CHILDRENS PLACE, INC. MANAGEMENT REPORT AND ANALYSIS OF FINANCIAL POSITION AND OPERATING RESULTS. (Form 10-K)

The following discussion should be read in conjunction with our audited
financial statements and notes thereto included in Part IV, Item 15.-Exhibits
and Financial Statement Schedules. This Annual Report on Form 10-K contains
forward-looking statements made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995, including but not limited to
statements relating to the Company's strategic initiatives. Forward-looking
statements typically are identified by use of terms such as "may", "will",
"should", "plan", "project", "expect", "anticipate", "estimate", and similar
words, although some forward-looking statements are expressed differently. These
forward-looking statements are based upon the Company's current expectations and
assumptions and are subject to various risks and uncertainties that could cause
actual results and performance to differ materially. Some of these risks and
uncertainties are described in the Company's filings with the Securities and
Exchange Commission, including in Part I, Item 1A. Risk Factors of this Annual
Report on Form 10-K for the fiscal year ended January 29, 2022. Included among
the risks and uncertainties that could cause actual results and performance to
differ materially are the risk that the Company will be unsuccessful in gauging
fashion trends and changing consumer preferences, the risks resulting from the
highly competitive nature of the Company's business and its dependence on
consumer spending patterns, which may be affected by changes in economic
conditions, the risks related to the COVID-19 pandemic, including the impact of
the COVID-19 pandemic on our business or the economy in general (including
decreased customer traffic, schools adopting remote and hybrid learning models,
closures of businesses and other activities causing decreased demand for our
products and negative impacts on our customers' spending patterns due to
decreased income or actual or perceived wealth, and the impact of the CARES Act
and other legislation related to the COVID-19 pandemic, and any changes to the
CARES Act or such other legislation), the risk that the Company's strategic
initiatives to increase sales and margin are delayed or do not result in
anticipated improvements, the risk of delays, interruptions and disruptions in
the Company's global supply chain, including resulting from the COVID-19
pandemic or other disease outbreaks, or foreign sources of supply in less
developed countries or more politically unstable countries, the risk that the
cost of raw materials or energy prices will increase beyond current expectations
or that the Company is unable to offset cost increases through value engineering
or price increases, various types of litigation, including class action
litigations brought under consumer protection, employment, and privacy and
information security laws and regulations, the imposition of regulations
affecting the importation of foreign-produced merchandise, including duties and
tariffs, and the uncertainty of weather patterns. Readers are cautioned not to
place undue reliance on these forward-looking statements, which speak only as of
the date they were made. The Company undertakes no obligation to release
publicly any revisions to these forward-looking statements that may be made to
reflect events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events.

As used in this Annual Report on Form 10-K, references to the "Company", "The
Children's Place", "we", "us", "our", and similar terms refer to The Children's
Place, Inc. and its subsidiaries. Our fiscal year ends on the Saturday on or
nearest to January 31. Other terms that are commonly used in our Management's
Discussion and Analysis of Financial Condition and Results of Operations are
defined as follows:

• Financial year 2021: the fifty-two weeks ended January 29, 2022

• Financial year 2020: the fifty-two weeks ended January 30, 2021

• Financial year 2019: the fifty-two weeks ended February 1, 2020

• Fiscal Year 2022 – Our next fiscal year representing the fifty-two weeks ending
January 28, 2023

• DRY – US Securities and Exchange Commission

• US GAAP – Generally accepted accounting principles in United States

• FASB – Financial Accounting Standards Board

•FASB ASC - FASB Accounting Standards Codification, which serves as the source
for authoritative U.S. GAAP, except that rules and interpretive releases by the
SEC are also sources of authoritative U.S. GAAP for SEC registrants

• AUR – Average Unit Selling Price

•Comparable Retail Sales - Net sales, in constant currency, from stores that
have been open for at least 14 consecutive months and from our e-commerce store,
excluding postage and handling fees. Store closures in the current fiscal year
will be excluded from Comparable Retail Sales beginning in the fiscal quarter in
which the store closes. A store that is closed for a substantial remodel,
relocation, or material change in size will be excluded from Comparable Retail
Sales for at least 14 months beginning in the fiscal quarter in which the
closure occurred. However, stores that temporarily close will be excluded from
Comparable Retail Sales until the store is

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reopened for a full fiscal month. Comparable retail sales do not exclude temporarily closed stores impacted by the COVID-19 pandemic.

• Gross Margin – Gross profit expressed as a percentage of net sales

• SG&A – Selling, general and administrative expenses

PREVIEW

Our business

We are the largest pure-play children's specialty apparel retailer in North
America. We design, contract to manufacture, sell at retail and wholesale, and
license to sell trend right, high quality merchandise predominantly at value
prices, primarily under our proprietary "The Children's Place", "Place", "Baby
Place", "Gymboree", and "Sugar & Jade" brand names. As of January 29, 2022, we
had 672 stores across North America, our e-commerce business at
www.childrensplace.com, www.gymboree.com, and www.sugarandjade.com, and had 211
international points of distribution with our seven franchise partners in 16
countries.

