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The slow June does not seem to be a yearly occurence given that June 2003 was pretty good. The retail industry in general had a bad June and Cache seems to have suffered too.

June was up last year and down this year because of high inventory last year. They overpriced their prom dresses and had many left over after prom season, so they marked them down and sold them last June and July. They didn't have the same problem this year so they didn't have as much clearence merchandise to move. This is what managment says about the SSS for June and July of this year being down.

I don't have any feel how succesful the formal wear market can be when it comes to solid growth. If they plan to diversify and are competent to do so, that may be a catalyst. Sounds like expansion is in their future. Are they sticking with party clothes for the expansion?

Due to the seasonality of the formal wear, they are trying to push more sportswear and accessories. They have recently introduced denim into the Cache branded stores which has been quite successful. They said on the last conference call that they increased their denim order for the fall season due to its strength. So they are trying to move away from formal party attire. So far, Lillie Rubin does not have any denim.

Here is the breakdown of sales at Cache branded stores for the past 3 years:

52 Weeks Ended
December 29, December 28, December 27,
2001 2002 2003
------------ ------------ ------------
Sportswear 67.0% 64.3% 67.3%
Dresses 24.7 27.5 24.3
Accessories 8.3 8.2 8.4
------------ ------------ ------------
Total 100.0% 100.0% 100.0%
============ ============ ============

I can't find it now so it must have been in a conference call, but I believe they're trying to get Sportswear to be over 70% of sales.

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