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Aéropostale Credits Its Fashion for Growth

Julian Geiger, ceo of Aéropostale, says teen specialty chain has outperformed competitors without focus on price.

Aéropostale Inc.’s recent sales growth is a function of fashion, not pricing.

That’s the message that Julian Geiger, chairman and chief executive officer of the New York-based teen specialty store chain, delivered in remarks following an upbeat annual meeting at its headquarters Thursday.

“Lots and lots of people are talking price point,” he told WWD. “In my mind that is secondary. The young customer is very smart.”

Aéropostale’s core customers — who average between the ages of 14 and 17 — are also “turned off” by brands they see as “arrogant and fake.”

The same genuine feeling that lifted the chain to sales of $1.89 billion last year — as well as to same-store sales increases of 19 percent in May and 20 percent in April — is expected to help the company’s new P.S. concept, aimed at seven- to 12-year-olds, establish a niche in children’s wear. Geiger expects to expand P.S. into a 500-store chain over the course of 10 years and, in the more immediate future, anticipates Aéropostale growing to 1,100 units from 914.

But Geiger said the company is “not limited to two concepts,” and he is “prudently confident” in its future expansion.

“In the end, businesses that are run well thrive and prosper,” he said, “and businesses that are run poorly don’t.”

Echoing the sentiments of analysts who cover the firm, Ken Ohashi, vice president of investor and media relations, credited much of the company’s improved merchandise to president and chief merchandising officer Mindy Meads. Ohashi said Meads has helped the retailer develop its own fashion by looking less at competitors’ lines, and more at emerging trends.

“We don’t chase our competition anymore,” he said.

Shares of Aéropostale Thursday closed at $35.08, up 41 cents, or 1.2 percent. The 52-week high of $37.96 was reached on May 6.