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SOFTWARE ETC. STORES, INC. NET INCOME INCREASES 71 PERCENT IN RECORD YEAR

 MINNEAPOLIS, Feb. 24 /PRNewswire/ -- Software Etc. Stores, Inc. (NASDAQ: SFWR), the nation's leading specialty retailer of home PC and video game software, today reported its results for the fourth quarter and 12 months ended Jan. 30, 1993.
 Revenues in the fourth quarter were $87.4 million, up 34 percent from $65.0 million a year ago. Net income for the quarter, before the extraordinary item, was $6.0 million or $.84 per share compared with $4.5 million for the same quarter last year. For the 12 months ended Jan. 30, 1993, revenues reached $203.4 million, up 22 percent from $166.2 million for the year-ago period. Net income for the year was $8.9 million, up 71 percent from $5.2 million a year ago; earnings per share, before non-recurring items, were $.88 per share.
 Comparable store sales for the fourth quarter rose 17 percent for the fourth quarter and 12 percent for the year. Dan DeMatteo, president and CEO, said that operating margins for the year increased 6.0 percent from 5.5 percent one year ago, due to increased sales per store and continued expense control. DeMatteo said he's optimistic about the 1993 outlook for home PC software and video game software: "There are approximately 10 million more 16-bit systems in the home today than there were one year ago -- a four-fold increase. In addition, PC hardware dealers have reported strong sales of home PCs throughout 1992. As a result, we're expecting a successful year for PC software and video game software."
 During the year Feb. 2, 1992 - Jan. 30, 1993, Software Etc. opened 42 new stores and relocated 5 stores. As of Jan. 30, the company operated 266 stores in 38 states and the District of Columbia. Software Etc. stores stock broad assortments of home personal computer software; supplies and accessories; video game software and systems; PC upgrades, and computer books and magazines.
 SOFTWARE ETC. STORES, INC.
 Statement of Operations
 (Unaudited)
 (in thousands, except per share data)
 Three Months Ended 12 Months Ended
 1/30/93 2/01/92 1/30/93 2/01/92
 Net sales $87,437 $65,018 $203,380 $166,169
 Cost of sales 61,998 44,137 139,260 109,839
 Gross margin 25,439 20,881 64,120 56,330
 Store operating expense 12,737 10,659 43,752 39,333
 General and
 administrative expense 2,077 1,956 7,743 7,655
 Store closing expense -- 1 346 205
 Operating income 10,625 8,265 12,279 9,137
 Interest expense, net 625 893 2,749 3,704
 Income before income taxes
 and extraordinary item 10,000 7,372 9,530 5,433
 Provision for income taxes 4,001 2,838 3,856 1?,998
 Income before extraordinary item 5,999 4,534 5,674 3,435
 Extraordinary item: Tax benefit
 from net operating loss
 carryforwards 3,402 2,506 3,241 1,769
 Net income $9,401 $7,040 $8,915 $5,204
 Preferred stock dividends and
 redemption premium -- (224) (318) (893)
 Net income applicable to
 common stockholders $9,401 $6,816 $8,597 $4,311
 Income per common share
 before extraordinary item $0.84 $0.97 $0.83 $0.57
 Extraordinary item per
 common share 0.48 0.56 0.50 0.40
 Net income per common share $1.32 $1.53 $1.33 $0.97
 Weighted average shares used
 in per share calculation 7,136 4,453 6,477 4,453
 SOFTWARE ETC. STORES, INC.
 Balance Sheets
 (Dollars in thousands)
 (Unaudited)
 1/30/93 2/01/92
 Current assets
 Cash and cash equivalents $2,235 $1,461
 Merchandise inventories 54,737 43,870
 Other current assets 6,131 4,095
 Total current assets 63,103 49,426
 Property and equipment, net 20,935 17,971
 Other assets 279 264
 -- $84,317 $67,661
 Current liabilities
 Outstanding checks $7,619 $6,939
 Accounts payable 31,491 19,676
 Short-term bank debt -- 13,000
 Short-term debt to related party 500 10,000
 Accrued expenses 6,793 4,735
 Total current liabilities 46,403 54,350
 Deferred credits 2,122 1,790
 Long-term debt to related parties 25,084 22,195
 Total liabilities 73,609 78,335
 Redeemable preferred stock -- 12,580
 Stockholders' equity (deficit) 10,708 (23,254)
 -- $84,317 $67,661
 -0- 2/24/93
 /CONTACT: Dan DeMatteo, 612-893-7052, or Bob Strawman, 612-893-7622, both of Software Etc. Stores/
 (SFWR)


CO: Software Etc. Stores, Inc. ST: Minnesota IN: REA SU: ERN

AL -- MN008 -- 9900 02/24/93 12:09 EST
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Copyright 1993 Gale, Cengage Learning. All rights reserved.

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Date:Feb 24, 1993
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