American Apparel shares fall after CFO resigns

NEW YORK Fri May 23, 2008 11:19am EDT

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NEW YORK (Reuters) - American Apparel Inc (APP.A) shares fell as much as 2.3 percent on Friday, the day after the retailer's chief financial officer resigned, leading to the appointment of a stop-gap replacement.

The resignation of Ken Cieply came weeks after American Apparel Chief Executive Dov Charney called him a "complete loser" in a late March interview with The Wall Street Journal. Charney later retracted the comment, but it left Cieply "surprised," according to the Journal report.

Cieply, who joined American Apparel in June 2006, left to pursue other opportunities, the casual and basic clothing retailer said in a statement.

Los Angeles-based American Apparel, which became a public company in December, appointed William Gochnauer as its interim CFO, effective immediately, until a permanent replacement is named.

Gochnauer was previously interim CFO at upscale gift retailer RedEnvelope REDEQ.PK and has been a financial consultant for early childhood and learning products company Excelligence Learning Corp.

One analyst called hiring Gochnauer "a step toward financial clarity" for American Apparel, which has had problems with its public financial reporting, according to media reports.

"Gochnauer's accounting, Sarbanes-Oxley, and public company background should prove incrementally positive in helping (American Apparel) manage through the reporting process on a timely and accurate basis," Lazard Capital Markets analyst Todd Slater said in a client note.

American Apparel's shares were down 10 cents, or 1.4 percent, at $7 on the American Stock Exchange, after falling as low as $6.94. The stock price has ranged from $6.68 to $16.75 in the past year.

(Reporting by Aarthi Sivaraman; Editing by Lisa Von Ahn)

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