American Eagle Outfitters Inc. (NYSE: AEO) reported its financial results for the quarter ended May 2, 2020, on Wednesday before the market opens. The bottom line was wider than the analysts’ expectations while the top-line missed consensus estimates.
The company slipped to a loss in the first quarter of 2020 from a profit last year due to higher impairment and restructuring charges as well as lower revenue. The results were impacted by store closures and aggressive inventory liquidation but customer engagement remained high and digital demand accelerated, well-exceeding its expectations.
In order to preserve financial liquidity in response to COVID-19, the company has reduced its fiscal 2020 capital spending plans to a range of $100-125 million, prioritizing strategic customer-centric and supply chain investments aimed at further strengthening its competitive position.
To preserve liquidity, the company has suspended its Q2 dividend and at this point does not anticipate declaring a dividend for the rest of this year. As previously announced, the company’s Q1 cash dividend was deferred until 2021 and will be payable on April 23, 2021, to stockholders of record at the close of business on April 9, 2021.
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