Unassociated Document

		Page Number
Part I. FINANCIAL INFORMATION:

Item 1. Condensed Consolidated Financial Statements (unaudited):

Condensed Consolidated Balance Sheets at April 28, 2007 and July 29, 2006		3

Condensed Consolidated Statements of Earnings for the thirteen weeks ended April 28, 2007
and April 29, 2006		4

Condensed Consolidated Statements of Earnings for the thirty-nine weeks ended April 28, 2007
and April 29, 2006		5

Condensed Consolidated Statements of Cash Flows for the thirty-nine weeks ended April 28, 2007
and April 29, 2006		6

Notes to Condensed Consolidated Financial Statements		8

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations		14

Item 3. Quantitative and Qualitative Disclosures About Market Risk		20

Item 4. Controls and Procedures		20

Part II. OTHER INFORMATION:

Item 1. Legal Proceedings		21

Item 1A. Risk Factors		21

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		21

Item 6. Exhibits		22

SIGNATURES		23


The Dress Barn, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (unaudited)
Amounts in thousands, except share data	April 28,			July 29,
	2007			2006
ASSETS
Current Assets:
Cash and cash equivalents	$	63,603		$	34,168
Restricted cash		-			100
Marketable securities and investments		152,813			118,745
Merchandise inventories		168,819			170,487
Deferred income tax asset		8,755			6,459
Prepaid expenses and other		15,508			19,404
Total Current Assets		409,498			349,363

Property and Equipment		492,807			452,816
Less accumulated depreciation and amortization		238,455			214,751
Property and equipment, net		254,352			238,065

Intangible Assets, net		109,399			110,199
Goodwill		130,656			132,566
Other Assets		21,072			16,667
TOTAL ASSETS	$	924,977		$	846,860

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable - trade	$	108,233		$	121,198
Accrued salaries, wages and related expenses		42,618			38,917
Other accrued expenses		47,239			38,557
Customer credits		20,070			16,260
Income taxes payable		-			11,453
Current portion of long-term debt		1,195			1,148
Total Current Liabilities		219,355			227,533
Long-term debt		143,849			144,751
Deferred rent and other		62,158			55,352
Deferred income tax liability		9,166			10,077
Total Liabilities		434,528			437,713

Commitments and Contingencies		-			-

Shareholders' Equity:
Common stock, par value $0.05 per share:
Authorized- 75,000,000 shares
Issued and outstanding at April 28, 2007 was 62,386,399 shares and issued and outstanding at July 29, 2006 was 61,715,588 shares		3,120			3,086
Additional paid-in capital		101,410			87,673
Retained earnings		385,933			318,380
Accumulated other comprehensive (loss) / income		(14	)		8
Total Shareholders’ Equity		490,449			409,147
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	924,977		$	846,860

See notes to condensed consolidated financial statements (unaudited)

		Thirteen Weeks Ended
		April 28, 2007			April 29, 2006
Net sales	$	347,923		$	327,176
Cost of sales, including occupancy and buying costs		205,378			193,764
Gross profit		142,545			133,412

Selling, general and administrative expenses		95,797			89,076
Depreciation and amortization		11,009			10,279
Operating income		35,739			34,057

Interest income		1,482			804
Interest expense		(1,282	)		(1,243	)
Other income		388			381
Earnings before income taxes		36,327			33,999

Income taxes		13,216			13,968
Net earnings	$	23,111		$	20,031

Earnings per share:
Basic	$	0.37		$	0.33
Diluted	$	0.33		$	0.29

Weighted average shares outstanding:
Basic		62,188			61,569
Diluted		69,574			70,229

See notes to condensed consolidated financial statements (unaudited)

	Thirty-Nine Weeks Ended
	April 28, 2007			April 29, 2006
Net sales	$	1,046,705		$	956,972
Cost of sales, including occupancy and buying costs		626,182			573,720
Gross profit		420,523			383,252

Selling, general and administrative expenses		283,522			258,614
Depreciation and amortization		33,856			30,852
Operating income		103,145			93,786

Interest income		4,414			1,428
Interest expense		(3,731	)		(4,158	)
Other income		1,011			1,144
Earnings before income taxes		104,839			92,200

Income taxes		37,286			37,689
Net earnings	$	67,553		$	54,511

Earnings per share:
Basic	$	1.09		$	0.89
Diluted	$	0.97		$	0.81

Weighted average shares outstanding:
Basic		61,906			61,071
Diluted		69,852			67,640

See notes to condensed consolidated financial statements (unaudited)

The Dress Barn, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (unaudited)

Amounts in thousands	Thirty-Nine Weeks Ended
	April 28, 2007			April 29, 2006
Operating Activities:
Net earnings	$	67,553		$	54,511

Adjustments to reconcile net earnings to net cash
provided by operating activities:
Depreciation and amortization		33,856			30,852
Impairment and asset disposals		1,374			2,366
Deferred income taxes		(3,207	)		(3,244	)
Deferred rent and other occupancy		(3,689	)		(4,058	)
Share-based compensation		3,976			3,168
Tax benefit related to share-based compensation		4,321			6,549
Excess tax benefits from share-based compensation		(4,175	)		(3,091	)
Amortization of debt issuance costs		282			711
Cash surrender value of life insurance		(588	)		(286	)
Deferred compensation		599			510
Other		177			-

