- Prachi Singh |
Abercrombie & Fitch’s GAAP net income per diluted share was 0.15 dollar for the third quarter ended October 28, 2017, compared to 0.12 dollar for the third quarter last year. Excluding certain items, the company reported adjusted non-GAAP net income per diluted share of 0.30 dollar for the quarter, compared to 0.02 dollar last year. Net sales were 859.1 million dollars, up 5 percent over last year, with comparable sales for the third quarter up 4 percent and changes in foreign currency exchange rates benefiting net sales by 1 percent.
Commenting on the results, Fran Horowitz, the company’s CEO said in a press release: "We are pleased by the clear progress across all brands, delivering another quarter of sequential comparable sales improvement, and a return to positive comparable sales. This sales performance in combination with disciplined expense management drove profit growth, despite the promotional environment.”
Review of the third quarter sales results
By brand, net sales for the third quarter increased 10 percent to 508.1 million dollars for Hollister and decreased 2 percent to 351 million dollars for Abercrombie over last year. By geography, net sales increased 4 percent to 554.7 million dollars in the US and 5 percent to 304.4 million dollars in international markets over last year.
Direct-to-consumer sales grew to approximately 24 percent of total company net sales for the third quarter, compared to approximately 23 percent of total company net sales last year.
The gross profit rate for the third quarter was 61.3 percent, 80 basis points lower than last year on a constant currency basis, as lower average unit cost was more than offset by lower average unit retail. Net other operating income was 0.1 million dollars compared to 0.8 million dollars last year. Operating income was 22.7 million dollars compared to 19.6 million dollars last year. Excluding certain items, adjusted non-GAAP operating income was 37.3 million dollars compared to 13.6 million dollars last year.
Net income attributable to Abercrombie & Fitch Co. was 10.1 million dollars compared to 7.9 million dollars last year. Excluding certain items, adjusted non-GAAP net income attributable to Abercrombie & Fitch Co. for the third quarter was 20.5 million dollars compared to 1.4 million dollars last year.
On November 14, 2017, the board of directors declared a quarterly cash dividend of 0.20 dollar per share on the Class A Common Stock of Abercrombie & Fitch Co., payable on December 11, 2017 to stockholders of record at the close of business on December 1, 2017.
Abercrombie & Fitch reveals Q4 outlook
For the fourth quarter of fiscal 2017, the company expects, comparable sales to be up low-single digits, and net sales to be up mid- to high-single digits, including benefits from the 53rd week and changes in foreign currency exchange rates. The 53rd week is expected to benefit net sales by approximately 38 million dollars and operating income by approximately 2 million dollars.
Changes in foreign currency exchange rates is expected to benefit net sales by approximately 20 million dollars and operating income by approximately 5 million dollars, net of hedging. A gross profit rate is anticipated to be down approximately 100 basis points to last year's rate of 59.3 percent, in line with the third quarter year-over-year decline.
The company said, in addition to the five stores opened year to date, including two outlet stores, the company expects to open four new full-price stores in the fourth quarter. The company anticipates closing up to 60 stores in the US by year-end through natural lease expirations, including 14 stores closed to date.
- Prachi Singh |
Foot Locker has reported third quarter net income of 102 million dollars or 0.81 dollar per share, compared with 157 million dollars or 1.17 dollars per share in the same period of 2016. Third quarter comparable-store sales decreased 3.7 percent and total sales decreased 0.8 percent, to 1,870 million dollars. Excluding the effect of foreign currency fluctuations, total sales decreased 2.3 percent.
“The company’s results in the quarter were broadly in line with our expectations,” said Foot Locker’s Richard Johnson, Chairman and Chief Executive Officer, adding, “Despite the highly promotional environment we still see in the marketplace, the availability of premium product is gradually improving compared to the first half of the year, and we believe we can achieve, and perhaps modestly exceed, the top- and bottom-line guidance we gave for the fourth quarter back in August.”
