American Eagle Outfitters, Inc. · NYSE:AEO
American Eagle Outfitters — Q1 2023 Earnings Presentation
28 slides from American Eagle Outfitters's earnings presentation, May 24, 2023
Slide 1: First Quarter 2023 Investor Presentation
FIRST QUARTER 2023 Investor Presentation
Slide 2: Safe Harbor Statement Under The Private Securities Litigation Reform Act Of 1995
Safe Harbor Statement Under The Private Securities Litigation Reform Act Of 1995 This release and related statements by management contain forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995), which represent our expectations or beliefs concerni
Slide 3: Non-GAAP Measures
Non-GAAP Measures This presentation includes information on non-GAAP financial measures (“non-GAAP” or “adjusted”), including consolidated adjusted operating income, net income and net income per diluted share, excluding non-GAAP items. These financial measures are not based on any standardized method
Slide 4: First Quarter Fiscal 2023 Results
First Quarter Fiscal 2023 Results Record first quarter revenue, up 2% to last year. Adjusted operating profit of $44 million, up to last year. Aerie posted all-time high first quarter revenue and profitability with positive comp growth. American Eagle continued to see a sequential improvement in revenue
Slide 5: CEO Commentary on First Quarter
“We entered 2023 with a cautious plan, balancing continued optimism for our brands with the flexibility to navigate uncertainty in the macro environment. I am pleased to note that this strategy delivered for us, as we successfully managed through the first quarter and achieved results in-line with pl
Slide 6: Key Highlights and Inventory Data (unaudited)
Key Highlights (unaudited) FIRST QUARTER 2023 2022 TOTAL NET REVENUE CHANGE 2% 2% GROSS MARGIN 38.2% 36.8% SELLING, GENERAL & ADMINISTRATIVE EXPENSES 28.9% 28.3% ADJUSTED OPERATING MARGIN(1) 4.1% 4.0% ADJUSTED EPS(1) $0.17 $0.16 (1) Results shown are on a non-GAAP basis and exclude certain charges f
Slide 7: First Quarter Net Revenue
First Quarter Net Revenue Total Company Revenue Up 2%; Stores Revenue Up 5%; Digital Revenue Down 4% AMERICAN EAGLE AERIE TOTAL AEO $1081M $1055M $686M $671M $359M $322M 1Q22 1Q23 1Q22 1Q23 1Q22 1Q23 Net Revenue Down 2% YOY Net Revenue Up 12% YOY Net Revenue Up 2% YOY
Slide 8: First Quarter Operating Income
First Quarter Operating Income Total Company Adjusted Operating Income of $44M AMERICAN EAGLE AERIE CORPORATE AND OTHER1 TOTAL AEO Operating Margin Operating Margin Adjusted Operating 16.0% 15.8% Margin 4.1% -$120M $107M $104M -$105M $57M $43M $42M $44M 1Q22 1Q23 1Q22 1Q23 1Q22 1Q23 1Q22 1Q23 (1) Co
Slide 9: Outlook
Outlook For the second quarter, management’s outlook reflects revenue in the range of flat to down low-single digits to last year with operating income in the range of $25 to $35 million. This assumes gross margin recovery year-over-year as the company cycles pressure from end of season sell-offs and
Slide 10: Results by Segment (Dollars in Thousands) (unaudited)
Results by Segment (Dollars in Thousands) (unaudited) (1) Corporate and Other includes revenue and operating results of the Todd Snyder brand, Unsubscribed brand, and Quiet Platforms (net of intersegment eliminations), which have been identified as separate operating segments, but are not material t
Slide 11: Statement of Operations Summary-GAAP Basis (unaudited)
Statement of Operations Summary-GAAP Basis (unaudited)
Slide 12: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation (1) $21.3 million pre-tax impairment, restructuring and other charges related to Quiet Platforms as the Company repositions for improved profitability including: - $10.8 million of long-lived asset impairment charges - $5.6 million of employee related costs - $4.9 mil