Segment Reporting

In accordance with FASB ASC 280-Segment Reporting, we report segment data based
on geography: The Children's Place U.S. and The Children's Place International.
Each segment includes an e-commerce business located at www.childrensplace.com,
www.gymboree.com, and www.sugarandjade.com. Included in The Children's Place
U.S. segment are our U.S. and Puerto Rico-based stores and revenue from our
U.S.-based wholesale business. Included in The Children's Place International
segment are our Canadian-based stores, revenue from our Canadian-based wholesale
business, as well as revenue from international franchisees. We measure our
segment profitability based on operating income, defined as income before
interest and taxes. Net sales and direct costs are recorded by each segment.
Certain inventory procurement functions such as production and design, as well
as corporate overhead, including executive management, finance, real estate,
human resources, legal, and information technology services, are managed by The
Children's Place U.S. segment. Expenses related to these functions, including
depreciation and amortization, are allocated to The Children's Place
International segment based primarily on net sales. The assets related to these
functions are not allocated. We periodically review these allocations and adjust
them based upon changes in business circumstances. Net sales to external
customers are derived from merchandise sales, and we have no customers that
individually account for more than 10% of our net sales.

Covid-19 pandemic

The COVID-19 pandemic continues to significantly impact regions all around the
world, including the United States and Canada. This has resulted in continuing
restrictions of businesses and other activities implemented by national, state,
and local authorities and private entities, leading to significant adverse
economic conditions and business and lifestyle disruptions, as well as
significant volatility in global financial and retail markets. Federal, state,
and local governments and health officials worldwide continue to impose varying
degrees of preventative and protective actions, such as travel bans,
restrictions on public gatherings, forced closures of businesses and other
activities, social distancing, and the adoption of remote or hybrid learning
models for schools, all in an effort to reduce the spread of the virus. In
addition, certain U.S. and Canadian mall owners continue to restrict hours of
operation and the number of people permitted in stores. Such factors, among
others, have resulted in a significant decline in retail traffic and consumer
spending on discretionary items.

As a result of the impact of the COVID-19 pandemic, we continue to experience
business disruption with many of our retail stores across the U.S. and Canada.
As of January 29, 2022, all of our stores were open to the public in the U.S.,
Canada, and Puerto Rico. Our distribution centers have remained open and
operating during the pandemic to support our retail stores and e-commerce
business. We have experienced, and will likely continue to experience,
disruptions in our global supply chain, which have caused delays in the
production and transportation of our products, which we are mitigating through
shifting production schedules.

RECENT DEVELOPMENTS

Recent macroeconomic events have increased the cost of goods necessary to
produce and distribute our products, including cotton and other materials used
in production, as well as labor, fuel and energy. We expect these product input
costs to continue to increase in 2022, which is planned to be partially
mitigated by higher price realization.

On November 16, 2021, we completed the refinancing of our previous $360.0
million asset-based revolving credit facility (the "Previous ABL Credit
Facility") and our previous $80.0 million term loan (the "Previous Term Loan")
with a new lending group led by an affiliate of Wells Fargo Bank, National
Association ("Wells Fargo") by entering into a fourth amendment to our Credit
Agreement, dated as of May 9, 2019, with the lenders party thereto (the "Fourth
Amendment"). The new debt consists of a revolving credit facility with $350.0
million of availability (the "ABL Credit Facility") and a $50.0

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term loan (the “Term Loan”), both with five-year terms, lower interest rates, reduced reporting requirements and increased covenant flexibility.

The ABL Credit Facility is secured by a first-priority lien on substantially all
of our U.S. and Canadian assets other than intellectual property, certain
furniture, fixtures, equipment, and pledges of subsidiary capital stock; and a
second-priority lien on our intellectual property, certain furniture, fixtures,
equipment, and pledges of subsidiary capital stock. Interest on borrowings is
payable monthly and is based on the amount of our average excess availability
under the facility, at (a) the prime rate plus 0.375% or 0.625%, or (b) LIBOR
plus 1.125% or 1.375%. The ABL Credit Facility has an unused line fee of 0.20%.

The Term Loan is secured by a first-priority lien on our intellectual property,
certain furniture, fixtures, equipment, and pledges of subsidiary capital stock,
and a second-priority lien on the assets securing the ABL Credit Facility on a
first-priority basis. Interest is payable monthly at (a) LIBOR plus 2.50% for
any portion that is a LIBOR loan, or (b) the base rate plus 1.75% for any
portion that is a base rate loan. The Term Loan does not require amortization if
certain conditions are met and is pre-payable at any time without penalty.

Simultaneously, we repaid our then unpaid principal of $78.0 million on the previous term loan with SLR Credit Solutions (formerly Crystal Financial LLC).

The description of the Fourth Amendment set forth herein is qualified in its
entirety by reference to the full text thereof, a copy of which was filed as
Exhibit 10.4 to our Quarterly Report on Form 10-Q for the third quarter of
Fiscal 2021.

Operating Highlights

Net sales increased $392.8 million, or 25.8%, to $1.915 billion during Fiscal
2021 from $1.523 billion during Fiscal 2020. The increase in net sales was
driven primarily by strong customer response to our product assortment,
strategic pricing and promotion changes, and the unprecedented level of stimulus
and enhanced child tax credit payments to our customers resulting from the
government pandemic relief legislation. During Fiscal 2021, we opened one new
store and closed 78 stores.

