This summary is based on the third quarter fiscal 2006 earnings call conducted by Aeropostale, Inc (ARO: chart) on November 29, 2006.

Key Investors Issues

- Earnings were 61 cents per share compared to 47 cents per share a year ago.
- Net income was income $32.6 million compared to $26.1 million in last year.
- Revenue was $386 million, 19% increase versus last year.
- Total sales increased 11.5% to $149.7 million.
- The company repurchased 308,000 shares of its stock.

Third Quarter Highlights

Total net sales were up 18.7% versus last year.

This was driven by square footage growth of approximately 11% and a 5.6% comparable store sales increase. Average unit retail increased 5% driven by less promotional activity. Units per transaction were essentially flat and comparable store sales transactions increased 1%.

- Women’s comparable store sales increased 4%.
- Men’s comparable store sales increased 6%.
- Accessories comparable store sales increased 15%.

Gross margin was 32.1% versus 29.2% last year.

The increment was a result of 300 basis point increase in merchandised products.

SG&A was 18.6% of sales versus 16.1% last year.

The increase of the 250 basis points was due primarily to 170 basis point increase related to the reversal of bonus accrual and option expense and a 30 basis point increase in both marketing and e-commerce transaction related fees.

Tax rate was 39%, resulting in net income of $32.6 million or 61 cents per share versus $26.1 million or 47 cents per share last year.

Earnings per share also included a 3 cent per share loss related to Jimmy''Z and a 1 cent per share charge related to stock option expense.

The company repurchased 308,000 shares of its stock for approximately $8.3 million.

It currently has under $86 million remaining under $250 million share repurchase program.

Inventory at the close of the quarter was $167.5 million, up approximately 5% in total compared to last year.

On a per square foot basis, inventories were down 5% versus the third quarter of last year.

- CapEx for the quarter was 48.9 million and depreciation and amortization was $7.6 million.
- Cash and short-term securities at the close of the quarter were $203.3 million versus a $134.4 million last year.
- During the quarter, the company opened 13 Aeropostale stores and closed 1, ending with a total of 724 Aero and 14 Jimmy’Z stores.

Total net sales for November increased 13.7% to $152.7 million and comparable store sales increased 1% for the month.

Average unit retail increased in the low double-digits while unit per transaction and comparable store sales transactions decreased in the mid single-digits.