Aeropostale Reports Fourth Quarter and Fiscal 2005 Results.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Aeropostale, Inc. (NYSE NYSE See: New York Stock Exchange : ARO), a mall-based specialty A contract under seal. A specialty is a written document that has been sealed and delivered and is given as security for the payment of a specifically indicated debt. retailer of active and casual apparel for the teen market, today reported results for the fourth quarter and fiscal year ended January January: see month. 28, 2006. FOURTH QUARTER PERFORMANCE: Net income for the fourth quarter of fiscal 2005 was $41.8 million or $0.76 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, versus net income of $35.3 million or $0.62 per diluted share in the fourth quarter of fiscal 2004. Fourth quarter of fiscal 2004 earnings were reduced by $2.8 million or $0.05 per share due to a non-cash expense Noun 1. non-cash expense - an expense (such as depreciation) that is not paid for in cash disbursal, disbursement, expense - amounts paid for goods and services that may be currently tax deductible (as opposed to capital expenditures) adjustment related to a correction CORRECTION,punishment. Chastisement by one having authority of a person who has committed some offence, for the purpose of bringing him to legal subjection. 2. It is chiefly exercised in a parental manner, by parents, or those who are placed in loco parentis. in the Company's lease accounting policy. Excluding this one time adjustment, pro-forma fourth quarter earnings were $38.1 million or $0.67 per share last year. Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for the fourth quarter of fiscal 2005 increased 33.1% to $435.2 million versus net sales of $327.1 million in the fourth quarter of last year. Comparable store sales for the fourth quarter increased 10.3% versus an increase of 1.9% last year. Julian Julian or Julian the Apostate Latin Julianus Apostata orig. Flavius Claudius Julianus (born AD 331/332, Constantinople—died June 26/27, 363, Ctesiphon, Mesopotamia) Roman emperor (361–363), noted scholar and military leader. R. Geiger, Chairman and Chief Executive Officer said, "We are very pleased to have ended the fiscal year with such a strong finish. Our ability to respond to the challenges in our business and achieve our short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. objectives in such a timely manner underscores the strength and flexibility of our operating model Operating Model is a term that is used in many contexts. In essence an operating model describes how an organization operates across both business and technology domains. The Operating Model describes what is important for the organization. . We continue to remain focused on executing our merchandise MERCHANDISE. By this term is understood all those things which merchants sell either wholesale or retail, as dry goods, hardware, groceries, drugs, &c. It is usually applied to personal chattels only, and to those which are not required for food or immediate support, but such as remain initiatives and look forward to capitalizing on our opportunities during fiscal 2006." FISCAL YEAR PERFORMANCE: Net income for the fiscal year ended January 28, 2006 was $84.0 million or $1.50 per diluted share, compared to net income of $84.1 million or $1.47 per diluted share for the fiscal year ended January 29, 2005. Excluding the lease accounting correction, earnings were $87.0 million or $1.52 per share last year. Net sales for the fiscal year ended January 28, 2006 increased 24.9% to $1.204 billion, versus net sales of $964.2 million last year. Comparable store sales increased 3.5% for the full year, compared to an increase of 8.7% last year. FIRST QUARTER AND FULL YEAR GUIDANCE: The company announced its earnings guidance for the first quarter of fiscal 2006. The company believes it will achieve earnings in the range of $0.14 - $0.16 per diluted share, including the negative impact from $0.01 per share for stock option expense and $0.03 per share loss related to Jimmy'Z. For the first quarter of fiscal 2006, the company expects comparable store sales equal to or slightly below the same period last year. The company announced that it expects to achieve full year fiscal 2006 earnings per share growth of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 20%, including the negative impact from full year stock option expense of $0.04 per share. Based on the comparable fiscal 2005 pro-forma earnings Pro-Forma Earnings Projected earnings based on a set of assumptions and often used to present a business plan (in Latin pro forma means "for the sake of form"). It also refers to earnings which exclude non-recurring items. Pro-forma earnings are not derived by standard GAAP methods. per share of $1.47, after deducting $0.03 per share of pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma stock option expense, this earnings per share growth would be approximately 22%. STORE GROWTH: The company announced that it intends to open