Gross profit increased $461.4 million, or 138.4%, to $794.7 million during
Fiscal 2021 from $333.3 million during Fiscal 2020. Gross margin increased 1,960
basis points to 41.5% during Fiscal 2021 from 21.9% during Fiscal 2020. The
increase in gross margin resulted primarily from the leverage of fixed expenses
resulting from the increase in net sales, higher merchandise margins in both our
digital and stores channels due to strategic pricing and promotion changes,
lower occupancy expenses due to rent abatements of $12.1 million, favorable
lease negotiations, permanent store closures, and lower e-commerce fulfillment
costs, resulting from our continuing cost optimization initiatives.

Selling, general, and administrative expenses ("SG&A") increased $31.0 million,
or 7.2%, to $459.2 million during Fiscal 2021 from $428.2 million during Fiscal
2020, driven by higher incentive compensation expense and higher marketing
spend. As a percentage of net sales, SG&A decreased 410 basis points to 24.0%
during Fiscal 2021 from 28.1% during Fiscal 2020, primarily as a result of the
leverage of fixed expenses resulting from the increase in net sales.

Interest expense was $18.6 million during Fiscal 2021, compared to $11.8 million
during Fiscal 2020. The increase in interest expense was driven by a higher
average debt balance and the higher interest rate associated with the Previous
ABL Credit Facility and Previous Term Loan for the first nine months of Fiscal
2021. In addition, interest expense for Fiscal 2021 included a charge of $3.7
million related to the refinancing of our Previous ABL Credit Facility and
Previous Term Loan.

Provision for income taxes was $69.9 million during Fiscal 2021, compared to a
benefit of $71.4 million during Fiscal 2020. Our effective tax rate was an
expense of 27.2% and a benefit of 33.7% during Fiscal 2021 and Fiscal 2020,
respectively. The decrease in our effective tax rate was primarily driven by tax
benefits from the CARES Act in Fiscal 2020.

Net income increased $327.6 million to $187.2 million, or $12.59 per diluted
share, during Fiscal 2021, compared to a net loss of $140.4 million, or $9.59
per share, during Fiscal 2020, due to the factors discussed above.

Although we face a period of uncertainty regarding the future impact of the COVID-19 pandemic, we continue to focus on our core strategic growth initiatives – superior product, digital transformation and fleet optimization.

Focus on product remains our top priority. We reintroduced the Gymboree brand in
February 2020 on an enhanced Gymboree website and in certain co-branded
locations in Company stores in the U.S. and Canada, and in November 2021, we
introduced our new brand, Sugar & Jade, which is targeted at the girls' "tween"
market and is offered exclusively online.

The transformation of our digital capabilities continues to expand given a
completely redesigned responsive site and mobile application, providing a rich
online shopping experience geared toward the needs of our "on-the-go" mobile
customers, expanded customer personalization, which delivers unique, relevant
content to drive sales, loyalty and retention, and the ability to have our
entire store fleet equipped with ship-from-store capabilities. Also, in response
to increased digital demand, including as a result of the COVID-19 pandemic, we
have increased and will continue to increase the utilization of our third-party
logistics provider to further support both our U.S. and Canadian e-commerce
operations.

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As a result of the heightened demand for online purchasing, including due to the
COVID-19 pandemic, we accelerated our planned store closures under our fleet
optimization initiative and have closed 256 stores, against our original target
of 300 stores, over the past two fiscal years, including the 78 stores closed
during Fiscal 2021. We have closed 527 stores since the announcement of this
initiative in 2013. We are targeting 40 retail store closures in Fiscal 2022,
which would bring our total store closures since the fleet optimization
initiative began to 567 stores.

In March 2018, our Board of Directors authorized a $250.0 million share
repurchase program (the "2018 Share Repurchase Program"). In November 2021, our
Board of Directors approved another $250.0 million share repurchase program,
which added to the remaining availability under the 2018 Share Repurchase
Program. During Fiscal 2021, we repurchased approximately 1.0 million shares of
our common stock for $85.6 million, consisting of shares surrendered to cover
tax withholdings associated with the vesting of equity awards and shares
acquired in the open market. As of January 29, 2022, there was $257.3 million
remaining under these programs.

We have subsidiaries whose operating results are based in foreign currencies and
are thus subject to the fluctuations of the corresponding translation rates into
U.S. dollars. The table below summarizes the average translation rates that most
significantly impact our operating results:

                                                           Fiscal Years Ended
                                         January 29,             January 30,       February 1,
                                             2022                    2021              2020

Average translation rates (1)

    Canadian dollar                             0.7986                  0.7481            0.7550
    Hong Kong dollar                            0.1286                  0.1290            0.1277
    Chinese renminbi                            0.1548                  0.1459            0.1446

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(1)The average conversion rates are the average of the monthly conversion rates used during each financial year to translate the respective income statements. Each rate represents the we the dollar equivalent of the foreign currency concerned.

CRITICAL ACCOUNTING ESTIMATES

The preparation of financial statements in conformity with U.S. GAAP requires us
to make estimates and assumptions that affect the reported amounts of assets and
liabilities, disclosure of contingent assets and liabilities at the date of the
financial statements, and the amounts of revenues and expenses reported during
the period. We continuously review the appropriateness of the estimates used in
preparing our financial statements; however, estimates routinely require
adjustment based on changing circumstances and the receipt of new or better
information. Consequently, actual results could differ materially from our
estimates. "Note 1. Basis of Presentation and Summary of Significant Accounting
Policies," of the Notes to Consolidated Financial Statements in Part II, Item 8
of this Form 10-K describes the significant accounting policies and methods used
in the preparation of the Company's consolidated financial statements.