Changes in assets and liabilities:
Decrease in merchandise inventories		1,668			17,241
Decrease / (increase) in prepaid expenses and other		4,203			(690	)
Decrease in other assets		382			924
Decrease in accounts payable - trade		(12,965	)		(5,647	)
Increase in accrued salaries, wages and related expenses		3,701			6,429
Increase in other accrued expenses		3,715			3,915
Increase in customer credits		3,810			4,369
(Decrease) / increase in income taxes payable		(11,453	)		7,939
Increase in other long-term liabilities		10,616			6,514
Total adjustments		36,603			74,471

Net cash provided by operating activities		104,156			128,982

The Dress Barn, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (unaudited)
Amounts in thousands

	Thirty-Nine Weeks Ended
	April 28, 2007			April 29, 2006

Investing Activities:
Purchases of property and equipment		(45,750	)		(31,231	)
Purchases of long-term investments		(1,539	)		(343	)
Sales and maturities of marketable securities and investments		236,265			334,348
Purchases of marketable securities and investments		(270,548	)		(438,550	)
Investment in life insurance policies		(3,254	)		(2,775	)
Reimbursement related to acquisition of Maurices Incorporated		1,910			-
Net cash used in investing activities		(82,916	)		(138,551	)

Financing Activities:
Repayments of long-term debt		(855	)		(10,812	)
Refund of deferred financing costs		-			10
Proceeds from employee stock purchase plan purchases		219			185
Excess tax benefits from share-based compensation		4,175			3,091
Proceeds from stock options exercised		4,656			5,549
Net cash provided by / (used in) financing activities		8,195			(1,977	)

Net increase / (decrease) in cash and cash equivalents		29,435			(11,546	)
Cash and cash equivalents - beginning of period		34,168			42,434
Cash and cash equivalents - end of period	$	63,603		$	30,888

Supplemental Disclosure of Cash Flow Information:
Cash paid for income taxes	$	47,912		$	27,172
Cash paid for interest	$	2,658		$	3,040
Accrual for capital expenditures	$	4,967		$	3,440

See notes to condensed consolidated financial statements (unaudited)

The unaudited condensed consolidated financial statements included in this Form 10-Q have been prepared by The Dress Barn, Inc. and its wholly owned subsidiaries (collectively the “Company”, “we”, “our” or similar terms) pursuant to the rules and regulations of the United States Securities and Exchange Commission. Certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed, or omitted, pursuant to such rules and regulations, although we believe that the disclosures made are adequate to make the information not misleading. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended July 29, 2006. The results of operations for the interim periods shown in this report are not necessarily indicative of results to be expected for the fiscal year. In the opinion of management, the information contained herein reflects all adjustments necessary to present fairly the financial position, results of operations and cash flows for the periods presented. All such adjustments are of a normal recurring nature. The July 29, 2006 condensed consolidated balance sheet amounts have been derived from audited financial statements in the Company’s Annual Report on Form 10-K. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cost of sales consists of net merchandise costs, including design, sourcing, importing and inbound freight costs, as well as markdowns, shrinkage and promotional costs. Buying, occupancy and warehousing costs consist of compensation and travel for our buyers and certain senior merchandising executives; rent related to our stores, corporate headquarters, distribution centers and other office space; freight from our distribution centers to the stores; and compensation and supplies for our distribution centers, including purchasing, receiving and inspection costs.

Selling, general and administrative expenses consist of compensation and employee benefit expenses, other than for our design, sourcing and importing teams, our buyers and our distribution centers personnel. Such compensation and employee benefit expenses include salaries, incentives and related benefits associated with our stores and corporate headquarters, except as previously noted. Selling, general and administrative expenses also include advertising costs, supplies for our stores and home office, communication costs, travel and entertainment, leasing costs and services purchased.

The Company's 2001 Stock Incentive Plan, as amended November 30, 2005, provides for grants of either ISOs or non-qualified options to purchase shares of common stock and grants of restricted shares, with a total of 12 million shares authorized for grant. As of April 28, 2007, there were approximately 6.5 million shares under the 2001 plan available for future grant. No new option grants may be made under any of the Company’s prior stock option plans.

Stock option awards outstanding under the Company’s current plans have generally been granted at exercise prices which are equal to the market value of our stock on the date of grant, generally vest over five years and expire no later than ten years after the grant date. We recognize compensation expense ratably over the vesting period, net of estimated forfeitures. For the thirteen-week period, ended April 28, 2007 and April 29, 2006, the Company recognized a total of approximately $1.7 million and $1.4 million in share-based compensation, respectively. For the thirty-nine weeks ended April 28, 2007 and April 29, 2006, the Company recognized a total of approximately $4.6 million and $3.7 million in share-based compensation, respectively. Furthermore, there was $16.1 million of total unrecognized compensation cost related to nonvested options as of April 28, 2007, which is expected to be recognized over a remaining weighted-average vesting period of 3.4 years. The total intrinsic value of options exercised during the thirteen weeks ended April 28, 2007 and April 29, 2006 was approximately $1.6 million and $1.9 million, respectively. The total intrinsic value of options exercised during the thirty-nine weeks ended April 28, 2007 and April 29, 2006 was approximately $9.7 million and $13.7 million, respectively.

