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SAN FRANCISCO, CA-Design Within Reach, with plans to open one more studio this year, outlined turnaround plans Monday while postponing the filing of quarterly results because of management turnover in the company’s finance department. The company said that the turnover has delayed its independent public accountants’ ability to complete the review of the quarterly filing.

Design Within Reach has opened seven studios this year, including the DWR Annex, an outlet for returned and discontinued merchandise in Secaucus, NJ. It operated 62 studios in the second quarter of 2006 compared to 51 studios in the second quarter of last year.

In answer to financial analysts’ questions during the company’s conference call Monday, CEO Ray Brunner said that the company still plans to open three or four new stores in 2007, as previously stated. “I think we need ’07 to get this business buttoned back down and refocused. Around the middle of 07 we would begin to make decisions about where we will go in 08,” Brunner said.

Design Within Reach lost $800,000 in the quarter, or six cents per diluted share, compared with earnings of $1.4 million (nine cents a share) in the same quarter last year. Sales totaled $48.9 million, an increase of approximately 16.7% from the $41.9 million recorded in the second quarter of 2005.

Brunner said in the conference call with financial analysts that the chain is encouraged by the second quarter performance but expects that the full impact of its strategic changes “will not be evident until 2007.” The strategy the company is pursuing includes trengthening its management team, controlling costs, promotion programs and other efforts.

As part of shoring up its financial management, the company recently announced the appointment of John Hellmann as CFO, effective Sept. 5. Hellmann’s nearly 30 years of senior corporate finance and consumer sector experience include posts at several public companies, including Shoe Pavilion Inc. Hellmann will succeed former CFO Ken La Honta, who resigned.

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