Fourth Quarter Earnings of $1.01 Per Diluted Share NEW YORK, March 12 /PRNewswire-FirstCall/ -- Aeropostale, Inc. (NYSE: ARO), a mall-based specialty retailer of casual apparel for young women and men, today reported results for the fourth quarter, provided guidance for the first quarter of fiscal 2009 and announced the name of its new kids store concept. Fourth Quarter Performance: Net income for the fourth quarter of fiscal 2008 increased 5% to a record $68.2 million, or $1.01 per diluted share, compared to net income of $64.7 million, or $0.95 per diluted share, in the fourth quarter of fiscal 2007. Total net sales for the fourth quarter of fiscal 2008 increased 17% to $690.0 million, from $591.3 million for the fourth quarter of fiscal 2007. Same store sales for the fourth quarter increased 6%, compared to a same store sales increase of 9% in the year ago period. Julian R. Geiger, Chairman and Chief Executive Officer, said, "We are extremely pleased with our record fourth quarter performance and our strong finish to fiscal 2008. The ongoing strength of our merchandise assortment, coupled with our powerful promotions, led to another record quarter and another record year. Throughout the year we have maintained strong brand momentum and we have executed consistently on our strategies to meet our corporate goals." Full Fiscal Year Performance Net income for fiscal 2008 increased 16% to a record $149.4 million or $2.21 per diluted share, compared to net income of $129.2 million or $1.73 per diluted share in fiscal 2007. Total net sales for the fiscal year ended January 31, 2009 increased 19% to $1.886 billion, from $1.591 billion in the year ago period. Same store sales for fiscal 2008 increased 8%, compared to a same store sales increase of 3% in the year ago period. First Quarter Guidance The Company announced its earnings guidance for the first quarter of fiscal 2009. The Company expects earnings in the range of $0.22 to $0.24 per diluted share for the first quarter, which includes charges of approximately $3.0 million, or $0.03 per diluted share related to the closing of the Jimmy'Z concept. The Company expects to record additional costs related to the Jimmy'Z closing of approximately $2.0 million, or $0.02 per diluted share, in the second quarter of fiscal 2009. Mr. Geiger concluded, "Moving into fiscal 2009, we are well positioned to continue building upon our significant accomplishments from last year. We are very pleased with the initial customer reaction to our spring merchandise assortment. We look forward to expanding the Aeropostale brand, both domestically and internationally, while also launching our new concept. We are very proud of the achievements we have made in our business, and we look forward to maximizing our opportunities in the coming year." Launch of P.S. from Aeropostale The Company also announced today the name of its new kids store concept - "P.S. from Aeropostale". The new concept will offer casual clothing and accessories for kids ages 7 to 12. "P.S. from Aeropostale" will draw from the core competencies of Aeropostale by offering the customer trend-right merchandise at compelling values. The innovative store format will be a fun, playful and inviting shopping experience for both the child and parent. The first "P.S. from Aeropostale" store is planned to open in June 2009, with an online launch at http://www.ps4u.com/ shortly thereafter. E-commerce Total net sales from the Company's e-commerce business for the fourth quarter of fiscal 2008 increased 88% to $41.4 million, from $22.0 million for the fourth quarter of fiscal 2007. Total net sales from the Company's e-commerce business for the fiscal year ended January 31, 2009 increased 85% to $79.1 million, from $42.8 million in the year ago period. Strong Cash Positioning The Company ended fiscal 2008 with cash and cash equivalents of $228.5 million, compared to $111.9 million last year. The Company currently has no debt outstanding. As of January 31, 2009, the Company had $150.0 million available under its revolving credit facility. Store Growth and Capital Spending The Company plans to invest approximately $55 million in capital for fiscal 2009 to open approximately 40 Aeropostale and approximately 10 P.S. from Aeropostale stores, remodel certain existing stores and make certain information technology investments. This compares to capital expenditures of approximately $83 million in fiscal 2008. Conference Call Information The Company will be holding a conference call today at 4:15 P.M. EDT to review its fourth quarter results. The broadcast will be available through the 'Investor Relations' link at http://www.aeropostale.com/ and http://www.fulldisclosure.com/. To listen to the broadcast your computer must have Windows Media Player installed. If you do not have Windows Media Player go to the latter site prior to the call, where you can download the software for free. About Aeropostale, Inc. Aeropostale, Inc. is a mall-based, specialty retailer of casual apparel and accessories, principally targeting 14 to 17 year-old young women and men. The Company provides customers with a focused selection of high-quality, active-oriented, fashion and fashion basic merchandise at compelling values. Aeropostale maintains control over its proprietary brands by designing, sourcing, marketing and selling all of its own merchandise. Aeropostale