approximately 70-75 Aeropostale stores and up to 5 Jimmy'Z stores during fiscal 2006. During the fourth quarter of fiscal 2005 the company opened 6 Aeropostale stores and closed 4 Aeropostale stores, ending the year with 657 Aeropostale stores in 47 states. During the same period, the company opened 1 Jimmy'Z store, ending the year with 14 Jimmy'Z stores in 11 states. CAPITAL SPENDING capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. AND SHARE BUY BACK: The company has no debt and ended fiscal 2005 with $225.3 million in cash and short-term investments. The company is planning to invest approximately $54.0 million in capital expenditures for fiscal 2006 to open new Aeropostale and Jimmy'Z stores, to remodel re·mod·el tr.v. re·mod·eled also re·mod·elled, re·mod·el·ing also re·mod·el·ling, re·mod·els also re·mod·els To make over in structure or style; reconstruct. certain existing stores, to replace the existing point of sale systems, and to make certain information technology investments. The company incurred approximately $58.2 million in capital expenditures during fiscal 2005. As of January 28, 2006, the company had $41.9 million of repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. availability under its $150.0 million stock buy back program. During the fourth quarter of fiscal 2005, the company purchased approximately $9.0 million or 346 thousand shares of stock. For the full fiscal year 2005, the company purchased approximately $45.0 million or 1.8 million shares of stock. CONFERENCE CALL INFORMATION: The Company will be holding a conference call today at 4:15 P.M. to review its fourth quarter and fiscal 2005 results. The broadcast will be available through the 'Investor Relations' link at www.aeropostale.com and at www.fulldisclosure.com. To listen to the broadcast your computer must have Windows Media Player Digital jukebox software for Windows from Microsoft that plays a variety of audio, video and streaming formats including MP3, WMA, CD audio and MIDI. Starting with Version 6.2 in 1999, the Windows Media Rights Manager was added for securing copyrighted content. installed. If you do not have Windows Media Player go to the latter site prior to the call, where you can download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. the software for free. About Aeropostale, Inc. Aeropostale, Inc. is a mall-based, specialty retailer of casual apparel and accessories, principally targeting 11 to 18 year-old young women and men. The company provides customers with a focused selection of high-quality, active-oriented, fashion basic merchandise at compelling values. Aeropostale maintains control over its proprietary brands by designing, marketing and selling all of its own merchandise. Aeropostale products are currently purchased only in its stores, on-line thorough its website (www.aeropostale.com) or at organized sales events Noun 1. sales event - an occasion (usually brief) for buying at specially reduced prices; "they held a sale to reduce their inventory"; "I got some great bargains at their annual sale" cut-rate sale, sale at college campuses. The company currently operates 659 Aeropostale stores in 47 states and 14 Jimmy'Z stores in 11 states. SPECIAL NOTE: THIS PRESS RELEASE AND ORAL STATEMENTS MADE FROM TIME TO TIME BY REPRESENTATIVES OF THE COMPANY CONTAIN CERTAIN "FORWARD-LOOKING STATEMENTS forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " CONCERNING EXPECTATIONS FOR SALES, STORE OPENINGS, GROSS MARGINS, EXPENSES, STRATEGIC DIRECTION AND EARNINGS. ACTUAL RESULTS MIGHT DIFFER MATERIALLY FROM THOSE PROJECTED IN THE FORWARD-LOOKING STATEMENTS. AMONG THE FACTORS THAT COULD CAUSE ACTUAL RESULTS TO MATERIALLY DIFFER INCLUDE, AMONG OTHERS, CHANGES IN THE COMPETITIVE MARKETPLACE, INCLUDING THE INTRODUCTION OF NEW PRODUCTS OR PRICING CHANGES BY OUR COMPETITORS COMPETITORS, French law. Persons who compete or aspire to the same office, rank or employment. As an English word in common use, it has a much wider application. Ferriere, Dict. de Dr. h.t. , CHANGES IN THE ECONOMY AND OTHER EVENTS LEADING TO A REDUCTION IN DISCRETIONARY CONSUMER SPENDING Consumer demand or consumption is also known as personal consumption expenditure. It is the largest part of aggregate demand or effective demand at the macroeconomic level. ; SEASONALITY; RISKS ASSOCIATED WITH CHANGES IN SOCIAL, POLITICAL, ECONOMIC AND OTHER CONDITIONS AND THE POSSIBLE ADVERSE IMPACT OF CHANGES IN IMPORT RESTRICTIONS; RISKS ASSOCIATED WITH UNCERTAINTY RELATING TO relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc THE COMPANY'S ABILITY TO IMPLEMENT ITS GROWTH STRATEGIES, AS WELL AS THE OTHER RISK FACTORS SET FORTH IN THE COMPANY'S FORM 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. AND CURRENT REPORTS ON FORM 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. , FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE OR REVISE ANY FORWARD-LOOKING STATEMENTS TO REFLECT SUBSEQUENT EVENTS OR CIRCUMSTANCES CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or .
