Guitar Center Reiterates Third Quarter 2004 Sales and Earnings Guidance

WESTLAKE VILLAGE, Calif.--(BUSINESS WIRE)--Sept. 8, 2004--Guitar Center, Inc. (Nasdaq:GTRC - News) today reiterated its guidance for the third quarter of 2004. On July 28, 2004 in connection with the release of second quarter results, Guitar Center projected third quarter 2004 net sales would be in the range of $342 million to $352 million and that third quarter 2004 diluted earnings per share would be in the range of $0.39 to $0.42. The Company also projected that Guitar Center comparable store sales in the third quarter would increase 6% to 8% from the same period of 2003. Assuming current business and economic conditions continue, management remains comfortable with this guidance.
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The comments regarding future financial performance in the immediately preceding paragraph constitute forward-looking statements and are made in express reliance on the safe harbor provisions contained in Section 21E of the Securities Exchange Act of 1934. This information should be read in conjunction with the information under the caption "Business Risks and Forward Looking Statements" below.

Guitar Center Presenting at Goldman Sachs Global Retail Conference

Guitar Center will be presenting today at the 11th Annual Goldman Sachs Global Retail Conference. Marty Albertson, President and Co-Chief Executive Officer, and Bruce Ross, Chief Financial Officer, will be speaking at the conference today at 11:15 a.m. Eastern Time. The audio and slide presentation will be available via live webcast through the Investor Relations section of Guitar Center's web site located at www.guitarcenter.com. The webcast will be available to the general public and will be archived for replay at Guitar Center's web site for thirty days following the conclusion of the conference.

About Guitar Center

Guitar Center is the nation's leading retailer of guitars, amplifiers, percussion instruments, keyboards and pro-audio and recording equipment. We presently operate 134 Guitar Center stores, with 111 stores in 46 major markets and 23 stores in secondary markets across the U.S. In addition, the American Music division operates 20 family music stores specializing in band instruments for sale and rental, serving thousands of teachers, band directors, college professors and students. Guitar Center is also the largest direct response retailer of musical instruments in the U.S. through our wholly owned subsidiary, Musician's Friend, Inc., and its catalog and web site, www.musiciansfriend.com. More information on Guitar Center can be found by visiting the Company's web site at www.guitarcenter.com.

Business Risks and Forward Looking Statements

This press release contains forward-looking statements relating to, among other things, results deemed to be achievable by management in the quarter ending September 30, 2004. This earnings guidance is based on preliminary, unaudited internal operating data that is subject to adjustment. Sales and earnings trends are also affected by many other factors including, among others, world and national political events, including the existence of armed conflict involving the U.S., the effectiveness of our promotion and merchandising strategies, and competitive factors applicable to our retail and direct response markets.

In light of these risks, the forward-looking statements contained in this press release are not guarantees of future performance and in fact may not be realized. Our actual results could differ materially and adversely from those expressed in this press release. Further, the statements made by us above represent our views only as of the date of this press release, and it should not be assumed that the statements made herein remain accurate as of any future date. We do not presently intend to update these statements prior to our next quarterly earnings release and undertake no duty to any person to effect any such update under any circumstances.

Our guidance for the third quarter also assumes that the 2.9 million shares of common stock underlying our convertible notes will be deemed to be outstanding for purposes of calculating earnings per share under the "if-converted" method of accounting.

Investors are also urged to review carefully the discussion under the caption "Risks Related to the Business" in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2004, which has been filed with the Securities and Exchange Commission and may be accessed through the EDGAR database maintained by the SEC at www.sec.gov.