Event Brief of Q3 2004 The Children's Place Retail Stores, Inc. Earnings Conference Call - Final.

Original Source: FD (FAIR DISCLOSURE) WIRE

CORPORATE PARTICIPANTS

. Heather Anthony, The Children's Place Retail Stores, Inc., Director, IR . Ezra Dabah, The Children's Place Retail Stores, Inc., Chairman & CEO . Seth Udasin, The Children's Place Retail Stores, Inc., VP, CFO & Treasurer . Neal Goldberg, The Children's Place Retail Stores, Inc., President . Richard Flaks, The Children's Place Retail Stores, Inc., VP, Planning & Allocation . Amy Hauk, The Children's Place Retail Stores, Inc., SVP, General Merchandise Manager . Mario Ciampi, The Children's Place Retail Stores, Inc., SVP, Store Development & Logistics

OVERVIEW

During 3Q04, net sales increased 26% to a record $280.5m from $223.3m last year. PLCE earned EPS of $0.65. The Co. remains on track to close the Disney Store North America acquisition this month. The Co. reports of mgt. promotions across the Disney Store chain. Q&A Focus: Conversion rates, inventory, marketing initiatives, pricing, and Disney acquisition.

FINANCIAL DATA

A. Key Data From Call 1. 3Q04 net sales = $280.5m 2. 3Q04 EPS = $0.65. 3. 3Q04 net income = $17.7m.

PRESENTATION SUMMARY

S1. Opening Comments (E.D.) 1. Details: 1. Not only did PLCE report significantly increased earnings over the prior year, but also announced its definitive agreement to acquire the Disney Store North America retail chain, a major milestone for the Co. 2. Management Promotions: 1. Mario Ciampi soon to be president of the Disney Store chain. 2. Amy Hauk, PLCE's SVP, General Merchandise Manager. 3. Richard Flaks, the Co.'s newly promoted SVP of Planning,

Allocation and Information Technology. 4. These promotions will appropriately align PLCE's experienced mgt. team as the Co. prepares for the next phase of growth and reflect a reallocation of responsibilities as Mario transitions into his new role as President of subsidiary, which will own and operate the Disney Store chain in North America. 3. 3Q04 Highlights: 1. Total sales increased 26%. 2. Comp-store sales increased 18%. 3. Comp-store transactions were up 13% on top of last year's 16%

increase. 4. Operating margin increased 200 BP to 10.5%. 5. EPS increased 51% to $0.65. 4. Other Highlights: 1. PLCE is selling significantly more units and introducing many customers to its brand. 2. Store productivity, Co.'s Number 1 priority, has produced increased sales growth per sq. ft. of 14% YTD. 3. Stores opened last year and this year are producing strong

analyzed sales of approx. $1.3m, excluding outlets, which are

tracking significantly higher. 4. These results gives PLCE further comfort in its ability to grow the business to $1.5b in revenue over the next four years. 5. Customer response to the back-to-school and holiday dressy merchandise was incredibly positive. 6. Inventory investment and key drivers enabled PLCE to meet demand and insure a strong in-stock position throughout the season. 1. This combined with PLCE's strategic investment in merchandise quality paid off for the Co. and further strengthened its competitive position. 5. Disney Store: 1. PLCE remains on track to close the Disney Store North America acquisition this month. 2. The Disney store chain has experienced improvement over the past FY and the Co. believes that earnings potential over the near and long term are compelling. 3. The Co. also believes that combining the power and creativity of the Disney brand was its merchandising, sourcing and operating expertise will result in increased sales, significant margin expansion, and expense leverage. 4. Strategically, the Disney Store fits perfectly within PLCE's goal of becoming the leading player in the newborn to age 10 category. 5. Highlights: 1. The Disney brand is among the most powerful in the world and is the key reason behind the Co.'s enthusiasm for this unique opportunity. 2. Strategically, the Disney Store is a perfect fit for the Co.'s business and profile is strikingly similar. 3. Like PLCE, the Disney Store is a proprietary mall-based vertically integrated specialty retailer with similar

customer demographics. 6. PLCE will develop, manufacture, source and sell merchandise featuring Disney branded characters, past, present and future, as well as certain other Disney on characters such as Lizzie McGuire and Power Rangers. 7. Once the majority of the store remodels are completed, PLCE believes the Disney Store chain can be expended beyond its current base. 1. Through expansion in A and B modes, lifestyle centers, and the rollout of an outlet store strategy, PLCE believes that it can successfully grow over time to approx. 600 Disney stores across the US and Canada.

2. Given that the concepts are so different, the Co. expects

little if any cannibalization to occur despite the fact that approx. 80% of Disney Stores overlap with PLCE locations.

S2. 3Q04 Financial Results (S.U.) 1. Highlights: 1. During 3Q04, PLCE opened 19 new stores. 1. Eleven in the US. 2. Seven in Canada. 3. One in Puerto Rico. 2. The Co. also remodeled two stores. 3. As of 10/30/04, PLCE operated 734 stores in approx. 3.3m sq. ft. 1. An avg. of approx. 4,500 sq. ft. per store.

4. In the qtr., net sales increased 26% to a record $280.5m from

$223.3m last year. 5. Comparable store sales for 3Q04 increased 18% on top of last year's 14% increase. 6. For 3Q04, the Co. achieved double-digit comps across all regions, departments, and store types. 1. Demonstrating the broad appeal of its brand.

7. The West Canada, Southwest and Rocky Maintain regions were the

strongest regions in the qtr. 8. By department, accessories and newborn achieved the highest comps. 9. …