Third quarter highlights of Foot Locker results
The company’s gross margin rate decreased to 31 percent of sales from 33.9 percent a year ago. The company said, third quarter results included a 13 million dollars pre-tax charge related to reducing and reorganizing corporate and division staff. Excluding this charge, which reduced after-tax earnings by 6 cents per share, non-GAAP earnings were 0.87 dollar per share compared to 1.13 dollars per share in the comparable period of 2016.
Net income for the Company’s first nine months of the year decreased to 333 million dollars or 2.55 dollars per share on a GAAP basis, compared to net income of 475 million dollars or 3.50 dollars per share, for the corresponding period in 2016. Year-to-date sales were 5,572 million dollars, a decrease of 1.4 percent, while comparable store sales decreased 2.9 percent. Total year-to-date sales, excluding the effect of foreign currency fluctuations, decreased by 1.5 percent.
During the third quarter, the company opened 12 new stores, remodelled or relocated 41 stores, and closed 22 stores. As of October 28, 2017, the company operated 3,349 stores in 23 countries in North America, Europe, Australia, and New Zealand. In addition, 83 franchised Foot Locker stores were operating in the Middle East, as well as 14 franchised Runners Point stores in Germany.
- Prachi Singh |
Total sales at Destination XL Group, for the third quarter increased 1.8 percent to 103.7 million dollars, while comparable sales decreased 0.1 percent. Gross margin, inclusive of occupancy costs, was 43.2 percent compared with 44.4 percent for the prior year's third quarter. Net loss was 5.7 million dollars or 0.12 dollar per diluted share compared with 4.5 million dollars or 0.09 dollar per diluted share, for the prior year's third quarter.
"Our third quarter results reflect the difficult retail apparel environment that has persisted for most of 2017," said the company’s President and CEO David Levin in a media statement, adding, "Unseasonably warm weather, disruption from Hurricanes Irma and Harvey, and no incremental marketing support all contributed to a 5 percent decline in store traffic. Despite the soft results for the third quarter, we are optimistic regarding the fourth quarter.”
Third quarter EBITDA declines to 2.8 mn dollars
On a non-GAAP basis, assuming a normalized tax rate of 40 percent, adjusted net loss for the third quarter was 0.07 dollar per diluted share compared with 0.05 dollar per diluted share for the prior year's third quarter. EBITDA was 2.8 million dollars compared with 3.9 million dollars for the third quarter of fiscal 2016.
During the first nine months of fiscal 2017, the company opened a total of 19 DXL retail stores, with 2 DXL retail stores opened in Ontario, Canada, and 1 DXL outlet store.
On a trailing twelve-month basis, ecommerce sales, as a percentage of net sales, the company said, were 20.8 percent at the end of the third quarter of fiscal 2017 as compared to19.5 percent at the end of the prior year's third quarter.
Destination XL revises FY17 Outlook
As a result of the sales shortfall in the third quarter of fiscal 2017, the company has revised guidance for fiscal 2017 and now expects total sales to range from 466 million dollars to 470 million dollars, with comparable sales being flat to an increase of 2 percent. This compares to a decrease from previous guidance of total sales of 470 to 480 million dollars and a comparable sales increase of 1 percent to 4 percent.
Gross margin rate is expected to be approximately 45 percent to 45.5 percent, a decrease of 50 basis points to flat from fiscal 2016 against previous guidance of 45.5 percent to 46 percent. Net loss, on a GAAP basis is expected to be between 17 to 21 million dollars, or 0.35 dollar to 0.42 dollar per diluted share, a decrease from previous guidance of 11.7 to 16.7 million dollars, or 0.24 dollar to 0.34 dollar per diluted share. EBITDA is anticipated to be between 16 to 20 million dollars, a decrease from previous guidance of 20 to 25 million.
Adjusted net loss, on a non-GAAP basis is expected of 0.21 dollar to 0.25 dollar per diluted share, a decrease from previous guidance of 0.14 dollar to 0.21 dollar per diluted share), assuming a normal tax rate of 40 percent.
Picture:Destination XL website
- Prachi Singh |
Developer of designer outlets, McArthurGlen Group has announced that total sales across its 24-centre portfolio increased to 4.5 billion euros (5.3 billion dollars) in 2017. The company recently also announced the appointment of Tom Enraght-Moony as its new Chief Customer Officer.
