We were relatively pleased with our second quarter sales performance, even though business conditions continue to be tough at retail
Robert H. Spilman, Jr. president and CEO

Bassett Furniture Industries announced today that it had reached an agreement to acquire a controlling interest in eight Bassett Furniture Direct (BFD) stores in greater Dallas, Texas.

The Company expects these retail stores to operate at breakeven in fiscal 2006. This transaction will bring the total number of corporate BFDs to 22, approximately 18 percent of the 120 BFDs operating at the end of the second quarter.

"We've experienced solid improvement in our Corporate Store Program over the past two years," said Robert H. Spilman, Jr. president and chief executive officer. "This operation will provide our Corporate Store Program with greater scale allowing us to drive the consistency and uniformity we believe are vital to our overall BFD program at this time. We will provide both the organizational and financial strength needed to improve the performance of these stores. "

"As it relates to the Company's overall business, we were relatively pleased with our second quarter sales performance, even though business conditions continue to be tough at retail," continued Spilman. The Company expects to release its second quarter earnings on June 28, 2005, and estimates a sales increase of approximately 3.5 percent for the quarter ended May 28, 2005 as compared to the second quarter of 2004.