The expansion announcement comes as Aeropostale closed on a third quarter that produced record sales and strong earnings on the verge of what the company expects to be a robust holiday season. The mall-based retailer, which operates more than 700 stores that cater to 11 to 18-year-olds, says net income for the quarter ended Oct. 28 rose by 25% to $32.6 million, or 61 cents per share, a gain of more than $6 million over the prior year's quarter when it earned $26.1 million, or 47 cents per share.
Sales for the quarter were up 18.7% to a record $385.5 million, from $324.7 million in the year-ago period while comparable store sales rose 5.6% against a 1.5% drop in comparable store sales during the third quarter of 2005.
"During the quarter, we experienced solid sales and margin growth in classifications which will continue to drive our business for the remainder of the year," Julian R. Geiger, Aeropostale's chairman and CEO said, adding that the results exceeded company expectations.
Geiger attributed the company's strong third-quarter performance to the success of several initiatives, including improvements to merchandising assortments.
"We are very pleased with what we accomplished in the past 12 months and 2007 looks to be a promising year," he told analysts in a conference call.
For November, comparable store sales were up 1% and total sales for the month jumped 11.5% to more than $15 million from $134.3 million in the year ago period to $149.7 million, the company said. Driven by deep discount promotions, same store sales rose to the mid-single digits for the two prime shopping days after Thanksgiving, Aeropostale said. That compares to a 30% jump in comparable store sales on the same days in 2005.
For the fourth quarter, Aeropostale says it expects earnings of 89 cents to 91 cents, on par with the 90 cents expected by analysts.
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