Net income attributable to the company rose to $41.9 million, or 60 cents per share, in the third quarter ended October 31, from $18.2 million, or 25 cents per share, a year earlier.
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Abercrombie, once popular for its logo-emblazoned polo shirts, sweatpants and sweatshirts, has had a tough few years, struggling to cope with rapidly changing consumer tastes and stiff competition from relatively new entrants H&M HMb.ST and Inditex’s ITX.MC Zara – leaders in the fast fashion industry.
Marketing, general and administrative expense climbed to $117.7 million from $105.0 million.
“Our third quarter results exceeded our expectations coming into the quarter and provide the strongest validation yet that our initiatives are working, said Abercrombie & Fitch Executive Chairman Arthur Martinez in a statement”.
Abercrombie’s comparable-store sales fell 1 percent in the quarter, less than the 2.4 percent drop analysts on average were expecting, according to research firm Consensus Metrix. Although that was less than $911.5 million during the same time a year ago, it was better than Wall Street expectations of $862.8 million. Analysts estimated 22 cents, on average.
But that decline in the current environment appeared palatable for investors. Late Thursday, Gap reported a 4 percent decline at name brand stores, and a 12 percent decline at its Banana Republic locations. Comparable sales include online revenue and sales from stores open at least a year while excluding the effects of currency fluctuations.
“If you have the right product, there is a trend going on that is allowing teen retailers to grow same-store sales”, Nomura Equities Research analyst Simeon Siegel said.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research.
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Abercrombie & Fitch (NYSE:ANF) soared on Friday after the retailer reported a higher-than-expected third-quarter revenue, buoyed by rebounding sales at its Hollister unit. The gross margin rate is expected to be level with last year’s mark. Third-quarter results also compare to the Thomson Reuters consensus estimates for EPS of $0.22 and $864.65 million in revenues.
