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BRADLEES, INC. REPORTS SECOND QUARTER RESULTS

 BRAINTREE, Mass., Sept. 14 /PRNewswire/ -- Bradlees, Inc. (NYSE: BLE) today reported sales for the 12 weeks ended Aug. 14, 1993 were $392.1 million compared with $367.1 million for the second quarter last year. Comparable store sales were up 4 percent. Operating profit for the second quarter of 1993 was $1.9 million vs. $6.5 million on a pro forma basis last year. The loss per share for the quarter of 44 cents includes a one-time 19 cent per share deferred tax charge due to the higher corporate tax rate legislated by the Omnibus Budget Reconciliation Act of 1993. The loss last year was 3 cents on a pro forma basis.
 Sales for the 28 weeks ended Aug. 14, 1993 were $851.5 million compared with $826.0 million in 1992. Comparable store sales were up 1 percent. The year-to-date operating loss was $5.3 million compared with a pro forma operating profit of $4.7 million last year. Before the extraordinary loss related to the March 1993 debt refinancing, the 1993 year-to-date loss per share was $1.28 (including the above-referenced 19 cent tax charge) vs. last year's pro forma loss of 62 cents.
 The company does not anticipate a LIFO charge for fiscal 1993 as a result of its acquisition of the Bradlees Business in July, 1992. The 1992 LIFO charge, on a pro forma basis, was $0.9 million for the second quarter and $2.2 million for the first half.
 "We found consumer demand to be quite soft during much of the spring and summer, thus negatively impacting our results," said Barry A. Berman, chairman and chief executive officer of Bradlees, Inc. "Sales, though sluggish in the last half of May and all of June, picked up considerably in July, but then declined again in August. Consequently, we increased our advertising and markdowns in order to clear summer merchandise. At present, we are well positioned to take advantage of any upturn in the economy and any increase in consumer spending during the fall and holiday season."
 Bradlees, Inc. operates 126 discount department stores in Maine, New Hampshire, Massachusetts, Connecticut, New York, New Jersey, Pennsylvania and Virginia. Bradlees' common stock is listed and traded on the New York Stock Exchange under the symbol "BLE."
 BRADLEES, INC. AND SUBSIDIARIES
 Condensed Consolidated Historical Statements of Operations
 (In thousands except per share amounts)
 Company
 Period from
 12 Wks Ended July 10 to 28 Wks Ended
 Aug 14, 1993 Aug 15, 1992 Aug 14, 1993
 Retail Sales $392,094 $154,113 $851,534
 Cost of goods sold,
 buying and warehousing
 costs 277,214 107,587 595,509
 Selling, store operating
 and administrative
 expenses 101,972 38,729 236,271
 Depreciation and
 amortization 11,012 4,701 25,060
 Operating profit (loss) 1,896 3,096 (5,306)
 Interest expense, net 7,287 3,110 16,665
 Loss before income
 tax benefit and
 extraordinary loss (5,391) (14) (21,971)
 Income tax benefit (441) (6) (7,571)
 Loss before extraordinary
 loss (4,950) (8) (14,400)
 Extraordinary loss, net --- --- (5,200)
 Net loss $(4,950) $(8) $(19,600)
 Net loss per share:
 Loss before
 extraordinary loss $(0.44) --- $(1.28)
 Extraordinary loss, net --- --- $(0.46)
 Net loss $(0.44) --- $(1.74)
 Predecesor
 Corporation
 Period from Period from
 May 24 to Feb 2 to
 July 9, 1992 July 9, 1992
 Retail Sales $212,986 $671,844
 Cost of goods sold,
 buying and warehousing
 costs 150,532 465,733
 Selling, store operating
 and administrative expenses 54,739 184,665
 Depreciation and
 amortization 6,456 21,417
 Operating profit (loss) 1,259 29
 Interest expense, net 7,906 27,165
 Loss before income
 tax benefit and
 extraordinary loss (6,647) (27,136)
 Income tax benefit --- ---
 Loss before extraordinary
 loss (6,647) (27,136)
 Extraordinary loss, net --- (1,122)
 Net loss $(6,647) $(28,258)
 Note: Footnotes (a) and (b) which provide pro forma data and explanations are presented on the following page.
 Bradlees, Inc. and Subsidiaries
Note: (a) Condensed Consolidated Pro Forma Statements of Operations
 (In thousands except per share amounts)
 12 Weeks Ended 28 Weeks Ended
 8/14/93 8/15/92 8/14/93 8/15/92
 Actual Pro Forma Actual Pro Forma
 Retail sales $392,094 $367,099 $851,534 $825,957
 Cost of goods
 sold, buying and
 warehousing costs 277,214 256,206 595,509 571,407
 Selling, store
 operating and
 administrative
 expenses 101,972 94,236 236,271 226,505
 Depreciation and