Commenting on the company’s strong trading performance, Julia Calabrese, McArthurGlen’s CEO, said in a statement: “Over the past 12 months our programme of new development, acquisition and expansion has added 85,000 sq. m. of new retail space in major catchment and tourist locations, taking our collective 90 minute catchment to 160 million consumers. Through these new centres and expansions McArthurGlen has delivered 400 additional stores, partnered with over 100 new brands, grown footfall to 90 million visits and created nearly 3,000 new jobs.”
Developments at McArthurGlen in 2017
In April 2017 the group opened the first designer outlet in the South of France, Designer Outlet Provence, which the company expects to attract nearly two million visitors by the end of the year. The 120 million euro centre will unveil its latest store this November, and department store Printemps will open doors to its first ever outlet store in 150 years.
The company said, April 2017 also saw McArthurGlen complete the acquisition of the Rosada Fashion Outlet in the Netherlands, one of the largest in the McArthurGlen portfolio. In addition, four of McArthurGlen’s most successful centres - Serravalle and Noventa in Italy, Roermond in the Netherlands and Parndorf in Austria - also opened new phases.
With a portfolio of 3000 stores the group completed over 500 leasing deals in the past 12 months. The company added that the group’s retail offering has been enhanced with over 100 new brands from Longchamp and Montblanc in Roermond to Hotel Chocolat in Cheshire Oaks and Fendi in Serravalle.
“In the last 12 months we have introduced several new product categories, with each centre evolving its brand mix in line with its customer profile,” added Adrian Nelson, McArthurGlen's Group Leasing and Brand Development Director.
The company added that in the past 12 months tax free sales rose by 13 percent, with like-for-like international spend growing by 50 percent over a three year period. China, Russia and South Korea remain the most prominent markets, McArthurGlen said, adding, accounting for over 50 per cent of all tax-free sales, spending on average six times more than other customers.
The company future key developments include, McArthurGlen’s entry into the Spanish market with Malaga designer outlet due to open in autumn 2018. Spring 2019 will see the launch of McArthurGlen designer outlet Vancouver Airport Phase II that will add 40 new stores. Opening in autumn 2019, McArthurGlen designer outlet Ashford Phase II will add 35 new stores to Richard Roger’s designed centre. Taking the McArthurGlen portfolio to 26 centres and scheduled to open in 2020, McArthurGlen designer outlet Remscheid will be the next new centre to open in the German market.
Looking for a job at McArthurGlen? Click here.
Picture:Facebook/Designer Outlet Roermond
- Prachi Singh |
Vivienne Westwood has posted a drop in pre-tax profit to 1.9 million pounds for the year to December 31, 2016 compared to 2.3 million pounds last year, according to the accounts filed by the company.
The company’s operating profit dropped from 2.5 million pounds to 1.3 million pounds. However the company managed to increase its turnover from 33.7 million pounds to 37.5 million pounds.
The label founded by the British fashion designer Vivienne Westwood is loved by A-list personalities including Prime Minister Theresa May. The company recently opened doors to a new store in Amsterdam, the first boutique to be launched in the Netherlands .
- Simone Preuss |
The Accord on Fire and Building Safety in Bangladesh (Accord) has issued its quarterly progress report, finding that the overall remediation progress for the more than 1,600 factories covered by it stands at 80 percent. There is even 100 percent remediation from initial inspections at 120 factories and 90 percent or more at 665 factories. In addition, the Safety Committee training curriculum has been completed at 159 factories and 208 health and safety complaints have been resolved.
Thinking back to numerous garment factory fires and the collapse of the Rana Plaza building that triggered the massive remediation effort, it is reassuring to know that 94.8 percent of factories have removed lockable and/or collapsible gates, meaning workers have more chances of escaping the factory in an emergency. Prior to the initiative, factories often just had one escape route and door, which triggered panic among the workers and led to many being trapped.
Another big problem was fire warning systems and sprinklers not being in place. As of 1st October, 2017, the full installation of such systems including final verification of testing and commissioning has been completed at a little less than one third (31.3 percent) of all factories. However, most of them have submitted fire alarm and fire detection design drawings to the Accord and are in the process of ordering and installing the systems.
