TOWER LOSES ITS PULSE!

Departments affected include Accounts Payable, the Book division, Construction & Maintenance, Direct to Consumer, IS&T, Magazines, Print Shop, Product Management, Training and Education, as well as the offices of Pulse! magazine, along with the suspension of the publication.

Tower Records President Michael Solomon said: "We are deeply saddened by these job cuts and we are losing some loyal and long-serving employees. This is a painful process, but we are committed to providing compensation packages in those affected and the support to help them secure new employment."

In addition, the company today reported net revenues of $982.8 million in fiscal 2002, which ended July 31, 2002, compared with net revenues of $1.08 billion in fiscal 2001. The 9% decrease in revenue was due primarily to the closing of under-performing stores, a decline in same-store sales associated with cautious consumer spending attributed to the events of September 11, 2001, and a sluggish economy.

Added Solomon: "One of our key strategic initiatives as we move forward is cost containment. These job losses have been necessary in order to streamline our efforts toward restroring the company to financial health."

Tower Records currently employs 372 people at its corporate campus and 158 at Bayside. The company owns and operates 101 stores in the U.S., with 3,624 employees, 642 of whom work for the retailer in the Sacramento Valley.