Slide 13: Liquidity and Capital Allocation
Liquidity and Capital Allocation
Slide 14: 1Q23 Liquidity and Capital Allocation Priorities
1Q23 LIQUIDITY Capital Allocation Priorities 1 $659M* Investments to Fuel Aerie’s Growth & Build Capabilities $118M 2 Preserving Balance Sheet Strength Cash & Cash Equivalents Total Available Liquidity 3 of dividends and share repurchases Direct Shareholder Returns through a combination *Includes $5
Slide 15: Balance Sheet Summary (unaudited)
Balance Sheet Summary (unaudited)
Slide 16: Real Estate Highlights
Real Estate Highlights
Slide 17: 1Q Real Estate Summary (unaudited)
1Q Real Estate Summary (unaudited) Consolidated stores at beginning of period 1,175 Consolidated stores opened during the period AE BRAND(2) 4 Aerie (incl. OFFL/NE)(3) 2 Todd Snyder 1 Consolidated stores closed during the period (1) International license locations are not included in the consolidate
Slide 18: Historical Quarterly Store Data by Brand (unaudited)
Historical Quarterly Store Data by Brand (unaudited) STORE COUNTS SQFT BY BRAND (1) Total Stores includes Todd Snyder and Unsubscribed
Slide 19: AE North America Store Footprint
AE North America Store Footprint Closed 83 stores since FY19, reflecting a 9% reduction in square footage NORTH AMERICAN STORES FY19 FY20 FY21 FY22 1Q23 931 892 867 846 848 Weighted Average Square Footage* FY19 FY20 FY21 FY22 1Q23 5,984 5,904 5,692 5,562 5,448 North America includes stores in the U.S
Slide 20: Historical Financials
Historical Financials
Slide 21: Historical Financial Information - GAAP Basis
Historical Financial Information - GAAP Basis Fiscal 2022 Fiscal 2023 (1) In Q1 2022, the Company adopted ASU 2020-06 under the modified retrospective method, which requires the Company to utilize the "if-converted" method of calculated diluted EPS. (2) Comparable sales includes results from Todd Sn
Slide 22: Historical Operating Income Reconciliation
Historical Operating Income Reconciliation (1) In fiscal 2022, the Company recorded impairment charges of $20.6 million primarily related to store property and equipment and operating lease ROU assets. In fiscal 2021, the Company recorded impairment charges of $11.9 million primarily related to stor
Slide 23: REAL Power. REAL Growth. Value Creation Plan
REAL Power. REAL Growth. Value Creation Plan
Slide 24: Brands designed to empower customers to be their real, authentic selves
Fueled by optimism, our brands are designed to empower our customers to be their real, authentic selves.
Slide 25: Customer Centric Omni Channel Retailer With Strong Digital Presence
Customer Centric Omni Channel Retailer With Strong Digital Presence $5.0B $5.0B* Digital 13% 6-Year CAGR $4.3B $1.8B $1.7B $4.0B $3.8B $1.3B $3.8B $3.6B $1.1B COVID IMPACTED $1.0B $0.8B $0.8B $1.7B $3.1B $3.0B $2.9B $2.9B $3.0B $2.8B $2.8B $2.1B 2016 2017 2018 2019 2020 2021 2022 DIRECT REVENUE STOR
Slide 26: Value Creation Plan
Value Creation Plan • Grow Aerie to $2 Billion+ in Revenue • Drive Sustained Profitable Growth at American Eagle • Leverage Customer-Focused Capabilities • Strengthen ROI Discipline • Power of People, Culture and Purpose
Slide 27: Aerie's Roadmap and Profitable Growth at American Eagle
Aerie’s Roadmap to Drive Sustained Profitable $2 Billion+ in Revenue Growth at American Eagle 1 Winning in Intimates & Lounge 1 Refresh Brand DNA 2 Activewear Product Extension 2 Complete The Outfit 3 Market Expansion 3 Optimize Inventory 4 New Customer Acquisition 4 Right-Size Store Footprint
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