SANTA BARBARA, CA -- (Marketwire) -- 03/23/09 -- The Walking Company Holdings, Inc. (NASDAQ: WALK) (www.thewalkingcompany.com; www.bigdogs.com) today reported sales results for the fourth quarter ended December 31, 2008, a financial restructuring and other corporate events.

SALES RESULTS:

For the quarter and year ended December 31, 2008, consolidated net sales were $79.6 million and $241.5 million as compared with $76.6 million and $233.3 million, respectively in 2007. Our annual consolidated net sales increased 4% primarily due to the addition of 23 net new TWC stores (209 stores at year end vs. 186 last year) and a comparative TWC store sales increase of 6.7% in the 4th quarter and 1.8% for the year. Gross margin declined about 2% in the 4th quarter, primarily a result of The Walking Company discontinuing its small outlet business and liquidating the related inventory. Financial results for 2008 will be released within the next few weeks.

Andrew Feshbach, CEO, commenting on 4th quarter sales, said, "Despite the general decline in retail business in the 4th quarter, The Walking Company was able to achieve increased comparative store sales as a result of a few factors; strong sales of Ugg Australia boots and related products; strong increases in women's products overall, offset by declines in men's products; a perceived trend towards more versatile shoe styles sold by The Walking Company; and solid increases in the Company's "bricks and clicks" internet initiatives. Feshbach continued, "Comparative store sales in the first quarter of 2009 are estimated to be down mid to high single digits (reflecting the loss of a calendar day in February and the Easter holiday shift to April) with margins about the same as last year. We are noting the declines coming more significantly from the areas of the country most affected by the distressed housing market and the more luxury-oriented malls in general."

DISPOSITION OF THE BIG DOGS OUTLET CHAIN:

In the fall of 2007, the Company attempted to sell the Big Dog chain of outlet stores along with the related intellectual property assets. Due to the existing losses and the negative sales trends at the store level, we were unsuccessful in selling Big Dogs. We concluded from the input we received during the process that the intellectual property, the brand and its trademarks and library of graphics along with the internet business still had value but was weighed down by the outlet chain which was no longer viable. We received at least one bid from a large liquidator to dispose of the chain. Believing the bid to be inadequate, we set out to liquidate the business ourselves. On December 31st of 2007, the Big Dogs outlet chain of stores numbered 131. As of today, the store chain has been reduced to 14. Over the past 15 months, over $20 million of inventory was turned into cash and was used to pay down our debt, all but a few of the store leases have been resolved, the employees were terminated with severance based on their tenure with the Company and we have largely finished the task we began early in 2008. The results achieved by the Company were substantially greater than the offer we received from the liquidator.