Comparable store sales essentially flat at Aeropostale

19 May '12

3 min read

Aeropostale Inc. a mall-based specialty retailer of casual apparel for young women and men, reported results for the first quarter of fiscal 2012, and provided guidance for the second quarter of fiscal 2012.

First Quarter Performance
Diluted net earnings for the first quarter of 2012 were $0.13 per share, compared to $0.20 per diluted share in the same period last year. Net income for the first quarter of 2012 was $10.6 million, compared to net income of $16.4 million last year.

For the first quarter of fiscal 2012, net sales increased 6% to $497.2 million, from $469.2 million in the year ago period. Comparable sales, including the e-commerce channel, for the first quarter increased 2%, compared to a 5% decrease last year. Comparable store sales, excluding the e-commerce channel, for the first quarter were essentially flat, compared to a 7% decrease last year.

Thomas P. Johnson, Chief Executive Officer, commented, "During the first quarter, we continued to make progress on our key initiatives, and we experienced a significant improvement in trends versus the fourth quarter. This accomplishment was a result of the efforts of our entire organization, and I continue to be very proud of our team's contributions and dedication."

E-commerce
Net revenue from the Company's e-commerce business for the first quarter of fiscal 2012 increased 32% to $37.2 million, from $28.2 million in the year ago period.

Inventory
Total merchandise inventory for the first quarter of fiscal 2012 was $174.9 million, a total increase of 23%, or 16% on a retail per square foot basis, reflecting accelerated receipts due to a shift in the timing of summer floor-sets. As of May 12, 2012, inventory levels versus last year decreased 2% on a retail per square foot basis.

Cash Positioning and Share Repurchase Program
The Company ended the quarter with cash and cash equivalents of $202.6 million and no debt. The Company currently has $145.2 million of availability remaining under its share repurchase program.

Store Growth and Capital Spending
The Company opened three Aeropostale and 10 P.S. from Aeropostale stores, and closed three Aeropostale stores during the quarter. For the first quarter, the Company invested $18.2 million in planned capital expenditures.

Second Quarter Guidance
For the second quarter of fiscal 2012, the Company expects earnings in the range of $0.03 to $0.05 per diluted share. This compares to earnings of $0.04 per diluted share for the second quarter of 2011, which included a non-recurring pre-tax benefit to the Company's gross profit of $8.7 million, or $0.06 per diluted share, resulting from the resolution of a dispute with one of the Company's merchandise vendors surrounding prior period allowances.

Mr. Johnson, continued, "While I am pleased with the sequential progress we are making in our business, the overall retail environment remains uncertain and we are early in the cycle of executing our key initiatives. As we move through the remainder of the year, we continue to focus on improving our financial performance and our profitability."

Aeropostale, Inc. is a primarily mall-based, specialty retailer of casual apparel and accessories, principally targeting 14 to 17 year-old young women and men through its Aeropostale stores and 4 to 12 year-old kids through its P.S. from Aeropostale stores.

Aeropostale Inc

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