman, Chief Executive Officer, said, "As anticipated, the losses for the quarter and six-month periods were roughly comparable to the losses we incurred for the same periods last year. However, gross margins for the quarter and six-month periods improved compared to the same periods last year as we commenced shipments of our licensed Nautica women's line, and reduced the level of off-price sales for core Chaus products. In addition, we are anticipating substantially improved operating performance for the second half of the fiscal year as compared to the second half of last year. This improvement is expected to come from continued shipments of our Nautica line, coupled with improved performance of the Chaus line."

The Company also announced it has received continued support from The Bank of New York which has waived noncompliance with financial covenants for the period ended December 31, 1996. Additional sources of financing will nonetheless be required to adequately support the business. In that regard, the Company has engaged Lehman Brothers to explore various alternatives available to the Company.

Additionally, the Company announced that Michael Winter has resigned from his position as President of the Nautica division, effective as of December 31, to form a consulting firm. Andrew Grossman, Chief Executive Officer, has assumed responsibilities for the day-to-day operations of the Nautica division. During the transition period, Mr. Winter is acting as a consultant to the Company.

This press release contains forward-looking statements which are based upon current expectations and involve a number of uncertainties, including the Company's ability to secure additional financing, retail market conditions, and consumer acceptance of product. Further information on potential factors which could affect the company's financial results is included in the Company's Form 10-K for the year ended June 30, 1996.

The Company designs, arranges for the manufacture of and markets an extensive range of women's career and casual sportswear which are marketed principally under the CHAUS(R), CHAUS SPORT(R) and NAUTICA(R) trademarks. The Company's products are sold nationwide through department store chains, specialty retailers and other retail outlets. -0-

                           BERNARD CHAUS, INC.
                      STATEMENT OF OPERATIONS DATA
           (Dollars In Thousands, Except Share and Per Share Data)

                           For the Six               For the
                           Months Ended            Quarter Ended
                           December 31,            December 31,
                        1996         1995        1996        1995

Net Sales            $ 86,094     $ 97,920    $ 38,084    $ 49,035
Cost of goods sold     65,746       79,300      30,214      41,159
Gross profit           20,348       18,620       7,870       7,876

Selling, general &
 administrative
  expenses             20,428       19,677      10,173       9,913
Loss from operations      (80)      (1,057)     (2,303)     (2,037)

Interest and other
 income, net               41           50          35         (58)
Interest expense       (3,832)      (3,128)     (1,994)     (1,709)
 Loss before income
  taxes                (3,871)      (4,135)     (4,262)     (3,804)
Income taxes               36          151           6          75

Net loss              ($3,907)     ($4,286)    ($4,268)    ($3,879)

Net loss per common
 share                 ($0.15)      ($0.20)     ($0.16)     ($0.17)

Weighted average number
of common equivalent
shares outstanding 26,277,000   21,735,000  26,277,000  23,010,000
-0-

                                SELECTED BALANCE SHEET DATA
                                  (Dollars in thousands)

                                  December 31,    December 31,
                                     1996            1995


Cash and cash equivalents            $ 39           $ 312
Accounts receivable, net            7,124          19,401
Inventory                          19,020          22,491
Working capital (deficiency)      (22,134)         (1,093)
Total assets                       29,557          45,768
Total liabilities                  74,061          66,618
Stockholders' deficiency          (44,504)        (20,850)
-0-

CONTACT: Wayne Miller, Chief Financial Officer

[phone]