Aéropostale, Inc. (ARO)
Q2 2009 Earnings Call
August 20, 2009 04:15 PM ET
Kenneth Ohashi - Vice President, Investor and Media Relations
Julian R. Geiger - Chairman and Chief Executive Officer
Mindy C. Meads - President and Chief Merchandising Officer
Michael J. Cunningham - Executive Vice President and Chief Financial Officer
Thomas P. Johnson - Executive Vice President and Chief Operating Officer
Christine Chen - Needham & Company
Betty Chen - Wedbush Morgan
Jeff Klinefelter - Piper Jaffray
Roxanne Meyer - UBS
Michelle Tan - Goldman Sachs
Stacy Park - SP Research
Edward J. Yruma - KeyBanc Capital Markets
Brian Tunick - JPMorgan
John Morris - BMO Capital Markets
Kimberly Greenberger - Citigroup
Janet Kloppenburg - JJK Research
Dana Telsey - Telsey Advisory Group
Laura Champine - Cowen and Company
Michelle Clark - Morgan Stanley
Linda Tsai - MKM Partners
Robin Murchinson - SunTrust Robinson Humphrey
Richard Jaffe - Stifel Nicolaus
Marni Shapiro - The Retail Tracker
Howard Tubin - RBC Capital Markets
Lorraine Hutchinson - Bank of America Merrill Lynch
Previous Statements by ARO
» Aeropostale Inc. Q4 2008 Earnings Call Transcript
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» Aeropostale, Inc. Q2 2008 Earnings Call Transcript
I would now like to introduce Ken Ohashi, the company's Vice President of Investor and Media Relations. Please go ahead sir.
Thank you all for joining us this afternoon. With me here today are Julian Geiger, our Chairman and Chief Executive Officer; Mindy Meads, our President and Chief Merchandising Officer; Tom Johnson, our Chief Operating Officer; and Michael Cunningham, our Chief Financial Officer.
We issued a press release earlier this afternoon announcing our second quarter financial results. A copy of the release can be found on our corporate website.
Before we begin, I'd like to remind you that during this earnings conference call certain statements and responses to questions may contain forward-looking information such as forecast of the future financial performance. Forward-looking information and statements involve known and unknown risks and uncertainties which may cause our actual results and future periods to differ materially from our forecasted results. Those risks are described on our report on Form 10-K and our quarterly reports on Form 10-Q, all of which have been filed with the SEC and are available on our website.
We undertake no obligations up date or revise any forward-looking statements to reflect subsequent events or circumstances. Listeners of this call are referred to those filings. Before I turn the call over to Julian, I would like to ask everyone to limit themselves to one question during our Q&A session to allow everyone a chance to speak. Once we've gone through the round of questions, we will go back and you may queue up again at that time.
I would now like to turn the call over to Julian.
Julian R. Geiger
Thanks, Ken. Good afternoon, everyone. All of us thank you for participating in today's conference call.
As you can well imagine, we are very pleased with our results for the second quarter which once again exceeded expectations. Our performance represented another period of record-setting sales, record-setting operating margins and record-setting earnings. At this point, I would like to highlight some of the key financials of the quarter for you.
Net earnings were a record $0.57 per share, an 84% increase over the same period last year. Net sales increased 20% to a record $453 million. Same stores sales increased 12% on top of an 11% increase last year. Net sales from our e-commerce business increased 49% to $15.8 million and operating margins increased 480 basis points, driven by increased merchandise margins, by strategic expense controls and by the leverage of our business.
Results such as these are not the by-product to good luck. They are the direct result of the expertise, commitment and determination of an entire organization. Mindy, Tom, Michael and I thank everyone within the Aéropostale family for their impressive contributions to an outstanding second quarter and a memorable first half of fiscal 2009.
The ability of our organization to excel even in times of economic distress, clearly underscores not only our unique culture and competitive spirit, but also the real power of the Aéropostale brand. It is reassuring to know that the current generation of teen customers has truly embraced Aéropostale as one of its top brands of choice.
Today's teenage customers are uniquely sophisticated, knowing exactly what they want to wear and enormously pragmatic understanding just how much they are willing to pay for their cloths. Our entire product development team has done an outstanding job understanding our customer and delivering to them a fresh focused and balanced merchandise assortment. Our unique positioning as a promotional specialty store enables us to bring fashion and value to our stores in a compelling and consistent manner.
Clearly this is a winning combination, no wonder we anticipate being important to the customer for many seasons to come.
Now, I will turn the call over to Mindy, who will discuss some of the merchandising highlights of the second quarter with you.
Mindy C. Meads
Thank you, Julian. During the second quarter, the entire team did an excellent in executing on merchandising strategies and our promotional plans. We continue to drive increases in the same-store sales, merchandise margins, store transaction and average unit retail.
Now, let me take you through some of the highlights from the quarter. We experienced strength in both genders; woman's up low double-digit and men's up mid teen.