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value (000’s)
Options outstanding at July 29, 2006		6,255,862		$	8.81		7.4
Granted		502,200		$	23.04
Forfeited or expired		(119,440	)	$	11.10
Exercised		(626,997	)	$	7.43
Options outstanding at April 28, 2007		6,011,625		$	10.10		6.9	$	62,683.7
Vested and exercisable at April 28, 2007		2,448,665		$	6.97		5.3	$	32,625.8

The Company purchases short-term investments and marketable securities that have been designated as “available-for-sale” as required by Statement of Financial Accounting Standard (“SFAS”) No. 115, Accounting for Certain Investments in Debt and Equity Securities. Available-for-sale securities are carried at fair value with the unrealized gains and losses reported in shareholders’ equity under the caption “Accumulated other comprehensive (loss) / income.” The cost of securities sold is based on the specific identification method.

The Company periodically reviews its investment portfolio to determine if there is an impairment that is other than temporary, and to date has not experienced any impairment in its investments that were other than temporary. In evaluating whether the individual investments in the investment portfolio are not other than temporarily impaired, the Company considered the credit rating of the individual securities, the cause of the impairment of the individual securities and the severity of the impairment of the individual securities.

The Board of Directors authorized a $75 million stock repurchase program that was announced on April 5, 2001. As of the date of this filing, the Company had repurchased 4,885,400 shares at an aggregate purchase price of approximately $26.7 million. At April 28, 2007, the Company had $48.3 million of repurchase availability remaining. During the thirteen and thirty-nine weeks ended April 28, 2007 and April 29, 2006, no shares were repurchased under this stock repurchase program. Purchases of shares of the Company’s common stock will be made at our discretion from time to time, subject to market conditions and at prevailing market prices, through open market purchases or in privately negotiated transactions. Treasury (reacquired) shares are retired and treated as authorized but unissued shares.

Basic earnings per share are computed based upon the weighted average number of common shares outstanding less unvested restricted stock. The computation of diluted earnings per share includes the foregoing and exercise of all stock options using the treasury stock method, conversion obligation of the Convertible Senior Notes (refer to Note 7) and restricted stock issuances to the extent dilutive.

	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
(Amounts in thousands)	April 28, 2007		April 29, 2006		April 28, 2007		April 29, 2006
Weighted average number of common shares outstanding - basic		62,188		61,569		61,906		61,071

Net effect of dilutive common stock equivalents that include stock options, convertible securities and restricted stock based on the treasury stock method using the average market price		7,386		8,660		7,946		6,569
Weighted average number of common shares outstanding - diluted		69,574		70,229		69,852		67,640

The Convertible Senior Notes were dilutive to earnings per share at April 28, 2007 since the average price of the Company’s stock for the third quarter was more than the conversion price of the Convertible Senior Notes. In accordance with Emerging Issues Task Force (“EITF”) Issue No. 04-8, The Effect of Contingently Convertible Debt on Diluted Earnings Per Share, the number of additional shares related to the dilutive effect of the Convertible Senior Notes was approximately 5.5 million shares in the third quarter ended April 28, 2007 and approximately 6.0 million shares for the third quarter ended April 29, 2006. There were 466,250 common stock equivalents that were anti-dilutive for the third quarter and none for the comparable prior year period. The number of additional shares related to the dilutive effect of the Convertible Senior Notes was approximately 5.6 million shares for the thirty-nine weeks ended April 28, 2007 and approximately 4.4 million shares for the thirty-nine weeks ended April 29, 2006. There were 466,250 common stock equivalents that were anti-dilutive for the thirty-nine weeks ended April 28, 2007 and 96,000 for the comparable prior year period.

In January 2005, we acquired Maurices Incorporated, and the Company accounted for the acquisition as a purchase using the accounting standards established in Statement of Financial Accounting Standard (“SFAS”) No. 141, Business Combinations, and, accordingly, the excess purchase price over the fair market value of the underlying net assets acquired was allocated to goodwill. In connection with the acquisition, there was an unsettled purchase price adjustment that would be ultimately determined upon finalization of the seller’s tax returns. This determination of the purchase price was resolved during the first quarter of fiscal 2007, resulting in a $1.9 million reduction of the goodwill that was initially recorded.

In accordance with SFAS No. 142, Goodwill and Other Intangible Assets, amortization of goodwill and indefinite life intangible assets is replaced with annual impairment tests. The Company performs an impairment test at least annually on or about June 30^th or whenever events or changes in business circumstances necessitate to determine whether an impairment charge related to the carrying value of the Company’s recorded goodwill or indefinite life intangible assets is needed. Other identifiable intangible assets consist of trade names, customer relationships and proprietary technology. Trade names have an indefinite life and therefore are not amortized. Customer relationships and proprietary technology constitute the Company's identifiable intangible assets subject to amortization, which are amortized on a straight-line basis over their useful lives. The estimated annual amortization expense over the next five years is approximately $1 million per fiscal year. The weighted average expected life of the other intangible assets subject to amortization is 6 years.

On December 15, 2004, the Company issued 2.50% Convertible Senior Notes due 2024 (“Convertible Senior Notes”). The Convertible Senior Notes have an aggregate principal amount of $115 million and interest is payable on June 15 and December 15 of each year, beginning on June 15, 2005. On April 28, 2007, the market value of the Convertible Senior Notes was $235.7 million as valued on PORTAL (Private Offering Resale and Trading through Automated Linkage).

