• Increased sales 25.3% to $510.7 million
• Increased net income
• Improved gross margins
• Opened five new Borders superstores and one Books etc. store
• Teamed with Amazon.com to launch dedicated online shopping sites in U.K.
• Plan to open 10 to 12 new locations in 2005 — including the first Borders franchise store in Malaysia
• Plan to increase International segment sales 20% to 25% in 2005

• Increased sales 4.8% to $2.59 billion
• Increased net income 15.1% to $112.0 million
• Opened 19 new Borders superstores and remodeled 33 existing stores
• Streamlined supply chain and improved inventory management
• Signed licensing agreement with Seattle's Best Coffee
• Plan to open 15 to 20 new stores and remodel 80 to 100 existing locations in 2005
• Expect to increase segment sales and profitability

• Improved store layouts and expanded merchandise
• Enhanced customer value, including lower everyday pricing on bestsellers
• Converted 37 Waldenbooks stores to new Borders Express format
• Increased locations and sales of Borders Outlet and airport stores
• Increased locations and sales within our seasonal business
• Plan to convert 75 to 100 Waldenbooks stores to Borders Express in 2005