The accounting estimates discussed below include those that we believe are the
most critical to aid in fully understanding and evaluating our financial
results. Senior management has discussed the development and selection of our
critical accounting estimates with the Audit Committee of our Board of
Directors, which has reviewed our related disclosures herein.

Impairment of long-lived assets

We periodically review our long-lived assets for impairment when events indicate
that their carrying value may not be recoverable. Such events include a
historical or projected trend of cash flow losses or a future expectation that
we will sell or dispose of an asset significantly before the end of its
previously estimated useful life. In reviewing for impairment, we group our
long-lived assets at the lowest possible level for which identifiable cash flows
are largely independent of the cash flows of other assets and liabilities.

We review all stores that have reached comparable sales status for impairment on
at least an annual basis, or sooner if circumstances so dictate. We believe
waiting this period of time allows a store to reach a maturity level where a
more comprehensive analysis of financial performance can be performed. For each
store that shows indications of impairment, we perform a recoverability test
comparing estimated undiscounted future cash flows to the carrying value of the
related long-lived assets. If the undiscounted future cash flows are less than
the related net book value of the long-lived assets, they are written down to
their fair market value. We primarily use discounted future cash flows directly
associated with those assets, which consist principally of property and
equipment and right-of-use ("ROU") lease assets, to determine their fair market
values. Estimating the fair market value of long-lived assets using the
discounted cash flow model requires management to estimate future revenues,
expenses, discount rates, long-term growth rates, and other factors in order to
project future cash flows. The assumptions used to assess impairment consider
external and internal factors. External factors comprise the local environment

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in which the store resides, including mall traffic, competition, and their
effect on sales trends, as well as macroeconomic factors, such as the global
pandemic. Internal factors include our ability to gauge the fashion taste of our
customers, control over variable costs such as cost of sales and payroll, and in
certain cases, our ability to renegotiate lease costs. If external factors
should change unfavorably, if actual sales should differ from our projections,
or if our ability to control costs is insufficient to sustain the necessary cash
flows, changes in these estimates can have a significant impact on the
assessment of fair market value, which could result in material impairment
charges.

Income taxes

We utilize the liability method of accounting for income taxes as set forth in
FASB ASC 740-Income Taxes. Under the liability method, deferred taxes are
determined based on the temporary differences between the financial statement
and tax basis of assets and liabilities, as well as for net operating losses and
tax credit carryforwards. Deferred tax assets and liabilities are measured using
currently enacted tax rates applied to taxable income in effect for the years in
which the basis differences and tax assets are expected to be realized. Although
we believe our assumptions, judgments and estimates are reasonable, changes in
tax laws or our interpretation of tax laws and the resolution of any tax audits
could significantly impact the amounts reflected for income taxes in our
consolidated financial statements.

A valuation allowance is recorded when it is more likely than not that some of
the deferred tax assets will not be realized. In determining the need for
valuation allowances, we consider projected future taxable income, the
availability of tax planning strategies, taxable income in prior carryback
years, and future reversals of existing taxable temporary differences. The
assumptions utilized in determining future taxable income require significant
judgment. Actual operating results in future years could differ from our current
assumptions, judgments and estimates. If, in the future, we determine that we
would not be able to realize our recorded deferred tax assets, an increase in
the valuation allowance would decrease earnings in the period in which such
determination is made.

We assess our income tax positions and record tax benefits for all years subject
to examination based upon our evaluation of the facts, circumstances, and
information available at the reporting date. For those tax positions where it is
more likely than not that a tax benefit will be sustained, we have recorded the
largest amount of tax benefit with a greater than 50% likelihood of being
realized upon ultimate settlement with a taxing authority that has full
knowledge of all relevant information. For those income tax positions where it
is not more likely than not that a tax benefit will be sustained, no tax benefit
has been recognized in the consolidated financial statements. Due to
uncertainties in any income tax audit, our assumptions regarding the ultimate
settlement of unrecognized tax positions may change and the actual tax benefits
may differ significantly from current estimates.

Stock-based compensation

We account for stock-based compensation according to the provisions of FASB ASC
718- Compensation-Stock Compensation. We grant time-vesting and
performance-based stock awards to employees at various management levels. We
also grant time-vesting stock awards to our non-employee directors. Time-vesting
awards are granted in the form of restricted stock units that require each
recipient to complete a service period ("Deferred Awards"). Deferred Awards
granted to employees generally vest ratably over three years. Deferred Awards
granted to non-employee directors generally vest after one year.
Performance-based stock awards are granted in the form of restricted stock
units, which have performance criteria that must be achieved for the awards to
be earned, in addition to a service period requirement ("Performance Awards"),
and each Performance Award has a defined number of shares that an employee can
earn (the "Target Shares"). With the approval of the Human Capital &
Compensation Committee, we may settle vested Deferred Awards and Performance
Awards in shares, in a cash amount equal to the market value of such shares at
the time all requirements for delivery of the award have been met, or in part
shares and cash. For Performance Awards granted in Fiscal 2021, employees may
earn from 0% to 300% of their Target Shares and for Performance Awards granted
in Fiscal 2020 and Fiscal 2019, employees may earn from 0% to 250% of their
Target Shares, based on the terms of the award and our achievement of certain
performance goals established at the beginning of the applicable service period.
Performance Awards cliff vest, if earned, after completion of the applicable
service period, which is generally three years. The expense recognized for
Performance Awards throughout the service period and the number of shares that
are projected to ultimately vest, are based on the estimated degree to which the
related performance metrics are expected to be achieved. Actual performance may
differ from such projections, which would impact the number of shares that vest
and the total amount of expense recognized for the related Performance Awards,
which could have a material impact on our consolidated financial statements.