The Company’s credit agreement provides a senior secured revolving credit facility that provides for borrowings and issuance of letters of credit for up to $100 million, which the Company may request be increased up to $150 million. As of April 28, 2007, $44 million was available under the Credit Agreement, which represents the $100 million from our senior secured revolving credit facility less $56 million of outstanding letters of credit at April 28, 2007.

The Company’s Dunnigan mortgage loan is in connection with the purchase of the Suffern, New York facility, of which the major portion is the Company’s corporate offices and dressbarn’s distribution center. Payments of principal and interest on the mortgage, a 20-year fully amortizing loan, continue through 2023. The outstanding principal balance of the loan as of April 28, 2007 was $30 million.

In June 2006, the Financial Accounting Standards Board’s (“FASB”) Emerging Issues Task Force reached a consensus on Issue No. 06-3, “How Taxes Collected from Customers and Remitted to Governmental Authorities Should be Presented in the Income Statement (That Is, Gross versus Net Presentation)” (“EITF 06-3”). EITF 06-3 includes sales, use, value-added and some excise taxes that are assessed by a governmental authority on specific revenue-producing transactions between a seller and a customer. EITF 06-3 requires disclosure of the method of accounting for the applicable assessed taxes and the amount of assessed taxes included in revenues if such taxes are accounted for under the gross method. EITF 06-3 is effective for interim and annual periods beginning after December 15, 2006. The adoption of EITF 06-3 did not have a material impact on our consolidated financial position, results of operations or cash flows.

In June 2006, the FASB issued FASB Interpretation No. 48 (“FIN 48”), Accounting for Uncertainty in Income Taxes — an interpretation of FASB Statement No. 109, which clarifies the accounting for uncertainty in income taxes recognized in financial statements in accordance with FASB Statement No. 109, Accounting for Income Taxes. FIN 48 provides guidance on the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. FIN 48 requires that companies recognize in their consolidated financial statements the impact of a tax position that is more likely than not to be sustained upon examination based on the technical merits of the position. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon ultimate settlement. FIN 48 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosures, and transition. FIN 48 is effective for fiscal years beginning after December 15, 2006 (our Fiscal 2008). We have not completed our evaluation of the potential impact, if any, that this standard will have on our consolidated financial position, results of operations or cash flows.

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements, which defined fair value, establishes a framework for measuring fair value under GAAP, and expands disclosures about fair value measurements. SFAS No. 157 applies to other accounting pronouncements that require or permit fair value measurement. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 (our Fiscal 2009), and for interim periods within those fiscal years. We have not completed our evaluation of the potential impact, if any, of the adoption of SFAS No. 157 on our consolidated financial position, results of operations and cash flows.

In September 2006, the Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin (SAB) No. 108, Considering the Effects of Prior Year Misstatements When Quantifying Misstatements in Current Year Financial Statements, which provides interpretive guidance on the consideration of the effects of prior year misstatements in quantifying current year misstatements for the purpose of materiality assessment. SAB No. 108 is effective for fiscal years ending after November 15, 2006 (our Fiscal 2007). We have not completed our evaluation of the potential impact, if any, of the adoption of SAB No. 108 on our consolidated financial position, results of operations or cash flows. The cumulative effect, if any, of applying the provisions of SAB No. 108 will be reported as an adjustment to beginning-of-year retained earnings.

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities - Including an Amendment of FASB Statement No. 115, which provides companies with an option to measure, at specified election dates, many financial instruments and certain other items at fair value that are not currently measured at fair value. A company will report unrealized gains and losses on items for which the fair value option has been elected in earnings at each subsequent reporting date. This Statement also establishes presentation and disclosure requirements designed to facilitate comparisons between entities that choose different measurement attributes for similar types of assets and liabilities. SFAS 159 is effective as of the beginning of an entity’s first fiscal year that begins after November 15, 2007 (our Fiscal 2009). We have not completed our evaluation of the potential impact, if any, of the adoption of SFAS No. 159 on our consolidated financial position, results of operations and cash flows.

Effective with the acquisition of Maurices Incorporated, in January 2005, we operate and report in two segments, the dressbarn brands and the maurices brand. We believe that the maurices brand is currently a reportable segment, consistent with the way our chief operating decision-makers review the results of operations for each of the two brands. In addition, maurices also distributes goods to its stores through a separate distribution center and has financial reporting systems separate from dressbarn.

