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Penn Traffic Reports 35 Percent Increase in Adjusted Earnings Per Diluted Share in Fourth Quarter

SYRACUSE, N.Y. - The Penn Traffic Company today announced that adjusted net income was $7.1 million or $0.35 per diluted share in the fourth quarter of fiscal 2002 (the 13-week period ended February 2, 2002) compared to $5.3 million or $0.26 per share in the prior year.

Total revenues for the fourth quarter were $615.0 million, a 0.3 percent increase from the prior year. Same store sales for the fourth quarter increased 0.9 percent from the comparable prior year period.

EBITDA for the fourth quarter was $30.6 million, an increase of 3.9 percent over the prior year's adjusted $29.5 million level. EBITDA in the prior year's fourth quarter has been adjusted to exclude New England store startup costs and operating losses and the effect of the additional week. Excluding these adjustments, EBITDA for the 14-week fourth quarter of the prior year was $32.1 million.

"The continued implementation of our long-term business strategies drove our improved financial performance in both the fourth quarter and the fiscal year," said Joseph V. Fisher, Penn Traffic's President and CEO.

"A softening economy and a greater than normal amount of promotional activity made the fourth quarter a challenging one for us," said Fisher. "We were able to achieve solid results, however, primarily because of improvements in the planning and execution of holiday merchandising programs, an increase in private label sales and the benefits of our cost reduction programs."

Fisher cited the company-wide rollout of Penn Traffic's Wild Card loyalty card program as another factor in the company's improved fourth quarter performance. "Our loyalty card has enabled us to implement more effective and efficient promotions for our customers," said Fisher. "We have more than two million customers carrying the Wild Card, accounting for more than 70 percent of all retail sales." The fourth quarter was the first full quarter in which the Wild Card was available in all Penn Traffic supermarkets.

"We believe the current fiscal year will test our company again," said Fisher. "We expect to continue to face a challenging competitive environment this year. In addition, like the entire industry, we anticipate that employee benefit costs, in particular health care and pension costs, will increase in Fiscal 2003 more than they have in many years."

"We approach these challenges with many strengths, including a modern store base, a strong position in virtually all our markets and a dedicated team of management and associates," said Fisher. "We believe that by relentlessly pursuing our business plan we will continue to achieve positive same store sales and income growth in this fiscal year."
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