Bakers Footwear Announces Sale of an Operating Lease

  
    
  
  
    
      Bakers Footwear Group, Inc. (Nasdaq: BKRS), a leading specialty 
      retailer of moderately priced fashion footwear for young women, with 257 
      stores, today announced the signing of an agreement to sell an operating 
      lease for total consideration of $5.05 million. The Company plans to 
      utilize the net proceeds of approximately $5.0 million to reduce debt. 
      Separately, the Company announced:
    
    
      
        It expects a third quarter fiscal 2007 net loss of approximately $15.3 
        million, or $2.35 per share, including approximately $3.5 million of 
        additional markdown expense compared to the third quarter of 2006 and 
        approximately $3.1 million of asset impairment and severance expenses 
        associated with its cost reduction plan announced on September 24, 
        2007. The Company expects to announce full results for its third 
        quarter and first nine months of fiscal 2007 on December 18, 2007;
      
      
        November 2007 comparable store sales declined 3.7%, representing a 
        significant improvement from the Company’s 
        third quarter fiscal 2007 comparable store sales decline of 16.6%; and
      
      
        Cost reduction initiatives remain on track and are expected to lead to 
        annual savings of approximately $8.0 million that will positively 
        impact operating results in fiscal 2008 with benefits also anticipated 
        to positively affect net income in the fourth quarter of fiscal 2007.
      
    
    
      Peter Edison, Chairman and Chief Executive Officer of Bakers Footwear 
      Group, stated: “We are pleased to announce the 
      sale of an operating lease, as it allows us to improve our liquidity 
      with no anticipated impact on our 2008 operations. These proceeds, 
      combined with the $8 million in cost savings that we expect to be 
      generated from our expense reductions, should improve fourth quarter 
      fiscal 2007 and fiscal 2008 operating results.”
    
    
      “We are also pleased by the improvement in our 
      sales trends in November,” Mr. Edison 
      continued. “Sales trends during the month 
      improved considerably from the trends reported in our third quarter, 
      reflecting a good response to our boot offerings across key styles. This 
      is a direct reflection of the fresh ideas and trend-right perspective of 
      our new merchandising leadership. We believe we have addressed the 
      issues that negatively affected our recent results. We move forward with 
      inventory that is well controlled, down more than 21% from the third 
      quarter last year, with November unit selloff the highest since November 
      2004. We remain hopeful in our outlook and expect to report continued 
      progress in our business during the fourth quarter.”
    
    
      About Bakers Footwear Group, Inc.
    
    
      Bakers Footwear Group, Inc. is a national, mall-based, specialty 
      retailer of distinctive footwear and accessories for young women. The 
      Company’s merchandise includes private label 
      and national brand dress, casual and sport shoes, boots, sandals and 
      accessories. The Company currently operates over 250 stores nationwide. 
      Bakers’ stores focus on women between the ages 
      of 16 and 35. Wild Pair stores offer fashion-forward footwear to both 
      women and men between the ages of 17 and 29.
    
    
      THIS PRESS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS (WITHIN THE 
      MEANING OF SECTION 27(A) OF THE SECURITIES ACT OF 1933 AND SECTION 21(E) 
      OF THE SECURITIES EXCHANGE ACT OF 1934). BAKERS FOOTWEAR HAS NO DUTY TO 
      UPDATE SUCH STATEMENTS. ACTUAL FUTURE EVENTS AND CIRCUMSTANCES COULD 
      DIFFER MATERIALLY FROM THOSE SET FORTH IN THIS STATEMENT DUE TO VARIOUS 
      FACTORS. FACTORS THAT COULD CAUSE THESE CONDITIONS NOT TO BE SATISFIED 
      INCLUDE MATERIAL CHANGES IN CAPITAL MARKET CONDITIONS OR IN BAKERS 
      FOOTWEAR’S BUSINESS, PROSPECTS, RESULTS OF 
      OPERATIONS OR FINANCIAL CONDITION AND OTHER RISKS AND UNCERTAINTIES, 
      INCLUDING THOSE DETAILED IN BAKERS FOOTWEAR’S 
      FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION.