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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549
________________
 FORM 10-Q (Mark One)[ X ]
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended October 30, 2004
 OR [  ]
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the transition period from to Commission file number 0-19526 Goodys Family Clothing, Inc. 
 Tennessee
    
    62-0793974(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification Number)400 Goodys Lane,Knoxville, Tennessee
    
    37922(Address of principal executive offices)
    
    (Zip Code)
 (865) 966-2000      Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [  ] Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). Yes [X] No [  ] APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the issuers classes of
common stock, as of the latest practicable date. Common Stock, no par value,32,789,119 shares outstanding as of November 12, 2004.




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GOODYS FAMILY CLOTHING, INC.
Index to Form 10-Q
October 30, 2004 Part I  Financial Information:Item 1 - Condensed Consolidated Financial Statements (Unaudited)Condensed Consolidated Statements of Operations
    
    
    3Condensed Consolidated Balance Sheets
    
    
    4Condensed Consolidated Statements of Cash Flows
    
    
    5Notes to Condensed Consolidated Financial Statements
    
    
    6  9Report of Independent Registered Public Accounting Firm
    
    
    10Item 2 - Managements Discussion and Analysis of Financial
Condition and Results of Operations
    
    
    11 - 15Item 3 - Quantitative and Qualitative Disclosures about Market Risk
    
    
    16Item 4 - Controls and Procedures
    
    
    16Part II  Other Information:Item 1. Legal Proceedings
    
    
    17Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    17Item 3. Defaults Upon Senior Securities
    
    
    17Item 4. Submission of Matters to a Vote of Security Holders
    
    
    17Item 5. Other Information
    
    
    17Item 6. Exhibits
    
    
    17Signatures
    
    
    18EX-10.103 EMPLOYMENT AGREEMENT DATED JULY 12,2004EX-15 ACCOUNTANTS AWARENESS LETTEREX-31.1 SECTION 302 CERTIFICATION OF CEOEX-31.2 SECTION 302 CERTIFICATION OF CFOEX-31.3 SECTION 302 CERTIFICATION OF SENIOR VP AND CAOEX-32.1 SECTION 906 CERTIFICATION OF CEOEX-32.2 SECTION 906 CERTIFICATION OF CFOEX-32.3 SECTION 906 CERTIFICATION OF SENIOR VP AND CAO
  2




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##### Table of Contents



PART 1  FINANCIAL INFORMATION 
 Item 1  Condensed Consolidated Financial Statements Goodys Family Clothing, Inc. and Subsidiaries 
 Condensed Consolidated Statements of Operations (Unaudited)
(In thousands, except per share amounts)
 Thirteen
    
    Thirty-nineWeeks Ended
    
    Weeks EndedOctober 30,
    
    November 1,
    
    October 30,
    
    November 1,2004
    
    2003
    
    2004
    
    2003Sales
    
    $
    284,794
    
    
    $
    280,777
    
    
    $
    882,304
    
    
    $
    857,828Cost of sales and occupancy expenses
    
    
    200,975
    
    
    
    197,509
    
    
    
    617,567
    
    
    
    602,801Gross profit
    
    
    83,819
    
    
    
    83,268
    
    
    
    264,737
    
    
    
    255,027Selling, general and administrative expenses
    
    
    85,390
    
    
    
    80,676
    
    
    
    251,717
    
    
    
    238,571(Loss) earnings from operations
    
    
    (1,571
    )
    
    
    2,592
    
    
    
    13,020
    
    
    
    16,456Investment income
    
    
    291
    
    
    
    127
    
    
    
    682
    
    
    
    507Interest expense
    
    
    2
    
    
    
    1
    
    
    
    133
    
    
    
    2(Loss) earnings before income taxes
    
    
    (1,282
    )
    
    
    2,718
    
    
    
    13,569
    
    
    
    16,961(Benefit) provision for income taxes
    
    
    (478
    )
    
    
    1,006
    
    
    
    5,054
    
    
    
    6,276Net (loss) earnings
    
    $
    (804
    )
    
    $
    1,712
    
    
    $
    8,515
    
    
    $
    10,685(Loss) earnings per common share:Basic
    
    $
    (0.02
    )
    
    $
    0.05
    
    
    $
    0.26
    
    
    $
    0.33Diluted
    
    $
    (0.02
    )
    
    $
    0.05
    
    
    $
    0.25
    
    
    $
    0.32Cash dividends declared per common share
    
    $
    0.03
    
    
    $
    0.02
    
    
    $
    0.08
    
    
    $
    0.04Weighted average common shares outstanding:Basic
    
    
    32,915
    
    
    
    32,740
    
    
    
    32,923
    
    
    
    32,623Diluted
    
    
    32,915
    
    
    
    33,649
    
    
    
    33,812
    
    
    
    33,268
 See accompanying Notes to Condensed Consolidated Financial Statements and
Report of Independent Registered Public Accounting Firm. 3




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Goodys Family Clothing, Inc. and Subsidiaries 
 Condensed Consolidated Balance Sheets
(Dollars in thousands, except per share amounts)
 October 30,
    
    January 31,
    
    November 1,2004
    
    2004
    
    2003(Unaudited)
    
    
    
    
    
    (Unaudited)ASSETSCurrent AssetsCash and cash equivalents
    
    $
    67,016
    
    
    $
    123,033
    
    
    $
    66,727Inventories
    
    
    300,542
    
    
    
    198,726
    
    
    
    274,853Accounts receivable and other current assets
    
    
    22,703
    
    
    
    13,177
    
    
    
    21,763Total current assets
    
    
    390,261
    
    
    
    334,936
    
    
    
    363,343Property and equipment, net
    
    
    114,692
    
    
    
    106,968
    
    
    
    108,424Other assets
    
    
    5,130
    
    
    
    5,437
    
    
    
    13,901Total assets
    
    $
    510,083
    
    
    $
    447,341
    
    
    $
    485,668LIABILITIES AND SHAREHOLDERS EQUITYCurrent LiabilitiesAccounts payable  trade
    
    $
    170,661
    
    
    $
    119,411
    
    
    $
    160,775Accounts payable  other
    
    
    14,265
    
    
    
    11,999
    
    
    
    18,622Accrued expenses
    
    
    44,887
    
    
    
    46,095
    
    
    
    50,262Current deferred income taxes
    
    
    24,770
    
    
    
    21,909
    
    
    
    15,010Total current liabilities
    
    
    254,583
    
    
    
    199,414
    
    
    
    244,669Long-term liabilities
    
    
    7,405
    
    
    
    6,945
    
    
    
    6,379Deferred income taxes
    
    
    13,871
    
    
    
    12,212
    
    
    
    12,348Total liabilities
    
    
    275,859
    
    
    
    218,571
    
    
    
    263,396Commitments and Contingencies (Note 4)Shareholders EquityPreferred stock, par value $1.00 per share;Authorized - 2,000,000 shares; issued and outstanding  noneClass B Common stock, no par value;Authorized - 50,000,000 shares; issued and outstanding  noneCommon stock, no par value;Authorized - 50,000,000 shares;Issued and outstanding  32,788,969; 32,841,706; and
32,814,306 shares, respectively
    
    
    34,269
    
    
    
    34,697
    
    
    
    34,518Retained earnings
    
    
    199,955
    
    
    
    194,073
    
    
    
    187,754Total shareholders equity
    
    
    234,224
    
    
    
    228,770
    
    
    
    222,272Total liabilities and shareholders equity
    
    $
    510,083
    
    
    $
    447,341
    
    
    $
    485,668
 See accompanying Notes to Condensed Consolidated Financial Statements and
Report of Independent Registered Public Accounting Firm. 4




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Goodys Family Clothing, Inc. and Subsidiaries 
 Condensed Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
 Thirty-nine Weeks EndedOctober 30,
    
    November 1,2004
    
    2003Cash Flows from Operating ActivitiesNet earnings
    
    $
    8,515
    
    
    $
    10,685Adjustments to reconcile net earnings to net cash used in operating activities:Depreciation and amortization
    
    
    17,030
    
    
    
    16,287Net loss on asset disposals and write-downs
    
    
    774
    
    
    
    287Changes in assets and liabilities:Inventories
    
    
    (101,816
    )
    
    
    (94,830
    )Accounts payable  trade
    
    
    51,250
    
    
    
    54,877Accounts payable  other
    
    
    2,266
    
    
    
    (5,699
    )Income taxes
    
    
    6,723
    
    
    
    5,767Other assets and liabilities
    
    
    (12,181
    )
    
    
    (1,085
    )Net cash used in operating activities
    
    
    (27,439
    )
    
    
    (13,711
    )Cash Flows from Investing ActivitiesAcquisitions of property and equipment
    
    
    (25,384
    )
    
    
    (16,365
    )Acquisition of intangible assets
    
    
    
    
    
    
    (4,098
    )Proceeds from sale of property and equipment
    
    
    24
    
    
    
    215Net cash used in investing activities
    
    
    (25,360
    )
    
    
    (20,248
    )Cash Flows from Financing ActivitiesDividends paid to shareholders
    
    
    (2,305
    )
    
    
    (652
    )Proceeds from exercise of stock options
    
    
    934
    
    
    
    1,308Shares repurchased and retired
    
    
    (1,847
    )
    
    
    Net cash (used in) provided by financing activities
    
    
    (3,218
    )
    
    
    656Net decrease in cash and cash equivalents
    
    
    (56,017
    )
    
    
    (33,303
    )Cash and cash equivalents, beginning of period
    
    
    123,033
    
    
    
    100,030Cash and cash equivalents, end of period
    
    $
    67,016
    
    
    $
    66,727Supplemental Disclosures:Net income tax payments
    
    $
    7,209
    
    
    $
    1,319Interest payments
    
    
    1
    
    
    
    1
 See accompanying Notes to Condensed Consolidated Financial Statements and
Report of Independent Registered Public Accounting Firm. 5




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Goodys Family Clothing, Inc. and Subsidiaries 
 Notes to Condensed Consolidated Financial Statements
(Unaudited)
 (1) Basis of presentation The accompanying condensed consolidated financial statements of Goodys Family
Clothing, Inc. and subsidiaries (the Company) are unaudited and have been
prepared pursuant to the rules and regulations of the Securities and Exchange
Commission for interim financial statements. In the opinion of the Companys
management, the accompanying unaudited condensed consolidated financial
statements include all adjustments, consisting primarily of normal and
recurring adjustments, necessary for a fair presentation of the Companys
financial position, results of operations and cash flows for the interim
periods presented. Due to the seasonal nature of the Companys business, the
results of operations for the interim periods are not necessarily indicative of
the results that may be achieved for the entire year. The condensed
consolidated financial statements should be read in conjunction with the
audited consolidated financial statements and the notes thereto contained in
the Companys Annual Report on Form 10-K for its fiscal year ended January 31,
2004. Certain reclassifications have been made to the condensed consolidated
financial statements of prior periods to conform to the current period
presentation. (2) Stock-Based Compensation The Company has options outstanding under four stock option plans: the Goodys
Family Clothing, Inc. Amended and Restated 1991 Stock Incentive Plan (the 1991
Plan), the Goodys Family Clothing, Inc. Amended and Restated 1993 Stock
Option Plan (the 1993 Plan), the Goodys Family Clothing, Inc. Amended and
Restated 1997 Stock Option Plan (the 1997 Plan) and the Amended and Restated
Discounted Stock Option Plan for Directors (the Directors Plan). The Company accounts for its stock option plans under the recognition and
measurement principles of Accounting Principles Board Opinion No. 25,
Accounting for Stock Issued to Employees, and related Interpretations. No
stock-based employee compensation cost is reflected in net earnings, as all
options granted under those plans had an exercise price equal to the market
value of the underlying common stock on the date of grant. However, expense is
recorded in connection with stock options issued under the Directors Plan to
non-employee directors and this expense has been insignificant. Interim
proforma information regarding net (loss) income and (loss) earnings per share
is required by Statement of Financial Accounting Standards No. 148 (SFAS
148), Accounting for Stock-Based Compensation  Transition and Disclosure 
an Amendment of Financial Accounting Standards Board (FASB) Statement No.
123, which requires that the information be determined as if the Company had
accounted for its employee stock options granted under the fair value method of
that statement. The following table illustrates the effect on net (loss)
earnings and (loss) earnings per common share if the Company had applied the
fair value recognition provisions of SFAS 148 to stock-based employee
compensation (in thousands, except per share amounts): 6




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Goodys Family Clothing, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  continued
(Unaudited) Thirteen
    
    Thirty-nineWeeks Ended
    
    Weeks EndedOctober 30,
    
    November 1,
    
    October 30,
    
    November 1,2004
    
    2003
    
    2004
    
    2003Net (loss) earnings, as reported
    
    $
    (804
    )
    
    $
    1,712
    
    
    $
    8,515
    
    
    $
    10,685Deduct: Total stock-based
employee compensation expense
determined under fair value
based-method for all awards, net
of related tax effects
    
    
    (346
    )
    
    
    (165
    )
    
    
    (459
    )
    
    
    (618
    )Pro forma net (loss) earnings
    
    $
    (1,150
    )
    
    $
    1,547
    
    
    $
    8,056
    
    
    $
    10,067(Loss) earnings per common share:Basic  as reported
    
    $
    (0.02
    )
    
    $
    0.05
    
    
    $
    0.26
    
    
    $
    0.33Basic  pro forma
    
    
    (0.03
    )
    
    
    0.05
    
    
    
    0.24
    
    
    
    0.31Diluted  as reported
    
    $
    (0.02
    )
    
    $
    0.05
    
    
    $
    0.25
    
    
    $
    0.32Diluted  pro forma
    
    
    (0.03
    )
    
    
    0.05
    
    
    
    0.24
    
    
    
    0.30
 The weighted-average fair value of each stock option included in the preceding
pro forma amounts was estimated using the Black-Scholes option-pricing model
and is amortized over the vesting period of the underlying options. (3) Credit arrangements In May 2001, the Company entered into a five-year, $130,000,000 syndicated
revolving loan and security agreement that provides for cash borrowings for
general corporate purposes, including a $95,000,000 sub-facility for the
issuance of letters of credit. Borrowings under this credit facility are
limited by collateral formulas, based principally upon the Companys eligible
inventories. The credit facility is secured primarily by the Companys
inventories, receivables and cash and cash equivalents. The borrowing base was
$215,414,000 at October 30, 2004, which excludes cash and most of cash
equivalents and only gives credit for specified percentages of inventory and
receivables. The amount available to draw under the credit facility at October
30, 2004 was approximately $95,092,000. If availability (as calculated pursuant
to the credit facility) falls below $25,000,000, the Company would be required,
for a period of time, to comply with a financial covenant requiring it to
maintain minimum levels of tangible net worth based on formulas. The Companys
availability did not fall below $25,000,000 during the thirty-nine weeks ended
October 30, 2004, or November 1, 2003 and therefore the Company was not
required to comply with this financial covenant. The credit facility also
contains certain discretionary provisions that enable the lender to reduce
availability. The credit facility bears interest at LIBOR plus an applicable
margin or the prime rate. In June 2003, the credit facility was amended to
permit cash dividends in any fiscal year on the common stock in an amount not
to exceed (i) $3,500,000 (but not to exceed $10,000,000 in the aggregate during
the remaining term of the credit facility) plus (ii) 50% of the Companys
consolidated net income for the immediately preceding fiscal year. In June
2003, the lenders agreed to waive any events of default which could be deemed
to have occurred by reason of the Courts decision in the Hilfiger Matter
described below. At October 30, 2004, the Company had no borrowings outstanding
and has $20,699,000 in outstanding letters of credit (not yet reflected in
accounts payable) under the facility. These letters of credit generally have
terms of less than one year and are primarily used to facilitate the purchase
of import merchandise. 7




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Goodys Family Clothing, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  continued
(Unaudited) (4) Contingencies Class Action Proceeding In February 1999, a lawsuit was filed in the United States District Court for
the Middle District of Georgia and was served on the Company and Robert M.
Goodfriend, its Chairman of the Board and Chief Executive Officer, by 20 named
plaintiffs, generally alleging that the Company discriminated against a class
of African-American employees at its retail stores through the use of
discriminatory selection and compensation procedures and by maintaining unequal
terms and conditions of employment. The plaintiffs further alleged that the
Company maintained a racially hostile working environment. On February 28, 2003, a proposed Consent Decree was filed with the District
Court for its preliminary approval. The proposed Consent Decree sets forth the
proposed settlement of the class action race discrimination lawsuit.
Ultimately, class action certification was sought in the lawsuit only with
respect to alleged discrimination in promotion to management positions and the
proposed Consent Decree is limited to such claims. Generally, the proposed
settlement provides for a payment by the Company in the aggregate amount of
$3.2 million to the class members (including the named plaintiffs) and their
counsel, as well as the Companys implementation of certain policies, practices
and procedures regarding, among other things, training of employees. The
Companys employer liability insurance underwriter has funded $3.1 million of
such payment to a third-party administrator. The proposed Consent Decree
explicitly provides that it is not an admission of liability by the Company and
the Company continues to deny all of the allegations. On April 30, 2003, the
District Court granted preliminary approval of the proposed Consent Decree, and
a hearing was held on June 30, 2003, regarding the adequacy and fairness of the
proposed settlement. On March 3, 2004, the United States District Court for the
Middle District of Georgia issued an Order granting final approval of the
Consent Decree. On or about February 23, 2004, a purported class member filed
an appeal with the U.S. Court of Appeals for the Eleventh Circuit (the
Eleventh Circuit), alleging, among other things, misconduct on the part of
the District Court and the plaintiffs/appellants counsel; the Eleventh
Circuit dismissed this appeal on March 5, 2004. On or about March 12, 2004, a
Motion to set aside the dismissal was filed with the Eleventh Circuit. On May
28, 2004, the Eleventh Circuit dismissed all appeals regarding this matter. In
August 2004, a purported class member filed a Petition for a Writ of Certiorari
with the United States Supreme Court regarding the Eleventh Circuits dismissal
of all appeals on this matter; the United States Supreme Court is expected to
make a ruling on such Petition within six (6) months. Pursuant to the terms of
the March 3, 2004 Order, the District Court will maintain jurisdiction of this
matter until July 2006 to monitor the parties compliance with the Consent
Decree. Hilfiger Matter, Sun Matter and Related Insurance Matters In July 2000, Tommy Hilfiger Licensing, Inc. (Hilfiger) commenced an action
against the Company in the United States District Court for the Northern
District of Georgia, alleging, among other things, counterfeiting and trademark
infringement (the Hilfiger Matter). A bench trial for the Hilfiger Matter
concluded on March 13, 2003, and on May 9, 2003, the Court rendered its
decision, awarding damages to Hilfiger in the amount of approximately $11.0
million, plus reasonable attorneys fees and costs. In June 2002, Hilfiger brought an action against Sun Apparel, Inc. (Sun), a
Goodys denim supplier, alleging trademark infringement arising out of Suns
manufacture of the allegedly infringing labels that gave rise to Hilfigers
trademark infringement claims against Goodys (the Sun Matter). Goodys had
agreed to pay for the defense of the Sun Matter because of certain
indemnification obligations it had to Sun. At the time the Hilfiger Matter commenced, the Companys primary liability
insurer indicated that it would reimburse Goodys for its legal fees and
expenses. In February 2003, after several unsuccessful attempts to obtain such
reimbursement, Goodys filed an insurance coverage action against the insurers.
Following the commencement of such action, the primary insurer agreed to
reimburse Goodys for a substantial portion of its past and future legal
expenses. However, the insurance carriers reserved their rights regarding their
obligations to indemnify Goodys against damages resulting from the Hilfiger
claims and the Sun Matter and the carriers asserted certain defenses against
their indemnity obligations. On May 13, 2003, Firemans Fund Insurance Company
(Firemans Fund), the excess layer (umbrella insurance) carrier, commenced an
action against Goodys in the Chancery Court for Knox County, Tennessee,
seeking a declaratory judgment against Goodys declaring that it has no duty to
indemnify Goodys in the Hilfiger Matter (the Goodys suit against the insurers
and the Firemans Fund suit against the Company are collectively referred to
herein as the Insurance Matters). 8




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Goodys Family Clothing, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements  continued
(Unaudited) The Company recorded a pre-tax charge of $7,996,000 during the thirteen weeks
ended May 3, 2003, for legal claims and related legal fees in connection with
the Hilfiger Matter and related matters. In June 2003, the Company reached a settlement agreement with Hilfiger,
resolving all outstanding issues arising out of the Hilfiger Matter. Under the
settlement, the Company agreed to make an $11.0 million cash payment to
Hilfiger. The settlement amount also encompassed the settlement of the Sun
Matter. In June 2003, the Company also reached an agreement in principle with
its insurance carriers regarding the Insurance Matters and a definitive
settlement agreement with its insurance carriers was executed in July 2003. The
settlement enabled the Company to reverse $4,441,000 ($0.08 per diluted share
after taxes) of the pre-tax charge of $7,996,000 ($0.15 per diluted share after
taxes) in the second quarter of fiscal 2003. Other Matters In addition, the Company is a party to various other legal proceedings arising
in the ordinary course of its business. The Company has various insurance
policies in place in the event of unfavorable outcomes from such proceedings.
The insurance companies level of, and willingness to, support their coverage
could vary depending upon the circumstances of each particular case. As such,
there can be no assurance as to the level of support available from insurance
policies. The Company does not currently believe that the ultimate outcome of
all such pending legal proceedings, individually or in the aggregate, would
have a material adverse effect on the Companys financial position, results of
operations or cash flows. (5) Intangible Assets The Company purchased the Duck Head trademarks and four related licenses from
TSI Brands Inc., and its parent corporation, Tropical Sportswear Intl
Corporation during the second quarter of fiscal 2003 for $4,000,000, and total
acquisition costs were ultimately $4,103,000. In accordance with FASB Statement
No. 142, Goodwill and Other Intangible Assets, the Company performed a
valuation of the trademarks during fiscal 2003 and determined that the asset
has an indefinite life and no impairment charge was necessary. 9




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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Board of Directors and Shareholders
Goodys Family Clothing, Inc.
Knoxville, Tennessee: We have reviewed the accompanying condensed consolidated balance sheets of
Goodys Family Clothing, Inc. and Subsidiaries (the Company) as of October
30, 2004 and November 1, 2003, and the related condensed consolidated
statements of operations for the thirteen and thirty-nine week periods ended
October 30, 2004 and November 1, 2003, and of cash flows for the thirty-nine
week periods ended October 30, 2004 and November 1, 2003. These interim
condensed consolidated financial statements are the responsibility of the
Companys management. We conducted our reviews in accordance with standards established by the Public
Company Accounting Oversight Board (United States). A review of interim
financial information consists principally of applying analytical procedures
and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in
accordance with auditing standards of the Public Company Accounting Oversight
Board (United States), the objective of which is the expression of an opinion
regarding the financial statements taken as a whole. Accordingly, we do not
express such an opinion. Based on our reviews, we are not aware of any material modifications that
should be made to such condensed consolidated interim financial statements for
them to be in conformity with accounting principles generally accepted in the
United States of America. We have previously audited, in accordance with auditing standards of the Public
Company Accounting Oversight Board (United States), the consolidated balance
sheet of the Company as of January 31, 2004, and the related consolidated
statements of operations, shareholders equity, and cash flows for the year
then ended (not presented herein); and in our report dated March 19, 2004, we
expressed an unqualified opinion on those consolidated financial statements. In
our opinion, the information set forth in the accompanying condensed
consolidated balance sheet as of January 31, 2004, is fairly stated, in all
material respects, in relation to the consolidated balance sheet from which it
has been derived. /s/Deloitte & Touche LLP
Atlanta, Georgia
November 17, 2004 10




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Item 2 
Managements Discussion and Analysis of Financial Condition and Results of Operations Forward-looking Statements This Quarterly Report contains certain forward-looking statements which are
based upon current expectations, business plans and estimates and involve
material risks and uncertainties including, but not limited to:  (i)
    
    customer demand and trends in the apparel and retail industry;(ii)
    
    the acceptance of the Companys merchandise offerings, including the new Duck Head line;(iii)
    
    the ability to avoid excess promotional pricing;(iv)
    
    weather conditions;(v)
    
    the impact of competitors pricing and store expansion;(vi)
    
    the timely availability of branded and private-label merchandise in sufficient quantities to satisfy customer demand;(vii)
    
    the effectiveness of merchandising, advertising, pricing, and operational strategies;(viii)
    
    the ability to achieve business plan targets;(ix)
    
    the ability to enter into leases for new store locations;(x)
    
    the timing, magnitude and costs of opening new stores;(xi)
    
    individual store performance, including new stores;(xii)
    
    relations with vendors, factors and employees;(xiii)
    
    the general economic conditions within the Companys markets;(xiv)
    
    the ability to successfully launch the Companys e-commerce initiative,
including site design, planning, programming, and marketing;(xv)
    
    global political unrest, including terrorism and war;(xvi)
    
    the continued availability of adequate credit support from vendors and factors;(xvii)
    
    the Companys compliance with loan covenants and the availability of sufficient eligible collateral for borrowing;(xviii)
    
    the possibility of unanticipated needs for additional capital expenditures;(xix)
    
    trends affecting the Companys financial condition, results of operations or cash flows;(xx)
    
    the success of the Companys information technology systems; and(xxi)
    
    the seasonality of the Companys business.  Any forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended, which generally can be identified by the use of
forward-looking terminology such as may, will, expect, estimate,
anticipate, believe, target, plan, project, or continue or the
negatives thereof or other variations thereon or similar terminology, are made
on the basis of managements plans and current analysis of the Company, its
business and the industry as a whole. Readers are cautioned that any such
forward-looking statement is not a guarantee of future performance and involves
risks and uncertainties, and that actual results may differ materially from
those 11




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##### Table of Contents



projected in the forward-looking statement as a result of various factors. The
Company does not undertake to publicly update or revise its forward-looking
statements even if experience or future changes make it clear that any
projected results expressed or implied therein will not be realized. Additional
information on risk factors that could potentially affect the Companys
financial results may be found in the Companys public filings with the
Securities and Exchange Commission. Certain of such filings may be accessed
through the Companys web site, http://www.goodysonline.com, then choose SEC
Filings. Critical Accounting Policies The Companys accompanying interim condensed consolidated financial statements
have been prepared in conformity with accounting principles generally accepted
in the United States of America, which require management to make estimates
that affect the amounts of revenues, expenses, assets, and liabilities
reported. The critical accounting matters that are very important to the
portrayal of the Companys financial condition and results of operations and
require some of managements most difficult, subjective and complex judgments
are described in detail in the Companys Annual Report on Form 10-K for the
fiscal year ended January 31, 2004. The accounting for these matters involves
forming estimates based on current facts, circumstances and assumptions which,
in managements judgment, could change in a manner that would materially affect
managements future estimates with respect to such matters and, accordingly,
could cause future reported financial condition and results of operations to
differ materially from financial results reported based on managements current
estimates. There have been no material changes in the critical accounting
policies during the thirty-nine weeks ended October 30, 2004. Results of Operations The following table sets forth unaudited results of operations, as a percent of
sales, for the periods indicated: Thirteen
    
    Thirty-nineWeeks Ended
    
    Weeks EndedOctober 30,
    
    November 1,
    
    October 30,
    
    November 1,2004
    
    2003
    
    2004
    
    2003Sales
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Cost of sales and occupancy expenses
    
    
    70.6
    
    
    
    70.3
    
    
    
    70.0
    
    
    
    70.3Gross profit
    
    
    29.4
    
    
    
    29.7
    
    
    
    30.0
    
    
    
    29.7Selling, general and administrative expenses
    
    
    30.0
    
    
    
    28.8
    
    
    
    28.5
    
    
    
    27.8(Loss) earnings from operations
    
    
    (0.6
    )
    
    
    0.9
    
    
    
    1.5
    
    
    
    1.9Investment income
    
    
    0.1
    
    
    
    
    
    
    
    0.1
    
    
    
    0.1Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (Loss) earnings before income taxes
    
    
    (0.5
    )
    
    
    0.9
    
    
    
    1.6
    
    
    
    2.0(Benefit) provision for income taxes
    
    
    (0.2
    )
    
    
    0.3
    
    
    
    0.6
    
    
    
    0.7Net (loss) earnings
    
    
    (0.3
    )%
    
    
    0.6
    %
    
    
    1.0
    %
    
    
    1.3
    %
 Thirteen Weeks Ended October 30, 2004 Compared with Thirteen Weeks Ended
November 1, 2003 OverviewDuring the third quarter of fiscal 2004, the Company opened 7 new
stores, relocated 1 store and remodeled 1 store, bringing the total number of
stores in operation at October 30, 2004 to 352, compared with 332 at November
1, 2003. During the third quarter of fiscal 2003, the Company opened two new
stores, remodeled three stores and closed two stores. The Company incurred a
net loss for the third quarter of fiscal 2004 of $804,000, or 0.3% of sales,
compared with net earnings for the third quarter of fiscal 2003 of $1,712,000,
or 0.6% of sales. SalesSales for the third quarter of fiscal 2004 were $284,794,000, a 1.4%
increase from the $280,777,000 in sales for the third quarter of fiscal 2003.
The increase of $4,017,000 consisted of an $11,501,000 increase in additional
net sales from new stores, transition stores and sales from stores that were
subsequently closed, offset by a $7,484,000 decrease in comparable store sales.
Comparable store sales for the third quarter of fiscal 2004 decreased 2.7%
compared with the third quarter of fiscal 2003. Sales for the third quarter of
fiscal 2004 were negatively affected, in part, by (i) unseasonably warm weather
patterns during portions of the quarter, and (ii) the effects of three major
hurricanes which impacted approximately 240 of the Companys stores in
September. Sales of private-label merchandise, which includes the Companys
exclusive Duck Head lines launched March 14, 2004, increased to approximately
30.7% of total merchandise sales for the third quarter of fiscal 2004 from
24.5% of total merchandise sales for the same period in the prior year. 12




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##### Table of Contents



Gross profitGross profit for the third quarter of fiscal 2004 was $83,819,000
or 29.4% of sales, a $551,000 increase from the $83,268,000 in gross profit, or
29.7% of sales, for the third quarter of fiscal 2003. While merchandise margins
in the third quarter of fiscal 2004 approximated those for the third quarter of
fiscal 2003, occupancy costs increased 0.3% due largely to the decrease in
comparable store sales and the resulting lack of leverage as a percentage of
sales. Selling, general and administrative expensesSelling, general and
administrative expenses for the third quarter of fiscal 2004 were $85,390,000,
or 30.0% of sales, an increase of $4,714,000 from $80,676,000, or 28.8% of
sales, for the third quarter of fiscal 2003. Selling, general and
administrative expenses increased by 1.2%, as a percent of sales, for the third
quarter of fiscal 2004 compared with the third quarter of fiscal 2003. The
increase relates primarily to (i) a 0.5% increase in payroll expense, (ii) a
0.4% increase in the provision for health care costs, (iii) a 0.4% increase in
advertising expenses, (iv) a 0.2% increase in workers compensation expense,
(v) a 0.2% increase in trucking expense primarily related to rate increases,
including fuel surcharges, and (vi) a 0.3% increase in all other selling,
general and administrative expenses, offset by (vii) a 0.5% decrease in the
accrual of performance bonuses, and (viii) a 0.3% decrease in general liability
insurance expense. Income taxesThe benefit for income taxes for the third quarter of fiscal 2004
was $478,000, for an effective tax rate of 37.29% of loss before income taxes,
compared with a provision for income taxes of $1,006,000, for an effective tax
rate of 37.01% of earnings before income taxes, for the third quarter of fiscal
2003. Thirty-nine Weeks Ended October 30, 2004 Compared with Thirty-nine Weeks Ended
November 1, 2003 OverviewDuring the thirty-nine weeks ended October 30, 2004, the Company
opened 17 new stores, relocated 2 stores and remodeled 8 stores, bringing the
total number of stores in operation at October 30, 2004 to 352, compared with
335 at January 31, 2004 and 332 at November 1, 2003. During the corresponding
period of the previous fiscal year, the Company opened 7 new stores, relocated
or remodeled 13 stores and closed 3 stores. Net earnings for the thirty-nine
weeks ended October 30, 2004 were $8,515,000, or 1.0% of sales, compared with
net earnings for the thirty-nine weeks ended November 1, 2003 of $10,685,000,
or 1.3% of sales. Net earnings for the thirty-nine weeks ended November 1, 2003
included a pre-tax charge of $3,571,000 related to the previously reported
settlements of the Hilfiger Matter and related matters as discussed in Note 4
to the Notes to Consolidated Financial Statements. SalesSales for the thirty-nine weeks ended October 30, 2004 were $882,304,000,
a 2.9% increase from the $857,828,000 in sales for the thirty-nine weeks ended
November 1, 2003. This increase of $24,476,000 consisted of $26,694,000 in
additional net sales from new stores, transition stores and sales from stores
that were subsequently closed, offset by a decrease of $2,218,000 in comparable
store sales. Comparable store sales for the thirty-nine weeks ended October 30,
2004 decreased 0.3% compared with the corresponding period of the previous
fiscal year. Sales of private-label merchandise, which includes the Companys
exclusive Duck Head lines launched March 14, 2004, increased to approximately
32.5% of total merchandise sales for the thirty-nine weeks ended October 30,
2004, from 28.1% of total merchandise sales for the same period in the prior
year. Gross profitGross profit for the thirty-nine weeks ended October 30, 2004 was
$264,737,000, or 30.0% of sales, a $9,710,000 increase from the $255,027,000 in
gross profit, or 29.7% of sales, for the thirty-nine weeks ended November 1,
2003. The 0.3% increase in gross profit, as a percent of sales, for the
thirty-nine weeks ended October 30, 2004 compared with the thirty-nine weeks
ended November 1, 2003 resulted primarily from an increase in merchandise
margins. The improvement in gross profit was partially attributable to
increased private-label sales, which typically produce higher gross margins,
overall, than the Companys branded merchandise offerings. Selling, general and administrative expensesSelling, general and
administrative expenses for the thirty-nine weeks ended October 30, 2004 were
$251,717,000, or 28.5% of sales, an increase of $13,146,000 from $238,571,000,
or 27.8% of sales, for the thirty-nine weeks ended November 1, 2003. Selling,
general and administrative expenses, excluding the pre-tax charge of $3,571,000
related to the previously reported settlements of the Hilfiger litigation
during the thirty-nine weeks ended November 1, 2003, were $235,000,000 or 27.4%
of sales. Selling, general and administrative expenses increased by 1.1%, as a
percent of sales, for the thirty-nine weeks ended October 30, 2004 compared
with the thirty-nine weeks ended November 1, 2003 (excluding the settlements of
the Hilfiger litigation in the second quarter of fiscal 2003). The 1.1%
increase relates primarily to (i) a 0.4% increase in the provision for health
care costs, (ii) a 0.3% increase in payroll expense, (iii) a 0.2% increase in
workers compensation expense, (iv) a 0.2% increase in advertising expenses,
and (v) a 0.4% increase in all other selling, general and administrative
expenses, offset by (vi) a decrease of 0.4% in the accrual of performance
bonuses. 13




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Income taxesThe provision for income taxes for the thirty-nine weeks ended
October 30, 2004 was $5,054,000, for an effective tax rate of 37.25% of
earnings before income taxes, compared with a provision for income taxes of
$6,276,000, for an effective tax rate of 37.00% of earnings before income
taxes, for the thirty-nine weeks ended November 1, 2003. Liquidity and Capital Resources Financial PositionThe Companys primary sources of liquidity are cash flows
from operations, including credit terms from vendors and factors, and
borrowings under its credit facility discussed below. At October 30, 2004,
January 31, 2004 and November 1, 2003, the Companys working capital was
$135,678,000, $135,522,000 and $118,674,000, respectively. The increase in
working capital from November 1, 2003 to October 30, 2004 was $17,004,000 and
the increase from January 31, 2004 to October 30, 2004 was $156,000. The $17,004,000 increase in working capital from November 1, 2003 to October
30, 2004, consists primarily of (i) $15,490,000 in earnings, (ii) $8,390,000
from the purchase of the Companys interests in certain split-dollar life
insurance policies in the fourth quarter of fiscal 2003, (iii) $1,062,000 from
the issuance of common stock through the exercise of stock options, (iv)
increases in long-term liabilities of $2,549,000, offset by (v) a $6,268,000
net change in property and equipment, (vi) dividends paid of $2,961,000, and
(vii) repurchases of common stock of $1,847,000. The $156,000 increase in working capital from January 31, 2004 to October 30,
2004, consists primarily of (i) $8,515,000 in earnings, (ii) $934,000 from the
issuance of common stock through the exercise of stock options, (iii) increases
in long-term liabilities of $2,119,000, partially offset by (iv) a $7,724,000
net change in property, plant and equipment, (v) dividends paid of $2,305,000,
and (vi) repurchases of common stock of $1,847,000. In May 2001, the Company entered into a five-year, $130,000,000 syndicated
revolving loan and security agreement that provides for cash borrowings for
general corporate purposes, including a $95,000,000 sub-facility for the
issuance of letters of credit. Borrowings under this credit facility are
limited by collateral formulas, based principally upon the Companys eligible
inventories. The credit facility is secured primarily by the Companys
inventories, receivables and cash and cash equivalents. The borrowing base was
$215,414,000 at October 30, 2004, which excludes cash and most of cash
equivalents and only gives credit for specified percentages of inventory and
receivables. The amount available to draw under the credit facility at October
30, 2004 was approximately $95,092,000. If availability (as calculated pursuant
to the credit facility) falls below $25,000,000, the Company would be required,
for a period of time, to comply with a financial covenant requiring it to
maintain minimum levels of tangible net worth based on formulas. The credit
facility also contains certain discretionary provisions that enable the lender
to reduce availability. The credit facility bears interest at LIBOR plus an
applicable margin or the prime rate. In June 2003, the credit facility was
amended to permit cash dividends in any fiscal year on the common stock in an
amount not to exceed (i) $3,500,000 (but not to exceed $10,000,000 in the
aggregate during the remaining term of the credit facility) plus (ii) 50% of
the Companys consolidated net income for the immediately preceding fiscal
year. In June 2003 the lenders agreed to waive any events of default which
could be deemed to have occurred by reason of the Courts decision in the
Hilfiger Matter. At October 30, 2004, January 31, 2004 and November 1, 2003, the Company had (i)
no cash borrowings under the credit facility and (ii) letters of credit
outstanding not yet reflected in accounts payable of $20,699,000, $28,908,000
and $22,741,000, respectively. There were no cash borrowings at any time during
the thirty-nine weeks ended October 30, 2004 and November 1, 2003. Letters of
credit outstanding averaged $37,750,000 during the thirty-nine weeks ended
October 30, 2004, compared with $36,586,000 during the thirty-nine weeks ended
November 1, 2003. The highest balance of letters of credit outstanding during
the thirty-nine weeks ended October 30, 2004, was $44,632,000 in August 2004
compared with $47,428,000 in February 2003 during the thirty-nine weeks ended
November 1, 2003. Cash FlowsCash used in operating activities was $27,439,000 and $13,711,000
for the thirty-nine weeks ended October 30, 2004 and November 1, 2003,
respectively. Cash used for increases in inventory during the thirty-nine weeks
ended October 30, 2004 and November 1, 2003, was $101,816,000 and $94,830,000,
respectively. Inventories on a per square foot basis were $30.80 and $29.72 at
October 30, 2004 and November 1, 2003, respectively, which represents a 3.6%
increase on a per square foot basis. While inventory levels remain above plan
at the end of the third quarter, the inventory increases from the end of the
fiscal year and from the end of the third quarter last year were primarily
attributable to (i) a sales shortfall from plan, (ii) the purchase of
additional merchandise to support the March 14, 2004 launch of the new Duck
Head sportswear lines, (iii) the July 2004 introduction of the new Duck Head
Jeans Company denim lines, (iv) the expansion of certain other merchandise
offerings including assortments for automatically replenished basic merchandise
and special size categories, and (v) merchandise for new and relocated stores
opening after the end of the third fiscal quarter of 2004. Additionally, as it
relates to the comparison with 14




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##### Table of Contents



year-end inventory levels, the inventory balance at the end of the third
quarter includes normal seasonal build-ups of inventory, as well as inventory
for new stores. An increase in accounts payable - trade provided cash of
$51,250,000 and $54,877,000 in the thirty-nine weeks ended October 30, 2004 and
November 1, 2003, respectively, and was primarily related to the funding of
inventory for new and relocated stores and normal seasonal and Duck Head
inventory buildups. Cash flows from investing activities reflected a net use of cash of $25,360,000
and $20,248,000 for the thirty-nine weeks ended October 30, 2004 and November
1, 2003, respectively. The Company used cash to fund capital expenditures for
new, relocated and remodeled stores, as well as for upgrading information
technology, and for general corporate purposes for the thirty-nine weeks ended
October 30, 2004. Cash flows from financing activities used cash of $3,218,000 for the
thirty-nine weeks ended October 30, 2004 and provided cash of $656,000 for the
thirty-nine weeks ended November 1, 2003. The Company paid two quarterly cash
dividends of $0.02 per share on March 15, 2004 and June 15, 2004 of $657,000
and $659,000, respectively, and one quarterly cash dividend of $0.03 per share
on September 15, 2004 of $989,000, for a total of $2,305,000. The Company
repurchased $1,847,000 of its common stock during the thirty-nine weeks ended
October 30, 2004. Proceeds from the issuance of common stock resulting from the
exercise of stock options for the thirty-nine weeks ended October 30, 2004 and
November 1, 2003 were $934,000 and $1,308,000, respectively. OutlookAs previously reported, the Companys sales target for Duck Head
products in fiscal 2004 was approximately $75.0 million, with 15% of such
amount representing incremental sales after giving effect to the consolidation
of underperforming private-label programs and the elimination of duplicate
assortments across all merchandising departments. Fiscal year to date, Duck
Head sales were $60.1 million, outperforming expectations and the Company
estimates Duck Head sales to be between $85.0 million and $90.0 million for the
full fiscal year. Fiscal year to date, private-label sales, including Duck
Head products, as a percentage of total merchandise sales, increased to 32.5%
from 28.1% for the same period in the prior year. The increase in
private-label sales was more than offset, however, by a decrease in sales in
all other merchandising departments. Nonetheless, the Company is encouraged by
the favorable consumer response to its exclusive Duck Head brand offerings,
which it believes is fast becoming a destination brand for its customers.
Furthermore, the Company believes it should benefit from the higher margins
generally associated with private-label merchandise. The Company opened 3 new stores and relocated 1 store on November 4, 2004, and
expects to open 4 additional new stores and relocate 2 existing stores on
November 18, 2004, which will conclude the Companys new store opening schedule
for fiscal 2004. Capital expenditures for the remainder of fiscal 2004 are
expected to be approximately $11,000,000, primarily related to new and
relocated store costs, management information systems, and general corporate
purposes. Total capital expenditures for fiscal 2004 are expected to be
approximately $36,400,000, down from the previously reported $41,300,000. For fiscal 2005, the Company anticipates that it will open approximately 35 new
stores, and relocate or remodel up to 15 existing stores. Capital expenditures
for fiscal 2005 are anticipated to be in the range of $45,000,000 to
$48,500,000. The Company is working to achieve, on a per square foot basis, inventory levels
at the end of fiscal 2004 that are similar to those at the end of fiscal 2003. The Companys primary needs for capital resources are for the purchase of store
inventories, capital expenditures and for normal operating purposes. Management
believes that its existing working capital, together with anticipated cash
flows from operations, including credit terms from vendors and factors, and the
borrowings available under the credit facility will be sufficient to meet the
Companys operating and capital expenditure requirements for the foreseeable
future. On October 13, 2004, the Companys Board of Directors declared a quarterly cash
dividend of $0.03 per share to shareholders of record on December 1, 2004,
payable on December 15, 2004. The Company anticipates paying regular, quarterly
cash dividends in the future, subject to the Companys earnings, financial
condition, capital requirements, general economic and business conditions, and
other factors deemed relevant by the Board of Directors. The Companys credit
facility was amended to permit such dividends within certain prescribed
limitations, as described above. On June 17, 2004, the Company announced the appointment of a Vice President of
E-commerce to lead the development of the Companys e-commerce initiative,
including the site design, planning, programming, and marketing. The Company
now expects to begin selling merchandise online during the first half of fiscal
2005. 15