EXHIBIT A
AEROPOSTALE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
January 28, January 29,
2006 2005
-----------------------
ASSETS
Current Assets:
Cash and cash equivalents $205,235 $106,128
Short-term investments 20,037 76,224
Merchandise inventory 91,908 81,238
Other current assets 22,159 15,897
-------- ---------
Total current assets 339,339 279,487
Fixtures, equipment and improvements,
net 160,229 122,651
Other assets 4,383 3,681
-------- ---------
TOTAL ASSETS $503,951 $405,819
======== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $57,165 $44,858
Accrued expenses 69,188 52,136
-------- ---------
Total current liabilities 126,353 96,994
Other non-current liabilities 92,808 70,574
Stockholders' equity 284,790 238,251
-------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $503,951 $405,819
======== =========
EXHIBIT B
AEROPOSTALE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND
SELECTED STORE DATA
(in thousands, except per share and store data)
13 weeks ended
----------------------------------
January 28, 2006 January 29, 2005
----------------------------------
% of % of
sales sales
------- -------
Net sales (1) $435,246 100.0% $327,090 100.0%
Cost of sales (including certain
buying, occupancy and warehousing
expenses) 289,288 66.5 213,977 65.4
----------------------------------
Gross profit 145,958 33.5 113,113 34.6
Selling, general and administrative
expenses 77,589 17.8 56,172 17.2
----------------------------------
Income from operations 68,369 15.7 56,941 17.4
Interest income, net 1,308 0.3 642 0.1
----------------------------------
Income before income taxes 69,677 16.0 57,583 17.5
Income taxes 27,871 6.4 22,315 6.7
----------------------------------
Net income (2) $41,806 9.6% $35,268 10.8%
==================================
Basic net income per share (2) $0.77 $0.63
========== ==========
Diluted net income per share (2) $0.76 $0.62
========== ==========
Basic weighted average number of
shares outstanding 54,247 55,563
Diluted weighted average number of
shares outstanding 55,095 56,822
STORE DATA:
Comparable store sales 10.3% 1.9%
Stores open at end of period 671 561
Total gross square footage at end
of period 2,373,475 1,978,406
(1) - Net sales for the period ended January 28, 2006 included $2.4
million of miscellaneous revenues, which were previously recorded as a
reduction of cost of sales.
(2) - The period ended January 29, 2005 included a charge related to
the correction of lease accounting policies, which reduced net income
by $2.8 million, or by $0.05 per share.
EXHIBIT C
AEROPOSTALE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND
SELECTED STORE DATA
(in thousands, except per share and store data)
52 weeks ended
-----------------------------------
January 28, 2006 January 29, 2005
-----------------------------------
% of % of
sales sales
------- -------
Net sales (1) $1,204,347 100.0% $964,212 100.0%
Cost of sales (including certain
buying, occupancy and warehousing
expenses) 841,872 69.9 644,305 66.8
-----------------------------------
Gross profit 362,475 30.1 319,907 33.2
Selling, general and administrative
expenses 227,044 18.9 183,977 19.1
-----------------------------------
Income from operations 135,431 11.2 135,930 14.1
Interest income, net 3,670 0.3 1,438 0.1
-----------------------------------
Income before income taxes 139,101 11.5 137,368 14.2
Income taxes 55,147 4.5 53,256 5.5
-----------------------------------
Net income (2) $83,954 7.0% $84,112 8.7%
===================================
Basic net income per share (2) $1.53 $1.51
=========== ==========
Diluted net income per share (2) $1.50 $1.47
=========== ==========
Basic weighted average number of
shares outstanding 54,994 55,735
Diluted weighted average number of
shares outstanding 55,937 57,255
STORE DATA:
Comparable store sales 3.5% 8.7%
(1) - Net sales for the period ended January 28, 2006 included $2.4
million of miscellaneous revenues, which were previously recorded as a
reduction of cost of sales.
(2) - The period ended January 29, 2005 included a charge related to
the correction of lease accounting policies, which reduced net income
by $2.8 million, or by $0.05 per share.
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