Abercrombie & Fitch (ANF) Q3 2023 Quarterly Earnings

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Abercrombie & Fitch.

Courtesy: Abercrombie & Fitch

Abercrombie & Fitch On Tuesday it blew away estimates as it posted a 20% jump in sales thanks to a strong back-to-school shopping season and growth at both its namesake brand and Hollister.

The slow-moving retailer, which has bounced back after years of stagnation, raised its sights again as it continues to face an overall slowdown across the clothing industry.

The company’s shares fell more than 5% in premarket trading, however. Through Monday’s close, the stock was up 215% on the year.

Here’s how Abercrombie did in its fiscal third quarter compared to Wall Street expectations, based on a survey of analysts by LSEG, formerly Refinitiv:

  • Earnings per share: $1.83 today stands at 1.18 $
  • Income: $1.06 billion vs $981 million expected

The company reported net income of $96.2 million, or $1.83 per share, for the three months ended Oct. 28, compared with a loss of $2.21 million, or 4 cents per share, a year earlier. that.

Sales rose to $1.06 billion from $880 million a year earlier.

For its holiday quarter, Abercrombie expects net sales growth to be in the low double digits compared to the prior year, which is in line with the 11.6% that analysts had expected, according to LSEG.

It expects its operating margin to be in the range of 12% to 14%, compared to 7.7% a year ago and ahead of expectations of 11.3%, according to StreetAccount. The expected increase is driven by a higher gross profit margin, lower freight costs and higher retail prices.

For the full year, the company expects net sales to grow between 12% and 14%, up from a previous view of around 10% and ahead of the 10.8% increase that analysts had been expecting, which according to LSEG. Operating margin is expected to be around 10%, up from the previous range of 8% to 9%, which is what analysts had been expecting, according to StreetAccount. The expected increase is driven by lower commodity and raw material costs.

In the quarter, Abercrombie saw sales at its name brand grow 30% to $548 million and revenue at Hollister grew 11% to $509 million. Same store sales were up 16% across both brands.

“Our strong third quarter results, with net sales and operating margin well above our expectations, speak to the power of our playbook working globally across our brand portfolio,” said CEO Fran Horowitz in a press release. “Heading into the important holiday season, our fiscal 2023 results to date give us confidence that we can continue to deliver for our customers and drive profitable growth.” operating margin.”

Abercrombie stock has soared this year as the company’s transformation continues to bear fruit. For years, Abercrombie was known for its iconic t-shirts and jeans and shirtless male models, which in turn led critics to accuse the company of racism and exclusion.

In the years since Horowitz took over as CEO of the brand, Abercrombie has transformed into an inclusive retailer with a product range that continues to appeal to consumers.

Read the full earnings release here.

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