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American Eagle Nabs New CEO as Sales Soar

Jay Schottenstein has been named chief executive officer at American Eagle Outfitters (AEO), nearly two years after he stepped into the role on an interim basis.

The news was announced Wednesday, the same day the teen retailer reported that third-quarter revenue rose 8 percent to $919 million—up from $854 million for the same period a year ago—and the board has credited Schottenstein with guiding what it has called a “swift recovery.”

“He has exceptional instincts for our brands, a strong strategic vision and proven ability to lead the company to profitable growth,” said Michael Jesselson, lead independent director for AEO’s board of directors.

Earnings per share (EPS) for continuing operations were $0.35 for the three months ended Oct. 31—a 59 percent increase from adjusted EPS of $0.22 for the same quarter in 2014.

Additionally, consolidated comp-store sales increased 9 percent, compared to a 5 percent decrease in the year-ago period, which Schottenstein said was down to both the American Eagle and Aerie brands performing “exceptionally well.”

“It is gratifying to see positive momentum,” he said, “which speaks volumes to the strength of our teams, brands and operations.”

Q4 looks positive

On an inventory basis, total merchandise at the end of the third quarter increased 2 percent to $480 million, versus the $469 million reported last year. The company said inventory for the end of the fourth quarter at cost is expected to increase to the high single-digits, citing earlier receipts as it “laps last year’s delays caused by the port slowdown.”

Schottenstein also noted that the holiday season is off to a “solid start” and, based on an anticipated increase in comparable sales in the mid-single digits, management expects fourth-quarter EPS to be around $0.40 to $0.42.

“Nearly two years ago, we set priorities to strengthen the merchandise, reinvigorate our brands and deliver profit improvement,” said Schottenstein, who previously served as CEO from March 1992 to December 2002. “As a result, we have achieved several quarters of sales and earnings growth in a tough retail landscape. This success is a true testament to the strength of our leadership team, dedication and talent of our associates and the power of our brands.”