American Eagle Outfitters Furloughs Employees, Cuts Inventory, Defers Dividends
Finding the economic wind beneath its wings weakening following coronavirus lockdowns and store closures, American Eagle Outfitters (NYSE: AEO) announced yesterday it is taking a multi-pronged approach to slashing its expenses during the crisis. Elements of its plan include deferring payment of the first-quarter 2020 cash dividend on its shares, suspending its stock buyback program, and furloughing many of its workers starting on Sunday, April 5.
Before the full force of the COVID-19 outbreak gripped the United States, the company reported continuing growth, driven in part by the strong success of its Aerie brand. Now, the company is battening down the hatches to preserve its financial position through the coronavirus crisis. It has fortified its liquidity by drawing down $330 million from its available revolving credit and withdrawn its March 4 guidance.
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