PITTSBURGH — American Eagle Outfitters Inc. said Wednesday that its fiscal fourth-quarter net income surged 85 percent as it reduced inventory and sales improved.
But its earnings adjusted for unusual items missed Wall Street’s view, and it provided a first-quarter earnings forecast well below analysts’ estimates. The clothing company’s stock fell almost 9 percent in morning trading.
For the period ended Feb. 2, American Eagle Outfitters earned $94.8 million, or 47 cents per share. That’s up from $51.3 million, or 26 cents per share, a year ago when it had a $9.1 million loss from discontinued operations.
Excluding restructuring and store impairment costs and tax benefits in the latest quarter, earnings were 55 cents per share. Analysts predicted earnings of 56 cents per share, according to a FactSet poll.
Revenue climbed 9 percent to $1.12 billion from $1.03 billion, meeting Wall Street’s expectations.
Revenue at stores open at least a year rose 4 percent. This metric is a key gauge of a retailer’s health because it excludes results from stores recently opened or closed.
Total merchandise inventories fell 10 percent to $332 million at quarter’s end.
American Eagle Outfitters’ full-year net income increased 53 percent to $232.1 million, or $1.16 per share, from $151.7 million, or 77 cents per share, in the previous year. Annual revenue rose 12 percent to $3.48 billion from $3.12 billion.
The chain said that its results were helped by leaner inventory levels and reduced markdowns.
For the first quarter, American Eagle Outfitters foresees earnings between 16 cents and 19 cents per share. The company said the outlook is based on revenue at stores open at least a year declining in the mid-single digits.
The retailer said that it took into account the bad weather and unfavorable economic conditions that impacted consumer spending in February.
Analysts predict higher earnings of 25 cents per share for the quarter.
Shares of American Eagle Outfitters dropped $2.01, or 8.9 percent, to $20.54 in morning trading. Its shares have traded in a 52-week range of $14.44 to $23.94.
The Pittsburgh company boosted its quarterly dividend by 14 percent to 12.5 cents per share. The company said that the increased dividend will start in the second quarter. It also authorized a 20 million share repurchase program.