Aéropostale Inc. narrowed its fourth-quarter loss, but shares declined further in after-market trading on a weak first-quarter forecast.
Shares of Aéropostale closed down 6.8 percent to $3.70 in Big Board trading Thursday, but then fell another 6 percent to $3.48 in after-market trading. The company reported results after the markets closed.
The teen retailer posted a loss of $13.5 million, or 17 cents a diluted share, for the three months ended Jan. 31, compared with the year-ago loss of $70.3 million, or 90 cents. On an adjusted basis, after excluding certain charges, the company had net income of $400,000, or 1 cent a diluted share. Net sales were down 11.4 percent to $593.8 million from $670 million. Comparable-store sales decreased 9 percent on top of the 15 percent decline a year ago.
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Still, the results were better than expected as analysts’ consensus estimate was a loss of 3 cents on sales of $576.8 million.
For the year, the loss widened to $206.5 million, or $2.62, from $141.8 million, or $1.81, in 2013. Net sales fell 12.1 percent to $1.84 billion from $2.09 billion.
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The after-market sell-off was triggered by a weak first-quarter forecast. The company said it expects a loss of between 53 cents and 61 cents a diluted share. Wall Street analysts were forecasting a loss of 35 cents.
Julian Geiger, chief executive officer, said: “Achieving our first operating profit in eight quarters is a noteworthy accomplishment,” noting the profit in the period on an adjusted basis. He cited “better-than-expected margins and expense savings” as reasons for the improvement.
But while the company saw improvement in the quarter due to a shift in strategies, Geiger also said there are “challenging trends” in the first quarter as the company continues to see softness in “consumer demand as a result of weak traffic.”