Originally planning to open between four to six Cusp stores thisyear, the company now will not expand beyond the two stores alreadyopened in the quarter. However, management is maintaining plannedopenings for its namesake Neiman Marcus stores, although on alengthier schedule.

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"We have six full-line stores on the schedule," said Burton M.Tansky, president and CEO. "That has not changed, but in same cases[the opening dates have] shifted."

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Neiman Marcus stores will open in Bellevue, WA; Walnut Creek,CA; Sarasota, FL; San Jose, CA; and Princeton, NJ, through fall2013. Tansky did not give a specific date for a scheduled unit inOyster Bay, NY.

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Cusp, which is geared to a younger customer, recently opened itssixth unit at Water Tower Place, in Chicago. Though the company"remains very optimistic about its prospects," Tansky said, it hasceased expansion for 2009 and early 2010, and will reevaluate 2010plans later in the fiscal year.

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For the quarter, the company reported total revenues of $986million, compared to $1.13 billion in the prior year. Comparablerevenues decreased 14.5%. Operating earnings for the first quarterof fiscal year 2009 were $81.6 million compared to $189.7 millionfor the first quarter of fiscal year 2008. Adjusted operatingearnings were $81.6 million in the first quarter of fiscal year2009 compared to $157.2 million in the first quarter of fiscal year2008.

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"This reflects a weakness of both our aspirational shopper andthe loyal customer," Tansky said. "We believe the loyal customerstill has the ability to shop with us. Though she may have reducedher spend, we believe she will return to a much more normal patternof shopping."

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