AEO American Eagle Outfitters Inc

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 29, 2024

 

 

AMERICAN EAGLE OUTFITTERS INC

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware			1-33338	13-2721761
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
77 Hot Metal Street
Pittsburgh, Pennsylvania				15203-2329
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: (412) 432-3300

 

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.01 par value		AEO		New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

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Item 2.02 Results of Operations and Financial Condition.

 

On May 29, 2024, American Eagle Outfitters, Inc. (the “Company”) issued a press release announcing, among other things, the Company’s financial results for the first quarter ended May 4, 2024. A copy of this press release is attached hereto as Exhibit 99.1.

The information in this Item 2.02, including the accompanying Exhibits, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

This Current Report on Form 8-K (including the Exhibits hereto) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. Factors that could cause actual results to differ materially from those described in the forward-looking statements can be found in our Annual Report on Form 10-K for the year ended February 3, 2024, and in any subsequently-filed quarterly reports on Form 10-Q, which have been filed with the Securities and Exchange Commission and are available on our website and on the Securities and Exchange Commission’s website (www.sec.gov). The Company does not undertake to update the forward-looking statements to reflect the impact of circumstances or events that may arise after the date of the forward-looking statements.

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit Number		Description
99.1		Press release dated May 29, 2024
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			AMERICAN EAGLE OUTFITTERS, INC.
			(Registrant)
Date:	May 29, 2024	By:	/s/ Michael A. Mathias
			Michael A. Mathias Executive Vice President, Chief Financial Officer

 

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Exhibit 99.1

 

 

AEO Inc. Reports First Quarter Fiscal 2024 Results Reflecting Strong Execution on Powering Profitable Growth Strategy

May 29, 2024

 

PITTSBURGH -- (BUSINESS WIRE) – American Eagle Outfitters, Inc. (NYSE: AEO) today announced financial results for the first quarter fiscal 2024 ended May 4, 2024.

“Our strong first quarter results underscore the power of our iconic brand portfolio and demonstrate great progress on our Powering Profitable Growth strategy. We achieved record revenue, amplifying American Eagle’s and Aerie’s leading market positions and opportunity in casual apparel. We continued to offer exciting merchandise collections and customer activations, providing compelling in-store and digital shopping experiences. This, combined with actions to optimize our operations and drive efficiencies across the organization, contributed to meaningful profit expansion, which was ahead of expectations,” commented Jay Schottenstein, AEO’s Executive Chairman of the Board and Chief Executive Officer.

“As I look forward, I remain confident in our ability to deliver on our plans for 2024 and beyond. We have significant runway across our brands and we continue to execute with discipline as we drive our business to deliver sustained, profitable growth and returns to shareholders,” he continued.

First Quarter 2024 Results compared to First Quarter 2023 Results:

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Inventory

Total ending inventory increased 9% to $681 million, with units up 10%. Ending inventory includes higher end of season merchandise due to the company’s shift to a more profitable clearance strategy. Inventory levels are healthy and well positioned to fuel growth initiatives.

Shareholder Returns

In the first quarter, the company returned approximately $60 million in cash to shareholders.

This included the repurchase of 1.5 million shares for approximately $35 million. The company continues to have 28.5 million shares remaining for repurchase under the current authorization.

Additionally, the company paid a quarterly cash dividend of $0.125 per share, or approximately $25 million.

Capital Expenditures

Capital expenditures totaled $36 million in the first quarter. For fiscal 2024, management continues to expect capital expenditures to approximate $200 to $250 million.

Outlook

For fiscal 2024, management continues to expect operating income in the range of $445 to $465 million. This reflects revenue up 2 to 4% to last year, including an approximately one point headwind from one less selling week due to the retail calendar shift.

For the second quarter, management expects operating income in the range of $95 to $100 million. This reflects revenue up high-single digits, including an approximately $55 million positive impact from the retail calendar shift.

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Webcast and Supplemental Financial Information

Management will host a conference call and real time webcast today at 4:30 pm Eastern Time. To listen to the call, dial 1-877-407-0789 or internationally dial 1-201-689-8562 or go to www.aeo-inc.com to access the webcast and audio replay. Additionally, a financial results presentation is posted on the company’s website.

* * * *

About American Eagle Outfitters, Inc.

American Eagle Outfitters, Inc. (NYSE: AEO) is a leading global specialty retailer offering high-quality, on-trend clothing, accessories and personal care products at affordable prices under its American Eagle® and Aerie® brands. Our purpose is to show the world that there’s REAL power in the optimism of youth. The company operates stores in the United States, Canada, Mexico and Hong Kong and ships to approximately 80 countries worldwide through its websites. American Eagle and Aerie merchandise also is available at more than 300 international locations operated by licensees in approximately 30 countries. To learn more about AEO and the company’s commitment to Planet, People and Practices, please visit www.aeo-inc.com.