	Thirteen Weeks Ended						Thirty-Nine Weeks Ended
(Amounts in millions)	April 28, 2007			April 29, 2006			April 28, 2007			April 29, 2006
Net sales
dressbarn and dressbarn woman brands	$	228.6		$	225.7		$	683.8		$	636.8
maurices brand		119.3			101.5			362.9			320.2
Consolidated net sales	$	347.9		$	327.2		$	1,046.7		$	957.0

Operating income
dressbarn and dressbarn woman brands	$	20.4		$	21.3		$	59.2		$	54.2
maurices brand		15.3			12.8			43.9			39.6
Consolidated operating income		35.7			34.1			103.1			93.8
Interest income		1.5			0.8			4.4			1.4
Interest expense		(1.3	)		(1.3	)		(3.7	)		(4.1	)
Other income		0.4			0.4			1.0			1.1
Earnings before provision for income taxes	$	36.3		$	34.0		$	104.8		$	92.2

Depreciation and amortization
dressbarn and dressbarn woman brands	$	6.6		$	6.6		$	20.7		$	19.1
maurices brand		4.4			3.7			13.2			11.8
Consolidated depreciation and amortization	$	11.0		$	10.3		$	33.9		$	30.9

Cash paid for property and equipment
dressbarn and dressbarn woman brands	$	14.1		$	10.9		$	27.9		$	22.0
maurices brand		8.4			4.1			17.9			9.2
Consolidated purchases of property and equipment	$	22.5		$	15.0		$	45.8		$	31.2

The following discussion and analysis of financial condition and results of operations are based upon the Company's unaudited condensed consolidated financial statements and should be read in conjunction with those statements, the notes thereto and our Annual Report on Form 10-K for the fiscal year ended July 29, 2006. This Form 10-Q contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These statements reflect the Company’s current views with respect to future events and financial performance. The Company’s actual results of operations and future financial condition may differ materially from those expressed or implied in any such forward-looking statements. We disclaim any intent or obligation to update or revise any forward-looking statements as a result of developments occurring after the period covered by this report or otherwise.

This Management Overview section of Management’s Discussion and Analysis of Financial Condition and Results of Operations provides a high level summary of the more detailed information elsewhere in this quarterly report and an overview to put this information into context. This section is also an introduction to the discussion and analysis that follows. Accordingly, it necessarily omits details that appear elsewhere in this quarterly report. It should not be relied upon separately from the balance of this quarterly report.

We operate a chain of primarily women’s apparel specialty stores, principally under the names “dressbarn” and “dressbarn woman” and, since our January 2005 acquisition of Maurices Incorporated, “maurices.” Our dressbarn stores are operated mostly in a combination of dressbarn and dressbarn woman stores, or Combo stores, which carry dressbarn and larger-sized dressbarn woman merchandise, as well as freestanding dressbarn and dressbarn woman stores. These stores offer in-season, moderate to better quality career and casual fashion to working women primarily in their mid 30s to mid 50s at value prices. Our maurices stores are concentrated in small markets in the United States and their product offerings are designed to appeal to the casual and dressy apparel needs of the 17 to 34 year-old woman and to the casual apparel needs of the 17 to 34 year-old male. During the third quarter maurices began transitioning out of the men's business in order to introduce female plus-sizes in the fourth quarter. The impact on the third quarter financial statements from exiting the men's business was approximately $1.3 million, net of taxes. The Company believes the impact on its fourth quarter financial statements will not be material.

With the acquisition of maurices, the Company has diversified its core business and believes it has strengthened its foundation for future growth. The addition of maurices allows the Company to broaden its demographic reach and diversify its retail base. With this broader foundation, the Company expects to continue its strategy of opening new stores while closing under-performing locations. Our store expansion strategy is to focus on both expanding in the Company's major trading markets and developing and expanding into new domestic markets. The Company plans to continue to fund its planned store openings using cash flow from operations. In the fourth quarter of Fiscal 2007, the Company plans to open approximately 30 additional stores and close approximately 15 stores. During the thirteen weeks ended April 28, 2007, the Company opened 19 dressbarn and 17 maurices stores, and closed 3 dressbarn brand locations as well as 1 maurices brand location. During the thirty-nine weeks ended April 28, 2007, the Company opened 38 dressbarn brand Combo stores and 35 maurices stores. There were 9 closings of dressbarn brand locations and 3 closings of maurices stores during the thirty-nine weeks ending April 28, 2007. Furthermore, 6 freestanding dressbarn brand stores were converted into Combos. The Company’s total store square footage increased 4.9% from April 29, 2006.

Customer tastes and fashion trends are volatile and can change rapidly. Our success depends in part on our ability to effectively predict and respond to changing fashion trends and consumer demands, and to translate market trends into appropriate, saleable product offerings. If we are unable to successfully predict or respond to changing styles or trends and misjudge the market for our products or any new product lines, our sales will be lower and we may be faced with a substantial amount of unsold inventory. In response, we may be forced to rely on additional markdowns or promotional sales to dispose of excess or slow-moving inventory, which may have a material adverse effect on our financial condition or results of operations.

We consider comparable store sales to be one of the most important indicators of our current performance. Comparable store sales results are important in leveraging our costs, including store payroll, store supplies, and rent. Positive comparable store sales contribute to greater leveraging of costs. Comparable store sales also have a direct impact on the Company's total net sales, cash and working capital. The Company calculates comparable store sales based on the sales of stores open throughout the full period and throughout the full prior period (including stores relocated within the same shopping center and stores with minor square footage additions). If a single-format store is converted into a Combo store, the additional sales from the incremental format are not included in the calculation of same store sales. The determination of which stores are included in the comparable store sales calculation only changes at the beginning of each fiscal year except for stores that close during the fiscal year which are excluded from comparable store sales beginning with the fiscal month the store actually closes.

