ABERCROMBIE & FITCH SEES IMPROVEMENTS IN SECOND QUARTER
Ohio-based specialty retailer Abercrombie & Fitch is reporting some progress in its efforts to turn around its business. Although net sales for the second quarter were down 1 percent from last year’s 783.2 million to $779.3 million, the company has seen many successes this quarter, especially from its Hollister brand.
By brand, net sales for the second quarter increased 6 percent to $446.6 million for Hollister and decreased 8 percent to $332.7 million for Abercrombie over last year. By geography, net sales for the second quarter decreased 2 percent to $470.3 million in the U.S. and increased 2 percent to $309 million in international markets over last year. Direct-to-consumer sales grew to approximately 24 percent of total company net sales for the second quarter, compared to approximately 23 percent of total company net sales last year.
For the second half of the year, the company expects comparable sales to be approximately flat, and flat to up slightly in the second half of the year. Additionally, the company expects to open seven new stores in fiscal 2017, primarily in the U.S. The company also plans to open two new outlet stores. In addition, the company anticipates closing approximately 60 stores in the U.S. during the fiscal year through natural lease expirations.
“We are encouraged by the clear progress across all brands,” said Fran Horowitz, chief executive officer of Abercrombie & Fitch. “Through aggressive execution of our strategic plan, we delivered our third consecutive quarter of sequential comparable sales improvement. Hollister continues to build on its strong foundation, leveraging higher levels of customer engagement to drive growth across all touchpoints, and demonstrates how the customer responds when product, brand voice and brand experience are aligned. Abercrombie showed continued improvement in the areas we expected, as we brought better balance to the assortment throughout the quarter, and continued to apply the learnings from Hollister’s successes. Our focus remains on staying close to our customers and investing in our ability to meet their needs whenever, wherever and however they choose to engage with our brands.”
“While we expect the environment to remain challenging and promotional in the second half, we expect to see benefits from the continued improvement in product assortment, our strategic investments in marketing and omnichannel, and our ongoing efforts to optimize productivity across all channels,” continued Horowitz. “We are confident we are on the right path to deliver enhanced performance and long term shareholder value.”
