American Eagle first quarter earnings decline - Orlando Business Journal:

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Net income for the quarter ended May 2was $22.0 or 11 cents per share, compared to $43.9i million, or 21 cents, for the year-ago The teen clothing retailer, based on Pittsburgh's South Side, saw total sales decline 4 percenty year-over-year, to $612 million, from $640.3 million. Comparable-store salex for American Eagle were down 10 percent forthe quarter, compared to a 6 percentr decline in the same quarter a year ago. "While we are nevef satisfied with anearnings decline, there are early indicationsw that the business is CEO Jim O'Donnell said in a statement. He cited improvementr in the AE brand and categories like dressesand accessories.
Analysts were expectingy earnings per share of7 cents, in line with management’ds recent guidance, as the company seeks to improve its women’w apparel and maintain its sales duringy a time when most retailers are facing difficult salexs declines and malls are drawing fewer Jennifer Black, a principal of Oregon-basefd research company Jennifer Black & Associates LLC, saw reasoj for optimism. “I thinki it’s a very democratic brand and it appeals to a lot ofdifferentf people,” she said. “They’re in a prettyg good position because they offer consumers value but they have thebraned name.
” Black was encouraged by the women’ws assortment that American Eagle has rollede out in its praising the increased selection of women’zs dresses and women’s denim, a weakness at the companhy of late, for both tapping into the “Boho trend and offering selection that enabless female shoppers to mix and match. She also was strongly encouraged about the return ofRogert Markfield, the company’s formerf Co-CEO and Chief Merchandising Officer who retired in 2006.
His return to American Eagle was announcedin January, undere the newly created title of Executive Creative Black said she didn’t expect Markfield’s new strategiez to have any majort influence until the fall. Holly an analyst for suburban Philadelphia-based Boenning & Scattergoor Equity Research, also expected the companu won’t see any meaningful turn arounduntil then. “Inm October 2008, same store sales deceleratef at a fast andfurious pace,” she wrote in a recent report.
“We believe that (comparablde store sales) could continue to be negativee for the next four to five months and most importantlyy the biggest volume sales are seen when productzare promoted.”