After four years of work in Bangladesh, the Accord finds: "While marking this significant progress, major life-threatening safety concerns remain outstanding in too many factories and need to be fixed urgently. These include: inadequately protected fire exits, inadequate fire alarm and fire protection systems and outstanding structural retrofitting work."
This shows that it is necessary that the Accord be extended beyond its initial five-year duration, which will run out in May 2018, also in view of the Alliance for Worker Safety in Bangladesh not being extended beyond 2018 but being transitioned to various local stakeholders. An extension for another three years of the Accord has already been announced and 49 brands and retailers have already signed the new Accord, covering almost 1,200 of the current Accord factories. However, more still need to join.
Currently, the Accord "monitors completion of remediation at the 1600+ factories with more than 100 engineers on staff who conduct up to 500 follow-up inspections each month. Each factory covered by the Accord is inspected approximately once every three to four months. The Accord secretariat further conducts targeted remediation review meetings with individual signatory companies to identify high priority factories where remediation must be accelerated."
Thanks to refinements made to Accord’s data system, the remediation progress at all factories covered can now be analysed more in-depth by looking at the progress rate of the most common fire, electrical and structural items that need to be remediated. These and other details, including the progress made over the years, can be found in the latest quarterly report via the Accord's website, bangladeshaccord.org.
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Read more on the most recent developments concerning the Bangladesh Accord. Navigate through the timeline by clicking the arrows.
- Prachi Singh |
Shoe Carnival reported net sales of 287.5 million dollars for the third quarter of fiscal 2017, a 4.7 percent increase, while comparable store sales increased 4.4 percent. Gross profit margin decreased 0.1 percent to 29.8 percent compared to 29.9 percent in the third quarter of fiscal 2016. Net income for the quarter was 10.7 million dollars or 0.66 dollar per diluted share compared to 9.7 million dollars or 0.54 dollar per diluted share.
“During the quarter, our traffic was down low single digits, particularly due to the three hurricanes affecting Texas, Florida and Puerto Rico. Despite the inclement weather in these regions, we experienced solid increases in both units per transaction and conversion which helped drive a 4.4 percent increase in comparable store sales for the quarter. These increases, combined with our ongoing commitment and ability to effectively manage expenses, resulted in a 22 percent year-over-year increase in quarterly earnings per diluted share.”
Net sales for the nine months rise by 9 mn dollars
Net sales during the first nine months of fiscal 2017 increased 9 million dollars to 775.9 million dollars and comparable store sales increased 0.4 percent.
Net earnings were 22.8 million dollars or 1.38 dollars per diluted share, compared to 24.4 million dollars or 1.31 dollars per diluted share, in the first nine months of fiscal 2016. The gross profit margin was 29.1 percent compared to 29.3 percent in the same period last year.
Shoe Carnival expects to post rise in FY17 net sales
The company expects fiscal 2017 net sales to be in the range of 1.020 billion dollars to 1.025 billion dollars, with comparable store sales flat to up low single digits. Earnings per diluted share are expected to be in the range of 1.42 dollars to 1.49 dollars compare to fiscal 2016 earnings per diluted share of 1.28 dollars and adjusted earnings per diluted share were 1.40 dollars.
The company opened 19 stores and closed ten stores during the first nine months of fiscal 2017 compared to 15 store openings and five store closings in the first nine months of fiscal 2016. The company expects to open 19 stores and close 26 stores during fiscal 2017 compared to opening 19 stores and closing nine stores during fiscal 2016.
- Prachi Singh |
Ross Stores reported earnings per share for the third quarter ended October 28, 2017 of 0.72 dollar, a 16 percent increase from 0.62 dollar last year. Net earnings grew to 274 million dollars, up from 245 million dollars in the prior year. The company’s third quarter sales rose 8 percent to 3.3 billion dollars, with comparable store sales up 4 percent on top of a 7 percent increase last year.
