EXHIBIT 99.1
99 CENTS ONLY STORES ANNOUNCES A POTENTIAL RESTATEMENT OF ITS FINANCIAL
STATEMENTS AND A DELAY IN ITS EARNINGS RELEASE AND FILING OF FORM 10-K.
CITY OF COMMERCE, CA - March 7, 2005 - 99 Cents Only Stores(R) (NYSE:NDN)
announces a potential restatement of its financial statements and a delay in its
earnings release and filing of Form 10-K.
Potential Restatement of Previously Issued Financial Statements
The Company is evaluating certain lease and depreciation issues, which may
result in restatement of previously issued financial statements. In light of
views expressed by the Chief Accountant of the Securities and Exchange
Commission in a February 7, 2005 letter to the American Institute of Certified
Public Accountants regarding certain operating lease issues and their
application under generally accepted accounting principles, the Company is
analyzing its method of accounting for leasehold improvements funded by either
landlord incentives or allowances under operating leases (tenant improvement
allowances) and its method of accounting for rent holidays. Additionally, the
Company is reviewing certain depreciation issues related to prior periods to
determine whether adjustments to previously issued financial statements will be
required. These potential adjustments are non-cash and have no significant
impact on the Company's cash flows, cash position, revenues or same store sales.
Sarbanes Oxley Compliance Update
As an "accelerated filer," the Company is required to comply with Section 404 of
the Sarbanes Oxley Act of 2002 for the year ended December 31, 2004. Management
has substantially completed its assessment of the internal controls over
financial reporting for the year ended December 31, 2004. Based on the work
performed to date on internal controls, management did not complete the
necessary testing of its internal controls over financial reporting as of
December 31, 2004. Therefore, the Company's independent accountants are unable
to complete their audit of management's assessment of the internal controls over
financial reporting. Further, management has identified material weaknesses as
defined by the Public Company Accounting Oversight Board. These material
weaknesses relate to (i) deficiencies in the internal control environment; (ii)
deficiencies in the design, documentation and execution of significant control
activities; and (iii) deficiencies in the management information systems and
information technology. The Company has been advised by its independent
accountants that they will disclaim an opinion on management's assessment of
internal controls because of the scope limitation and express an adverse opinion
on the effectiveness of internal controls as of December 31, 2004 because of
material weaknesses.
Delay in Earnings Release and Filing Form 10-K
The Company announces that in consideration of the various issues indicated in
this release, there will be a delay in the timing of the previously announced
Earnings Release and Earnings Call. The Company will be extending the time
required to file the Form 10-K by filing Form 12b-25 with the Securities and
Exchange Commission and will announce the timing of the Earnings Release and
Earnings Call at a later date.
99 Cents Only Stores, the nation's oldest existing one-price retailer, operates
223 retail stores in California, Texas, Arizona and Nevada and a wholesale
division called Bargain Wholesale. 99 Cents Only Stores emphasizes name-brand
consumables, priced at an excellent value, in attractively merchandised stores.
Special Note Regarding Forward-Looking Information
We have included statements that constitute "forward-looking statements" within
the meaning of Section 21E of the Securities Exchange Act and Section 27A of the
Securities Act. The words "expect," "estimate," "anticipate," "predict,"
"believe" and similar expressions and variations thereof are intended to
identify forward-looking statements. Such statements appear in a number of
places in this release and include statements regarding the intent, belief or
current expectations of 99 Cents Only Stores (the " Company"), its directors or
officers with respect to, among other things (a) trends affecting the financial
condition or results of operations of the Company, (b) the business and growth
strategies of the Company, and (c) the status of the Company's compliance with
Section 404 of the Sarbanes Oxley Act of 2002. The shareholders of the Company
are cautioned not to put undue reliance on such forward-looking statements. Such
forward-looking statements are not guarantees of future performance and involve
risks and uncertainties, and actual results may differ materially from those
projected in this release, for the reasons, among others, discussed in the
reports and other documents the Company files from time to time with the
Securities and Exchange Commission, including the risk factors contained in the
Section - "Management's Discussion and Analysis of Financial Condition and
Results of Operations" of the Company's Annual Reports on Form 10-K and
Quarterly Reports on Form 10-Q. The Company undertakes no obligation to
publicly revise these forward-looking statements to reflect events or
circumstances that arise after the date hereof.
NOTE TO EDITORS: 99 CENTS ONLY STORES(R) NEWS RELEASES AND INFORMATION AVAILABLE
ON THE INTERNET AT WWW.99ONLY.COM
CONTACT: 99 CENTS ONLY STORES(R), CITY OF COMMERCE, CALIFORNIA, ALBERT LEE,
INVESTOR RELATIONS 323/881-9962 -99 CENTS--