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##### Table of Contents



Contractual ObligationsFor a discussion of the Companys contractual
obligations, see a discussion of future commitments under Item 7, Managements
Discussion and Analysis of Financial Condition and Results of Operations in
its Annual Report on Form 10-K for the fiscal year ended January 31, 2004.
There have been no significant developments with respect to the Companys
contractual obligations since January 31, 2004. 
 Item 3  Quantitative and Qualitative Disclosures about Market Risk The Company has no material investments or risks in market risk sensitive
instruments. 
 Item 4  Controls and Procedures The Company maintains disclosure controls and procedures that are designed to
ensure that information required to be disclosed by the Company in the reports
filed or submitted by it under the Securities Exchange Act of 1934, as amended
(the Exchange Act), is recorded, processed, summarized and reported within
the time periods specified in the Securities and Exchange Commissions rules
and forms, and include controls and procedures designed to ensure that
information required to be disclosed by the Company in such reports is
accumulated and communicated to the Companys management, including the
Companys Chairman and Chief Executive Officer, and the Companys Chief
Financial Officer and Chief Accounting Officer, as appropriate, to allow timely
decisions regarding required disclosure. Each fiscal quarter, under the supervision and with the participation of the
Companys management, including the Companys Chairman and Chief Executive
Officer, the Companys Chief Financial Officer and Chief Accounting Officer,
the Company carries out an evaluation of the effectiveness of the design and
operation of the Companys disclosure controls and procedures pursuant to
Exchange Act Rule 13a-15. Based upon the foregoing, the Companys Chairman and
Chief Executive Officer, along with the Companys Chief Financial Officer and
Chief Accounting Officer, concluded that, as of October 30, 2004, the Companys
disclosure controls and procedures are effective in timely alerting them to
material information relating to the Company (including its consolidated
subsidiaries) required to be included in the Companys Exchange Act reports. During the fiscal quarter ended October 30, 2004, there has been no change in
the Companys internal control over financial reporting that has materially
affected, or is reasonably likely to materially affect, the Companys internal
control over financial reporting. 16




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##### Table of Contents



PART II  OTHER INFORMATION 
 Item 1.  Legal Proceedings- See Note 4 to the Notes to Condensed Consolidated
Financial Statements contained herein for a discussion of the Class Action. 
 Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds- The
following table provides information with respect to purchases the Company made
of its common stock during the third quarter of fiscal 2004: (c) Total Number of
    
    (d) Maximum DollarShares Purchased as
    
    Value of Shares that(a) Total Number
    
    
    
    
    
    Part of Publicly
    
    May Yet Be Purchasedof Shares
    
    (b) Average Price Paid per
    
    Announced Plans or
    
    Under the Plans orFiscal Period
    
    Purchased
    
    Share
    
    Programs (1)
    
    Programs (1)August 2004 (August
1, 2004 to August
28, 2004)
    
    
    0
    
    
    
    N/A
    
    
    
    1,118,300
    
    
    $
    12,561,523September 2004
(August 29, 2004 to
October 2, 2004)
    
    
    103,000
    
    
    $
    8.31
    
    
    
    1,221,300
    
    
    $
    11,705,705October 2004
(October 3, 2004 to
October 30, 2004)
    
    
    121,100
    
    
    $
    8.18
    
    
    
    1,342,400
    
    
    $
    10,714,632Total
    
    
    224,100
    
    
    $
    8.24
    
    
    
    1,342,400
    
    
    $
    10,714,632
 (1) In June 1999, the Board of Directors authorized $20 million of share
repurchases, with no expiration date. 
 Item 3.  Defaults Upon Senior Securities- None 
 Item 4.  Submission of Matters to a Vote of Security Holders- None 
 Item 5.  Other Information- None 
 Item 6.  Exhibits  10.103
    
    Employment agreement between the registrant and Devin Keil, dated July 12, 2004.15
    
    Accountants Awareness Letter.31.1
    
    Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.3
    
    Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.32.2
    
    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.32.3
    
    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002. 17




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##### Table of Contents



GOODYS FAMILY CLOTHING, INC. 
 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized. GOODYS FAMILY CLOTHING, INC.
(Registrant)Date: November 17, 2004
    /s/ Robert M. GoodfriendRobert M. GoodfriendChairman of the Board and
Chief Executive Officer Date: November 17, 2004
    /s/ Edward R. CarlinEdward R. CarlinExecutive Vice President,
Chief Financial Officer and
Secretary
(Principal Financial Officer) Date: November 17, 2004
    /s/ David G. PeekDavid G. PeekSenior Vice President and
Chief Accounting Officer
(Principal Accounting
Officer) 18