American Eagle Outfitters Raises 2023 Financial Targets, Taking Operating Income to $800 Million Reflecting Outstanding Execution On Real Power. Real Growth. Plan; 2021 Operating Income On-Track to $600 Million Following Strong Holiday Demand
11 Januar 2022 - 2:00PM
Business Wire
- AEO on track to achieve $600 million in operating income in
2021, surpassing 2023 operating income and margin goals two years
ahead of schedule
- New targets reflect $5.8 billion in revenue; 13.5% operating
margin; and $800 million in operating income -- a 26% CAGR from
2019-2023
- Aerie’s powerful brand platform targeted to reach $2 billion+
in 2023
- American Eagle to leverage structural profit improvements,
leading brand position and expanding customer base
After strong holiday sales, American Eagle Outfitters, Inc.
(NYSE: AEO) is on track to achieve $600 million in operating income
for fiscal 2021.
With a year of strong execution across the “Real Power. Real
Growth.” value creation plan, the company is on track to surpass
its fiscal 2023 operating income and margin goals two years ahead
of schedule. Building on this momentum, AEO is raising its 2023
financial targets. The plan will continue to focus on pursuing
growth opportunities for Aerie’s powerful brand platform through
innovation, expanding deeper into key markets and growing its
customer base. Having successfully driven significant and
structural improvement in profitability at American Eagle, the
brand will now pursue a dual agenda of modest growth and
maintaining healthy profit flow-through.
AEO will continue to leverage its leading customer-focused and
operational capabilities and maintain its ROI discipline, while
building on the power of its people, culture and purpose.
“I am extremely proud of the team’s outstanding execution
throughout the past year, which has instilled real structural
improvements within our company. Inventory and real-estate
optimization combined with strong demand fueled by product
improvements have reignited profitability at the American Eagle
brand. Aerie cemented another year of industry-leading growth and
achieved a substantial inflection in profitability as its powerful
brand platform continued to scale. Operational excellence drove
solid results amidst external disruptions. We closed out a
milestone year for our supply chain, anchored by two key
acquisitions, which secured cost efficiencies, locked in key
strategic advantages and created a new platform for future growth,”
commented Jay Schottenstein, AEO’s Executive Chairman of the Board
and Chief Executive Officer. “As I look forward, I see tremendous
growth potential and opportunities across the organization. I am
excited to see us build on our successes as we strive to reach
greater heights and create lasting value for our shareholders.”
Fourth Quarter Outlook
Fueled by strong demand and positive pricing, AEO expects record
fourth quarter revenue with growth in the mid-to-high teens
compared to fourth quarter 2020, and up in the mid-teens from the
fourth quarter of 2019. Operating income is expected to be in the
range of $90 to $100 million including approximately $80 million in
higher freight costs, due to supply chain disruptions as discussed
in November. The fourth quarter profit outlook reflects significant
progress and meaningful growth compared to the fourth quarter of
2019.
2023 Financial Outlook
AEO targets revenue of approximately $5.8 billion and operating
income of $800 million in fiscal 2023, with the operating margin
expanding to 13.5%. These targets exclude potential asset
impairment and restructuring charges.
AEO Inc
Previous 2023 Targets
New 2023 Targets
Revenue
$5.5 billion
$5.8 billion
Operating Income
$550 million
$800 million
Operating Margin
10.0%
13.5%
Aerie revenue is expected to reflect a high-20%’s compound
annual growth rate to fiscal 2019, reaching approximately $2.2
billion and providing significant profit flow through. American
Eagle revenue is expected to be up slightly to fiscal 2019, at
approximately $3.6 billion, with improved profitability.
AEO’s executive leadership team will discuss its new targets in
detail in a fireside chat at the ICR Conference today at 1pm
Eastern Time. The event can be accessed in the Investor Relations
section on AEO’s website, www.aeo-inc.com. A replay of the event
will be archived and made available online 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 81 countries worldwide through its websites.
American Eagle and Aerie merchandise also is available at more than
200 international locations operated by licensees in 24 countries.
For more information, please visit www.aeo-inc.com.
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 our
expectations or beliefs concerning future events, including fourth
quarter and annual fiscal 2021 results. All forward-looking
statements made by the company involve material risks and
uncertainties and are subject to change based on many important
factors, some of which may be beyond the company’s control. Words
such as "estimate," "project," "plan," "believe," "expect,"
"anticipate," "intend," “potential,” and similar expressions may
identify forward-looking statements. 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 January 30,
2021 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 for the fourth quarter and fiscal 2021 and
beyond 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 negative impacts of the COVID-19
pandemic and related operational disruptions; 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.
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version on businesswire.com: https://www.businesswire.com/news/home/20220110006066/en/
Olivia Messina 412-432-3300 LineMedia@ae.com
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