US-based apparel retailer Abercrombie & Fitch recently filed its results for the third quarter sales, which has been flat on a constant currency basis but 4 per cent less than what was reported last year for the same period. Though the comparable sales trends improved across all brands and geographies, comparable sales for the third quarter decreased 1 per cent. Net sales of US $ 878.6 million has been reported, with Abercrombie’s net sales decreasing by 6 per cent to US $ 411.3 million and Hollister’s net sales went flat at US $ 467.3 million. In the US, net sales for the third quarter dropped by 4 per cent to US $ 572.2 million and by 3 per cent globally to US $ 305.8 million.
Also Read – After American Apparel, Abercrombie & Fitch faces similar danger
21 per cent of the net sales in the third quarter were contributed by direct-to-consumer and omnichannel sales. Abercrombie & Fitch reported a gross profit rate of 63.7 per cent for the third quarter which was primarily attributed to higher average unit retails coupled with lower average unit cost. The company opened 13 new stores in this quarter and closed down two.
For the fourth quarter, the company expects comparable sales to be flat, continuation of adverse effects due to foreign currency exchange rates, and gross margin rate as well as operating expense to be flat as well. The company expects US $ 150 million worth of capital expenditures for the complete year. Abercrombie & Fitch plans to open eight new stores in the fourth quarter, with six international stores and two stores in North America. It also plans to close down about 60 stores in the U.S. during the fiscal year due to natural lease expirations. At the end of the third quarter, the company operated 790 stores in the United States and 175 stores across Canada, Europe, Asia and the Middle East.
