Stock moves up
On June 1, Abercrombie & Fitch (ANF) stock had risen 5.5% as of 8:22 AM Eastern Time after the company announced its fiscal first-quarter results. The company’s sales of $730.9 million beat analysts’ projection of $695.7 million.
Its adjusted loss per share was $0.56, much smaller than the loss of $0.77 per share expected by analysts. Foreign exchange contributed to 4% of the company’s sales growth and $0.03 of its bottom line.
This fiscal year, Abercrombie & Fitch expects sales growth of 2%–4%, with foreign exchange adding $50 million to sales. The loss of the 53rd week this year is expected to impact sales by $40 million.
Quarter in detail
YoY (year-over-year), Abercrombie & Fitch’s sales rose 11%, driven by strong Hollister brand sales, international operations, and D2C (direct-to-customer) sales. Its D2C sales rose 14% to $200.7 million, comprising 27% of overall sales.
Hollister brand sales rose 13% while Abercrombie sales rose 7%. US sales rose 10%, and international sales rose 12%. The company’s comps grew 5% in the first quarter, with US comps rising 8% YoY and international comps staying flat. Hollister comps grew 6%, while Abercrombie comps grew 3%.
Abercrombie & Fitch’s gross margin expanded 20 basis points to 60.5%, while its store and distribution expenses rose 0.3% and its marketing, general, and administrative expenses rose 13.7%. However, its higher revenue and gross profit reduced its operating loss YoY, to $42.2 million from $69.9 million.
The company’s reported loss per share shrank YoY to $0.62 from $0.91. It repurchased 0.8 million shares for $19 million in the first quarter.