Thomas Braum

1
February 2005
Thomas Braum Senior Vice President and Chief
Financial Officer [phone], Ext.
718 Greg Mize Vice President Investor
Relations [phone], Ext. 211
2
United States - Fiscal 2005 Quarter 3 Results
Handleman Fiscal Quarter 3 Unit Sales
(Nov/Dec/Jan) (in thousands of units)

• US music industry unit volume decreased 6.3 from
  231.8 million units in fiscal 2004 Q3 to 217.2
  million units in fiscal 2005 Q3.
• Mass merchant sales increased by 6.3 from 84.4
  million units in fiscal 2004 Q3 to 89.7million
  units in fiscal 2005 Q3. The mass channel
  accounted for 41.3 of total unit sales for
  fiscal 2005 Q3 an increase of 4.9 share points
  from 36.4 in 2004.
• Chain store unit volume decreased from 117.5
  million units in fiscal 2004 Q3 to 99.7 million
  units in fiscal 2005 Q3. Share of industry
  volume decreased from 50.7 in 2004 to 45.9 in
  2005.
• Unit sales for the non-traditional channel
  (online stores, concert, venues and television
  product sales) increased 34.4.

2005 Q3 - Units sales from Monday, November 1,
2004 to Sunday, January 30, 2005.
Channel Share of Total Unit Sales - Fiscal 2005 Q3
Source Nielsen SoundScan National Summary Report
3
Canada - Fiscal 2005 Quarter 3 Results
Handleman Fiscal Quarter 3 Unit Sales
(Nov/Dec/Jan) (in thousands of units)

• Canada music industry unit volume increased 3.9
  from 17.7 million units in fiscal 2004 Q3 to 18.4
  million units in fiscal 2005 Q3.
• Mass merchant retailers experienced an increase
  of 4.5 from 5.5 million units in fiscal 2004 Q3
  to 5.7 million units in fiscal 2005 Q3. Share of
  industry volume increased slightly from 31.0 to
  31.1.
• Retail channel sales (including chain and
  independent music retailers) increased 3.4 from
  12.2 million in fiscal 2004 Q3 to 12.6 million in
  fiscal 2005 Q3.

2005 Q3 - Units sales from Monday, November 1,
2004 to Sunday, January 30, 2005.
Channel Share of Total Unit Sales - Fiscal 2005 Q3
Source Nielsen SoundScan Canada National
Summary Report
4
United Kingdom - Fiscal 2005 Quarter 3 Results
Handleman Fiscal Quarter 3 Unit Sales
(Nov/Dec/Jan) (in thousands of units)

• UK music industry unit volume decreased 3.7 from
  68.1 million units in fiscal 2004 Q3 to 65.6
  million units in fiscal 2005 Q3 .
• Album sales decreased 0.7 from 59.7 million
  units in fiscal 2004 Q3 to 59.3 million units in
  fiscal 2005 Q3. Single sales decreased 25.2.
• The album configuration represented 90.4 of
  total unit sales - an increase from 87.6 in
  fiscal 2004 Q3. Singles represented 9.6 of total
  unit sales in fiscal 2005 Q3 down 2.8 points
  from 12.4 share in 2004.

2005 Q3 - Units sales from Sunday, October 31,
2004 to Saturday, January 29, 2005.
Configuration of Total Unit Sales - Fiscal 2005
Q3
Source CIN - The Official UK Chart Company
5
New Release Schedule - Fiscal 2005 Quarter 4
February 3 Doors Down Seventeen Days LeAnn
Womack Theres More Where That Came From Tori
Amos The Bee Keeper Kidz Bop Kids Kidz Bop
7 Chely Wright The Metropolitan
Hotel March Jennifer Lopez Rebirth Jami ONeal
Brave 50 Cent The Massacre Various Artists
Now 18 Will Smith Lost and Found April Mariah
Carey The Emancipation of Mimi Fat Joe All or
Nothing Rob Thomas Something to Be