American Apparel Announces Preliminary June and Second Quarter Sales

In addition, the company reported that record volumes should allow it to better leverage store, factory and corporate overheads. "Although favorable cotton prices are tempered by the negative effects of a strengthening U.S. Dollar, we are managing our margins tightly and continue to generate a significant proportion of our sales through full-price selling," American Apparel said in the statement. "As we continue to raise store productivity levels, we will begin to examine opening additional stores, and believe we could be in a position to open as many as 50 additional stores over the next three years."

"We expect these positive sales trends will continue into the third quarter," the statement continued.

American Apparel reiterated its 2012 earnings before interest, taxes, depreciation and amortization (EBITDA) to be in the range of $32 million to $40 million. The company provided a chart illustrating five years of EBITDA rates.

Annual EBITDA
2012 $32 to $40 million (projected)
2011 $14 million
2010 $-9 million
2009 $56 million
2008 $71 million

"As we continue to drive higher cash flow and improved earnings performance, we believe we could be in a position to refinance our higher cost debt at substantially lower interest rates in late 2012 or early 2013," the company stated.