Aeropostale Inc. (ARO), a mall-based specialty retailer of casual apparel, Thursday said its first quarter profit surged from a year ago, as sales improved 21% driven by strong e-commerce business and same store sales growth of 11%. Aeropostale also expects second quarter results to be better than current Street expectations.
For the first quarter, net income of Aeropostale surged 81.03%to $31.68 million or $0.47 per share from $17.50 million or $0.26 per share in the same quarter a year ago.
Quarterly results include pre-tax charges of around $2.7 million or $0.02 per share, related to the closing of Jimmy'Z concept stores.
On average, twenty-four analysts polled by Thomson Reuters expected earnings of $0.48 per share for the quarter. Analysts' estimate typically excludes one-time items.
Net sales for the quarter rose 21% to $408.02 million from $336.33 million in the year-earlier quarter, exceeding Street estimates of $404.65 million. Same store sales increased 11%, compared to an increase of 10% in the prior-year quarter.
Total net revenue from e-commerce business surged 74% to $16.7 million from $9.6 million in the comparable quarter last year.
In the sequentially preceding fourth quarter, Aeropostale's profit increased a modest 5% to $68.2 million or $1.01 per share, on a 17% increase in sales at $690.02 million. Same-store sales for the fourth quarter increased 6%.
Amongst others in the industry, casual apparel retailer Buckle Inc. (BKE) reported a 43.5% surge in first quarter profit to $26.9 million or $0.58 per share as sales increased 24.6% to $199.7 million from the same quarter of the prior year. Comparable store sales for the quarter increased 17.7%.
Another peer, Gap Inc. (GPS) yesterday said its first quarter profit dropped to $215 million or $0.31 per share, hurt by sales that decreased to $3.13 billion in the comparable quarter last year. Casual apparel retailer Abercrombie & Fitch Co. (ANF) last week reported a loss in the first quarter of $26.79 million, or $0.31 per share, as sale dropped 24% to $612.14 million from the year-earlier quarter.
Aeropostale's income from operations for the quarter under review was $53.44 million, compared to $29.19 million in the corresponding quarter last year.
Gross profit as a percentage of sales was 36.2%, compared to gross profit of 33.1% in the prior-year quarter.
Cost of sale, including certain buying, occupancy and warehousing expenses, was 63.8% or sales, compared to 66.9% of sales in the year-earlier quarter.
For second quarter of 2009, the company expects earnings in the range of $0.43 to $0.45 per share, compared to earnings of $0.31 per share in the second quarter last year. Second quarter guidance includes pre-tax charges of approximately $3.0 million or $0.03 per share related to the closing of the Jimmy'Z concept store.
The Street currently expects earnings of $0.37 per share for the quarter.
On May 14, 2009, brokerage Sun Trust Rbsn Humphrey upgraded Aeropostale shares to 'Buy' from 'Neutral', with a mean target of $37.09.
ARO closed Thursday's regular trading at $32.55, down $0.08 or 0.25%, on a volume of 3.26 million shares. In after-hours, the stock gained $1.15 or 3.53%, to trade at $33.70. In the last 52-week period, the stock traded in the range of $12.52 to $37.96, on a three-month average volume of 3.66 million shares.
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