NEW YORK — Hot Topic stayed hot in June and Aeropostale continued to soar.
This story first appeared in the July 10, 2003 issue of WWD. Subscribe Today.
Retailers are due to report their June same-store sales today but Hot Topic said Wednesday that same-store sales in June were up 3.5 percent as overall sales jumped 22.2 percent to $42.4 million. Aeropostale said comparable-store sales were up 8.7 percent during the month and 41.7 percent overall, to $45.9 million.
While the two youth specialty stores added to the momentum established Tuesday when, as reported, both Chico’s FAS and Pacific Sunwear of California reported double-digit increases in June comps, the higher-comp procession was interrupted Wednesday by American Eagle Outfitters, which continued to struggle, particularly in its men’s business. AEO’s comps for the month fell 5.7 percent.
“Sales throughout June met our expectations, with positive comps in each of the five weeks and in each geographic region for the month,” said Betsy McLaughlin, president and chief executive of Hot Topic, in a statement.
Leading HT’s results, somewhat uncharacteristically, was the men’s classification, up 9 percent on a comp basis, while music-licensed apparel was up 4 percent, and women’s and accessories ahead 2 percent.
The City of Industry, Calif.-based company, which operates 450 HT stores and 40 Torrid units, said on a prerecorded call that similar to recent months, the June comp increase is because of an increase in the average number of transaction per store. In June, the average number of transactions per store rose 3 percent, average units per transactions were flat and the average transaction value fell by 2 percent to $21.
With a midteen increase, women’s was the strongest part of Aeropostale’s 8.7 percent jump, but men’s rose in the low-single digits as accessories fell at the same pace. Women’s and men’s accounted for 60 and 27 percent of sales during the month versus 56 and 30 percent, respectively, a year ago.
The company, with 413 stores, said inventory levels and gross margins continue to track inline with expectations. Transactions for the month were flat, while units per transaction were up in the low double-digit range.
At American Eagle, AE stores dwindled 5.3 percent and the Bluenotes/Thriftys decreased by 10.8 percent in June. Total sales increased 5.3 percent to $128.2 million from $121.7 million, including $7.7 million from Bluenotes/Thriftys.
“While our June business was choppy at times, overall results were inline with expectations,” Laura Weil, chief financial officer, said on a call. “Our top priority is to clear through spring-summer merchandise and enter fall with lean inventories and a clean, fresh assortment.”
She said the summer sale event drove business in June, leading to a high-single-digit decline in the average unit retail price. However, the number of units sold per store increased in the high-single digits and unit per transaction rose in the low-double digits.
Regarding the second quarter, AE said it expects to report earnings per share in a range of 10 cents to 12 cents, which is based on a July comparable-store sales decline in the mid-to-low single digits. In last year’s quarter, AE reported EPS of 14 cents.
Also reporting Wednesday, San Diego-based Factory 2-U Stores completed a trio of consecutive monthly increases, this time a 3 percent rise. Bill Fields, chairman and chief executive, said in a statement he is targeting July comps to be in the range of between negative 2 percent and positive 2 percent.