	Thirteen Weeks Ended						Thirty-Nine Weeks Ended
	April 28, 2007			April 29, 2006			April 28, 2007			April 29, 2006
Net sales growth		6.3	%		10.5	%		9.4	%		38.0	%(1)
dressbarn comparable store sales		(0.8	)%		9.6	%		4.7	%		9.3	%
maurices comparable store sales		8.7	%		2.5	%		5.0	%		N/A
Total comparable store sales growth		2.2	%		7.3	%		4.8	%		9.3	%
Gross profit as a percentage of sales		41.0	%		40.8	%		40.2	%		40.0	%
Square footage growth vs. prior year		4.9	%		3.5	%		4.5	%		20.3	%(1)
Total store count		1,400			1,326			1,400			1,326
Diluted earnings per share	$	0.33		$	0.29		$	0.97		$	0.81
SG&A as a percentage of sales		27.5	%		27.2	%		27.1	%		27.0	%
Capital expenditures (in millions)	$	22.5		$	15.0		$	45.8		$	31.2

The Company includes in its cost of sales line item all costs of merchandise (net of purchase discounts and vendor allowances), freight on inbound, outbound and internally transferred merchandise, merchandise acquisition costs (primarily commissions and import fees), occupancy costs excluding utilities and depreciation and all costs associated with the buying and distribution functions. The Company’s cost of sales and gross profit may not be comparable to those of other entities, since some entities include all costs related to their distribution network and all buying and occupancy costs in their cost of sales, while other entities such as the Company exclude a portion of these expenses from cost of sales and include them in selling, general and administrative expenses or depreciation. The Company includes depreciation related to the distribution network in depreciation and amortization, and utilities and insurance expenses, among other expenses, in selling, general and administrative expenses on the Condensed Consolidated Statements of Earnings.

	Thirteen Weeks Ended									Thirty-Nine Weeks Ended
				% of Net Sales									% of Net Sales
	$ % Change vs. LY			Apr. 28, 2007			Apr. 29, 2006			$ % Change vs. LY			Apr. 28, 2007			Apr. 29, 2006
Net sales		6.3	%		100.0	%		100.0	%		9.4	%		100.0	%		100.0	%
Cost of sales, including occupancy & buying		6.0	%		59.0	%		59.2	%		9.1	%		59.8	%		60.0	%
Gross profit		6.8	%		41.0	%		40.8	%		9.7	%		40.2	%		40.0	%
Selling, general and administrative expenses		7.5	%		27.5	%		27.2	%		9.6	%		27.1	%		27.0	%
Depreciation and amortization		7.1	%		3.2	%		3.1	%		9.7	%		3.2	%		3.2	%
Operating income		4.9	%		10.3	%		10.4	%		10.0	%		9.9	%		9.8	%
Interest income		84.3	%		0.4	%		0.2	%		209.1	%		0.4	%		0.1	%
Interest expense		3.1	%		(0.4	)%		(0.4	)%		(10.3	)%		(0.4	)%		(0.4	)%
Other income		1.8	%		0.1	%		0.1	%		(11.6	)%		0.1	%		0.1	%
Earnings before income taxes		6.8	%		10.4	%		10.4	%		13.7	%		10.0	%		9.6	%
Net earnings		15.4	%		6.6	%		6.1	%		23.9	%		6.5	%		5.7	%

Net sales for the third quarter increased by 6.3% to $347.9 million from $327.2 million for the thirteen weeks ended April 29, 2006 (“prior period”). The sales increase for the third quarter resulted primarily from the Company’s comparable store sales increase of 2.2% (dressbarn decreased 0.8% and maurices increased 8.7%), and the 4.9% increase from the prior period in store square footage due to new store openings. The dressbarn comparable store sales decrease was driven by a decrease in total sales transactions, primarily due to unseasonable and volatile weather during the month of February and the first two weeks of April, offset by an increase in the average price per unit sold of 0.9%. dressbarn net sales for the third quarter increased 1.3% to $228.6 million versus $225.7 million for the prior period. The strongest category that helped increase net sales for dressbarn was dresses. maurices sales for the third quarter were $119.3 million as compared with $101.5 million in the prior period. Strong sales trends were noted for denim bottoms, Studio Y tops, and lounge apparel. maurices offset a slight decline in store traffic with increases in units per transaction and customer conversion rates.

Gross profit, net of buying and occupancy costs, as a percentage of sales increased to 41.0% for the current period from 40.8% for the prior period. For the dressbarn brand, gross profit was 40.0%, as compared to 40.1%, a decrease of 10 basis points. For the dressbarn brand, the gross profit decrease was primarily due to the lack of occupancy cost leverage from the comp sales decrease. For the maurices brand, gross profit for the third quarter was 42.9% of net sales as compared to 42.3% of net sales in the prior period. The increase in gross margin resulted from higher markons partially offset by slightly higher markdowns due to the transition out of the men’s business and occupancy cost leverage from the increase in comparable store sales.

Selling, general and administrative (“SG&A”) expenses as a percentage of sales for the third quarter increased 30 basis points to 27.5% as compared to 27.2% in the prior period. On a divisional basis, dressbarn SG&A expenses for the third quarter increased 30 basis points to 28.1% of net sales versus 27.8% of net sales in the prior period. The increase was mainly due to the de-leveraging of payroll related expenses (50 basis points) and other fixed costs as a result of its 0.8% comparable sales decrease. maurices’ SG&A expenses were 26.3% of net sales for the third quarter as compared to 26.0% in the prior period. The increase was primarily due to a significant increase in the Company’s investment in maurices’ marketing, grand opening and advertising to enhance the maurices brand recognition and drive store traffic and an increase in health insurance costs.