Inventory valuation

We value inventory at the lower of cost or net realizable value, with cost
determined using an average cost method. The estimated market value of inventory
is determined based on an analysis of historical sales trends of our individual
product categories, the impact of market trends and economic conditions, and a
forecast of future demand, as well as plans to sell through inventory. Estimates
may differ from actual results due to the quantity, quality, and mix of products
in inventory,

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consumer and retailer preferences, and market conditions such as those resulting
from disease pandemics and other catastrophic events. Reserves for inventory
shrinkage, representing the risk of physical loss of inventory, are estimated
based on historical experience and are adjusted based upon physical inventory
counts. Our historical estimates for inventory obsolescence and shrinkage have
not differed materially from actual results.

Recently issued accounting standards

Refer to "Item 8. Financial Statements and Supplementary Data - Note 1. Basis of
Presentation and Summary of Significant Accounting Policies" for discussion
regarding the impact of recently issued accounting standards on our consolidated
financial statements.

RESULTS OF OPERATIONS

The following table sets forth, for the periods indicated, selected income
statement data expressed as a percentage of net sales. We primarily evaluate the
results of our operations as a percentage of net sales rather than in terms of
absolute dollar increases or decreases by analyzing the year over year change in
our business expressed as a percentage of net sales (i.e., "basis points"). For
example, SG&A decreased approximately 410 basis points to 24.0% of net sales
during Fiscal 2021 from 28.1% during Fiscal 2020. Accordingly, to the extent
that our sales have increased at a faster rate than our costs (i.e.,
"leveraging"), the more efficiently we have utilized the investments we have
made in our business. Conversely, if our sales decrease or if our costs grow at
a faster pace than our sales (i.e., "de-leveraging"), we have less efficiently
utilized the investments we have made in our business.

                                                                                         Fiscal Years Ended
                                                                 January 29,              January 30,                February 1,
                                                                     2022                     2021                       2020
Net sales                                                              100.0  %                   100.0  %                   100.0  %
Cost of sales (exclusive of depreciation and amortization)              58.5                       78.1                       65.0
Gross profit                                                            41.5                       21.9                       35.0
Selling, general, and administrative expenses                           24.0                       28.1                       25.6
Depreciation and amortization                                            3.0                        4.4                        4.0
Asset impairment charges                                                 0.1                        2.5                        0.3

Operating income (loss)                                                 14.4                      (13.1)                       5.2

Income (loss) before provision (benefit) for income taxes               13.4                      (13.9)                       4.7
Provision (benefit) for income taxes                                     3.6                       (4.7)                       0.8

Net income (loss)                                                        9.8  %                    (9.2) %                     3.9  %
Number of Company stores, end of period                                  672                        749                        924


The following table sets forth net sales by segment, for the periods indicated:
                                                   Fiscal Years Ended
                                      January 29,      January 30,      February 1,
                                         2022             2021             2020
                                                     (in thousands)
Net sales:
The Children's Place U.S.            $ 1,723,887      $ 1,372,079      $ 1,671,165

International Children’s Square 191,477 150,519 199,502 Total net sales

                      $ 1,915,364      $ 1,522,598      $ 1,870,667


Fiscal 2021 vs. Fiscal 2020

Net sales increased $392.8 million, or 25.8%, to $1.915 billion during Fiscal
2021 from $1.523 billion during Fiscal 2020. The increase in net sales was
driven primarily by strong customer response to our product assortment,
strategic pricing and promotion changes, and the unprecedented level of stimulus
and enhanced child tax credit payments to our customers resulting from the
government pandemic relief legislation.

We believe that our e-commerce and brick-and-mortar retail store operations are
highly interdependent, with both sharing common customers purchasing from a
common pool of product inventory. Accordingly, we believe that consolidated
omni-channel reporting presents the most meaningful and appropriate measure of
our performance, including net sales.

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The Children's Place U.S. net sales increased $351.8 million, or 25.6%, to
$1.724 billion during Fiscal 2021, compared to $1.372 billion during Fiscal
2020. The increase in net sales was driven primarily by strong customer response
to our product assortment, strategic pricing and promotion changes, and the
unprecedented level of stimulus and enhanced child tax credit payments to our
customers resulting from the government pandemic relief legislation.

The Children's Place International net sales increased $41.0 million, or 27.2%,
to $191.5 million during Fiscal 2021, compared to $150.5 million during Fiscal
2020. The increase in net sales was driven primarily by the strong customer
response to our product assortment and strategic pricing and promotion changes.

