American Eagle Outfitters Inc. announced that Jennifer Foyle has been promoted to Chief Creative Officer, AEO Inc. effective immediately, reporting to Jay Schottenstein, Executive Chairman of the Board and Chief Executive Officer.
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In addition to her existing responsibilities as Aerie’s Global Brand President, Jen’s expanded role includes oversight of merchandising, design and marketing for the American Eagle brand. Chad Kessler, American Eagle Global Brand President, will report to Jen.
“Jen is a strategic brand visionary, with a proven ability to drive consistent profitable growth. She has led Aerie to incredible success, resulting in the quadrupling of sales and profits over the past five years. She brings passion, innovative thinking and an ability to infuse clear vision across product and marketing to create real connections with customers. In Aerie, we have one of the best brands in retail today, and I know Jen’s influence will be instrumental as we continue to drive our momentum and shape the future of American Eagle,” said Jay Schottenstein, Executive Chairman of the Board and Chief Executive Officer.
“I look forward to working with Chad and the team to build on AE’s many strengths and leading product lines to fuel the next chapter of growth. We also remain intensely focused on the vast opportunity ahead for Aerie,” said Jen Foyle, Chief Creative Officer, AEO Inc. and Aerie Global Brand President.
American Eagle Outfitters, Inc. also reported EPS of ($0.08) for the 13 weeks ended 1st August, 2020. This compared to $0.38 for the 13 weeks ended 3rd August, 2019. Adjusted EPS of ($0.03) this year excluded $0.05 of COVID-19 related expenses and restructuring charges and compared to adjusted EPS of $0.39 last year, which excluded $0.01 of restructuring costs.
Total net revenue for the 13 weeks ended 1st August, 2020 decreased $157 million, or 15% to $884 million, compared to $1.04 billion for the 13 weeks ended 3rd August, 2019. The decline to last year largely reflected store closures during the second quarter. Revenue in the year-ago period also included $40 million from Japanese license royalties.
By brand, American Eagle revenue decreased 26%, following a 1% decline last year. Aerie’s revenue increased 32%, following a 22% increase last year.
The company’s second quarter digital demand, as measured by ordered sales, increased 48%. Aerie digital demand rose 113% and AE increased 21%. AEO’s digital reported revenue increased 74%, reflecting the strong demand and a timing benefit related to the reversal of temporary fulfillment delays from the first quarter. Aerie digital revenue rose 142% and AE increased 47%.
Gross profit of $265 million compared to $383 million last year. The year-ago gross profit included an approximately $38 million benefit from Japanese license royalties. The decline to last year also reflected a reduction in store revenue and higher delivery and distribution center costs, primarily due to a strong digital business and higher cost per shipment. This was partly offset by lower rent expense and an increase in mark-up. As a rate to revenue, gross margin of 30.0% compared to 36.7% last year.
Selling, general and administrative expense of $224 million decreased $29 million from $253 million last year, primarily reflecting lower operating expenses due to store closures and disciplined cost controls.
Depreciation and amortization expense of $39 million decreased $6 million from $45 million last year, due to asset impairments taken in recent quarters, as well as lower capital spending.
Operating loss of $12 million compared to income of $82 million last year. Adjusted operating income of $2 million this year excluded $15 million of COVID-19 related expenses and restructuring charges and compared to adjusted operating income of $85 million last year, which excluded $3 million of restructuring charges. GAAP and adjusted operating income in the year-ago period included a $34 million benefit from Japanese license royalties.
Net interest expense of $9 million compared to net interest income of $2 million last year, reflecting interest expense associated with convertible notes and borrowings under the revolving credit facility this year.
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EPS of ($0.08) compared to EPS of $0.38 last year. Adjusted EPS of ($0.03) excluded $0.05 of COVID-19 related expenses and restructuring costs and compared to adjusted EPS of $0.39 last year, which excluded $0.01 of restructuring costs.