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Federated 1st Quarter

From: ASAP

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Federated Department Stores, Inc. (NYSE:FD) (PCX:FD) today reported total sales of $1.097 billion for the four weeks ended May 4, 2002. This represents a decrease of 5.6 percent from total sales of $1.162 billion for the same period last year. On a same-store basis, Federated's April sales were down 5.9 percent.

For the first quarter and year to date, Federated's sales totaled $3.454 billion, a decrease of 2.9 percent compared to sales of $3.556 billion for the first 13 weeks of last year. On a comp- store basis, Federated's first quarter and year-to-date sales also were down 2.9 percent, which is in the previously forecasted range for the quarter of down 2-3 percent.

"Cooler weather in the last week of the month hurt our apparel business, but in spite of that, same-store sales for the quarter were within the range of our expectations," said James M. Zimmerman, Federated's chairman and chief executive officer. He added that the company was especially pleased with early results from its most recently opened new stores, including Bloomingdale's in Bridgewater and Willowbrook, NJ; Rich's in Columbus, GA; and Macy's in Capitola, CA.

Zimmerman also noted that the quantity and quality of the company's inventory position going into the quarter contributed to a gross margin rate that was better than anticipated. As a result, he said, the company expects first quarter earnings to be in the range of 40-43 cents a share, which exceeds prior guidance of 25- 30 cents a share. The company's earnings guidance for the remaining three quarters of the year, however, remains unchanged at 50-60 cents a share in the second quarter and $2.45-$2.65 for the fall season.

Federated, with corporate offices in Cincinnati and New York, is one of the nation's leading department store retailers, with annual sales of more than $15.6 billion. Federated currently operates more than 450 stores in 34 states, Guam and Puerto Rico, under the names of Macy's, Bloomingdale's, The Bon Marche, Burdines, Goldsmith's, Lazarus and Rich's. The company also operates macys.com and Bloomingdale's By Mail.

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