POSITIVITY  is the heart of the Aerie brand. We need it now more than ever, which is why our Aerie team is calling on its customers to share some positivity. Singing, dancing, poetry-writing, whatever it is that brings you joy – our goal is to show that a little optimism and good cheer goes a long way. We’re in this together!

We are stronger together and to show our appreciation for the brave and hardworking medical professionals throughout New York City, AEO Inc. sent more than 2,000 American Eagle and Aerie gift cards to Northwell Health. We are incredibly grateful for the unwavering commitment of all public health workers on the front-lines. This past week, the staff of Bellevue hospital received our small gesture of thanks and shared some photos of the gift card distribution. AEO is happy to provide some simple joys during this time of great uncertainty.

PITTSBURGH — (BUSINESS WIRE) – April 2, 2020 – American Eagle Outfitters, Inc. (NYSE: AEO) today announced that in response to ongoing store closures due to COVID-19, the company is taking a series of actions to preserve financial strength including:

• A suspension of its share repurchase program and deferred payment of the first quarter cash dividend;
• Temporary furloughs of store, field and corporate associates beginning April 5, largely reflecting the continued uncertainty around the duration of store closures;
• Reductions to operating expense, which include delayed merit increases for associates, a hiring freeze and other cost saving initiatives;
• Cuts to inventory receipts to align with lower demand due to store closures;
• Reduced capital expenditures across stores, IT and other projects. The company will continue to invest in digital and Distribution Center capabilities to better serve our online customers.

“AEO entered 2020 with financial strength and two of the best brands in retail.  The measures we are taking today are difficult, and we recognize that these decisions significantly impact our associates, yet are unfortunately necessary for our continued long-term success,” said Jay Schottenstein, Executive Chairman of the Board and Chief Executive Officer.  “This is not business as usual and we are preparing to emerge from this crisis stronger, more nimble and ready to grow.  With health and safety a priority, we look forward to re-opening our stores as soon as we are safely able to do so.  In the meantime, I’d like to thank our dedicated team for serving our loyal customers through our online business.”

Associate Support
At AEO, we value our people above all else and are providing support. Furloughed associates will maintain benefits and AEO will fund 100% of the health premiums for eligible employees impacted by these measures, through at least April 2020.  AEO Inc. has seeded and set up a program through the AEO Foundation for associates who may be experiencing economic distress caused by a COVID-19 diagnosis. In addition, the company has set up an associate resource center online, which will allow easy access to contacts, benefits information as well as state unemployment resources.

Health and Safety

AEO has made investments in personal protective gear, as well as state-of-the-art cleaning and sanitization equipment for all locations.  We are taking numerous measures to protect the safety and welfare of associates including: following all federal and state COVID-19 guidelines; enhanced cleaning and sanitization activities; social distancing protocols; staggered work schedules; onsite nurses and temperature scanning at all Distribution Centers.  The company will continue donating personal protective equipment to our communities.  Additionally, we are taking active measures to install best in class safety and health protocols in all stores, ensuring a safe environment for when our associates and customers are able to return to our locations.

First Quarter 2020 Dividend

The company’s previously declared first quarter fiscal 2020 quarterly cash dividend of $0.1375 will now be payable April 23, 2021 to stockholders of record at the close of business on April 9, 2021.  The company maintains the right to defer the record and payment dates, depending upon, among other factors, the progression of the COVID-19 outbreak, business performance and the macroeconomic environment.

Previous Actions in Response to COVID-19

The company previously took the following actions in response to the COVID-19 crisis:

• The temporary closure of all AE and Aerie stores across North America, which has extended beyond the initial March 27, 2020 estimate. The company will continue to monitor guidance from government and health officials to determine when to re-open stores;
• The recent drawdown of $330 million from its revolving credit facility to bolster liquidity. AEO entered fiscal 2020 in strong financial condition, with $417 million in cash and short-term investments and no debt;
• The withdrawal of its first quarter 2020 guidance issued on March 4, 2020.

