Sales at off-price casual apparel store chain Factory 2-U Stores Inc fell 5.4 per cent to $49.9 million in the five-week period ended 6 July 2002, compared with $52.8 million for the same period in 2001.

Comparable store sales decreased 6.3 per cent versus a decrease of 5.5 per cent last year.

Sales for the 22-week period ended 6 July 2002 dropped 8.1 per cent to $203.5 million against $221.5 million last year. Comparable store sales decreased 11.4 per cent versus a decrease of 4.1 per cent last year.

Mike Searles, chairman and chief executive officer, said the strongest performing merchandise category was infant/toddler with positive low double-digit comparable store sales. "Our men's category, as has been the trend, performed the poorest with mid-teen negative double-digit comparable store sales."

Mr Searles continued: "We continue to anticipate comparable store sales for our second quarter to be in the mid to high negative single-digit range and a loss of between $0.14 and $0.18 per share for the second quarter as a result of increased promotional activity associated with the grand re-opening of our 257 Factory 2-U stores."