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American Eagle Outfitter's Q1 earnings fall to 0.14 dollar

American Eagle Outfitters reported EPS of 0.14 dollar for the first quarter ended April 29, 2017 compared to 0.22 dollar last year. Excluding restructuring and related charges of 0.02 dollar per diluted share, the company’s adjusted EPS was 0.16 dollar. Total net revenue increased 2 percent to 762 million dollars and consolidated comparable sales were up 2 percent, following a 6 percent increase last year.

Commenting on the first quarter results, Jay Schottenstein, Chief Executive Officer said in a press release, "The first quarter results reflected mall traffic headwinds, especially early in the quarter, with improved trends over Easter and a strong digital business throughout. The six million shares repurchased this quarter reflects the company’s strong cash flow, healthy balance sheet and confidence in our brands and long-term strategic initiatives."

First quarter financial highlights

Gross profit decreased to 278 million dollars from 293 million dollars last year with a gross margin rate of 36.5 percent to revenue compared to 39.2 percent last year, a 270 basis point decline.

Operating income was 37 million dollars including 5 million dollars of restructuring charges, compared to 59 million dollars last year. Adjusted operating income was 42 million dollars compared to 59 million dollars last year with a rate of 5.6 percent to revenue compared to 7.8 percent last year.

35 new stores planned in FY17

In fiscal 2017, the company plans to open a total of 35 American Eagle Outfitters and Aerie stores throughout the US, Canada and Mexico, while closing around 25 and 40 store locations. Internationally, the company plans to open 45 licensed stores and close two licensed locations.

Based on anticipated comparable store sales in the range of flat to a low single digit decline, management expects second quarter EPS to be approximately 0.15 dollar to 0.17 dollar compared to EPS of 0.23 dollar last year.

Picture:American Eagle Outfitters website