 

Non-GAAP Measures

This release includes information on non-GAAP financial measures (“non-GAAP” or “adjusted”), including adjusted operating income for first quarter fiscal 2023. These financial measures are not based on any standardized methodology prescribed by U.S. generally accepted accounting principles (“GAAP”) and are not necessarily comparable to similar measures presented by other companies. Non-GAAP information is provided as a supplement to, not as a substitute for, or as superior to, measures of financial performance prepared in accordance with GAAP. Management believes that this non-GAAP information is useful for an alternate presentation of the company’s performance, when reviewed in conjunction with the company’s GAAP consolidated financial statements and provides a higher degree of transparency.

These amounts are not determined in accordance with GAAP and therefore, should not be used exclusively in evaluating the company’s business and operations. We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure and to view these non-GAAP financial measures in conjunction with the related GAAP financial measures.

The tables included in this release reconcile the GAAP financial measures to the non-GAAP financial measures discussed above.

SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

This release and related statements by management contain forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995), which represent management’s expectations or beliefs concerning future events, including, without limitation, second fiscal quarter and annual fiscal 2024 results. Words such as “outlook,” "estimate,"

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"project," "plan," "believe," "expect," "anticipate," "intend," “may,” “potential,” and similar expressions may identify forward-looking statements, although not all forward-looking statements contain these identifying words. All forward-looking statements made by the company are inherently uncertain because they are based on assumptions and expectations concerning future events and are subject to change based on many important factors, some of which may be beyond the company’s control. Except as may be required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise and even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized. The following factors, in addition to the risks disclosed in Item 1A., Risk Factors, of our Annual Report on Form 10-K for the fiscal year ended February 3, 2024 and in any other filings that we may make with the Securities and Exchange Commission, in some cases have affected, and in the future could affect, the company's financial performance and could cause actual results to differ materially from those expressed or implied in any of the forward-looking statements included in this release or otherwise made by management: the risk that the company’s operating, financial and capital plans may not be achieved; our inability to anticipate customer demand and changing fashion trends and to manage our inventory commensurately; seasonality of our business; our inability to achieve planned store financial performance; our inability to react to raw material cost, labor and energy cost increases; our inability to gain market share in the face of declining shopping center traffic; our inability to respond to changes in e-commerce and leverage omni-channel demands; our inability to expand internationally; difficulty with our international merchandise sourcing strategies; challenges with information technology systems, including safeguarding against security breaches; and global economic, public health, social, political and financial conditions, and the resulting impact on consumer confidence and consumer spending, as well as other changes in consumer discretionary spending habits, which could have a material adverse effect on our business, results of operations and liquidity.

The use of the “company,” “AEO,” “we,” "us," and “our” in this release refers to American Eagle Outfitters, Inc.

 

 

CONTACT:

Line Media

412-432-3300

LineMedia@ae.com

 

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AMERICAN EAGLE OUTFITTERS, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
(In thousands)		May 4, 2024				April 29, 2023
Assets
Current assets:
Cash and cash equivalents		$	300,518			$	117,841
Merchandise inventory			681,062				624,851
Accounts receivable, net			230,934				259,074
Prepaid expenses and other			98,803				127,735
Total current assets			1,311,317				1,129,501
Operating lease right-of-use assets			1,123,649				1,053,938
Property and equipment, at cost, net of accumulated depreciation			703,551				762,433
Goodwill, net			225,253				264,896
Non-current deferred income taxes			89,332				13,034
Intangible assets, net			45,178				92,399
Other assets			58,937				57,693
Total assets		$	3,557,217			$	3,373,894
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable		$	225,480			$	212,318
Current portion of operating lease liabilities			303,603				321,430
Accrued compensation and payroll taxes			64,502				43,550
Unredeemed gift cards and gift certificates			57,373				57,014
Accrued income and other taxes			50,716				13,812
Other current liabilities and accrued expenses			71,655				68,313
Total current liabilities			773,329				716,437
Non-current liabilities:
Non-current operating lease liabilities			1,002,529				987,048
Long-term debt, net			—				30,225
Other non-current liabilities			29,003				21,168
Total non-current liabilities			1,031,532				1,038,441
Commitments and contingencies			—				—
Stockholders’ equity:
Preferred stock			—				—
Common stock			2,496				2,496
Contributed capital			345,922				324,396
Accumulated other comprehensive loss			(15,722	)			(26,777	)
Retained earnings			2,267,785				2,130,108
Treasury stock			(848,125	)			(811,207	)
Total stockholders’ equity			1,752,356				1,619,016
Total liabilities and stockholders’ equity		$	3,557,217			$	3,373,894
Current Ratio			1.70				1.58

 

 

 

 

 

 

 

 

 

 

 

