American Eagle first quarter earnings decline - Denver Business Journal:

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Net income for the quarter ended May 2was $22.9 million, or 11 cents per compared to $43.9 million, or 21 cents, for the year-ag quarter. The teen clothing retailer, based on Pittsburgh's Sout h Side, saw total sales decline 4 percentr year-over-year, to $612 million, from $640.3w million. Comparable-store sales for American Eaglde (NYSE:AEO) were down 10 percenrt for the quarter, compared to a 6 perceng decline in the same quarter ayear ago. "Whiler we are never satisfied with anearnings decline, there are earlyg indications that the business is CEO Jim O'Donnell said in a He cited improvement in the AE brand and categoriesw like dresses and accessories.
Analysts were expecting earnings per shard of7 cents, in line with management’s recengt guidance, as the company seeks to improvse its women’s apparel and maintaih its sales during a time when most retailers are facingt difficult sales declines and malls are drawing fewer Jennifer Black, a principal of Oregon-basexd research company Jennifer Black & Associates LLC, saw reasoj for optimism. “I think it’s a very democratic branrd and it appeals to a lot of different she said. “They’re in a pretty good position becauser they offer consumers value but they have thebrandr name.
” Black was encouragedd by the women’s assortmentg that American Eagle has rolled out in its praising the increased selection of women’ dresses and women’s denim, a weakness at the compant of late, for both tappingh into the “Boho trend and offering selection that enables female shopperas to mix and match. She also was strongluy encouraged about the returnh ofRoger Markfield, the company’es former Co-CEO and Chief Merchandising Officer who retired in 2006.
His returnm to American Eagle was announced in under the newly created titler of Executive Creative Black saidshe didn’t expect Markfield’sa new strategies to have any major influence until the fall. Holly Guthrie, an analystf for suburban Philadelphia-based Boenning & Scattergood Equith Research, also expected the company won’t see any meaningful turn arouncuntil then. “In October same store sales decelerated at a fast andfuriousd pace,” she wrote in a recenf report.
“We believe that (comparabled store sales) could continue to be negativ e for the next four to five months and most importantlu the biggest volume sales are seen when productsxare promoted.”