US: Abercrombie & Fitch Q4 profit up on new stores
- Q4 profit more than tripled to $157.2m
- Sales up 11% to $1.47bn
- CEO "pleased" with Q4 results
Net income reached US$157.2m in Q4
US teen apparel retailer Abercrombie & Fitch has today (22 February) more than tripled its fourth-quarter profit helped by a rise in sales from new international stores and lower product costs.
Under the company's new accounting method for inventory, net income reached US$157.2m for the 14 weeks to 2 February, compared with $45.8m the same period last year.
Net sales rose 11% to $1.47bn from $1.33bn the same period the year before. Total US sales edged up 1% to $976.4m, while international sales jumped 34% to $492.2m. Direct-to-consumer sales, including shipping and handling, increased 26% to $266.4m.
However, sales at stores open at least a year, including direct to consumer sales, edged down 1%. Within this, comparable store sales fell 4% and comparable direct to consumer sales jumped 17% compared with last year.
By region, comparable sales were flat for the US, but fell 3% in its international markets.
And by brand, comparable sales including online were flat for Abercrombie & Fitch, increased 4% for Abercrombie Kids, and fell 2% for Hollister Co.
"We are very pleased with our results for the fourth quarter," said Abercrombie & Fitch CEO and chairman Mike Jeffries.
"Our record sales were in line with our guidance coming into the quarter, and our earnings significantly exceeded expectations due to a strong gross margin performance for the quarter, allied with continued tight expense control.
"Despite a challenging US retail environment over the holiday period, our core US chain plus DTC comparable sales remained positive and we saw continued sequential improvement in our international business.
"We come into 2013 feeling very optimistic that we are well positioned to make continued strong progress over the next few years and to drive our operating margin and return on invested capital higher."
Over the full-year, net income under the new accounting method reached $237m, up 64.7% from $143.9m the previous year. Net sales were up 8% to $4.511bn against $4.16bn last year.
Looking forward, Abercrombie & Fitch expects fiscal 2013 earnings per share to range from $3.35 to $3.45.
US retailer Abercrombie & Fitch saw first quarter net losses narrow despite sales declining as the company faced inventory shortage issues....
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