Aeropostale (ARO) Plunges After Fourth Quarter Miss

NEW YORK (TheStreet) -- Aeropostale (ARO) is plummeting in extended trading after missing analysts' top and bottom line estimates in its year-ending quarter.

After the bell, shares dropped 13% to $6.35.

In the three months to Feb. 1, the New York-based retailer reported a 16% year-over-year sales decrease to $670 million. Comparable-store sales, which include its e-commerce channel, tumbled 15% compared to an 8% drop a year earlier.

Analysts had forecast sales of $683.79 million, according to averages compiled by Thomson Reuters.

The teen-focused chain reported a net loss of $70.3 million, or 90 cents a share, compared to analysts' estimated loss of $23.75 million, or 31 cents a share.

Excluding tax and legal-related charges, losses of $27.1 million, or 35 cents a share, were wider than an expected $22.9 million, or 31 cents a share.

Aeropostale had previously guided for a net loss between 24 cents and 32 cents a share.

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"The results we generated in 2013 are not acceptable nor are they a reflection of the progress we believe we have made in transforming our brand," said CEO Thomas P. Johnson in a statement.

Gross margins fell 680 basis points to 13% as Aeropostale engaged in deep discounting over a more promotional holiday shopping season than normal.

For its first quarter ending April, the company anticipates a net loss in the range of 70 cents to 75 cents a share, stripping away the impact of expected consulting fees and the potential for accelerated store closures.

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