Commenting on the positive trading, Barbara Rentler, the company’s Chief Executive Officer, said in a press release, “Our third quarter sales and earnings outperformed our expectations despite being up against our toughest prior year comparisons and two major hurricanes during the quarter. We are pleased with these strong results, which reflect our continued market share gains in a challenging retail environment.”
For the first nine months of fiscal 2017, earnings per share were 2.36 dollars, up 15 percent on an 11 percent gain last year. Net earnings were 912 million dollars compared to 817 million dollars in the prior year. Sales year-to-date rose 8 percent to 10.1 billion dollars, with comparable store sales up 4 percent.
“For the 13 weeks ending January 27, 2018, comparable store sales are now forecast to increase 2 percent to 3 percent versus a 4 percent gain last year. Earnings per share for the 14 weeks ending February 3, 2018 are projected to be 0.88 dollar to 0.92 dollar, up from 0.77 dollar in the prior year period. Based on this updated guidance and our year-to-date results, we are now planning earnings per share for fiscal 2017 to be in the range of 3.24 dollars to 3.28 dollars. Both our fourth quarter and full year guidance include an approximate 0.08 dollar benefit to earnings per share from the 53rd week in fiscal 2017,” added Rentler.
Picture:Ross Stores website
- Prachi Singh |
Gap’s third quarter diluted earnings per share were 0.58 dollar, while total company comparable sales increased 3 percent versus a 1 percent decrease last year, which the company said, excluded an estimated negative impact from the Fishkill distribution center fire of approximately 2 percentage points. Net sales for the third quarter were 3.84 billion dollars compared with 3.80 billion dollars for the third quarter of fiscal year 2016.
“Today, we are happy to report our fourth consecutive quarter of positive comps, reflecting the continued momentum in key parts of our business,” said Art Peck, President and CEO, Gap, in a media statement.
Gap Global posts positive same-store sales growth
Comparable sales at Old Navy Global: positive 4 percent versus positive 4 percent last year, excluding an estimated negative impact from the Fishkill distribution center fire of approximately 1 percentage point.
Comparable sales at Gap Global were positive 1 percent versus negative 4 percent last year, excluding an estimated negative impact from the Fishkill distribution center fire of approximately 4 percentage points, while Banana Republic Global reported negative 1 percent comparable sales rise versus negative 6 percent last year, excluding an estimated negative impact from the Fishkill distribution center fire of approximately 2 percentage points.
Gap raises FY17 earnings guidance
The company has raised its reported diluted earnings per share guidance for fiscal year 2017 to be in the range of 2.18 dollars to 2.22 dollars. Adjusted to exclude the second quarter benefit from insurance proceeds related to the Fishkill fire of about 0.10 dollar, the company now expects adjusted diluted earnings per share to be in the range of 2.08 dollars to 2.12 dollars.
The company noted that foreign currency fluctuations negatively impacted earnings per share for the third quarter by an estimated 0.02 dollars or about 3 percentage points of earnings per share growth compared with the adjusted earnings per share for the third quarter of fiscal year 2016. The company now expects comparable sales for fiscal year 2017 to be up low-single-digits.
Gap paid a dividend of 0.23 dollar per share during the third quarter and in addition, on November 9, 2017, the company announced that its board of directors authorized a fourth quarter dividend of 0.23 dollar per share.
The company ended the quarter with 3,639 store locations in 46 countries, of which 3,193 were company-operated. The company now expects to close about 30 company-operated stores, net of openings and repositions.
- Prachi Singh |
Nike’s board of directors has approved a quarterly cash dividend of 0.20 dollar per share on the company’s outstanding Class A and Class B Common Stock, which the company said an 11 percent increase over the prior quarterly dividend rate of 0.18 dollar per share.
“This marks Nike’s 16th consecutive year of increasing dividend payouts,” said Mark Parker, Chairman, President and CEO of Nike in a statement, adding, “Today’s announcement, combined with the four-year 12 billion dollars share repurchase program we announced in 2015, demonstrates our continued confidence in generating strong cash flow and returns for shareholders through our new Consumer Direct Offense as we continue to invest in fuelling sustainable, long-term growth and profitability.”
This dividend, Nike added is payable on January 2, 2018 to shareholders of record at the close of business December 4, 2017.