Chad Kessler was named chief merchandising and design officer at American Eagle Outfitters after the company reported a big decline in third-quarter profits and said it expects fourth quarter same-store sales to decline.
American Eagle Outfitters, which operates more than 1,000 stores in the U.S. and select international markets, said its third-quarter sales declined 6% to $857 million and same-store sales fell 5%. Profits from continuing operations fell to $24.9 million from $82.4 million and earnings per share, adjusted to exclude a six cent a share charge related to the closure of a distribution center, declined to 19 cents from 41 cents a share last year.
“Our financial performance is clearly unsatisfactory and not consistent with our objectives,” said American Eagle CEO Robert Hanson. “As we continue to navigate through an intensely promotional North American retail landscape, we are making improvements in merchandising and marketing, while aggressively pursuing efficiency gains, expense reductions and ensuring disciplined inventory management. We are continuing to invest in important areas of growth including omni-channel, global expansion and factory stores — all high-return segments, which diversify our business and will be key drivers of our future growth and success.”
The changes won’t have an immediate impact on the company’s performance, however, as Hanson forecast a fourth-quarter same-store sales decline in the mid-single digits. Going forward, American Eagle will rely on new head merchant Kessler to provide shoppers a more compelling product offering and reverse sales trends.
“Chad is a top talent in the business, bringing us a depth of experience in U.S. specialty youth brands, as well as recent experiences in global luxury and multichannel merchandising and design,” Hanson said regarding Kessler’s hiring. “He will be an incredible asset and will complement our highly talented team. I look forward to his many contributions as we continue our work to fortify and transform American Eagle Outfitters to a global, omni-channel brand.”
Kessler joins American Eagle with an extensive background in apparel retailing, most recently serving as SVP of corporate merchandising for Coach from 2010 to 2011 and prior to that as chief merchandising officer for Urban Outfitters from 1994 to 2010. He also held merchandising roles at Abercrombie & Fitch.