Net sales for the thirty-nine weeks increased by 9.4% to $1.05 billion from $957.0 million for the thirty-nine weeks ended April 29, 2006 (“prior thirty-nine week period”). The sales increase for the thirty-nine weeks resulted primarily from the Company’s comparable store sales increase of 4.8% (dressbarn increased 4.7% and maurices increased 5.0%), and the 4.5% increase from the comparable prior year period in store square footage due to new store openings. The dressbarn comparable store sales increase was driven by an increase in the average price per unit sold of 2.2% as well as an increase in total sales transactions. dressbarn net sales for the thirty-nine weeks increased 7.4% to $683.8 million versus $636.8 million for the comparable prior year period. The categories that helped increase net sales were dresses, social and knits. maurices’ sales for the thirty-nine weeks were $362.9 million as compared with $320.2 million in the comparable prior year period. Strong sales trends were noted for knit tops, sweaters, and denim bottoms. maurices offset a decline in store traffic with increases in units per transaction and customer conversion rates.

Gross profit, net of buying and occupancy costs, as a percentage of sales, increased 20 basis points to 40.2% for the thirty-nine weeks from 40.0% in the comparable prior period. For the dressbarn brand, gross profit was 39.8%, an increase of 10 basis points from the prior period. For the dressbarn brand, gross profit before buying and occupancy costs benefited from the leverage of its comparable sales increase on occupancy and buying costs and lower markdowns. For the maurices brand, gross profit as a percentage of sales for the thirty-nine weeks was 41.0% for the current period as compared to 40.7% for the prior period, as leverage from the comparable sales increase was offset by slightly higher markdowns.

Selling, general and administrative expenses as a percentage of sales for the thirty-nine weeks increased by 10 basis points to 27.1% for the current period as compared to 27.0% from the prior period. On a divisional basis, dressbarn’s SG&A expenses for the thirty-nine weeks decreased 10 basis points to 28.1% of net sales versus 28.2% of net sales in the comparable prior year period. The decrease was mainly due to leveraging of payroll related expenses as a result of its comparable sales increase offset by an increase in professional fees. maurices’ SG&A expenses were 25.2% of net sales for the thirty-nine weeks as compared to 24.7% in the comparable prior year period. The increase was primarily due to a significant increase in the Company’s investment in maurices’ marketing, grand opening and advertising costs to enhance the maurices brand recognition and drive store traffic and increased health insurance costs partially offset by a reduction in professional fees and the leveraging of store payroll.

Interest income for the thirty-nine weeks was $4.4 million as compared to interest income of $1.4 million in the comparable prior year period. The increase was due to the increase in funds invested in marketable securities and investments in the thirty-nine weeks as compared to the prior year thirty-nine week period. Interest expense for the thirty-nine weeks decreased to $3.7 million from $4.2 million due to lower debt levels due to the repayment of certain debt incurred to finance the acquisition of Maurices Incorporated.

The effective tax rate decreased to approximately 35.6% for the thirty-nine weeks ended April 28, 2007 from 40.8% for the thirty-nine weeks ended April 29, 2006. The income tax provision for the thirty-nine week period was favorably impacted as a result of higher tax exempt interest income, one-time adjustments to certain deferred tax accounts in the second quarter of fiscal 2007 and a reduction in the effective state tax rate in the third quarter of fiscal 2007. The company anticipates an effective tax rate in the range of 37.8% to 38.0% for the remainder of Fiscal 2007.

Net cash provided by operations was $104 million for the thirty-nine weeks ended April 28, 2007, compared with $129 million during last year’s comparable period. Though the Company’s thirty-nine week net income increased $13 million from the prior period, cash flow from operations decreased $24.8 million primarily due to a net $22.9 million decrease in cash flows relating to its inventory purchases. In addition, the Company paid $20.7 million more in income taxes during the thirty-nine weeks than during the comparable prior year period.

The Company used a net of $82.9 million in its investing activities during the thirty-nine weeks ended April 28, 2007. The majority of this amount represents an increase in the Company’s marketable securities and investments, which were a total of $153 million as of April 28, 2007. The Company’s purchases of property and equipment of $45.8 million related to new store openings, remodels and information system implementations during the thirty-nine weeks ended April 28, 2007.

As of April 28, 2007, $44 million was available under a revolving credit facility that was part of a credit agreement executed in December 2005 for future borrowings, which we believe gives the Company ample capacity to fund any short-term working capital needs that may arise in the operation of its business. The $44 million available under the credit agreement represents the $100 million from our revolving credit facility less $56 million of outstanding letters of credit at April 28, 2007. The Company also has an option to increase the revolving credit facility by $50 million.

The Company believes that its cash, cash equivalents, short-term investments, together with cash flow from operations, along with the credit agreement mentioned above, will be adequate to fund the Company's planned capital expenditures and operating requirements for the next 12 fiscal months, including planned new store growth, the Company’s store remodel program, its continued installation and upgrading of new and existing software packages, and the maintenance of proper inventory levels.

