American Eagle Outfitters Inc. said Tuesday that its profit climbed in the third quarter as the prior-year period was weighed down by an impairment charge.
The apparel retailer said it expects to remain competitive and build market share partly through attractive pricing. Many shoppers have looked for bargains at retailers during the recession, prompting businesses to lower their prices to increase traffic.
American Eagle's earnings grew 39 percent to $59.2 million, or 28 cents per share, from $42.6 million, or 21 cents per share, during the same period a year earlier.
Year-ago results included an impairment charge of $19.9 million.
Taking out a tax benefit of about 7 cents per share, the current quarter's profit was 21 cents per share.
This met the expectations of analysts surveyed by Thomson Reuters, whose estimates typically exclude one-time items.
Revenue for the three months ended Oct. 31 dipped 1 percent to $749 million from $754 million, with sales at stores open at least a year off 4 percent.
The total revenue results beat Wall Street's estimate for sales of $748.3 million.
American Eagle said sales at stores open at least a year are down 5 percent through the first three weeks of November.
Merchandise inventory rose 1 percent to $425 million on new stores and growth at AEO Direct, which includes ae.com, aerie.com, martinandosa.com, and 77kids.com.
American Eagle's brands include aerie, Martin+Osa, 77kids and its namesake.
The company's stock gained $1.16, or 8 percent, to $15.70 in morning trading. Over the past year, the shares have traded between $7.36 and $19.86.