SECAUCUS, N.J.--(BUSINESS WIRE)--Nov. 14, 2002--The Children's Place Retail Stores, Inc. (Nasdaq: PLCE) today reported financial results for the third quarter and nine months ended November 2, 2002.

Third Quarter

• Net sales for the third quarter decreased 4% to $173.4 million, compared with $181.4 million for the same period in 2001.

• Comparable store sales decreased 21% in the quarter, versus a 9% decrease for the same period last year.

• Net earnings were $1.6 million, versus $18.7 million a year earlier.

• Diluted earnings per share were $0.06 compared with $0.70 in the 2001 period.

• The Company opened 30 new stores during the third quarter, including 13 in Canada, and closed one.

Nine-Month Period

• Net sales for the nine-month period increased 4% to $474.7 million, from $458.2 million for the same period in 2001.

• Comparable store sales decreased 15% for the period, compared to an 8% decrease for the same period last year.

• Net earnings were $6.6 million, compared to $27.6 million in the year-ago period.

• Diluted earnings per share were $0.25 compared to earnings per share of $1.03 in the 2001 period.

• The Company opened 110 new stores during the nine-month period, including 26 in Canada, and closed one.

"As previously announced, our third quarter results were negatively impacted by merchandise that was over-assorted and over-designed," said Ezra Dabah, Chairman and Chief Executive Officer. "Compounding this was the continuation of both low inventory levels and late deliveries, especially of our successful `2for' items."

"We have learned from our recent experiences and with our strategies clearly defined, our efforts now center on implementation. Our brand identity, unique styling and fashion offering remain consistent and we are focusing on balance as a key to our merchandising strategy. Product quality is being enhanced and the new pricing strategy will bring to our customers even greater value every day. As our initiatives are being implemented, we are tightly managing our expenses and notably our balance sheet remains healthy, with no debt."

Separately, the Company announced today that its current fiscal 2003 store expansion plan is to open approximately 50 stores. Mr. Dabah commented, "While our stores continue to produce meaningful returns on investment, we are adjusting our growth plans and focusing on maximizing the sales productivity of our existing stores."

The Children's Place will host a webcast of its third quarter conference call today at 10:00 a.m., Eastern Time. Interested parties are invited to listen to the call at the Company's web site, www.childrensplace.com. An archive of the webcast will be available on the site through Thursday, November 21, 2002.

The Children's Place Retail Stores, Inc. is a leading specialty retailer of high quality, value-priced apparel and accessories for children, newborn to age twelve. The Company designs, contracts to manufacture and sells its products under the "The Children's Place" brand name. As of November 2, 2002, the Company operated 629 stores, including 603 stores in the United States and 26 stores in Canada. The Company also sells its merchandise through its virtual store located at www.childrensplace.com.

This press release and above referenced call may contain certain forward-looking statements regarding future circumstances. These forward-looking statements are based upon the Company's current expectations and assumptions and are subject to various risks and uncertainties that could cause actual results to differ materially from those contemplated in such forward-looking statements including, in particular, the risks and uncertainties described in the Company's filings with the Securities and Exchange Commission. Actual results, events, and performance may differ. Readers or listeners (on the call) are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. We undertake no obligation to release publicly any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. The inclusion of any statement in this release does not constitute an admission by The Children's Place or any other person that the events or circumstances described in such statement are material.

               THE CHILDREN'S PLACE RETAIL STORES, INC.
                    CONDENSED STATEMENTS OF INCOME
               (In thousands, except per share amounts)
                              (Unaudited)


                       13 Weeks Ended:             39 Weeks Ended:
                       --------------              --------------
                   November 2, November 3,   November 2,  November 3,
                   ----------- ----------    ----------   -----------
                      2002        2001          2002         2001
                      ----        ----          ----         ----

Net sales           $  173,403   $181,433    $  474,745   $  458,212
Cost of sales          111,663     97,363       297,492      265,161
                    ---------- ----------    ----------  -----------

Gross profit            61,740     84,070       177,253      193,051

Selling, general
 and
 administrative
 expenses               49,949     45,798       140,919      127,663

Depreciation and
 amortization            9,300      7,374        26,011       19,716
                  ------------ ------------  ----------  -----------

Operating income         2,491     30,898        10,323       45,672

Interest (income)
 expense, net            (118)      195           (483)          337
                   ----------- ------------- ----------  -----------

Income before
 income taxes            2,609     30,703        10,806       45,335

Provision for
 income taxes            1,005     11,984         4,161       17,690
                  ------------ ------------- ----------  -----------

Net income         $     1,604  $  18,719    $    6,645   $   27,645
                   ===========  =========    ==========   ==========

Basic income
 per share         $      0.06  $    0.71    $     0.25   $     1.05

Basic weighted
 average number
 of shares
 outstanding            26,523     26,281        26,481       26,229

Diluted income
 per share         $      0.06  $    0.70     $    0.25    $    1.03

Diluted weighted
 average number of
 shares
 outstanding            26,756     26,876        27,064       26,907


               THE CHILDREN'S PLACE RETAIL STORES, INC.
                       CONDENSED BALANCE SHEETS
                            (In thousands)
                              (Unaudited)


                              November 2, 2002     November 3, 2001
                              ----------------     ----------------
Current assets:            

Cash and cash equivalents    $        14,446     $          8,653
Accounts receivable                   17,047               19,089
Inventories                           84,343               79,304
Other current assets                  24,849               15,261
                             ---------------      ---------------

Total current assets                 140,685              122,307

Property and equipment, net          161,537              146,959
Other assets, net                      6,129                5,134
                            ----------------     ----------------

Total assets                   $     308,351        $     274,400
                               =============        =============

Current liabilities:

Revolving credit facility    $             0      $         7,365

Accounts payable                      32,500               26,457

Accrued expenses and other
 current liabilities                  36,947               35,882
                             ---------------      ---------------

Total current liabilities             69,447               69,704

Other liabilities                     13,405                8,557
                             ---------------      ---------------

Total liabilities                     82,852               78,261

Stockholders' equity                 225,499              196,139
                              --------------        -------------

Total liabilities and
 stockholders' equity          $     308,351         $    274,400
                               =============         ============