The stock closed out the morning at $3.45, down $1.07 or 23.7 percent, after hitting a 52-week low of $3.37, their lowest mark in more than 10 years. Shares hit their 52-week high of $16.82 exactly one year ago.
Analysts expressed concern both about the chain’s liquidity and its ability to catch on with shoppers in the youth market, which has shown a growing affection for fast-fashion retailers at the expense of conventional teen merchants.
Late Thursday, the New York-based specialty chain, spun off in 2002 from a private label initiative at Macy’s, reported a $76.8 million loss, greater than analysts expected as well as that of a year ago. Sales contracted 12.5 percent to $395.9 million and declined 13 percent on a same-store basis.
The projected loss of between 55 and 61 cents a share for the second quarter was also deeper than the 29-cent-a-share loss expected by analysts prior to the first-quarter report.
Jefferies analyst Randal Konik lauded the company’s “little victories” in the first quarter but said they were “not enough to move the needle. The relative outperformance of fashion product and newer sub-brands is encouraging, just not enough to offset deterioration of the core businesses.” He also noted the firm’s 3.9 percent decline in inventories as a positive.
“We laud management’s fervor toward attacking every angle possible to stabilize the business, be it store closures, securing external financing, reducing [capital expenditures],” he wrote in a note to clients. “Still, many quarters into the downturn, the dots aren’t connecting in terms of the financial results or outlook.”
Wells Fargo analyst Paul Lejuez estimated that Aéropostale’s cash burn for the current year would be $100 million and about $49 million in fiscal 2015. “Though ARO has found some wins in fashion — Live Love Dream, Bethany Mota, Tokyo Darling — the basic and core fashion business, 85 percent of the assortment, remains pressured,” he wrote.
Investors and analysts had also hoped that the first-quarter report would bring an update on the company’s plan to raise $150 million through a cash infusion from Sycamore Partners, which many now expect to close next month.
“Although the company has a $230 million revolver in place, without the closure of the Sycamore deal, liquidity becomes a major issue as the company burns through cash in efforts to restructure the business,” said Eric Beder, Brean Capital analyst, who reiterated his “hold” rate for the stock.
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews
“Stranger Things” is getting a new cast member for season 2. Meet @sadiesink_, the 15-year-old who will be joining the Netflix series for its new season. You may recognize her from “The Glass Castle” with Brie Larson and Woody Harrelson, but the Texas native’s next role goes in an entirely different direction. She describes her character, Max, as “a rough and tumble skater girl [who] becomes friends with the boys at school.” The second season debuts on October 27. (📷: @jgreenery) #wwdeye
Amid the Harvey Weinstein controversy, there’s another sector that’s being put under the spotlight for sexual abuse: the modeling industry. While rumors about abuse and sexual harassment of female and male models — and the photographers, agents and others who perpetrated it — have circulated within the fashion world for years, model @cameronrussell started posting stories from models on Instagram last week about abusive situations they’ve encountered — from sexual harassment and molestation to attempted rape. Over 75 have weighed in so far. Read more on WWD.com. Link in bio. #wwdnews
To celebrate its 16th anniversary, @dylanscandybar tapped designers and celebrities to create mosaics out of candy. The mosaics will be auctioned off to support the philanthropic cause of each participant’s choice. Pictured here is the mural created by @aliceandolivia's Stacey Bendet. For a first look at some of the other artwork being unveiled tonight, go to WWD.com. #wwdeye
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye
"Nowadays when life is not so happy with everything going on in the world, I think people come to me for a little bit of whimsy and color and fun." - Designer Rebecca De Ravenel on her cult-favorite jewelry line. (📸 : @vsteves) #wwd40
“Everyone is talking about how the retail industry is struggling, but I think it’s an incredible time because brands who are doing something different and innovative are setting themselves up for the future,” said @adamgoldston, who founded the luxury athletic brand @apl with his brother @ryangoldsten. The Goldston’s are part of WWD’s 40 under 40: a group of industry notables. See the rest of the list on WWD.com. (📷: @vsteves) #wwd40
@eyeswoon blogger Athena Calderone debuted her first-ever cookbook, “Cook Beautiful,” which is heavily centered on the presentation and visual expression of food. Pictured here are her miso glazed carrots from the book. Get the recipe on WWD.com. (📷: @johnny_miller_) #wwdeye