Abercrombie & Fitch Q1 losses widen
Abercrombie & Fitch has reported that its losses widened to $23.7 million for the thirteen weeks to 3 May 2014 from $7.2 million a year earlier.
Net sales by brand for the first quarter were $317.8 million for Abercrombie & Fitch, $68.5 million for Abercrombie Kids and $421.6 million for Hollister Co. Comparable sales by brand, including direct-to-consumer, decreased by 1% at Abercrombie & Fitch, by 6% at Abercrombie Kids, and by 7% at Hollister.
Despite the fall in sales, the company is maintaining its guidance of full year diluted earnings per share in the range of $2.15 to $2.35, which now includes the effect of the first quarter accelerated share repurchase. The guidance is based on the assumption that full year comparable sales will be in the range of down 3 to 4%.
Abercrombie & Fitch chief executive Mike Jeffries said: “In what remains a difficult teen retail environment, we are pleased that earnings for the quarter were in line with our expectations. Overall sales for the quarter decreased 2%, which included strong growth in our direct-to-consumer business. In addition, comparable sales continued to head in the right direction, and included significant sequential improvement in our female business and our Abercrombie & Fitch brand as a whole.
Never Miss a Retail Update!“We remain focused on returning to growth, and believe we are taking the right steps and are on course to accomplish that goal. As we look forward to the rest of 2014, we have made significant improvements throughout the organization to better align us for success, and we are energized by the opportunities ahead of us.”
At the end of the first quarter, Abercrombie & Fitch operated 842 stores in the US and 157 stores across Canada, Europe, Asia and Australia. The company is expecting to open 15 full-price international stores throughout the year, including a small number of Abercrombie & Fitch international mall-based stores. It is also planning to open around eight to ten international and US outlet stores during the year.
