Cost Plus Updates Third Quarter Sales and Earnings Guidance

Cost Plus, Inc. (Nasdaq:CPWM) today indicated that based on results thus far in its fiscal third quarter, total sales for the quarter should approximate $201 million, which would be a 5.8% increase over last year, compared to prior guidance of $209 million to $213 million. Further, the Company now estimates same store sales for the third quarter will decrease approximately 4.5% vs. prior guidance of a 1% decrease to an increase of 1%.

The Company now expects a net loss for the third quarter of approximately $ 0.12 per diluted share vs. prior guidance between a net loss of $0.04 to net income of $0.02 per diluted share.

The Company indicated that customer traffic continues to be below expectations with selling trends continuing to be inconsistent. The Company further indicated that merchandise margins should approximate those implied in its prior guidance.

The Company’s third quarter ends Saturday, October 29, 2005, and final quarterly sales results will be announced Thursday, November 3, 2005. The Company will report third quarter results and provide fourth quarter 2005 guidance on Friday, November 18, 2005.

The above statements relating to anticipated third quarter financial results are “forward-looking statements” that are based on current expectations and are subject to various risks and uncertainties that could cause actual results to differ materially from those forecasted. Such risk factors include, but are not limited to: general economic conditions, delays in the flow of merchandise, the timing and level of markdowns, competitive factors, changes in fuel and other shipping costs, labor market fluctuations, international conflicts, further terrorist activities, and unseasonable weather conditions.

Contact:
John Luttrell
(510) 808-9119