American Apparel Reports First Quarter 2009 Financial Results
American Apparel Inc., a vertically integrated manufacturer, distributor and retailer of branded fashion basic apparel, announced its financial results for the first quarter of 2009.
The company reported net sales for the quarter ended March 31, 2009 of $114.3 million, a 2.4 percent increase over net sales of $111.6 million for the quarter ended March 31, 2008. Total retail sales increased 16.5 percent to $78.0 million for the first quarter of 2009 as compared to $67.0 million for the same period in 2008, with comparable store sales for stores open at least 12 months declining 7 percent.
American Apparel ended the quarter with 264 stores, having added 4 net new stores in the period. The company operated 186 stores at the end of the first quarter of 2008. Total wholesale sales, excluding online consumer sales, were $28.1 million for the first quarter of 2009 as compared to $36.0 million for the first quarter of 2008, a decrease of 21.9 percent. Sales to third-party wholesale customers in the company's U.S. wholesale segment declined 27.4 percent, as a result of decreased end-user demand given the unfavorable economic environment. Slightly more than a third of the reduction in third-party wholesale sales was a result of significantly reduced sales to the company's largest distributor, as the company decided to limit its credit exposure to this customer which was in the process of an exchange offer with bondholders to restructure its debt to avoid a bankruptcy filing. Total online consumer sales decreased 5.5 percent to $8.2 million in the first quarter 2009 versus $8.6 million for the first quarter of 2008. The decrease was primarily to customers in the U.S., the result of the combined impact of a reduction in online advertising spend and the cannibalization of online sales by the company's significantly expanded brick-and-mortar retail footprint in the U.S.