Total e-commerce sales, which include shipping and handling, were 44.8% of net sales in fiscal 2021, compared to 52.7% in fiscal 2020.

Gross profit increased $461.4 million, or 138.4%, to $794.7 million during
Fiscal 2021 from $333.3 million during Fiscal 2020. Gross margin increased 1,960
basis points to 41.5% during Fiscal 2021 from 21.9% during Fiscal 2020. Fiscal
2021 results included incremental expenses, including personal protective
equipment and incentive pay for our associates of $1.4 million. Fiscal 2020
results included an inventory provision of $63.2 million related to the adverse
business disruption resulting from the COVID-19 pandemic, including store
closures and incremental expenses, personal protective equipment and incentive
pay for our associates of $11.6 million, and fleet optimization costs of $0.6
million. Excluding the impact of these charges, gross margin leveraged 1,472
basis points to 41.6% of net sales, primarily from the leverage of fixed
expenses resulting from the increase in net sales, higher merchandise margins
resulting from significant AUR increases in both our digital and stores channels
due to strategic pricing and promotion changes, lower occupancy expenses due to
rent abatements of $12.1 million, favorable lease negotiations, permanent store
closures, and lower e-commerce fulfillment costs, resulting from our continuing
cost optimization initiatives.

Gross margin as a percentage of net sales depends on a variety of factors, including changes in the relative mix of sales between distribution channels, changes in the mix of products sold, the timing and level of promotional activities, changes in foreign exchange, and fluctuations in material costs. These and other factors can cause gross margin as a percentage of net sales to fluctuate from period to period.

Selling, general, and administrative expenses increased $31.0 million, or 7.2%,
to $459.2 million during Fiscal 2021 from $428.2 million during Fiscal 2020. As
a percentage of net sales, SG&A decreased 410 basis points to 24.0% during
Fiscal 2021 from 28.1% during Fiscal 2020. Fiscal 2021 results included
incremental expenses, including personal protective equipment and incentive pay
for our associates of $1.6 million, restructuring costs, primarily related to
severance costs for corporate and store associates, of $2.3 million, fleet
optimization costs of $2.4 million, and contract termination costs of $0.8
million. Fiscal 2020 results included incremental operating expenses, including
personal protective equipment and incentive pay for our associates, of $10.9
million, restructuring costs, primarily related to severance costs for corporate
and store associates, of $10.5 million, the write-off of certain accounts
receivable of $1.1 million, fleet optimization costs of $2.8 million, Gymboree
integration costs of $0.6 million, and legal reserves of $0.3 million. Excluding
the impact of these charges, SG&A expenses leveraged 281 basis points to 23.6%
of net sales, primarily as a result of the leverage of fixed expenses resulting
from the increase in net sales.

Asset impairment charges were $1.5 million during Fiscal 2021, inclusive of ROU
assets, primarily related to two stores. Asset impairment charges during Fiscal
2020 were $38.5 million, inclusive of ROU assets, primarily related to 419
stores. These charges were related to underperforming stores identified in our
ongoing store portfolio evaluation primarily as a result of decreased net sales
and cash flow projections.

Depreciation and amortization was $58.4 million during Fiscal 2021, compared to
$66.4 million during Fiscal 2020. This decrease was primarily driven by reduced
depreciation of capitalized software, the permanent closure of 78 stores during
Fiscal 2021, and a decrease in net book value as a result of the impairment
charges recorded in Fiscal 2020.

Operating income (loss) increased to $275.6 million, or 14.4% of net sales for
Fiscal 2021, from an operating loss of $199.9 million, or 13.1% of net sales for
Fiscal 2020, reflecting the factors discussed above.

Interest expense, net was $18.6 million during Fiscal 2021, compared to $11.8
million during Fiscal 2020. The increase in interest expense was driven by a
higher average debt balance and the higher interest rate associated with the
Previous ABL Credit Facility and Previous Term Loan for the first nine months of
Fiscal 2021. In addition, interest expense for Fiscal 2021 included a charge of
$3.7 million related to the refinancing of our Previous ABL Credit Facility and
Previous Term Loan.

Provision (benefit) for income taxes was an expense of $69.9 million during
Fiscal 2021, compared to a benefit of $71.4 million during Fiscal 2020. Our
effective tax rate was an expense of 27.2% and a benefit of 33.7% during Fiscal
2021 and Fiscal 2020, respectively. The decrease in our effective tax rate was
primarily driven by tax benefits from the CARES Act in Fiscal 2020.

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Net profit (loss) increased to $187.2 millionWhere $12.59 per diluted share, during the 2020-2021 fiscal year, compared to a net loss of $140.4 millionWhere $9.59 per share, in fiscal 2020, due to the impact of the COVID-19 pandemic in fiscal 2020 and the other factors mentioned above.

Fiscal 2020 vs. Fiscal 2019

See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Company’s Annual Report on Form 10-K for the year ended January 30, 2021 for the comparative discussion of fiscal year 2020 to fiscal year 2019.

CASH AND CAPITAL RESOURCES

Liquidity

Our working capital needs typically follow a seasonal pattern, peaking during
the third fiscal quarter based on seasonal inventory purchases. Our primary uses
of cash are for working capital requirements, which are principally inventory
purchases, the financing of capital projects, including investments in new
systems, and for the capital return program (other than payment of dividends,
which continue to be temporarily suspended due to the COVID-19 pandemic).

