EXHIBIT 99.1
AMERICAN EAGLE
OUTFITTERS
Reports Record Second Quarter EPS of $0.40 versus $0.11 Last Year;
Comparable Store Sales Increase 12.7% and Total Sales Rise 22.8%
Warrendale, PA, August 12, 2004 - American Eagle Outfitters, Inc. (NASDAQ: AEOS) today announced its consolidated financial results for the second quarter ended July 31, 2004. Management also stated that the strong sales momentum has continued into August. At this time the Company is comfortable with the current third quarter First Call mean estimate of $0.47 per share.
Second Quarter Ended July 31, 2004
- Total sales increased 22.8% to $413.8 million from $337.1 million for the quarter ended August 2, 2003.
- Consolidated comparable store sales, which include American Eagle and Bluenotes/Thriftys stores, increased 12.7% when compared to the corresponding period last year.
- Gross profit as a percent to sales increased to 39.7% from 33.0% last year due primarily to an improvement in merchandise margins.
- Operating income for the quarter increased to $47.9 million, or 11.6% as a percent to sales, from $12.6 million, or 3.7% as a percent to sales last year.
- Net income for the quarter increased to $29.6 million, or $0.40 per share on a diluted basis, from net income of $8.1 million, or $0.11 per share on a diluted basis last year.
Year-to-Date for the Six Months Ended July 31, 2004
- Total sales increased 21.4% to $763.8 million from $628.9 million for the six months ended August 2, 2003.
- Consolidated comparable store sales, which include American Eagle and Bluenotes/Thriftys stores, increased 11.1% when compared to the corresponding period last year.
- Gross profit as a percent to sales increased to 41.1% from 34.5% last year due primarily to an improvement in merchandise margins.
- Operating income for the period increased to $87.9 million, or 11.5% as a percent to sales, from $22.3 million, or 3.5% as a percent to sales last year.
- Net income for the period increased to $54.7 million, or $0.74 per share on a diluted basis, from net income of $14.5 million, or $0.20 per share on a diluted basis last year.
* * * *
At 9:00 a.m. EST, on August 12, 2004, the Company's management team will host a conference call to review the financial results. To listen to the call, dial 877-601-0864 at least ten minutes prior to the start of the call. The conference call will also be simultaneously broadcast over the Internet at www.ae.com. A replay will be available beginning August 12th at 1:00 p.m. EST through August 26th. To listen to the replay, dial 1-800-642-1687 and reference confirmation code #9047190. An audio replay of the conference call will also be available at www.ae.com.
American Eagle Outfitters (NASDAQ: AEOS) is a leading lifestyle retailer that designs, markets, and sells its own brand of relaxed, casual clothing for 15 to 25 year olds, providing high-quality merchandise at affordable prices. AE's collection includes modern basics like jeans, cargo pants, and graphic Ts as well as a stylish assortment of cool accessories, outerwear and footwear. AE's Canadian subsidiary, Bluenotes/Thriftys, offers a more urban/suburban, denim-driven collection for 12 to 22 year olds. American Eagle Outfitters currently operates 758 AE stores in 49 states, the District of Columbia and Puerto Rico, 68 AE stores in Canada, and 107 Bluenotes/Thriftys stores in Canada. AE also operates via its Web business, www.ae.com, which offers additional sizes and styles of favorite AE merchandise.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This release contains forward-looking statements, which represent our expectations or beliefs concerning future events, specifically regarding third quarter earnings. All forward-looking statements made by the Company involve material risks and uncertainties and are subject to change based on factors beyond the Company's control. Such factors include, but are not limited to the risk that our third quarter sales, markdowns and/or earnings expectations may not be achieved, and those other risks described in the Company's filings with the Securities and Exchange Commission. Accordingly, the Company's future performance and financial results may differ materially from those expressed or implied in any such forward-looking statements. The Company does not undertake to publicly update or revise its forward-looking statements even if future changes make it clear that projected results expressed or implied will not be realized.