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Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

This release and related statements by management contain forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995), which represent our expectations or beliefs concerning future events, including first quarter 2020 results. All forward-looking statements made by the company involve material risks and uncertainties and are subject to change based on many important factors, some of which may be beyond the company’s control. Words such as “estimate,” “project,” “plan,” “believe,” “expect,” “anticipate,” “intend,” “potential,” and similar expressions may identify forward-looking statements. Except as may be required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise and even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized.  The following factors, in addition to the risks disclosed in Item 1A., Risk Factors, of the company’s Annual Report on Form 10-K for the fiscal year ended February 2, 2019 and in any subsequently-filed Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission in some cases have affected, and in the future could affect, the company’s financial performance and could cause actual results for the first quarter 2020 and beyond to differ materially from those expressed or implied in any of the forward-looking statements included in this release or otherwise made by management: the risk that the company’s operating, financial and capital plans may not be achieved; our inability to anticipate customer demand and changing fashion trends and to manage our inventory commensurately; seasonality of our business; our inability to achieve planned store financial performance; our inability to react to raw material cost, labor and energy cost increases; our inability to gain market share in the face of declining shopping center traffic; our inability to respond to changes in e-commerce and leverage omni-channel demands; our inability to expand internationally; difficulty with our international merchandise sourcing strategies; challenges with information technology systems, including safeguarding against security breaches; and changes in global economic and financial conditions, and the resulting impact on consumer confidence and consumer spending, as well as other changes in consumer discretionary spending habits, which could have a material adverse effect on our business, results of operations and liquidity.

First, our thoughts and hearts go out to those people around the world mentally or physically impacted by COVID-19. We are monitoring the rapidly changing situation and working with local and federal health and government officials on best steps forward. We recognize that this terrible pandemic, and our responses to it, will have far-reaching impacts on business, employment, and all of our daily lives.

We believe the best thing we can do for all of our people is make informed decisions based on facts as we do our part to try to slow the spread of COVID-19.  This is uncharted territory for us all.  The decision has been made to extend the temporary closure of all retail store locations across the U.S. and Canada. The closures are now expected to extend beyond the initial March 27, 2020 estimate.  The company will continue to monitor guidance from government and health officials to determine when to re-open stores. In the meantime, we welcome our customers to visit us on ae.com where they can shop our strong digital channel.

At AEO, we value our people above all else. Any associate that is ill or has symptoms is able to take time off, and we are doing all that we can to remove financial barriers for all of our people so that they can receive diagnostic testing or medical care when needed. We have also taken the following immediate steps for our teams and communities:

• We have initiated an associate response plan to ensure all AEO store associates receive compensation for scheduled work time.
• In our distribution centers, we have maximized cleaning measures to ensure safe product shipping.  In addition, we have staggered shifts and breaks to reduce the amount of associates spending time together in close proximity, increased the distance between workstations, and implemented additional safety measures.
• Our corporate associates are working remotely if they are able to do so, and meeting only in small groups. We are using technology to help keep us connected and we are still meeting and collaborating digitally.
• Through the AEO Foundation, we have provided support to impacted regions through Good360 and have established a COVID-19 relief fund to help associates who may be impacted by this health crisis.

​As we continue to assess the rapidly evolving situation, we will keep you informed of any changes to our operations. When we do re-open we will make sure we do so with our people in mind; we have sought expert medical guidance, purchased the best available cleaning and preventative medical supplies, and implemented appropriate protocols so that no matter when or where our people live and shop, we can help ensure they do so safely. Until then, please stay connected through our social channels — we would love to hear from you.

Although I recognize the days ahead will be challenging, we will remain true to the very heart of our purpose—optimism.  Let’s stay connected and strong together.

Sincerely,

Jay Schottenstein

Executive Chairman of the Board and Chief Executive Officer

PITTSBURGH–(BUSINESS WIRE)– American Eagle Outfitters, Inc. (NYSE:AEO) today announced that in order to protect its people and communities it is temporarily closing all of its American Eagle and Aerie stores in the United States and Canada effective end of day March 17, 2020. This is in response to the continued spread of COVID-19 and the guidance of government and public health officials. The closures will remain in place until at least March 27, 2020 and all store associates will be compensated for scheduled time during that period. Online shopping via ae.com, aerie.com and through the AE/Aerie app will continue to operate as normal.

“At AEO, above all else—our people come first. With that in mind, we have made the decision to temporarily close our American Eagle and Aerie stores to ensure that we are doing our part to safeguard our communities,” commented Jay Schottenstein, Executive Chairman of the Board and Chief Executive Officer. “The safety and well-being of our associates, customers, and partners around the world remain our priority. I recognize the days ahead will be challenging, but we remain true to the very heart of our purpose—optimism. We will continue to serve our customers with an exceptional experience through our strong digital channel.”