On November 16, 2021, we completed the refinancing of the Previous ABL Credit
Facility and Previous Term Loan with a new lending group led by an affiliate of
Wells Fargo by entering into the Fourth Amendment to our Credit Agreement with
the lenders party thereto. The new debt consists of a revolving credit facility
with $350.0 million of availability and a $50.0 million term loan. (See
"Revolving Credit Facility and Term Loan" below for further information).

Our working capital deficit improved $161.1 million to a deficit of $10.3
million at January 29, 2022, compared to a deficit of $171.4 million at
January 30, 2021, primarily reflecting operating results over the past twelve
months, as well as lower current lease liabilities resulting from favorable
lease negotiations. During Fiscal 2021, we repurchased approximately 1.0 million
shares for $85.6 million. During Fiscal 2020, prior to the suspension of our
capital return program, we repurchased approximately 0.3 million shares for
$15.5 million.

At January 29, 2022, we had $175.3 million of outstanding borrowings and $97.0
million available for borrowing under our ABL Credit Facility. In addition, at
January 29, 2022, we had $7.4 million of outstanding letters of credit with an
additional $42.6 million available for issuing letters of credit under our ABL
Credit Facility.

We expect to be able to meet our working capital and capital expenditure requirements for the foreseeable future using our free cash, operating cash flow and availability under our ABL credit facility.

ABL credit facility and term loan

We and certain of our subsidiaries maintain a $350 million ABL Credit Facility
and a $50 million Term Loan with Wells Fargo Bank, National Association ("Wells
Fargo"), Truist Bank, Bank of America, N.A., HSBC Business Credit (USA) Inc.,
and JPMorgan Chase Bank, N.A., as lenders (collectively, the "Lenders") and
Wells Fargo, as Administrative Agent, Collateral Agent, Swing Line Lender and
Term Agent. Both the ABL Credit Facility and the Term Loan mature in November
2026, and both of these debt facilities have lower interest rates, reduced
reporting requirements, and increased flexibility under the covenants compared
to the Previous ABL Credit Facility and Previous Term Loan.

The ABL credit facility includes a $25 million Canadian sub-limit and a $50 million sub-limit for stand-by and documentary letters of credit.

Borrowings outstanding under the ABL Credit Facility bear interest, at our option, at:

(i) the prime rate plus a margin of 0.375% or 0.625% based on the amount of our average excess availability under the facility; Where

(ii)the London InterBank Offered Rate, or "LIBOR", for an interest period of
one, three, or six months, as selected by us, plus a margin of 1.125% or 1.375%
based on the amount of our average excess availability under the facility.

We are charged an unused line fee of 0.20% on the unused portion of the
commitments. Letter of credit fees range from 0.563% to 0.683% for commercial
letters of credit and range from 0.625% to 0.875% for standby letters of
credit. Letter of credit fees are determined based on the amount of our average
excess availability under the facility. The amount available for loans and
letters of credit under the Credit Agreement is determined by a borrowing base
consisting of certain credit card receivables, certain trade receivables,
certain inventory, and the fair market value of certain real estate, subject to
certain reserves.

The outstanding obligations under the ABL Credit Facility may be accelerated
upon the occurrence of certain events, including, among others, non-payment,
breach of covenants, the institution of insolvency proceedings, defaults under
other

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material indebtedness, and a change of control, subject, in the case of certain
defaults, to the expiration of applicable grace periods. We are not subject to
any early termination fees.

The ABL Credit Facility contains covenants, which include conditions on stock
buybacks and the payment of cash dividends or similar payments. These covenants
also limit the ability of the Company and its subsidiaries to incur certain
liens, to incur certain indebtedness, to make certain investments, acquisitions,
or dispositions or to change the nature of its business.

Credit extended under the ABL Credit Facility is secured by a first priority
security interest in substantially all of the Company's U.S. and Canadian assets
other than intellectual property, certain furniture, fixtures, equipment, and
pledges of subsidiary capital stock, and a second priority security interest in
the Company's intellectual property, certain furniture, fixtures, equipment, and
pledges of subsidiary capital stock.

The table below presents the components of our ABL Credit Facility and Previous
ABL Credit Facility:

                                                                                     January 29,                    January 30,
                                                                                         2022                           2021
                                                                                                    (in millions)
Credit facility maximum                                                        $                  350.0       $                  360.0
Borrowing base (1)                                                                                279.7                          282.2

Outstanding borrowings                                                                            175.3                          169.8

Letters of credit outstanding-standby                                                               7.4                            8.2
Utilization of credit facility at end of period                                                   182.7                          178.0

Availability (2)                                                               $                   97.0       $                  104.2

Interest rate at end of period                                                                     1.6%                           4.2%


                                                                                 Fiscal Years Ended
                                                                     January 29,               January 30,
                                                                         2022                      2021
Average end of day loan balance during the period                   $        187.0       $                  216.2
Highest end of day loan balance during the period                            269.7                          275.6
Average interest rate                                                         3.6%                           3.8%

______________________________________________

(1) Lower between the maximum of the credit facility or the total of the basic loan guarantee.

