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MICHAELS REPORTS RECORD THIRD-QUARTER EARNINGS; PER-SHARE EARNINGS UP MORE THAN 130 PERCENT TO $0.14 PER SHARE

               MICHAELS REPORTS RECORD THIRD-QUARTER EARNINGS;
       PER-SHARE EARNINGS UP MORE THAN 130 PERCENT TO $0.14 PER SHARE
    IRVING, Texas, Nov. 19 /PRNewswire/ -- Michaels Stores, Inc. (NASDAQ: MIKE) today reported that net income for the three months ended Nov. 3, 1991, increased more than 100 percent to a record $1,646,000, or $0.14 per share, on sales that were 21 percent higher at $103,637,000.
    In fiscal 1990's third quarter, ended Oct. 28, the company's sales amounted to $85,448,000 and earnings were $578,000, or $0.06 per share.
    For fiscal 1991's first nine months, Michaels said its net income tripled to $3,124,000, from earnings of $1,039,000, for the previous year's same period.  Earnings per share for the nine months increased 160 percent to $.26 per share compared to $.10 per share last year. Revenues for the latest nine-month period improved 17 percent to $266,704,000, from $228,627,000 a year earlier.
    Michaels pointed out that its sales, on a comparable store basis, rose 17 percent in the third quarter, noting it has opened four new stores this year and currently operates 140 stores.  Comparable store sales have increased more than 9 percent year to date.  Last years' comparable store sales were up 8.5 percent at the end nine months.
    The company said its strong sales performance and higher profit margins are the result of new merchandising, advertising and operating strategies, including the deployment of full-time district managers, initiated in fiscal 1990.
    Michaels also explained that cash provided by operations during the first nine months was $6.8 million, an improvement of $7.5 million from last year's first nine months.  Additionally, the company has reduced its bank borrowings to less than $9 million at Nov. 3, 1991, from more than $41 million at the end of last year's third quarter.
    According to Chairman Sam Wyly, "We are gratified with Michaels' continued strong performance in the face of a sluggish economy and we're pleased with our success in offering the right merchandise at the right price to our customers."
    The nation's leading retailer of arts and crafts, Michaels Stores, Inc. offers a wide selection of picture framing materials, silk and dried flowers, hobby and art supplies, creative crafts and party, seasonal and holiday merchandise.  The company owns and operates 140 stores in 19 primarily Southern states, from California to the Carolinas.
                        MICHAELS STORES, INC.
                        Statements of Income
               (In thousands, except per-share data)
                           Third Quarter          First Nine Months
                          1991       1990         1991        1990
    Net sales          $103,637    $85,448     $266,704    $228,627
    Cost of sales and
     occupancy expense   70,020     58,360      179,440     156,353
    Selling, general
     & admin. expense    28,771     23,213       75,212      62,126
    Interest expense      1,824      2,717        5,473       7,806
    Other income and
     expense, net           283        178        1,374         579
    Income before
     income taxes         2,739        980        5,205        1,763
    Provision for
     income taxes         1,093        402        2,081         724
    Net income            1,646        578        3,124       1,039
    Earnings per share    $0.14      $0.06        $0.26       $0.10
    Wtd. avg. com. & com.
     equiv. shrs.
     outstdg., assuming
     full dilution       12,186      9,943       12,102      10,197
                               Balance Sheets
                               (In thousands)
                                11/3/91               10/28/90
    Assets:
     Cash                          $132                 $1,762
     Merchandise inventories    116,805                106,960
     Other current assets         5,851                  4,496
     Property and
      equipment-net              30,928                 31,696
     Costs in excess of
      net assets of
      acquired operations - net  22,547                 23,209
     Other                        5,350                  5,613
     Total                      181,613                173,736
    Debt and equity:
     Current liabilities         74,945                 48,185
     Senior bank debt             8,500                 41,100
     Other long-term
      liabilities                46,178                 42,716
     Stockholders' equity        51,990                 41,735
     Total                      181,613                173,736
    -0-        11/19/91
    /CONTACT:  Don Morris, CFO of Michaels Stores, 214-580-8242/
    (MIKE) CO:  Michaels Stores Inc. ST:  Texas IN:  REA SU:  ERN CK -- NY048 -- 4953 11/19/91 12:28 EST
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Copyright 1991 Gale, Cengage Learning. All rights reserved.

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Date:Nov 19, 1991
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