News Announcement	For Immediate Release
For further information contact:
Douglas Bruggeman	Joseph N. Jaffoni/David Collins
Chief Financial Officer	Jaffoni & Collins Incorporated
937/276-3931	212/835-8500 or rsc@jcir.com

REX STORES REPORTS FISCAL SECOND QUARTER
DILUTED EARNINGS PER SHARE OF $0.11

- Repurchased 706,461 Shares of Common Stock During the 2008 Fiscal
Second Quarter and 138,765 Shares in the Fiscal Third Quarter to Date -

Dayton, Ohio (September 9, 2008) – REX Stores Corporation (NYSE:RSC) today announced financial results for the three month period ended July 31, 2008 (the second quarter of the Company’s 2008 fiscal year). The Company will host a conference call and webcast this morning (details below) to review the results.

Fiscal Second Quarter and Six Month Income Statement Review

The table below summarizes net sales and revenue from REX’s retail and alternative energy segments and income from continuing operations before income taxes and minority interest for the three and six month periods ended July 31, 2008 and July 31, 2007.

		Three Months						Six Months
		Ended						Ended
(in thousands)		July 31,						July 31,
		2008			2007			2008			2007
	Unaudited
Net sales and revenue:
Retail segment	$	42,513		$	47,915		$	88,174		$	96,485
Alternative energy segment		24,857			-			26,024			-
Total net sales and revenues	$	67,370		$	47,915		$	114,198		$	96,485
Income from continuing operations before
income taxes and minority interest
Retail segment	$	774		$	1,897		$	1,635		$	3,711
Alternative energy segment		983			746			1,406			2,152
Corporate expense		(579	)		(865	)		(1,112	)		(1,476	)
Interest expense		(100	)		(34	)		(221	)		(723	)
Interest income		478			1,213			1,140			1,839
Income from synthetic fuel investments		-			3,406			670			10,139
Income from continuing operations before
income taxes and minority interest	$	1,556		$	6,363		$	3,518		$	15,642

-more-

REX Reports Fiscal 2008 Second Quarter, 9/9/08 page 2

The Company’s financial results reflect the consolidation of its investments in two ethanol affiliates, Levelland Hockley County Ethanol, LLC (“Levelland Hockley”) as of September 30, 2006 and One Earth Energy LLC (“One Earth”) as of October 30, 2007.

Comparable store sales in the fiscal 2008 second quarter declined 3.9% compared to the fiscal 2007 second quarter. The Company reports sales performance quarterly and considers a store to be comparable after it has been open six full fiscal quarters. Comparable store sales figures do not include sales of extended service contracts.

Net income in the quarter ended July 31, 2008 was $1.2 million, or $0.11 per diluted share compared with net income of $5.8 million, or $0.48 per diluted share, in the same period of fiscal 2007. During the fiscal 2008 second quarter, the Company recorded $1.0 million of non-cash pre-tax income from interest rate derivative financial instruments held by its consolidated ethanol entities, Levelland Hockley and One Earth. The fiscal 2008 second quarter net income reflects a $0.2 million gain on disposal of discontinued operations, net of tax, or $0.02 per diluted share, while the fiscal 2007 second quarter net income reflects a $2.5 million gain on disposal of discontinued operations, net of tax, or $0.21 per diluted share, as well as a $0.6 million loss from discontinued operations, net of tax, or $0.05 per diluted share. Per share results are based on 11,146,000 and 11,989,000 diluted weighted average shares outstanding for the quarters ended July 31, 2008 and July 31, 2007, respectively.

Select Segment Balance Sheet Data
		July 31, 2008		Jan. 31, 2008		July 31, 2007
Assets:
Retail	$	114,238	$	120,711	$	156,634
Alternative energy		217,994		167,070		104,613
Corporate		107,975		121,197		121,194
Total assets	$	440,207	$	408,978	$	382,441
Long- term debt and capital lease obligations:
Retail	$	-	$	-	$	-
Alternative energy		49,877		22,072		-
Corporate		12,250		13,152		19,122
Total long-term debt and capital lease obligations:	$	62,127	$	35,224	$	19,122

REX Stores’ Current Ethanol Production Interests

	REX’s				Production
	Capital		REX’s		Nameplate	Estimated
	Investment		Ownership		Capacity (millions	Commencement
Entity	($ In millions)		Interest		of gallons)	of Production
Levelland Hockley County Ethanol, LLC (1)	$	16.5	56	%	40	In Production
Patriot Renewable Fuels, LLC	$	16.0	23	%	100	September 2008
One Earth Energy, LLC	$	50.8	74	%	100	Early 2009
Big River Resources, LLC-W. Burlington					92	In Production
Big River Resources, LLC-Galva	$	20.0	10	%	100	Summer 2009

(1)      On February 20, 2008, REX (through a wholly-owned subsidiary) purchased a $5.0 million secured promissory note from Levelland Hockley. The note grants REX rights to convert the note into an additional equity ownership position.