(2) The sub-limit available for letters of credit was $42.6 million and $41.8 million at January 29, 2022 and January 30, 2021respectively.

The Term Loan bears interest, payable monthly, at (a) the LIBOR Rate plus 2.50%
for any portion that is a LIBOR loan, or (b) the base rate plus 1.75% for any
portion that is a base rate loan. The Term Loan is pre-payable at any time
without penalty, and does not require amortization. For Fiscal 2021, we
recognized $5.9 million in interest expense related to the Term Loan and the
Previous Term Loan.

The Term Loan is secured by a first priority security interest in the Company's
intellectual property, certain furniture, fixtures, equipment, and pledges of
subsidiary capital stock, and a second priority security interest in the
collateral securing the ABL Credit Facility on a first-priority basis. The Term
Loan is guaranteed by each of the Company's subsidiaries that guarantee the ABL
Credit Facility and shares substantially the same covenants as provided in the
ABL Credit Facility.

Both the ABL Credit Facility and the Term Loan contain customary events of
default, which include (subject in certain cases to customary grace and cure
periods), nonpayment of principal or interest, breach of other covenants,
failure to pay certain other indebtedness, and certain events of bankruptcy,
insolvency or reorganization. As of January 29, 2022 and January 30, 2021,
unamortized deferred financing costs amounted to $2.9 million and $3.6 million,
respectively, of which $2.6 million and $1.2 million, respectively, related to
our asset-based revolving credit facility.

Cash flow and capital expenditure

Cash provided by operating activities was $133.3 million during Fiscal 2021,
compared to $35.7 million of cash used by operating activities of during Fiscal
2020. Cash provided by operating activities during Fiscal 2021 was primarily the
result of earnings generated during the period, partially offset by planned
changes in working capital, which brought our vendor

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payables in line with historical payment terms. Cash used in operating
activities during Fiscal 2020 was primarily the result of the net loss in the
year due to the impact of the COVID-19 pandemic disruption, resulting in the
acceleration of permanent store closures and extensive government mandated
temporary store closures, partially offset by the impact of strategic working
capital management and the extension of vendor payment terms.

Cash used in investing activities was $29.3 million during Fiscal 2021, compared
to $30.4 million during Fiscal 2020. This change was primarily driven by the
timing of capital expenditures.

Cash used in financing activities was $112.7 million during Fiscal 2021,
compared to cash provided by financing activities of $60.9 million during Fiscal
2020. The decrease primarily resulted from net proceeds received from the
issuance of long-term debt during Fiscal 2020, compared to the use of cash in
Fiscal 2021 to repay long-term debt, and increased repurchases of our common
stock during Fiscal 2021, compared to Fiscal 2020.

Our ability to continue to meet our capital requirements in Fiscal 2022 depends
on our cash on hand, our ability to generate cash flows from operations, and
available borrowings under our ABL Credit Facility. Cash flows generated from
operations depends on our ability to achieve our financial plans. We believe
that our existing cash on hand, cash generated from operations, and funds
available to us through our ABL Credit Facility will be sufficient to fund our
capital and other cash requirements for the foreseeable future.

CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS

For a discussion of our contractual obligations and commercial commitments, see
"Item 8. Financial Statements and Supplementary Data" - "Note 7. Leases", "Note
8. Debt", and "Note 9. Commitments and Contingencies."

Off-balance sheet arrangements

We do not maintain any off-balance sheet arrangements, transactions, obligations
or other relationships with unconsolidated entities that would be expected to
have a material current or future effect upon our financial condition or results
of operations.

QUARTERLY RESULTS AND SEASONALITY

Our quarterly results of operations have fluctuated and are expected to continue
to fluctuate materially depending on a variety of factors, including overall
economic conditions, the timing and number of store closures, increases or
decreases in Comparable Retail Sales, weather conditions (such as unseasonable
temperatures or storms), shifts in timing of certain holidays, and changes in
our merchandise mix and pricing strategy, including changes to address
competitive factors. The combination and severity of one or more of these
factors could result in material fluctuations in our results of operations.

The following table sets forth certain statement of operations data for each of
our last four fiscal quarters. The quarterly statement of operations data set
forth below reflect, in our opinion, all adjustments (consisting only of normal
recurring adjustments) necessary to fairly present the results of operations for
these fiscal quarters (unaudited):

                                                                          

Year ended January 29, 2022

                                                            First                 Second             Third              Fourth
                                                           Quarter               Quarter            Quarter            Quarter
                                                                      (in thousands, except earnings per share)
Net sales                                            $    435,481           

$413,855 $558,225 $507,803
Gross profit

                                              188,206                167,861            244,831            193,842
Selling, general, and administrative expenses             106,738                115,620            115,563            121,248
Depreciation and amortization                              15,561                 14,392             14,204             14,260
Asset impairment charges                                        -                      -              1,254                252

Operating income                                           65,907                 37,849            113,810             58,082
Income before provision for income taxes                   61,496                 33,153            109,851             52,530
Provision for income taxes                                 16,291                  9,058             30,983             13,527
Net income                                           $     45,205           

$24,095 $78,868 $39,003

Diluted earnings per share                           $       3.01           

$1.60 $5.30 $2.68
Common Diluted Weighted Average

 shares outstanding                                        15,002                 15,062             14,873             14,543


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