American Eagle Outfitters Q1 revenues decline 5 percent

REPORT_ American Eagle Outfitters reported earnings of 0.02 dollars per diluted share

for the first quarter ended May 3, 2014, compared to adjusted earnings of 0.18 dollars per diluted share for the comparable quarter last year. Total net revenues decreased 5 percent to 646 million dollars from 679 million dollars last year. Consolidated comparable sales decreased 10 percent, following a 5 percent decrease last year.

Commenting on the results, Jay Schottenstein, Interim CEO stated, “Results were consistent with our expectations. The quarter reflected weak sales and increased markdowns. We are committed to improved profitability and are working hard to implement our plan to strengthen our brands, channels and operations. Our focus is on leveraging our strong brands and talented team in order to deliver long-term profitable growth and enhanced value for our shareholders.”

Pittsburgh-based company’s gross profit decreased 15 percent to 226 million dollars and 420 basis points to 34.9 percent as a rate to revenue. Operating income decreased 85 percent to 8 million dollars. The operating margin decreased 710 basis points to 1.3 percent.

Based on a high single-digit decline in comparable sales, management expects second quarter EPS to be approximately breakeven compared to earnings of 0.10 dollars per diluted share last year.