Trans World Entertainment Reports a 7% Decline in Comparable Store Sales for the Holiday Season

ALBANY, N.Y., Jan. 4 /PRNewswire-FirstCall/ — Trans World Entertainment
Corporation (Nasdaq: TWMC) today reported a comparable store sales decrease of
7% for the five-week period ended December 31, 2005. For the nine-week period
ended December 31, 2005, comparable store sales decreased 8%. The Company
operated 798 stores this year compared to 851 stores last year. Total sales
for the five-week period decreased 9% to $284 million compared to $312 million
for the same period last year. Total sales for the nine-week period were $380
million compared to $427 million for the same period last year, a decrease of
11%.

“Sales for the quarter have been affected by a general weakness in our
industry,” commented Robert J. Higgins, Chairman and Chief Executive Officer
of Trans World Entertainment. “Based on our disappointing holiday sales
performance, we expect to report lower earnings for fiscal 2005 of break-even
to $0.05 per share compared to the previously disclosed range of $0.25 to
$0.30 per share.”

For the eleven-month period ended December 31, 2005, comparable store
sales decreased 6%. Total sales for the period decreased 9% to $1.160 billion
compared to $1.279 billion during the same period last year.

Trans World will host a teleconference call today, Wednesday, January 4,
2006, at 10:00 AM ET to discuss the holiday sales results. Interested parties
can listen to the simultaneous webcast on the Company’s corporate website,
http://www.twec.com.

Trans World Entertainment is a leading specialty retailer of music, video
and video game products. The Company operates about 800 retail stores in 46
states, the District of Columbia, the U.S. Virgin Islands, Puerto Rico and
e-commerce sites, http://www.fye.com, http://www.coconuts.com,
http://www.wherehouse.com and http://www.secondspin.com. In addition to its
mall locations, operated primarily under the f.y.e brand, the Company also
operates freestanding locations under the names Coconuts Music and Movies,
Strawberries Music, Wherehouse, CD World, Spec’s, Second Spin, Streetside
Records, and Planet Music.

Certain statements in this release set forth management’s intentions,
plans, beliefs, expectations or predictions of the future based on current
facts and analyses. Actual results may differ materially from those indicated
in such statements. Additional information on factors that may affect the
business and financial results of the Company can be found in filings of the
Company with the Securities and Exchange Commission.

SOURCE Trans World Entertainment Corporation

CONTACT:
John J. Sullivan, EVP, Chief Financial Officer of Trans World
Entertainment,
+1-518-452-1242 ext. 7400; or
Rich Tauberman of MWW Group,
+1-201-507-9500,