Bombay Announces April and First Quarter Revenue

FORT WORTH, Texas, May 3 /PRNewswire-FirstCall/ -- The Bombay Company, Inc. reported today that total revenue for the four-week period ended April 29, 2006 declined 5.8% to $38.5 million compared to $40.9 million for the four-week period ended April 30, 2005. Same store sales for stores opened more than 12 months decreased 5.0% compared to the comparable four-week period of the prior year. Revenue from non-store activity was 7.0% of the month compared to 6.9% for the same period last year. Growth in the direct- to-customer business and the international wholesale operations partially offset the decline in revenue from the Bailey Street operations, the assets of which were sold during Fiscal 2005 and which contributed $1.0 million in revenue for the period last year. Current month results reflect the adverse impact of the shift in the calendar, which resulted in the Easter holiday moving from March during Fiscal 2005 to April in Fiscal 2006.

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For the thirteen-week period ended April 29, 2006, total revenue declined 2.4% to $119.1 million compared to $122.1 million for the comparable prior year period while same store sales declined 1.2%. Revenue from non-stores activity was 7.1% of total revenue for the nine-week period compared to 7.7% in the corresponding period of last fiscal year. Growth in direct-to-customer and International revenue partially offset lower revenue from the Bailey Street operations, which accounted for approximately $3.6 million of revenue during the prior period last year.

Sales trends were stronger during the first half of April but declined later in the month due, in part, to the majority of stores being closed on Easter and the calendar shift relating to Mother's Day. On a relative basis, the furniture category continued to outperform the accessories and wall decor categories in part due to the changing focus of the content of the April catalog from a gift focus to a furniture focus with the introduction of the new custom upholstery. The average ticket and average unit retail both increased double digit while retail traffic declined.

"We are encouraged by the positive comparison versus last year in Canada and with the strength of our direct to customer business. We are concerned about the weakness in our U.S. stores where we have experienced declines in traffic and negative same store sales. We believe that we are addressing these weaknesses with the change in field leadership and with our planned introduction of broadcast as a marketing vehicle in May," noted James D. Carreker, Chairman and Chief Executive Officer.

For the quarter, the furniture category had the strongest performance due to strength in the bedroom, home office and BombayKIDS furniture categories. The wall decor and accessories categories declined largely as a result of lower print and mirror sales and lower sales in the decorative accessory, lamps and floral and garden categories. Consistent with the month of April, the average ticket and average unit retail both increased double digit while retail traffic declined. The overall environment for home furnishings was more challenging than anticipated resulting in more reliance on promotional activity to which the customer responded favorably but which adversely impacted margins. During the current fiscal year, no tax benefit will be recorded for losses generated by the Company's U.S. operations during interim periods which effectively results in reporting earnings per share on a pre-tax basis as compared to prior year results where tax benefits were reflected in the quarterly operating results.

The Company plans to release first quarter results on Wednesday, May 17, 2006 after the close of stock market and will conduct a conference call with management on Thursday, May 18, 2006 at 10:00 a.m. Central Time. Interested parties should dial 212-676-5390 ten minutes prior to the start time. The call will also be broadcast live over the Internet at http://www.bombaycompany.com/. A telephone replay will be available for 72 hours beginning at 12:00 p.m. Central Time at 800-633-8284. The access code is 21274577. The call will also be available for replay for 45 days on the investor relations page of the Bombay website.

The Bombay Company, Inc. designs, sources and markets a unique line of home accessories, wall decor and furniture through 482 retail outlets, specialty catalogs and the Internet in the U.S. and internationally.

Any statements in this press release that may be considered forward- looking statements are subject to risks and uncertainties that could cause actual results to differ materially. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Those risks are described in the Company's public announcements, reports to stockholders and SEC filings, including but not limited to Reports on Forms 10-K, 8-K and 10-Q, copies of which are available from the SEC or may be obtained upon request from the Company. The Company undertakes no obligation to revise the forward-looking statements contained therein to reflect events or circumstances after the date hereof as a result of new information, future events or otherwise.