UPDATE 2-Abercrombie says the logo-focused offerings still a drag on sales
March 5, 2015 - fall Denim
* 4th-qtr same-store sales dump 10 pct, net sales 14 pct
* Net distinction falls by a third
* Shares dump as most as 15 pct to 6-year low
(Adds details, researcher comment, updates shares)
March 4 (Reuters) – Teen attire tradesman Abercrombie
Fitch Co pronounced a factors that led to a dump in sales in
the fourth entertain – a clever dollar and diseased direct for
clothing featuring a name and trademark – would insist in the
first half of a mercantile year.
Abercrombie Fitch shares fell as most as 15 percent to a
six-year low of $20.37 in morning trade on Wednesday.
The former teen favorite is struggling to revitalise sales of
its namesake and Hollister brands and concentration reduction on its
logo-centric clothing, that has depressed out of fashion.
The company, whose distinction fell by a third in a fourth
quarter finished Jan. 31, pronounced it approaching a disastrous impact from
reduced “logo sales” to modestly moderate in a initial half of the
fiscal year and vacate in a second half.
Teen attire retailers such as Abercrombie, American Eagle
Outfitters Inc and Aeropostale Inc have suffered
as immature American shoppers change to trendier and cheaper
offerings from “fast fashion” bondage such as Forever 21,
Inditex’s Zara and HM.
American Eagle, that was quicker to pierce divided from
logo-centric garments and take on a fast-fashion retailers,
reported both aloft distinction and sales for a quarter.
Abercrombie’s efforts to redefine a offerings have
included some-more denim styles and floral imitation dresses.
“We trust business are responding agreeably to the
improved conform assortments though a association needs to be more
aggressive with their conform buys, creation bigger bets,” Stifel
Nicolaus Co researcher Richard Jaffe pronounced in a customer note.
Abercrombie underscored a changing times by observant it
would sell a private jet. However, it pronounced a clever dollar
would equivalent a advantages of cost cuts.
The association is also expanding internationally, where it gets
about a third of a revenue.
AF non-stop 15 stores outward a United States during the
year and skeleton to open a same series this year.
Abercrombie sealed 52 U.S. stores final year and skeleton to
close 60 some-more in 2015. As of Jan. 31, it had 799 stores in the
United States and 170 outward a country.
AF’s same-store sales fell 10 percent in a fourth
quarter, while net sales slid 14 percent to $1.12 billion,
falling brief of a normal researcher guess of $1.17 billion,
according to Thomson Reuters I/B/E/S.
Excluding items, a association warranted $1.15 per share,
matching marketplace expectations.
(Reporting by Ramkumar Iyer in Bangalore; Editing by Joyjeet