 amortization 11,012 10,173 25,060 23,387
 Operating profit
 (loss) 1,896 6,484 (5,306) 4,658
 Interest expense,
 net 7,287 7,158 16,665 16,788
 Loss before income
 tax and
 extraordinary loss (5,391) (674) (21,971) (12,130)
 Income tax benefit (441) (290) (7,571) (5,216)
 Loss before
 extraordinary loss $(4,950) $(384) $(14,400) $(6,914)
 Loss before extraordinary
 loss per share (b) $(0.44) $(0.03) $(1.28) $(0.62)
 Note: (b) 1993 results are not directly comparable to those in 1992 because of the following:
 -- The 1993 cost of goods sold, buying and warehousing costs does not include a charge for the last-in, first-out method of valuing inventory ("LIFO"). The 1992 LIFO charge was $0.9 million or $0.04 per share (net of taxes) and $2.2 million or $0.11 per share (net of taxes) for the 12 and 28 weeks ended Aug. 15, 1992 respectively.
 -- In 1993, the company issued 9.25 percent Senior Subordinated Notes due ("2003 Notes"), which would have increased interest expense (net of taxes) by $0.02 per share in the 12 weeks ended Aug. 15, 1992 and $0.02 and $0.04 per share in the 28 weeks ended Aug. 14, 1993 and Aug. 15, 1992, respectively, had the 2003 Notes been outstanding in 1992.
 -- The higher tax rate legislated by the Omnibus Budget Reconciliation Act of 1993 reduced the income tax benefit by $2.1 million or $0.19 per share for both the 12 and 28 weeks ended Aug. 14, 1993, for a one-time charge related to prior years' deferred income taxes.
 BRADLEES, INC. AND SUBSIDIARIES
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (In thousands)
 Aug. 14, Jan. 30, Aug. 15,
 1993 1993 1992
 ASSETS
 Current assets:
 Cash and cash
 equivalents $4,261 $11,460 $15,589
 Inventories 326,996 271,496 299,045
 Other current assets 47,173 38,951 29,204
 Total current assets 378,430 321,907 343,838
 Property, plant and
 equipment, net 189,370 175,478 162,065
 Lease interests and
 acquisition costs 257,755 261,705 255,466
 Other 7,607 13,012 14,835
 Total assets $833,162 $772,102 $776,204
 LIABILITIES AND STOCKHOLDERS' EQUITY
 Current liabilities:
 Accounts payable $202,890 $135,905 $190,994
 Accrued expenses 64,617 90,430 48,658
 Short-term and current
 portion of debt 27,537 14,557 24,371
 Total current
 liabilities 295,044 240,892 264,023
 Long-term debt 267,151 245,166 253,490
 Deferred income taxes 98,772 105,739 111,665
 Other long-term
 liabilities 31,757 17,385 13,931
 Stockholders' equity 140,438 162,920 133,095
 Total liabilities and
 stockholders' equity $833,162 $772,102 $776,204
 BRADLEES, INC. AND SUBSIDIARIES
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (In thousands)
 Predecessor
 Company Corporation
 Period from Period from
 28 Weeks Ended July 10 to Feb. 2 to
 Aug 14, 1993 Aug. 15, 1992 July 9, 1992
 Cash flows from
 operating activities:
 Net loss $(19,600) $(8) $(28,258)
 Adjustments:
 Extraordinary loss on
 debt retirement 5,200 --- 1,122
 Depreciation and
 amortization 25,060 4,701 21,417
 Other noncash items 1,180 263 1,605
 Change in working
 capital, net (15,145) 6,435 (5,346)
 Net cash provided (used)
 by operating activities (3,305) 11,391 (9,460)
 Cash flows from investing
 activities:
 Acquisition, net of cash
 acquired --- (334,996) ---
 Capital expenditures, net
 of disposals (30,529) (7,625) (22,987)
 Lease acquisition costs (345) --- ---
 Net cash used in investing
 activities (30,874) (342,621) (22,987)
 Cash flows from financing
 activities:
 Proceeds from long-term
 debt 100,000 340,000 ---
 Principal payments on
 long-term debt (86,320) (121,200) (5,137)
 Net borrowings under
 revolver 21,500 10,000 ---
 Net borrowings under
 intercompany debt --- --- 46,444
 Extraordinary items - debt
 retirement 3,925 --- (546)
 Deferred financing costs (4,450) (14,300) (3,604)
 Principal payments under
 capital lease obligations(4,387) (745) (4,001)
 Preceeds from initial
 issuance of common stock --- 133,064 ---
 Other common stock activity,
 net 92 --- ---
 Dividends paid (3,380) --- ---
 Net cash provided by
 financing activities 26,980 346,819 33,156
 Net increase (decrease)
 in cash and cash
 equivalents (7,199) 15,589 709
 Cash and cash equivalents:
 Beginning of period 11,460 --- 1,859
 End of period $4,261 $15,589 $2,568
 -0- 9/14/93
 /CONTACT: Aileen Gorman of Bradlees, 617-380-8370/
 (BLE)


CO: Bradlees, Inc. ST: Massachusetts IN: REA SU: ERN

DD-DJ -- NE001 -- 1628 09/14/93 09:28 EDT
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