Abercrombie & Fitch comparable net sales down in 2013

REPORT_ Abercrombie & Fitch reported unaudited fourth quarter and fiscal 2013 results with comparable sales by brand, including direct to consumer sales, decreased 10 percent for Abercrombie & Fitch, 5 percent for Abercrombie kids, and 14 percent for Hollister Co

respectively.

Net sales for the fifty-two week period ended February 2, 2013 were approximately 63 million dollars less than net sales for the reported fifty-three week period ended February 2, 2013. Net sales by brand for the fiscal year were 1.547 billion dollars for Abercrombie & Fitch, 346.7 million dollars for Abercrombie kids and 2.128 billion dollars for Hollister Co.

Net sales

for the thirteen week period ended February 2, 2013 were approximately 82 million dollars less than net sales for the reported fourteen week period ended February 2, 2013. Net sales by brand for the fourth quarter were 477.9 million dollars for Abercrombie & Fitch, 107.9 million dollars for Abercrombie kids and 684.1 million dollars for Hollister Co. Comparable sales by brand, including direct-to-consumer, decreased 6 percent for Abercrombie & Fitch, decreased 8 percent for Abercrombie kids, and decreased 10 percent for Hollister Co. The gross profit rate for the fourth quarter was 59 percent, 440 basis points lower than last year.

According to Mike Jeffries, Chief Executive Officer, “2013 was a challenging year, with sales and earnings falling well short of the objectives we set at the beginning of the year. For the fourth quarter, we are pleased that results exceeded expectations coming into the quarter. Sales from our direct-to-consumer business were particularly strong, representing nearly 25 percent of sales for the quarter, we saw sequential improvement in our comparable store sales trend, and continued to see strong results in China and Japan.”

The results reflected GAAP net income of 66.1 million dollars and net income per diluted share of 0.85 dollars for the thirteen weeks ended February 1, 2014, compared to GAAP net income of 157.2 million dollars and net income per diluted share of 1.95 dollars for the fourteen weeks ended February 2, 2013.

Additionally, the New Albany, Ohio-based company reported full year GAAP net income of 54.6 million dollars and net income per diluted share of 0.69 dollars for the fifty-two week period ended February 1, 2014, compared to GAAP net income of 237 million dollars and net income per diluted share of 2.85 dollars for the fifty-three week period ended February 2, 2013.

Excluding restructuring charges related to Gilly Hicks, other asset impairment charges, and charges related to its profit improvement initiative, the company reported adjusted non-GAAP net income of 104.3 million dollars and net income per diluted share of 1.34 dollars for the fourth quarter and adjusted non-GAAP net income of 150.6 million dollars and net income per diluted share of 1.91 dollars for the full year.

Based on an assumption of a high-single digit decline in comparable store sales and an approximate 20 percent increase in comparable direct-to-consumer sales, the company projects full year diluted earnings per share in the range of 2.15 dollars to 2.35 dollars. The guidance assumes gross margin rate for the full year that is flat to down slightly compared to fiscal 2013. The company anticipates opening 16 full-price international stores throughout the year, including an Abercrombie & Fitch flagship store in Shanghai in April 2014.