-more-

REX Reports Fiscal 2008 Second Quarter, 9/9/08 page 3

During the fiscal 2008 second quarter REX purchased approximately 706,461 shares of its common stock in open market transactions. Subsequent to the end of the fiscal 2008 second quarter, REX purchased approximately 138,675 shares of its common stock in open market transactions. The Company has approximately 370,464 authorized shares remaining available to purchase under the expanded August 2008 stock buy-back authorization. Reflecting all purchases to-date, REX presently has approximately 10,087,216 shares of common stock outstanding.

During the fiscal second quarter REX initiated a strategic review of its retail segment and engaged Brown, Gibbons, Lang & Company Securities, Inc. to assist it in identifying and evaluating a broad range of alternatives during the strategic review process, including opportunities to monetize its real estate portfolio. There is no assurance that any transaction will occur as a result of the strategic review process.

The Company will host a conference call and webcast today at 11:00 a.m. ET, which are open to the general public. The conference call dial-in number is 212/231-2902; please call ten minutes in advance to ensure that you are connected prior to the presentation. Interested parties may also access the call live via the Investor Relations page of the Company’s website, www.rextv.com, or at www.earnings.com; please allow 15 minutes to register, download and install any necessary software. Following its completion, a telephonic replay of the call can be accessed through 1:00 p.m. ET on September 16, 2008 by dialing 800/633-8284 or 402/977-9140 (international callers). The access code for the audio replay is 21392537. Alternatively, a replay will be available on the Internet for 30 days at www.rextv.com or www.earnings.com.

REX has interests in four ethanol entities and is a specialty retailer of consumer electronic products and appliances. As of July 31, 2008, the Company operated 110 retail stores in 33 states under the trade name “REX.”

This news announcement contains or may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements can be identified by use of forward-looking terminology such as “may,” “expect,” “believe,” “estimate,” “anticipate” or “continue” or the negative thereof or other variations thereon or comparable terminology. Readers are cautioned that there are risks and uncertainties that could cause actual events or results to differ materially from those referred to in such forward-looking statements. These risks and uncertainties include the risk factors set forth from time to time in the Company’s filings with the Securities and Exchange Commission and include among other things: the highly competitive nature of the consumer electronics retailing industry, changes in the national or regional economies, weather, the effects of terrorism or acts of war on consumer spending patterns, the availability of certain products, technological changes, changes in real estate market conditions, the fluctuating amount of quarterly payments received by the Company with respect to sales of its partnership interest in its synthetic fuel investments, and the uncertain amount of synthetic fuel production and resulting income received from time to time from the Company’s synthetic fuel investments. As it relates to ethanol investments, risks and uncertainties include among other things: the uncertainty of constructing plants on time and on budget, the price volatility of corn, sorghum, dried distiller grains, ethanol, gasoline and natural gas, and the plants operating efficiently and according to forecasts and projections.

-tables follow-

REX Reports Fiscal 2008 Second Quarter, 9/9/08 page 4

REX STORES CORPORATION AND SUBSIDIARIES
Consolidated Condensed Statements Of Income
(In Thousands, Except Per Share Amounts)
Unaudited