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AMERICAN EAGLE OUTFITTERS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars and shares in thousands, except per share amounts)
(unaudited)
		13 Weeks Ended
		May 4, 2024					April 29, 2023
		(In thousands)		(Percentage of revenue)			(In thousands)		(Percentage of revenue)
Total net revenue		$1,143,867		100.0	%		$1,080,926		100.0	%
Cost of sales, including certain buying, occupancy and warehouse expenses		679,628		59.4			667,747		61.8
Gross profit		464,239		40.6			413,179		38.2
Selling, general and administrative expenses		333,493		29.2			312,345		28.9
Impairment and restructuring charges		-		0.0			21,275		2.0
Depreciation and amortization expense		52,910		4.6			56,728		5.2
Operating income		77,836		6.8			22,831		2.1
Interest (income) expense, net		(3,439)		(0.3)			690		0.1
Other (income), net		(1,396)		(0.1)			(3,311)		(0.3)
Income before income taxes		$82,671		7.2			$25,452		2.3
Provision for income taxes		14,919		1.3			6,999		0.6
Net income		$67,752		5.9	%		$18,453		1.7	%
Net income per basic share		$0.34					$0.09
Net income per diluted share		$0.34					$0.09
Weighted average common shares outstanding - basic		196,429					194,487
Weighted average common shares outstanding - diluted		201,310					197,160

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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GAAP to Non-GAAP Reconciliation
(Dollars in thousands, except per share amounts)
		13 Weeks Ended
		April 29, 2023
		Operating Income				Provision for Income Taxes				Net Income				Earnings per Diluted Share
GAAP Basis		$	22,831			$	6,999			$	18,453			$	0.09
% of Revenue			2.1	%						1.7%
Add: Impairment, restructuring and other charges (1)		$	21,275							$	15,424			$	0.08
Tax effect of the above (2)						$	5,851
Non-GAAP Basis		$	44,106			$	12,850			$	33,877			$	0.17
% of Revenue			4.1	%							3.1	%

 

The following footnotes relate to impairment, restructuring, and other charges recorded in the 13 weeks ended April 29, 2023:

All impairments were recorded due to insufficient prospective cash flows to support the asset value.

 

(2) The tax effect of excluded items is the difference between the tax provision calculated on a GAAP basis and an adjusted non-GAAP basis.

 

 

 

 

 

 

 

 

 

 

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AMERICAN EAGLE OUTFITTERS, INC.
NET REVENUE BY SEGMENT
(unaudited)
	13 Weeks Ended
(In thousands)	May 4, 2024				April 29, 2023
Net Revenue:
American Eagle	$	724,744			$	671,092
Aerie		372,652				359,082
Other		54,984				109,357
Intersegment Elimination		(8,513	)			(58,605	)
Total Net Revenue	$	1,143,867			$	1,080,926

 

 

 

 

 

 

 

 

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AMERICAN EAGLE OUTFITTERS, INC.
STORE INFORMATION
(unaudited)
	13 Weeks Ended
	May 4, 2024
Consolidated stores at beginning of period		1,182
Consolidated stores opened during the period
AE Brand (1)		3
Aerie (incl. OFFL/NE) (2)		1
Todd Snyder		-
Unsubscribed		-
Consolidated stores closed during the period
AE Brand (1)		(8	)
Aerie (incl. OFFL/NE) (2)		(4	)
Unsubscribed		(1	)
Total consolidated stores at end of period		1,173
Stores by Brand
AE Brand (1)		846
Aerie (incl. OFFL/NE) (2)		307
Todd Snyder		15
Unsubscribed		5
Total consolidated stores at end of period		1,173
Total gross square footage at end of period (in '000)		7,221
International license locations at end of period (3)		315
(1) AE Brand includes AE stand alone locations, AE/Aerie side-by side locations, AE/OFFL/NE side-by-side locations, and AE/Aerie/OFFL/NE side-by-side locations.
(2) Aerie (incl. OFFL/NE) includes Aerie stand alone locations, OFFL/NE stand alone locations, and Aerie/OFFL/NE side-by-side locations.
(3) International license locations (retail stores and concessions) are not included in the consolidated store data or the total gross square footage calculation.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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v3.24.1.1.u2

Document And Entity Information	May 29, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	May 29, 2024
Entity Registrant Name	AMERICAN EAGLE OUTFITTERS INC
Entity Central Index Key	0000919012
Entity Emerging Growth Company	false
Entity File Number	1-33338
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	13-2721761
Entity Address, Address Line One	77 Hot Metal Street
Entity Address, City or Town	Pittsburgh
Entity Address, State or Province	PA
Entity Address, Postal Zip Code	15203-2329
City Area Code	(412)
Local Phone Number	432-3300
Entity Information, Former Legal or Registered Name	Not Applicable
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	AEO
Security Exchange Name	NYSE

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