The Gymboree Corporation Reports Third Quarter 2005 Results
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The Gymboree Corporation Reports Third Quarter 2005 Results

SAN FRANCISCO, CALIFORNIA (Wednesday, November 16, 2005) - The Gymboree Corporation (NASDAQ: GYMB) today reported earnings from continuing operations of $12.6 million, or $0.39 per diluted share, for the third fiscal quarter ended October 29, 2005, compared to earnings from continuing operations of $7.5 million, or $0.24 per diluted share, for the same period last year. Operating income for the quarter increased over 200% to $22.7 million compared to $7.4 million in the prior year.

Net sales from retail operations for the third fiscal quarter ended October 29, 2005, totaled $174.5 million, a 14% increase over the $152.8 million in net sales from retail operations for the third fiscal quarter of the prior year. As previously reported, comparable store sales from retail operations for the third fiscal quarter increased 10% over the same period last year. Total net sales for the third fiscal quarter were $177.1 million, an increase of 14% compared to total net sales of $155.6 million for the third fiscal quarter last year.

Business Outlook

For the fourth fiscal quarter, the Company expects a low to mid single digit comparable store sales increase over the prior year. The Company continues to expect fourth fiscal quarter income from continuing operations in the range of $0.37 to $0.39 per diluted share. For the full fiscal year 2005, the Company now expects income from continuing operations to be in the range of $0.81 to $0.83 per diluted share.

For the full fiscal year 2006, the Company expects its earnings from continuing operations before the effect of stock based compensation to be in the range of $1.03-$1.09 per diluted share. The Company will adopt FAS Statement 123R "Share-Based Payment" beginning in fiscal 2006 which is expected to reduce earnings in the range of $0.08-$0.10 per diluted share.

Management Presentation

The live broadcast of the discussion of third fiscal quarter 2005 earnings results will be available to interested parties at 1:30 p.m. PT (4:30 p.m. ET) on Wednesday, November 16, 2005. To listen to the live broadcast over the Internet, please log on to www.gymboree.com, click on "Our Company" at the bottom of the page, go to "Investor and Media Relations" and then "Conference Calls, Webcasts & Presentations." A replay of the call will be available two hours after the broadcast through midnight ET, Wednesday, November 23, 2005, at 800-642-1687, passcode 1733758, as well as archived on our Website at the same location as the live Webcast.

About The Gymboree Corporation

The Gymboree Corporation's specialty retail brands offer unique, high-quality products delivered with personalized customer service. As of October 29, 2005, the Company operated a total of 663 stores: 574 Gymboree® retail stores (546 in the United States and 28 in Canada), 11 Gymboree® Outlet retail stores, 62 Janie and Jack® retail shops and 16 Janeville® retail stores in the United States. The Company also operates online stores at www.gymboree.com and www.janieandjack.com, and offers directed parent-child developmental play programs at 522 franchised and company-operated centers in the United States and 24 other countries.

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Forward-Looking Statements

The foregoing financial information for the fiscal quarter-ended October 29, 2005, is un-audited and subject to quarter-end and year-end adjustment, and could differ materially from the financial information indicated. The foregoing paragraphs contain forward-looking statements relating to The Gymboree Corporation's anticipated sales growth and cash flows and future financial performance. These are forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results could differ materially as a result of a number of factors, including customer reactions to new merchandise, service levels and new concepts, success in meeting our delivery targets, the level of our promotional activity, unanticipated costs actually incurred in connection with the wind down of our UK and Ireland operations, our gross margin achievement, our ability to appropriately manage inventory, general economic conditions, effects of future embargoes from countries used to source product, and competitive market conditions. Other factors that may cause actual results to differ materially include those set forth in the reports that we file from time to time with the Securities and Exchange Commission, including our annual report on Form 10-K for the year-ended January 29, 2005. These forward-looking statements reflect The Gymboree Corporation's expectations as of November 16, 2005. The Gymboree Corporation undertakes no obligation to update the information provided herein.

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