AEO is also taking the following steps to support its associates: working from home; staggered work schedules for in-office requirements to facilitate social distancing; and implementing enhanced sanitization and deep cleaning of operated facilities.

Through the AEO Foundation, the company has established a Relief Fund to provide additional assistance to associates affected by COVID-19.

In addition, AEO announced that it is withdrawing the first quarter 2020 guidance issued on March 4, 2020, as management expects store closures and the impact of COVID-19 to have a material adverse impact on financial results. AEO ended fiscal 2019 with $417 million in cash and short-term investments and no debt and has recently drawn $330 million on its revolving credit facility to further bolster near-term liquidity.

Nearly at its $1 billion goal, the intimates’ global brand president Jennifer Foyle sets her sights even higher.

By Kellie Ell | Link to article

Aerie’s Jennifer Foyle continues to stretch the limits of the lingerie business.

The intimates firm’s global brand president has been reimagining what it means to be in the bra and underwear business for the last decade, adding a diverse array of models, leading the bralette trend and skipping the digital touch-ups of photos. And it’s paying off.

At a time when other innerwear brands are struggling, Aerie, which falls under the American Eagle Outfitters umbrella, is crushing the competition. Comparable sales at the brand jumped 20 percent last year. That’s on top of a 29 percent gain the year before. Aerie is now on track to top $1 billion in revenues this year.

“I have a lot of faith that we can see growth beyond a billion dollars,” Foyle told WWD. “We’re really capturing a lot of fast-paced growth right now. We definitely have our sights set on this $1 billion mark, which we should be hitting this number pretty soon. And then we’re going to target more. We’re going to target a $3 billion brand.”

Aerie is the second largest e-commerce lingerie retailer, second only to marketshare leader Victoria’s Secret, according to the NPD Group. In 2018, Victoria’s Secret had 24 percent of the U.S. women’s intimate apparel industry, according to market research firm Euromonitor International. Aerie, by comparison, had 3 percent the same year, up from 2 percent in 2017.

The formula entails growing both the store fleet and the brand’s digital presence, which Foyle said creates a halo effect, prompting shoppers to spend more online at a later date.

“Our digital business represents 45 percent of the sales and we’re really able to leverage an omnichannel perspective and promotional environment,” Foyle said.

Last year Aerie opened 60 new stores — a mix of stand-alone stores and American Eagle-Aerie side-by-sides, bringing the total number of Aerie stores to 332. This year, the brand has plans to open about another 60.

“We still have a lot of markets to cover,” Foyle said. “There’s still a lot [of white space] to be had here and a lot of customers that we need to introduce into Aerie.”

But she added that it was important for Aerie to be strategic about its plans. That means moving into the most lucrative markets, optimizing each store’s square footage and obtaining flexible lease deals.

“There are some markets that we know we have to expand in,” Foyle said. “We have a lot of access to AE’s numbers across the company. It’s really just strategically accessing our competition, using a lot of the American Eagle metrics, as we share a fairly high percentage of the same customers. And looking at our digital numbers so that we can understand what markets are in higher demand.”

That includes places like Colorado and California. In addition, the demand in some Texas markets has led to plans to convert a handful of side-by-side stores into stand-alone Aerie units.

“The nice thing is that the mall owners are welcoming Aerie; we’re actually bringing traffic to the malls,” Foyle said. “So it’s really nice to see that turnaround and it’s really enabled us to have more flexible leases and agility, so we can manage the portfolio better.”

Robert Madore, American Eagle Outfitters executive vice president and chief financial officer, told analysts on Wednesday evening’s conference call that the average store lease at the end of 2019 was 3.6 years and that more than half of the store leases at malls rated c-level will expire in 2020.

“We will continue to prioritize the best strategic locations,” Madore said. “These include top-performing malls with positive traffic trends, attractive co-tenancies and favorable economics, and additional locations in strong omnichannel trading markets. At the same time, we will continue to close nonstrategic and unprofitable stores.”

Foyle added that Aerie’s growth plans will likely taper off after 2020.

“We want to grow, but we want to grow with really smart intentions,” she said. “We don’t want to just oversaturate stores.”

