SECAUCUS, N.J.--(BUSINESS WIRE)--May 19, 2005--The Children's Place Retail Stores, Inc.

• Net Sales Increased 64%; Comparable Store Sales Increased 13%
• Company Reports First Quarter GAAP Earnings Per Share of $0.36
• Company Reiterates Fiscal 2005 GAAP Earnings Per Share Guidance of $2.15 to $2.25

The Children's Place Retail Stores, Inc. (Nasdaq: PLCE) today reported financial results for the first quarter ended April 30, 2005.

• As previously announced, total consolidated net sales for the first quarter increased 64% to $369.2 million, compared with $225.8 million a year earlier. First quarter net sales were comprised of $280.7 million in sales from The Children's Place, a 24% increase over last year, and $88.5 million in sales from the Company's Disney Store business.
• Comparable store sales increased 13% in the quarter, on top of a 16% increase for the same period last year.
• Net income was $10.2 million, compared to net income of $11.5 million for the same period in 2004.
• Diluted GAAP earnings per share were $0.36 compared with $0.42 in the fiscal 2004 period. This also compares to the Company's recent GAAP earnings per share guidance of $0.33 to $0.34. Earnings per share results reflected the remaining $1.2 million, or $0.03 per share, non-cash charge related to acquired Disney Store inventory.
• The Company opened four Children's Place stores and closed one store during the first quarter. In addition, the Company opened one Disney Store, and closed one store during the first quarter.

"We are pleased with our first quarter financial results, which reflect improved profitability at The Children's Place and lower than previously guided to operating losses at Disney Store," said Ezra Dabah, Chairman and Chief Executive Officer of The Children's Place. "At The Children's Place brand, everyday we are earning the trust of new customers, with continued increases in traffic, conversion, and market share. At Disney Store, we are pleased with the progress we are making on our merchandising and sourcing initiatives, and we are intensely focused on execution to ensure a successful second half of the year."

The Company also stated that it anticipates May comparable store sales to be in the positive low-single digits and reiterated its previous fiscal 2005 guidance of $2.15 to $2.25 per share.

The Children's Place will host a webcast of its first 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, May 26, 2005.

The Children's Place Retail Stores, Inc. is a leading specialty retailer of children's merchandise. The Company designs, contracts to manufacture and sells high quality, value-priced merchandise under the proprietary "The Children's Place" and licensed "Disney Store" brand names. As of April 30, 2005, the Company owned and operated 753 The Children's Place stores, and 306 Disney Stores across North America. 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.

(Tables Follow)

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

                                            13 Weeks Ended:
                                April 30, 2005            May 1, 2004
                                                         (As Restated)

Net sales                      $      369,217        $        225,779
Cost of sales                         227,687                 131,596

Gross profit                          141,530                  94,183
Selling, general and
 administrative expenses              112,021                  62,680
Depreciation and amortization          12,875                  12,622

Operating income                       16,634                  18,881
Interest income, net                      (95)                    (25)

Income before income taxes             16,729                  18,906
Provision for income taxes              6,524                   7,373

Net income                     $       10,205        $         11,533

Basic net income per
 common share                  $         0.37        $           0.43

Basic weighted average common
 shares outstanding                    27,383                  26,813

Diluted net income per share   $         0.36        $           0.42

Diluted weighted average
 common shares and common share
 equivalents outstanding               28,611                  27,657


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

                                 April 30,    January 29,     May 1,
                                   2005          2005          2004
                                                         (As Restated)
Current assets:
Cash and investments            $ 148,982     $ 165,196      $ 84,295
Accounts receivable                21,831        23,987         9,879
Inventories                       158,200       161,969       100,731
Other current assets               41,902        41,007        22,014

Total current assets              370,915       392,159       216,919

Property and equipment, net       220,330       222,722       211,989
Other assets, net                  12,890        12,507        15,565

Total assets                    $ 604,135     $ 627,388      $444,473

Current liabilities:

Revolving loan                  $       0     $  37,268      $      0
Accounts payable                   87,526        78,106        43,622
Accrued expenses and
  other current liabilities        83,114        99,575        46,408

Total current liabilities         170,640       214,949        90,030

Other liabilities                 105,316       100,776        85,972

Total liabilities                 275,956       315,725       176,002

Stockholders' equity              328,179       311,663       268,471

Total liabilities and
 stockholders' equity       $     604,135     $ 627,388      $444,473

CONTACT: The Children's Place
Heather Anthony, 201-558-2865

SOURCE: The Children's Place Retail Stores, Inc.