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AMERICAN STUDIOS, INC. ANNOUNCES ASSOCIATION WITH WAL-MART IN MEXICO AND SECOND QUARTER TRENDS

 CHARLOTTE, N.C, May 12 /PRNewswire/ -- American Studios, Inc. (NASDAQ-NMS: AMST), the principal provider of portrait photography services to Wal-Mart Stores, Inc. (NYSE: WMT) today announced that it has been selected by Wal-Mart Stores, Inc. to open portrait photography studios in Wal-Mart Stores in Mexico, with the first studio expected to be in operation during 1993. R. Kent Smith, president, said that he is pleased with the confidence Wal-Mart has shown in American Studios and believes that Mexico will be a strong market for portrait photography services.
 American Studios also reported that, with seven of the second quarter's thirteen weeks completed as to portraits taken and four weeks completed as to sales, it appears that, current trends in customer count and revenues will be below plan for the second quarter. This appears to be due to uncertainty in the economy during April and May as well as to competitive pressures that developed during the period. Because of the presently anticipated shortfall in revenues against plan, the company expects its earnings for the second quarter to be below analysts' expectations.
 "Looking ahead," Smith commented, "we have developed and are beginning to implement several marketing and product strategies to increase sales and respond to competitive pressure. The company is also putting into place certain cost reduction programs in light of the current trend in revenues. We believe these measures will have a positive impact by the fourth quarter."
 Smith stated, "The company continues to be on schedule with expected new store and permanent studio openings and expects to have approximately 290 permanent studios in operation by the end of the second quarter."
 As of the end of the first quarter of 1993, American Studios, Inc., provided portrait photography services in over 1,700 Wal-Mart stores in 34 states and Puerto Rico.
 -0- 5/12/93
 /CONTACT: R. Kent Smith, President, or A. Allen Henderson, CFO, American Studios, Inc., 704-588-4351/
 (AMST WMT)


CO: American Studios, Inc.; Wal-Mart Stores, Inc. ST: North Carolina IN: REA SU: ECO

MM -- CH013 -- 7788 05/12/93 17:27 EDT
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Publication:PR Newswire
Date:May 12, 1993
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