Earnings for the quarter ended Jan. 27 totaled 205.5 million, or43 cents per share, down from $288.7 million, or 60 cents pershare, earned during the fourth quarter a year earlier. Overallsales were up 9% to $5.1 billion from $4.68 billion a year earlier.Sales from stores open at least one year rose 5% overall.

Carol Meyrowitz, president and CEO, said in a conference callthat the closing of 34 underperforming A.J. Wright stores willallow the company to refocus on the craft store's demographics tobring that division to the break-even point by 2008. A.J. Wrightlost $1 million last year but should show a positive cash flowsoon, she said.

The Framingham, MA-based discount retailer said it also expectsmore positive growth overall in first quarter of the new fiscalyear. Net income is projected to be between 36 cents and 38 centsper share, an increase from the 34 cents per share earned in theyear-ago period. Same store sales are also expected to rise 3%.