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By
Reuters
Published
May 20, 2012
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American Eagle exits children's shops, CFO resigns

By
Reuters
Published
May 20, 2012

Teen apparel retailer American Eagle Outfitters Inc said it is getting out of the children's clothing business and that Chief Financial Officer Joan Hilson will step down at the end of July.


Photo: Reuters

The Pittsburgh-based company is exploring options such as a full or partial sale of 77kids, which includes 22 stores and an online business, it said in a statement on Friday.

American Eagle introduced the brand in October of 2008 as an online-only brand. The brand generated an after-tax loss of about $24 million on sales of $40 million during fiscal 2011, when sales of children's apparel accounted for roughly 1 percent of company sales.

The company said it expects to book charges associated with the business exit in the second and third quarters.

Scott Hurd, American Eagle's vice president and controller, will lead day-to-day management of the finance team and assume the roles of interim principal accounting officer and interim principal financial officer until a new CFO is named.

American Eagle sold its 28-store Martin+Osa chain in 2010, citing inadequate sales. (Reporting By Lisa Baertlein in Los Angeles; Editing by Richard Chang)

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