products can only be purchased in its stores or on-line through its e-commerce website (http://www.aeropostale.com/). The Company currently operates 874 Aeropostale stores in 48 states and Puerto Rico and 29 Aeropostale stores in Canada. SPECIAL NOTE: THIS PRESS RELEASE AND ORAL STATEMENTS MADE FROM TIME TO TIME BY REPRESENTATIVES OF THE COMPANY CONTAIN CERTAIN "FORWARD-LOOKING STATEMENTS" 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, CHANGES IN THE COMPETITIVE MARKETPLACE, INCLUDING THE INTRODUCTION OF NEW PRODUCTS OR PRICING CHANGES BY OUR COMPETITORS, CHANGES IN THE ECONOMY AND OTHER EVENTS LEADING TO A REDUCTION IN DISCRETIONARY CONSUMER SPENDING; 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 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 AND QUARTERLY REPORTS ON FORM 10-Q, 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. Company Contact: Kenneth Ohashi/VP, Investor & Media Relations (646) 452-1876 or Media Contact: Leigh Parrish/Diane Zappas, FD (212) 850-5600 EXHIBIT A AEROPOSTALE, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) January 31, February 2, 2009 2008 ----------- ----------- ASSETS Current Assets: Cash and cash equivalents $228,530 $111,927 Merchandise inventory 126,361 136,488 Other current assets 39,967 36,272 ------ ------ Total current assets 394,858 284,687 Fixtures, equipment and improvements, net 248,999 213,831 Other assets 14,822 15,651 ------ ------ TOTAL ASSETS $658,679 $514,169 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable $77,248 $99,369 Accrued expenses 98,993 98,018 ------ ------ Total current liabilities 176,241 197,387 Other non- current liabilities 127,422 119,506 Stockholders' equity 355,016 197,276 ------- ------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $658,679 $514,169 ======== ======== 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 31, 2009 February 2, 2008 -------------------- --------------------- % of sales % of sales ---------- ---------- Net sales (1) $690,017 100.0% $591,289 100.0% Cost of sales (including certain buying, occupancy and warehousing expenses) 446,500 64.7 367,511 62.2 ------- ---- ------- ---- Gross profit 243,517 35.3 223,778 37.8 Selling, general and administrative expenses 130,055 18.8 116,792 19.8 Jimmy'Z asset impairment charges (1) - - 9,023 1.5 Other income (1) - - 4,078 0.7 --- --- ----- --- Income from operations 113,462 16.5 102,041 17.2 Interest income, net (20) 0.0 587 0.1 ---- --- --- --- Income before income taxes 113,442 16.5 102,628 17.3 Income taxes 45,217 6.6 37,893 6.4 ------ --- ------ --- Net income $68,225 9.9% $64,735 10.9% ======= ==== ======= ===== Basic earnings per share $1.02 $0.96 ===== ===== Diluted earnings per share $1.01 $0.95 ===== ===== Weighted average basic shares 66,822 67,489 Weighted average diluted shares 67,440 67,995 STORE DATA: Comparable store sales increase 6% 9% Stores open at end of period 914 828 Total square footage at end of period 3,284,614 2,935,214 Average square footage during period 3,296,466 2,933,759 (1) Amounts for the quarter ended February 2, 2008 were favorably impacted by initial gift card breakage income of $7.7 million ($4.8 million, after tax, or $0.06 per diluted share), or 1.3% of sales and by other income of $4.1 million ($2.6 million, after tax or $0.04 per diluted share), or 0.7% of sales. These amounts were partially offset by Jimmy'Z asset impairment charges of $9.0 million ($5.7 million, after tax, or $0.08 per diluted share), or 1.5% of sales. 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 31, 2009 February 2, 2008 ---------------------- ---------------------- % of sales % of sales ---------- ---------- Net sales (1) $1,885,531 100.0% $1,590,883 100.0% Cost of sales (including certain buying, occupancy and warehousing expenses) 1,231,349 65.3 1,037,680 65.2 --------- ---- --------- ---- Gross profit 654,182 34.7 553,203 34.8 Selling, general and administrative expenses 405,883 21.5 345,805 21.7 Jimmy'Z asset impairment charges (1) - - 9,023 0.6 Other income (1) - - 4,078 0.3 --- --- ----- --- Income from operations 248,299 13.2 202,453 12.8 Interest income, net 510 0.0 6,550 0.4 --- --- ----- --- Income before income taxes 248,809 13.2 209,003 13.2 Income taxes 99,387 5.3 79,806 5.0 ------ --- ------ --- Net income $149,422 7.9% $129,197 8.2% ======== ==== ======== ==== Basic earnings per share $2.24 $1.74 ===== ===== Diluted earnings per share $2.21 $1.73 ===== ===== Weighted average basic shares 66,832 74,315 Weighted average diluted shares 67,576 74,846 STORE DATA: Comparable store sales increase 8% 3% Average square footage during period 3,139,515 2,814,679 (1) Amounts for the fiscal year ended February 2, 2008 were favorably impacted by initial gift card breakage income of $7.7 million ($4.8 million, after tax, or $0.07 per diluted share), or 0.5% of sales and by other income of $4.1 million ($2.6 million, after tax or $0.04 per diluted share), or 0.3% of sales. These amounts were partially offset by Jimmy'Z asset impairment charges of $9.0 million ($5.7 million, after tax, or $0.08 per diluted share), or 0.6% of sales. DATASOURCE: Aeropostale, Inc. CONTACT: Company Contact, Kenneth Ohashi/VP, Investor & Media Relations, +1-646-452-1876, ; or Media Contact, Leigh Parrish or Diane Zappas, FD , +1-212-850-5600 Web Site: http://www.aeropostale.com/

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