Aerie’s growth story includes the successful AerieReal campaign, which was launched in 2014. At the time, the campaign, which omits airbrushing of its models, featured only one “role model,” British model Iskra Lawrence. Six years later, the campaign now has 13 role models and Aerie will host its first AerieReal Summit in New York City later this month. The one-day event will include the role models, Aerie executives and about 300 members of the Aerie community, along with activations, panel discussions and musical performances. Proceeds from tickets will go toward the National Eating Disorders Association.

In addition, Foyle said Aerie will continue to grow into new categories in the coming year. (The latest was a line of sustainable swimwear launched this year.) Foyle said more product expansions are coming, but was tight-lipped about the details.

“Our community is dying to get into our brand more and more every day,” she said. “We have our sights on [$3 billion] and we’ll be creating strategies and assortment ideas and newness and surprises as we move along so that we can really keep this exciting brand and growth rate going.”

Company shares shot up despite misses in the tops business.

By Kellie Ell | Link to article

Restructuring charges took a big bite out of American Eagle Outfitters’ fourth-quarter profits, but the retailer still showed enough growth to charge up investors.

The retailer, parent company to the American Eagle and Aerie brands, saw its stock jump nearly 7 percent in after-hours trading Wednesday on the strength of its quarterly report.

“Although we faced some challenges in 2019, we made good progress on our strategic growth pillars, posting record revenues,” Jay Schottenstein, American Eagle Outfitters’ chairman and chief executive officer said in his prepared remarks. “We saw strong customer engagement and positive traffic across brands and channels. “I’m also pleased that we successfully cleared through excess holiday inventory, ending the year well-positioned.”

For the three-month period ending Feb. 1, American Eagle Outfitters total revenues were $1.3 billion, up from $1.24 billion in 2018’s fourth quarter. Meanwhile, profits fell to $4.8 million due to more than $76 million worth of impairment tied to 20 stores as well as restructuring charges to cover severance and other costs. Profits tallied $76.2 million a year earlier.

Adjusted earnings per share for the quarter slipped to 37 cents from 43 cents a year earlier.

For all of 2019, sales grew to $4.3 billion, up from $4.03 billion in 2018, while income fell to $191 million, down from $261 million a year earlier.

The company’s bright spots continue to be the American Eagle jeans business and intimates brand Aerie. Aerie had its 21st consecutive quarter of double-digit sales growth with comps increasing 26 percent during the quarter. That’s on top of a 23 percent increase the same time last year.

“Aerie delivered exceptional growth, led by its unique brand positioning and strong customer connection, and has significant runway ahead,” Schottenstein said.

Aerie is the second largest e-commerce lingerie business, according to The NPD Group, thanks in part to the company’s successful AerieReal campaign.

And, while other retailers continue to shutter stores, the intimates brand opened 60 new Aerie locations in 2019, a mix of stand-alone and side-by-side stores, for a total of 332 Aerie stores. Many of them were in new markets, including Denver, Houston and Dallas. Jennifer Foyle, Aerie brand president, said the new stores create a halo effect, motivating shoppers to buy more online. Digital sales make up 45 percent of total Aerie sales, Foyle said.

Schottenstein added that the American Eagle jeans and bottom businesses also continue to grow. Still, the overall American Eagle brand has suffered in recent quarters with soft sales in the tops business. Comparable sales in the American Eagle division fell 3 percent last quarter, on top of a 3 percent increase a year earlier.

Chad Kessler, American Eagle brand president told analysts on a conference call that sales declines in the American Eagle business were driven by higher-than-planned promotional activity. However, he said that jeans business was a “standout,” and continues to take market share from competitors.

As for the tops business, he said men’s T shirts and fleece continue to be growth opportunities.

“It does take time for us to get the assortment righted,” Kessler said.

Meanwhile, as the coronavirus continues to sweep through the fashion industry and supply chains, executives on the call said it was too early to tell what impact it will have on the business, although there is a chance of residual effects, such delayed deliveries. Currently, about 20 percent of company products are sourced out of China.

“Looking ahead, we are laser focused on areas of underperformance and strengthening profit margins,” Schottenstein said. “Product improvements, inventory management and gaining efficiencies are top priorities. Our healthy brands and strong balance sheet position us well to compete in today’s market and we are excited to build upon our strengths and seize the many opportunities ahead for [American Eagle Outfitters].”

