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Aeropostale Glides Past Forecasts

The retailer also offers a strong guidance for the current quarter.

Aeropostale

(ARO)

posted a 64% jump in first-quarter earnings, topping its own projection, as strong sales and increased margins helped boost results.

The teen-apparel retailer also gave a forecast for the current period that exceeds Wall Street's target. Shares were climbing $1.12, or 2.4%, to $47.50 in after-hours trading.

The New York-based company said Thursday that its first-quarter earnings rose to $13.8 million, or 26 cents a share, from $8.4 million, or 15 cents a share, a year ago.

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The results were above Aeropostale's already raised forecast, given earlier this month, for earnings of 24 cents to 25 cents a share. Analysts polled by Thomson Financial projected earnings of 25 cents share.

Sales increased 12% to $275.8 million. Same-store sales, or sales at stores open at least a year, rose 2.5%.

"Our balanced and trend-right merchandise assortments are continuing to be received positively by our customers," Julian Geiger, chairman and CEO, said in a statement. "Our accomplishments for the quarter also reflect improvements we have made in our planning process and in our inventory management. As a result of the consistent execution of our strategic initiatives, we achieved strong increases in our gross margins and we ended the quarter with record earnings."

Gross margin for the period increased to 32.2% from 28.6%.

For the second quarter, Aeropostale predicts earnings of 26 cents to 28 cents a share. Wall Street had forecast earnings of 21 cents a share.

In last year's second quarter, Aeropostale recorded a profit of $8.4 million, or 16 cents a share.