Company Contacts:
Laura Weil
Judy Meehan
724-776-4857
AMERICAN EAGLE OUTFITTERS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in thousands) |
| | (Unaudited) | | | | (Unaudited) |
| | July 31, 2004 | | January 31, 2004 | | August 2, 2003 |
ASSETS | | | | | | |
Cash, cash equivalents and short-term investments | $ | 332,611 | $ | 337,812 | $ | 208,966 |
Merchandise inventory | | 169,840 | | 120,586 | | 159,036 |
Other current assets | | 86,067 | | 67,225 | | 73,815 |
Total current assets | | 588,518 | | 525,623 | | 441,817 |
Property and equipment, net | | 299,115 | | 278,689 | | 277,619 |
Goodwill, net | | 10,136 | | 10,136 | | 23,614 |
Other assets, net | | 53,103 | | 50,623 | | 30,934 |
Total Assets | $ | 950,872 | $ | 865,071 | $ | 773,984 |
| | | | | | |
LIABILITIES AND STOCKHOLDERS' EQUITY | | | | | | |
Accounts payable | $ | 70,732 | $ | 71,330 | $ | 64,525 |
Accrued compensation and payroll taxes | | 26,415 | | 14,409 | | 17,762 |
Accrued rent | | 29,984 | | 30,985 | | 27,874 |
Accrued income and other taxes | | 18,640 | | 28,669 | | 14,852 |
Unredeemed stored value cards and gift certificates | | 15,388 | | 25,785 | | 13,593 |
Current portion of note payable | | 4,832 | | 4,832 | | 4,593 |
Other current liabilities | | 15,661 | | 13,025 | | 10,103 |
Total current liabilities | | 181,652 | | 189,035 | | 153,302 |
Notepayable | | 11,469 | | 13,874 | | 15,100 |
Other non-current liabilities | | 21,475 | | 18,492 | | 9,752 |
Total non-current liabilities | | 32,944 | | 32,366 | | 24,852 |
Total stockholders' equity | | 736,276 | | 643,670 | | 595,830 |
Total Liabilities and Stockholders' Equity | $ | 950,872 | $ | 865,071 | $ | 773,984 |
| | | | | | |
Current Ratio | | 3.24 | | 2.78 | | 2.88 |
| | | | | | |
AMERICAN EAGLE OUTFITTERS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in thousands, except per share amounts) (Unaudited) |
| | | | | | | | |
| | Three Months Ended | | Six Months Ended |
| | July 31, 2004 | | August 2, 2003 | | July 31, 2004 | | August 2, 2003 |
| | | | | | | | |
Net sales | $ | 413,777 | $ | 337,055 | $ | 763,802 | $ | 628,913 |
Cost of sales, including certain buying, | | | | | | | | |
occupancy and warehousing expenses | | 249,485 | | 225,866 | | 449,641 | | 411,736 |
Gross profit | | 164,292 | | 111,189 | | 314,161 | | 217,177 |
Selling, general and administrative expenses | | 100,742 | | 84,826 | | 195,922 | | 167,682 |
Depreciation and amortization | | 15,684 | | 13,763 | | 30,306 | | 27,179 |
Operating income | | 47,866 | | 12,600 | | 87,933 | | 22,316 |
Other income, net | | 520 | | 514 | | 1,497 | | 1,155 |
Income before income taxes | | 48,386 | | 13,114 | | 89,430 | | 23,471 |
Provision for income taxes | | 18,762 | | 5,010 | | 34,699 | | 8,964 |
Net income | $ | 29,624 | $ | 8,104 | $ | 54,731 | $ | 14,507 |
| | | | | | | | |
Basic income per common share | $ | 0.41 | $ | 0.11 | $ | 0.76 | $ | 0.20 |
Diluted income per common share | $ | 0.40 | $ | 0.11 | $ | 0.74 | $ | 0.20 |
| | | | | | | | |
Weighted average common shares outstanding - basic | | 72,251 | | 71,085 | | 71,878 | | 71,071 |
Weighted average common shares outstanding - diluted | | 74,164 | | 72,380 | | 73,692 | | 72,175 |
Total gross square footage at end of period: | | | | | | | | |
| | | | | | | | |
American Eagle Outfitters Stores | | | | | | 4,390,790 | | 4,009,727 |
Bluenotes/Thriftys Stores | | | | | | 348,306 | | 354,206 |
Store count at end of period: | | | | | | | | |
| | | | | | | | |
American Eagle Outfitters Stores | | | | | | 825 | | 776 |
Bluenotes/Thriftys Stores | | | | | | 107 | | 111 |