MONTVALE, N.J.— (Business Wire)— July 5, 2002
The Great Atlantic & Pacific Tea Company, Inc. (A&P, NYSE: GAP) today filed its fiscal year 2001 annual report on Form 10-K with the Securities and Exchange Commission, containing restated financial statements as discussed below. As a result of the delay caused by its internal review, A&P has rescheduled the Annual Meeting of Stockholders for July 30, 2002.

The Company invites investors to listen to an audio Webcast of a discussion of the restatement by accessing a link on the “Investor Relations” page of its Website, www.aptea.com. The live broadcast is at 11 AM Eastern Time, Monday, July 8, 2002, with replays available from the afternoon of July 8 through August 7.

As the Company announced on May 24, 2002, after discovering certain irregularities relating to the appropriate timing for the recognition of vendor allowances and the accounting for inventory, it promptly commenced a review of these accounting issues. This review caused the Company to delay filing its Annual Report on Form 10-K. As a result of this review and in consideration of certain other accounting practices, the Company is restating its financial results for fiscal years 2000 and 1999, and adjusting its results previously announced for fiscal year 2001, for the following:

• Adjustments stemming from the Company's recent discovery of certain instances in which vendor allowances were recorded, in violation of Company policy, prior to the accounting period in which they were actually earned, totaling an aggregate after-tax charge to net income of $9.5 million for the years 2001, 2000 and 1999;

• Adjustments to correct an overstatement of perishable inventory in one region, totaling an aggregate after-tax charge to net income of $0.8 million for the years 2001, 2000 and 1999;

• Adjustments stemming from a change in the Company’s accounting policy for certain one-year and multi-year vendor allowance contracts to reflect the appropriate timing for the recording of such allowances, totaling an aggregate after-tax increase in net income of $28.2 million for the years 2001, 2000 and 1999;

• Adjustments to reflect an actuarially-based method of estimating the Company's self-insurance reserves, totaling an aggregate after-tax increase in net income of $21.5 million for the years 2001, 2000 and 1999; and

• Adjustments to reflect changes in the timing of recognition of sublet income associated with certain closed stores, totaling an aggregate after-tax charge to net income of $1.0 million for the years 2001, 2000 and 1999.

This release contains forward-looking statements about the future performance of the Company, which are based on Management's assumptions and beliefs in light of the information contained herein. The Company assumes no obligation to update this information. These forward-looking statements are subject to uncertainties and other factors that cause actual results to differ materially from such statements including, but not limited to: competitive practices and pricing in the food industry generally and particularly in the Company's principal markets; the Company's relationships with its employees and the terms of future collective bargaining agreements; the costs and other effects of legal and administrative cases and proceedings; the nature and extent of continued consolidation in the food industry; changes in the financial markets which may affect the Company's cost of capital and the ability of the Company to access capital; supply or quality control problems with the Company's vendors; and changes in economic conditions which affect the buying patterns of the Company's customers.

Contact:
Investors: Bill Moss, 201-571-4019
Press: Patti Councill, 201-571-4097

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