The Company does not have any off-balance sheet arrangements or transactions with unconsolidated, limited purpose entities. In the normal course of its business, the Company enters into operating leases for its store locations and utilizes letters of credit principally for the importation of merchandise. The Company does not have any undisclosed material transactions or commitments involving related persons or entities.

There have been no material changes during the period covered by this report, outside of the ordinary course of the Company’s business, to the contractual obligations specified in the table of contractual obligations included in the section “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the Company’s Fiscal 2006 Annual Report on Form 10-K.

The dressbarn and maurices brands have historically experienced substantially lower earnings in our second fiscal quarter ending in January than during our other three fiscal quarters, reflecting the intense promotional atmosphere that has characterized the holiday shopping season in recent years. We expect this trend to continue. In addition, our quarterly results of operations may fluctuate materially depending on, among other things, increases or decreases in comparable store sales, adverse weather conditions, shifts in timing of certain holidays, the timing of new store openings, net sales contributed by new stores, and changes in our merchandise mix.

Management has determined that the Company’s most critical accounting policies are those related to revenue recognition, merchandise inventories, long-lived assets, insurance reserves, claims and contingencies, litigation, operating leases, income taxes, goodwill impairment, sales returns and share-based compensation. The Company continues to monitor its accounting policies to ensure proper application. There have been no changes to these policies as discussed in the Company’s Annual Report on Form 10-K for the fiscal year ended July 29, 2006.

The Company’s portfolio of investments consisting of cash, cash equivalents and marketable securities can be affected by changes in market interest rates. Financial instruments, which potentially subject the Company to concentrations of credit risk, are principally bank deposits and short-term money market investments. Cash and cash equivalents are deposited with high credit quality financial institutions. Short-term investments principally consist of triple A or double A rated instruments. The carrying amounts of cash, cash equivalents, short-term investments and accounts payable approximate fair value because of the short-term nature and maturity of such instruments.

Our cash and cash equivalents include financial instruments with original maturity dates of three months or less. The majority of our marketable securities and investments are in auction rate securities that have interest rate resets through a modified Dutch auction, at predetermined short-term intervals, usually every 7, 28 or 35 days. The Company does not believe that an adverse change in interest rates would have a material effect on the Company’s financial condition.

Under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, the Company has conducted an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of April 28, 2007 (the “Evaluation Date”). There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. Based on such evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of the Evaluation Date, the Company’s disclosure controls and procedures are effective at the reasonable assurance level in alerting them on a timely basis to material information relating to the Company (including its consolidated subsidiaries) required to be included in the Company’s reports filed or submitted under the Exchange Act, and in ensuring that information required to be disclosed in the reports that the Company files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including the Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

(1)

The Company has a $75 million Stock Repurchase Program (the “Program”) which was originally announced on April 5, 2001. Under the Program, the Company may repurchase its shares of common stock from time to time, either in the open market or through private transactions, whenever it appears prudent to do so. The remaining authorized amount for stock repurchases under the Program is $48 million. The Program has no expiration date.

Exhibit		Description
31.1		Certification by the Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.

31.2		Certification by the Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.

32.1		Certification of David R. Jaffe pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of Armand Correia pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Connecticut	06-0812960
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

30 Dunnigan Drive, Suffern, New York	10901
(Address of principal executive offices)	(Zip Code)

	Number of Shares			Weighted Average Grant Date Fair Value Per Share
Restricted stock awards at July 29, 2006		155,440		$	9.62
Granted		37,500		$	24.46
Vested		(50,973	)	$	9.33
Forfeited		(4,800	)	$	15.03
Restricted stock awards at April 28, 2007		137,167		$	13.53

		April 28, 2007				July 29, 2006
(Amounts in thousands)		Estimated Fair Value		Amortized Cost		Estimated Fair Value		Amortized Cost
Municipal Bonds	$	32,733	$	32,747	$	29,465	$	29,457
Tax Exempt Auction-rate Securities		120,080		120,080		89,280		89,280
Total	$	152,813	$	152,827	$	118,745	$	118,737

(Amounts in millions)	April 28, 2007		July 29, 2006
Identifiable assets
dressbarn and dressbarn woman brands	$	786.7	$	707.9
maurices brand		138.3		139.0
Total identifiable assets	$	925.0	$	846.9

Merchandise inventories
dressbarn and dressbarn woman brands	$	118.9	$	113.9
maurices brand		49.9		56.6
Total merchandise inventories	$	168.8	$	170.5

Period		Total Number of Shares of Common Stock Purchased			Average Price Paid per Share of Common Stock			Total Number of Shares of Common Stock Purchased as Part of Publicly Announced Plans or Programs			Maximum Number of Shares of Common Stock that May Yet Be Purchased Under the Plans or Programs ⁽²⁾
January 28, 2007 through April 28, 2007			-			-			-			2,380,124

The Dress Barn, Inc. and Subsidiaries
Condensed Consolidated Statements of Earnings (unaudited)
Amounts in thousands, except per share amounts


June 6, 2007	BY:	/s/ David R. Jaffe
Date		David R. Jaffe President, Chief Executive Officer and Director (Principal Executive Officer)


June 6, 2007	BY:	/s/ Armand Correia
Date		Armand Correia Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)