Shares of parent company American Eagle Outfitters, which closed up 2.31 percent to $12.87 a share, is down roughly 36 percent year-over-year.

Fourth Quarter Comparable Sales Rose 2%, Marking 20 Consecutive Quarters of Growth

PITTSBURGH — (BUSINESS WIRE) – American Eagle Outfitters, Inc. (NYSE: AEO) today reported EPS of $0.03 for the 13 weeks ended February 1, 2020.  This compared to $0.43 for the 13 weeks ended February 2, 2019.  Adjusted EPS of $0.37 excludes $0.34 of impairment, restructuring and related charges discussed below.

For the 52 weeks ended February 1, 2020, the company reported EPS of $1.12.  This compared to $1.47 for the 52 weeks ended February 2, 2019.  Adjusted EPS of $1.48 excludes $0.36 of impairment, restructuring and related charges and compared to adjusted EPS of $1.48 last year, which excluded $0.01 of restructuring and related charges.  The EPS figures refer to diluted earnings per share.

Jay Schottenstein, AEO’s Chairman and Chief Executive Officer commented, “Although we faced some challenges in 2019, we made good progress on our strategic growth pillars, posting record revenues.  We saw strong customer engagement and positive traffic across brands and channels.  Aerie delivered exceptional growth, led by its unique brand positioning and strong customer connection, and has significant runway ahead.  American Eagle saw growth in its signature jeans and bottoms categories, where we continue to gain meaningful market share. I’m also pleased that we successfully cleared through excess holiday inventory, ending the year well-positioned.

“Looking ahead, we are laser focused on areas of underperformance and strengthening profit margins.  Product improvements, inventory management and gaining efficiencies are top priorities.  Our healthy brands and strong balance sheet position us well to compete in today’s market and we are excited to build upon our strengths and seize the many opportunities ahead for AEO.”

Adjusted amounts represent Non-GAAP results, as described in the accompanying GAAP to Non-GAAP reconciliations.

Fourth Quarter 2019 Results

• Total net revenue for the 13 weeks ended February 1, 2020 increased $70 million, or 6% to $1.31 billion compared to $1.24 billion for the 13 weeks ended February 2, 2019. Consolidated comparable sales increased 2% over the period ended February 2, 2019, following a 6% increase last year.  This marked the 20^th consecutive quarter of positive comparable sales.
• By brand, American Eagle comparable sales decreased 3%, compared to a 3% increase last year. Aerie’s comparable sales increased 26%, following a 23% increase last year, marking the 21^st consecutive quarter of double-digit sales growth.
• Gross profit decreased $23 million or 5% to $408 million, compared to $431 million last year. The gross margin rate of 31.0% declined from 34.6% last year.  Higher markdowns were the primary cause of the reduction to last year.  Increased distribution center and delivery costs were offset by lower incentives and slight rent leverage.
• Selling, general and administrative expense of $287 million decreased slightly from $288 million last year. As a rate to revenue, SG&A leveraged 130 basis points to 21.8%, primarily reflecting lower incentives, partly offset by higher professional services fees.
• Depreciation and amortization expense increased 8% to $44 million, increasing 10 basis points to 3.4% as a rate to revenue.
• Operating income of $0.5 million compared to $101 million last year. Adjusted operating income of $77 million excluded $76 million of impairment and restructuring charges.  As a rate to revenue, adjusted operating income decreased to 5.8% from 8.2% last year.
• EPS of $0.03 compared to EPS of $0.43 last year. Adjusted EPS of $0.37 excludes $0.34 of impairment, restructuring and related costs.

