Apparel Sales Fall in August

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The poor economy is continuing to take its toll on Los Angeles retailer American Apparel Inc., which on Thursday reported a 20 percent decline in same-store sales last month. Another trendy retailer, Hot Topic Inc., saw a significantly smaller decline in sales.

The back-to-school month of August generally is a strong one for apparel makers, and American Apparel in the same month in 2008 had seen 31 percent rise in sales from the prior year. The company said its August results included 186 stores that had been open at least a year. The company operates more than 270 stores worldwide, including one that opened last month in Toronto, Ontario.

Separately, American Apparel confirmed reports that it will have to fire about 1,500 workers more than one-quarter of its Los Angeles factory work force after the employees failed to pass immigration status screenings by U.S. immigration authorities.

City of Industry’s Hot Topic, which like American Apparel also typically benefits from back-to-school activity, reported its combined same-store sales fell 8.1 percent last month, a bigger drop than analysts expected.

Sales at stores open at least a year fell 1.7 percent at Hot Topic locations stores and 7.6 percent at its Torrid stores for plus-size women. Total sales for the month fell 7 percent to $66.6 million.

Analysts surveyed by Thomson Reuters, on average, expected combined same-store sales to fall 6.9 percent. Comparable estimates for American Apparel were not available.

American Apparel shares closed up 2 cents, or less than 1 percent, to $3.55 on the New York Alternet. Hot Topic sales gained 3 cents, or less than 1 percent, to $6.86 on the Nasdaq.

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