	Three Months Ended						Six Months Ended
	July 31,						July 31,
		2008			2007*			2008			2007*
Net sales and revenue	$	67,370		$	47,915		$	114,198		$	96,485
Cost of sales (excluding retail segment depreciation)		54,078			32,694			87,531			65,867
Gross profit		13,292			15,221			26,667			30,618
Selling, general and administrative expenses		(13,192	)		(14,690	)		(27,524	)		(29,253	)
Interest income		519			1,976			1,373			3,269
Interest expense		(897	)		(34	)		(1,018	)		(108	)
Loss on early termination of debt		-			-			-			(607	)
Gains on sale of real estate, net		-			72			-			62
Equity in income of unconsolidated ethanol affiliates		874			412			1,922			1,522
Income from synthetic fuel investments		-			3,406			670			10,139
Unrealized and realized gains on derivative financial instruments,
net		960			-			1,428			-
Income from continuing operations before provision for
income taxes, minority interest and discontinued operations		1,556			6,363			3,518			15,642
Provision for income taxes		468			2,563			994			6,168
Minority interest		(36	)		54			187			(41	)
Income from continuing operations		1,052			3,854			2,711			9,433
Loss from discontinued operations, net of tax		(41	)		(587	)		(173	)		(1,510	)
Gain on disposal of discontinued operations, net of tax		195			2,543			194			5,421
Net income	$	1,206		$	5,810		$	2,732		$	13,344
Weighted average shares outstanding – basic		10,510			10,625			10,618			10,548
Basic income per share from continuing operations	$	0.10		$	0.36		$	0.26		$	0.90
Basic loss per share from discontinued operations		-			(0.05	)		(0.02	)		(0.14	)
Basic income per share on disposal of discontinued operations		0.01			0.24			0.02			0.51
Basic net income per share	$	0.11		$	0.55		$	0.26		$	1.27
Weighted average shares outstanding – diluted		11,146			11,989			11,396			11,911
Diluted income per share from continuing operations	$	0.09		$	0.32		$	0.24		$	0.79
Diluted loss per share from discontinued operations		-			(0.05	)		(0.02	)		(0.13	)
Diluted income per share on disposal of discontinued operations		0.02			0.21			0.02			0.46
Diluted net income per share	$	0.11		$	0.48		$	0.24		$	1.12

^*      Amounts differ from those previously reported as a result of certain stores being reclassified into discontinued operations.

- balance sheet follows -

REX Reports Fiscal 2008 Second Quarter, 9/9/08 page 5

REX STORES CORPORATION AND SUBSIDIARIES
Consolidated Condensed Balance Sheets
(in thousands)
Unaudited

		July 31,			January 31,			July 31,
		2008			2008			2007
Assets
Current assets:
Cash and cash equivalents	$	79,608		$	127,716		$	90,293
Restricted cash		2,774			-			-
Accounts receivable, net		3,509			1,877			3,128
Synthetic fuel receivable		-			573			3,851
Inventory, net		59,457			49,933			84,256
Prepaid expenses and other		2,432			2,492			2,932
Deferred taxes		10,312			10,599			6,562
Total current assets		158,092			193,190			191,022
Property and equipment, net		202,193			136,505			78,575
Assets held for sale, net		92			-			1,064
Other assets		13,578			14,803			23,595
Goodwill		1,322			1,322			1,322
Deferred taxes		21,929			21,929			23,533
Equity method investments		40,505			38,748			28,212
Investments in debt instruments		-			-			32,675
Restricted investments		2,496			2,481			2,443
Total assets	$	440,207		$	408,978		$	382,441
Liabilities and shareholders’ equity
Current liabilities:
Current portion of long-term debt and capital lease obligations	$	6,609		$	4,101		$	2,183
Accounts payable, trade		49,688			27,253			42,923
Deferred income		13,144			14,448			15,085
Deferred gain on sale and leaseback		1,389			1,436			2,068
Other current liabilities		7,140			13,617			9,381
Total current liabilities		77,970			60,855			71,640
Long-term liabilities:
Long-term debt and capital lease obligations		62,127			35,224			19,122
Deferred income		15,173			17,172			17,653
Deferred gain on sale and leaseback		3,746			4,493			6,163
Derivative financial instruments		839			2,601			-
Other		1,152			4,313			940
Total long-term liabilities		83,037			63,803			43,878
Minority interest in consolidated subsidiaries		27,539			27,729			11,764
Shareholders’ equity:
Common stock		299			298			298
Paid-in capital		142,584			141,357			143,214
Retained earnings		288,361			285,629			265,106
Treasury stock		(179,583	)		(170,693	)		(163,176	)
Accumulated other comprehensive income, net of tax		-			-			9,717
Total shareholders' equity		251,661			256,591			255,159
Total liabilities and shareholders' equity	$	440,207		$	408,978		$	382,441

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