DUCK Alco Stores, Inc. (MM)

Duckwall-ALCO Stores, Inc. Reports June Sales Company Opens First 'ALCO Market Store' ABILENE, Kan., July 8 /PRNewswire-FirstCall/ -- Duckwall-ALCO Stores, Inc. (NASDAQ:DUCK), a leading regional retailer operating 264 full-line discount and hometown variety stores in 21 states in the central portion of the United States, today announced that its sales for the five weeks ended July 4, 2004 (fiscal month of June) increased approximately 0.3% to $42.4 million, compared with $42.3 million in the prior-year month. Same-store sales decreased approximately 0.2% for the month. ALCO stores, which generate approximately 93% of the Company's total revenues, recorded a 0.3% same-store sales decrease, while the Duckwall division recorded an increase of 1.4%. Management believes that sales for the month were negatively impacted by higher gasoline prices, which are beginning to affect discretionary spending by budget-conscious families that shop at discount retail stores. Sales for the month were also unfavorably impacted by a two-day calendar shift in the July 4th holiday (from Friday last year to Sunday this year) and unseasonably cool weather, which affected demand for warm weather-related items such as fans, apparel and summer seasonal merchandise. Merchandise categories that were particularly strong during June included crafts, jewelry, furniture, toys, Independence Day decorations, pet supplies, horticulture and ladies bottoms. For the twenty-two weeks ended July 4, 2004, total sales increased approximately 2.3% to $182.1 million, versus $178.0 million in the corresponding period of the prior year, while same-store sales decreased approximately 0.1%. June was highlighted by the opening of the Company's first "ALCO Market Store", which devotes approximately 25% of its floor space to a limited assortment of foods including produce, dry goods and frozen / coolers. "An existing ALCO store in Oklahoma was converted to the new format, and if the initial Market Store performs in accordance with management's expectations, the concept offers exciting possibilities for the future," noted a Company spokesman. "The enlargement of our grocery department represents a natural progression in the Company's successful expansion of its consumable product offerings during the past several years." The Company did not open or close any ALCO or Duckwall stores during the month of June 2004. Store openings during the first twenty-two weeks of the current fiscal year included 2 new ALCO stores, 1 ALCO Market Store, and 0 new Duckwall stores. Approximately 5 new ALCO stores and 2 new Duckwall stores are expected to open during the balance of the fiscal year. Duckwall-ALCO Stores, Inc. is a leading regional retailer that operates 264 full-line discount and hometown variety stores in 21 states in the central portion of the United States under the names "ALCO", "ALCO Market Store" and "Duckwall", respectively. The Company's strategy is to target smaller markets not served by other regional or national full-line retail discount chains and provide the most convenient access to retail shopping within each market. Duckwall-ALCO Stores, Inc. is headquartered in Abilene, Kansas, and its common stock is listed on the Nasdaq National Market under the symbol "DUCK". Forward-looking statements This press release contains forward-looking statements, as referenced in the Private Securities Litigation Reform Act of 1995 ("the Act"). Any forward-looking statements are made by the Company in good faith, pursuant to the safe-harbor provisions of the Act. These forward-looking statements reflect management's current views and projections regarding economic conditions, retail industry environments and Company performance. Factors, which could significantly change results, include but are not limited to: sales performance, expense levels, competitive activity, interest rates, changes in the Company's financial condition and factors affecting the retail category in general. Additional information regarding these and other factors may be included in the Company's quarterly 10-Q filings and other public documents, copies of which are available from the Company on request. CONTACT: Dick Mansfield Vice President, Finance, Treasurer and Chief Financial Officer 785-263-3350 x286 e-mail: internet home page: http://www.duckwall.com/ or RJ Falkner & Company, Inc., Investor Relations Counsel, at (800) 377-9893 or via e-mail at DATASOURCE: Duckwall-ALCO Stores, Inc. CONTACT: Dick Mansfield, Vice President, Finance, Treasurer and Chief Financial Officer of Duckwall-ALCO Stores, Inc., +1-785-263-3350 x286, ; or RJ Falkner & Company, Inc., Investor Relations Counsel, +1-800-377-9893, , for Duckwall-ALCO Stores, Inc. Web site: http://www.duckwall.com/

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