Bernard Chaus Reports Improved Fourth Quarter and Year-end Results; Healthier Margins and Lower Costs Contribute.

Business Editors

NEW YORK--(BUSINESS WIRE)--Aug. 30, 2002

Bernard Chaus, Inc. (OTC Bulletin Board: CHBD.OB) today announced its financial results for its fourth quarter and fiscal year 2002.

For the quarter ended June 30, 2002, the Company reported net income of $1.9 million, or $0.07 per share, compared to a net loss of $2.0 million, or a loss of $0.08 per share, in the fourth quarter last year. The results for the fourth quarter of 2002 include a tax benefit of $953,000, or $0.04 per share. Revenues for the fourth quarter of fiscal 2002 were $32.7 million versus $34.5 million in the comparable period last year.

Josephine Chaus, Chairwoman and Chief Executive Officer, commented, "Chaus generated a significant improvement in its results for the fourth quarter and second half of fiscal 2002, consistent with our previously announced expectations. This performance was driven by higher margins, reflecting actions we have taken to source our products more cost efficiently, coupled with a considerable reduction in overhead expense. These initiatives enabled us to increase profitability despite the challenges of the current retail environment."

Nick DiPaolo, Vice Chairman and Chief Operating Officer, added, "Our strategy is to carefully manage our business in department stores to maximize profitability, as we continue to develop our newer private and exclusive label products. We are also keeping a close eye on inventory levels and expenses as we plan our business going into 2003."

For the full fiscal 2002 year, the Company narrowed its net loss to $2.2 million, or $0.08 per share, including a tax benefit of $944,000, or $0.4 per share. In fiscal 2001, the Company's net loss was $7.6 million, or $0.28 per share. Revenues for fiscal 2002 were $145.8 million compared to $149.5 million in fiscal 2001.

Bernard Chaus, Inc., designs, sources and markets an extensive range of women's career and casual sportswear, principally under the Josephine Chaus Collection, Josephine Chaus Studio, Josephine Chaus Essentials and Josephine Chaus Sport trademarks. The Company's products are sold nationwide through department store chains, specialty retailers and other outlets. Further information can be found at www.BernardChaus.com.

This press release contains forward-looking statements that are based upon current expectations and involve a number of uncertainties, including retail market conditions, consumer acceptance of the Company's products, the ability to achieve anticipated profit margins and the ability to refinance the Company's existing credit facility that matures on April 1, 2003. Further information on potential factors which could affect the Company's financial results are included in the Company's Form 10-K for the year ended June 30, 2001 and Form 10-Q for the quarters ended September 30, 2001, December 31, 2001 and March 31, 2002.

                           -Tables Follow -

                 BERNARD CHAUS, INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (Dollars in thousands, except number of shares and per share amounts)


                         For the Quarter Ended    For the Year Ended
                          June 30,    June 30,    June 30,    June 30,
                            2002        2001        2002        2001

Net sales              $   32,730  $   34,530  $  145,769  $  149,499
Cost of goods sold         24,447      28,007     116,951     122,324
                       ----------  ----------  ----------  ----------
Gross profit                8,283       6,523      28,818      27,175

Selling, general and
 administrative expenses    6,991       8,131      30,130      32,666
                       ----------  ----------  ----------  ----------
Income (loss) from
operations                  1,292      (1,608)     (1,312)     (5,491)


Other income                  193           -         193           -
Interest expense, net         496         438       2,049       2,121
                       ----------  ----------  ----------  ----------

Income (loss) before
 provision (benefit)
 for income taxes             989      (2,046)     (3,168)     (7,612)

Income tax provision
 (benefit)                   (953)          3        (944)         11
                       ----------  ----------  ----------  ----------

Net income (loss)      $    1,942  $   (2,049) $   (2,224) $   (7,623)
                       ==========  ==========  ==========  ==========

Basic and diluted income
 (loss) per share      $     0.07  $    (0.08) $    (0.08) $    (0.28)
                       ==========  ==========  ==========  ==========

Weighted average number
 of common shares
 outstanding - basic   27,216,000  27,216,000  27,216,000  27,216,000
                       ==========  ==========  ==========  ==========

Weighted average number
 of common and
 common equivalent
 shares outstanding -
 diluted               27,911,000  27,216,000  27,216,000  27,216,000
                       ==========  ==========  ==========  ==========



                 BERNARD CHAUS, INC. AND SUBSIDIARIES
               CONDENSED CONSOLIDATED BALANCE SHEET DATA
                        (Dollars in thousands)


                                      June 30,    June 30,
                                        2002        2001


Cash and cash equivalents           $     150   $     183
Accounts receivable, net               20,586      23,688
Inventories                             8,050      13,582
Prepaid expenses and other
 current assets                         1,331       1,051
Fixed and other assets, net             5,574       6,291
                                    ---------   ---------
Total assets                        $  35,691   $  44,795
                                    =========   =========

Revolving credit borrowings         $   3,591   $   5,024
Accounts payable and accrued
 expenses                              12,997      17,295
Term loan                              10,500      11,500
Other long term liabilities               390         297
                                    ---------   ---------
   Total liabilities                   27,478      34,116
Total stockholders' equity              8,213      10,679
                                    ---------   ---------
Total liabilities and
 stockholders' equity               $  35,691   $  44,795
                                    =========   =========