99 Cents Only Stores Company

U.S. retailers face grim prospects in the second half of the year amid lackluster consumer spending, a slow economy and heavy company debt loads, a report Thursday warned. Bond-rating agency Standard & Poor's Corp. said it downgraded the credit-worthiness of 25 retailers in the first half of the year, and said the outlook for the rest of the year was "bleak." Two major retailers Thursday underscored fears of sluggish sales across the industry, as Federated Department Stores Inc.

99 Cents Only Stores, a discount retailer that operates mainly in California, released its preliminary third-quarter earnings and fourth-quarter revenue figures after its auditor resigned in September, delaying the reports. Third-quarter net income fell to $1 million, or 1 cent a share, from $5.5 million, or 8 cents, a year earlier, the City of Commerce-based company said. Net sales rose to $246 million from $238 million.

Some people are going to great lengths to buy a new 19-inch color television for 99 cents. A group has been camping out since Sunday in front of the soon-to-open 99 Cent Store at Springdale Street and Edinger Avenue. "We look like a bunch of homeless people," said Therese Sliter of Garden Grove, who set up camp Monday to await the store's opening Thursday morning. The first nine customers in line will be able to buy a color TV for 99 cents.

The city of Lancaster illegally attempted to take property from a 99 Cents Only store to benefit a neighboring Costco that wants to expand, a U.S. District Court ruled this week. In a 17-page ruling Wednesday, Judge Stephen J. Wilson called the Antelope Valley city's action "nothing more than the desire to achieve the naked transfer of property from one private party to another."

Hell hath no fury like a bargain-hunter scorned--but a hard-won deal can seem heaven-sent. Just ask the nine people who camped out in front of the new 99 Cents Only Store in Garden Grove from Wednesday to Friday. They brought sleeping bags, ice chests--even a television and VCR--and waited for the grand opening of the store at 9 a.m. Friday, when the first nine people in line could buy a new 19-inch color TV for, you guessed it, 99 cents.

99 Cents Alleges Trademark Infringement: 99 Cents Only Stores filed three trademark-infringement suits against 13 stores in Southern California, alleging that the stores used names similar to 99 Cents Only to deceive customers into shopping with them. The Los Angeles Superior Court suits were filed against stores with such names as 99 Cents Dollar World $1.00 and Nothing Over 99 Cents or Less in Los Angeles, Huntington Park, Paramount and Maywood.

Americans' love affair with bargain hunting was good for 99 Cents Only Stores as the deep discounter reported Tuesday that fourth-quarter profit climbed 20%. The City of Commerce-based company said earnings rose to $19.7 million, or 28 cents a share, from $16.4 million, or 23 cents, a year earlier. Revenue jumped 22% to $210.7 million from $172.9 million. Still, the company's stock fell $2.

One day in 1984, when crowds poured into Los Angeles for the Summer Olympics, David Gold and Thomas Hale made a $185,000 buy that would launch their 99 Cents Only Stores into the mainstream and foreshadow the future of their quirky off-priced outlets. Gold and Hale, president and vice president of 99 Cents Only Stores, had bought 500,000 authentic Olympic souvenir hats at a special low price--37 cents each--days before the games commenced.

It's easy to understand why people on fixed incomes and tight budgets would hunt for bargains at the 99-cent stores that dot the city. But what's with all those well-dressed types who pull up in pricey cars and can be seen scouring the well-stocked aisles like archeologists on a dig -- scooping up jars of white asparagus and artichoke hearts, hand-painted china, leopard-print thong undies, bottles of wine and Pellegrino water -- each priced at under $1? "It's amazing. It's fun.