Sales at off-price branded casual apparel retailer Factory 2-U Stores Inc fell 16.1 per cent over the four-week period ended 4 May 2002 to $34.5 million. This compares to sales of $41.1 million for the same period in 2001, but was in line with expectations.

Comparable store sales dropped 17.9 per cent versus a decrease of 10.5 per cent for the same period last year.

Sales for the thirteen-week period totalled $117.0 million, 7.1 per cent less than last year's $125.8 million. Comparable store sales for the quarter fell 11.8 per cent as the company opened 5 new stores and closed 28.

Mike Searles, chairman and chief executive officer, said the company expects a modest improvement in second quarter sales and a significant improvement in the second half of this fiscal year.