American Apparel, Inc. (NYSE Alternext US: APP) today announced that it will stand by its decision to continue selling the critically acclaimed gay quarterly magazine BUTT in its stores around the world.

In a recent provocative article in The Globe and Mail, American Apparel was criticized by a shopper for featuring BUTT magazine in a display at its West Vancouver store. The lady, who was accompanied by her daughter, expressed her view that it was pornographic in nature, and she demanded the company cease selling the publication and struck out to "hit [American Apparel] in the pocketbook" for its choice.

Today, the company is formally responding to this matter by maintaining its decision to continue displaying and selling BUTT magazine among other cosmopolitan and diverse publications at the signature "newsstand" section in each of its stores. American Apparel has carried BUTT in its stores since 2005.

"BUTT Magazine is a wonderful fashion, culture, art magazine and a popular seller", stated company creative director Iris Alonzo. "American Apparel has always supported gay rights and will continue to support its gay and gay-friendly customers by carrying publications and products they appreciate."

BUTT is a quarterly magazine, founded in 2001, published and printed in the Netherlands, and available worldwide at places like the Institute of Contemporary Arts in London, Art Metropole in Toronto and the Museum of Contemporary Art in Los Angeles. The magazine features photography and interviews with renowned artists and features articles which relate to trends and lifestyles in and around the gay community.

The company knew the decision to support BUTT Magazine would be controversial when a different mother inquired about it more than two years ago. Responding to his own mother via email in 2007, CEO Dov Charney wrote: "I wanted our company to be open enough to accommodate this kind of magazine, and if I don't set the precedent now, it could become too late to get that done later." He acknowledged then that American Apparel had faced some resistance from customs officials internationally but was committed to doing whatever it took to have the magazine at every American Apparel store and online.

Since this story broke last month, American Apparel has been applauded in the community for its decision to continue carrying BUTT magazine and for its policy of respecting diverse lifestyles. "We strongly support American Apparel in its decision to continue displaying and selling BUTT Magazine as well as other alternative, gay or gay-friendly publications in its stores. Discrimination of any sort and the banning of free expression have no place in society, including the retail industry", declared Hans Janiak, President of the Quebec Gay Chamber of Commerce. Calvin Klein, Gucci, Adidas, Christian Dior, Marc Jacobs, Helmut Lang, Yves Saint Laurent are all advertisers and supporters of BUTT Magazine.

The company's "Legalize Gay" campaign to reform Proposition 8, a California law banning gay marriage has donated more than $17,000 worth of t-shirts to protesters, the Harvey Milk School and gay businesses since November 2008.

Positive Financial Results

American Apparel recently disclosed the company's comparable store sales (unaudited) for the month of January 2009. It reported that for the month of January 2009, sales for stores open for more than twelve months increased 2% over the same period a year ago, on a constant currency basis. For the month of January 2009, comparable store sales increased 40%. There were 164 stores in the sales comparison for January 2009. American Apparel opened two new retail stores during the month of January in San Francisco, California and Quebec City, Quebec.

About American Apparel

American Apparel is a vertically integrated manufacturer, distributor, and retailer of branded fashion basic apparel based in downtown Los Angeles, California. As of January 31, 2009, American Apparel employed over 10,000 people and operated more than 260 retail stores in 19 countries, including the United States, Canada, Mexico, Brazil, United Kingdom, Austria, Belgium, France, Germany, Italy, the Netherlands, Spain, Sweden, Switzerland, Israel, Australia, Japan, South Korea, and China. American Apparel also operates a leading wholesale business that supplies high quality T-shirts and other casual wear to distributors and screen printers. In addition to its retail stores and wholesale operations, American Apparel operates an online retail e-commerce website at http://store.americanapparel.net