Fiscal Year 2019 Results

• Total net revenue for the 52 weeks ended February 1, 2020, increased $272 million, or 7% to a record $4.3 billion compared to $4.0 billion for the 52 weeks ended February 2, 2019.
• Consolidated comparable sales increased 3% over the period ended February 2, 2019, following an 8% increase last year.
• By brand, American Eagle comparable sales were up slightly, compared to a 5% increase last year. Aerie’s comparable sales increased 20%, following a 29% increase in 2018.
• Gross profit increased $35 million, or 2% to $1.52 billion. The gross margin rate decreased 160 basis points to 35.3% of revenue compared to 36.9% last year.  Higher markdowns were the primary cause of the reduction to last year.  Rent leverage and lower incentives were offset by increased distribution center and delivery costs.
• Selling, general and administrative expense of $1.03 billion increased 5% from $981 million last year. As a rate to revenue, SG&A leveraged 40 basis points to 23.9%, reflecting lower incentives, partially offset by higher store payroll and professional services.
• Depreciation and amortization expense increased 6% to $179 million from $168 million last year, improving 10 basis points to 4.1% as a rate to revenue.
• Operating income of $233 million decreased from $337 million last year. Adjusted operating income of $314 million decreased 7% from $339 million last year.  As a rate to revenue, adjusted operating income decreased to 7.3% from 8.4% last year.  Adjusted figures exclude impairment and restructuring charges of approximately $80 million in fiscal 2019 and restructuring and related charges of $2 million in 2018.
• EPS of $1.12 compared to EPS of $1.47 last year. Adjusted EPS of $1.48 excludes $0.36 of impairment, restructuring and related charges and was flat compared to adjusted EPS of $1.48 last year, which excluded $0.01 of restructuring and related charges.

Impairment, Restructuring and Related Charges

In the fourth quarter of 2019, the company incurred impairment, restructuring and related charges of approximately $76 million pre-tax, or $0.34 per share after-tax.  Approximately $65 million of the pre-tax charges related to the non-cash impairment of 20 stores and the remainder primarily reflected severance and other costs.

For the full year 2019, the company incurred impairment, restructuring and related charges of approximately $80 million pre-tax, or $0.36 per share after-tax, including approximately $4 million of pre-tax restructuring charges incurred in the first half of the year.  This compared to $2 million of pre-tax restructuring and related charges for the full year 2018, or approximately $0.01 per share after-tax.

Inventory

Total ending inventory at cost increased 5% to $446 million. The increase largely reflected inventory to support strong demand for AE Jeans, including new styles and expanded sizes, and Aerie store openings. Clearance inventory units were down to last year.

Capital Expenditures

In 2019, capital expenditures totaled $210 million.  For fiscal 2020, the company expects capital expenditures to be in the range of $225 to $275 million, with the increase primarily driven by investments in the distribution network, as well as Aerie store openings.

Shareholder Returns, Cash and Investments

During 2019, the company returned $205 million to shareholders through cash dividends and share repurchases.  We paid dividends of $93 million and repurchased 6.3 million shares for $112 million.  The company ended the year with total cash and short-term investments of $417 million, a decrease from $425 million at the end of 2018.

Store Information

We ended the year with a total of 1,095 stores.  During the year, the company opened 27 AE stores and closed 21, ending the year with 940 AE stores.  Included in the AE store count are 174 Aerie side-by-side locations, of which 28 opened and 1 closed in 2019.  Additionally, the company opened 37 Aerie stand alone stores and closed 4, ending the year with 148 Aerie stand-alone locations and 322 total Aerie stores.  Internationally, the company ended the year with 217 licensed stores.  For additional information, see accompanying table.

First Quarter 2020 Outlook

Based on an anticipated comparable sales increase in the low single digits, management expects first quarter 2020 EPS to be approximately $0.20 to $0.22.  This guidance excludes potential asset impairment and restructuring charges.  Last year’s first quarter reported EPS of $0.23 included $0.01 of restructuring charges.  Excluding these items, last year’s adjusted EPS was $0.24.  See the accompanying table for the GAAP to Non-GAAP reconciliation.

Conference Call and Supplemental Financial Information

Today, management will host a conference call and real time webcast at 4:15 p.m. Eastern Time. To listen to the call, dial 1-877-407-0789 or internationally dial 1-201-689-8562 or go to http://www.aeo-inc.com to access the webcast and audio replay. Additionally, a financial results presentation is posted on the company’s website.

Non-GAAP Measures

This press release includes information on non-GAAP financial measures (“non-GAAP” or “adjusted”), including earnings per share information and the consolidated results of operations excluding non-GAAP items.  These financial measures are not based on any standardized methodology prescribed by U.S. generally accepted accounting principles (“GAAP”) and are not necessarily comparable to similar measures presented by other companies.  Management believes that this non-GAAP information is useful for an alternate presentation of the company’s performance, when reviewed in conjunction with the company’s GAAP financial statements.  These amounts are not determined in accordance with GAAP and therefore, should not be used exclusively in evaluating the company’s business and operations.