(Filed Under Financial and General Interest News). Helped by the 8 percent growth in comparable store sales during the month of January, Abercrombie & Fitch cited a 13 percent decrease in comparable store sales during the fourth quarter ended January 31, 2010, higher than analysts expected. Total net sales dropped 5 percent, to $936.0 million, with domestic sales down 12 percent and international net sales up 86 percent. Comparable store sales for the Abercrombie & Fitch and Hollister divisions decreased 8 percent and 19 percent, respectively.
During the fourth quarter, the company opened 24 stores, including 11 domestically and 13 internationally, and closed 53 stores, including 29 Ruehl stores. As of the end of the fourth quarter, the Ruehl chain is no longer in operation.
The company plans to open two stores domestically under its intimate apparel brand, Gilly Hicks, during 2010. The company did not release sales results for the Gilly Hicks division; however, in a February 16th conference call, Jonathan E. Ramsen, chief financial officer and executive vice president of Abercrombie & Fitch, shed some much-needed light on the company’s plans for the chain, which has remained steady at between 13 and 16 stores since launching in 2008.
“We expect that bringing Gilly Hicks to break even or beyond over the time will contribute to operating margin improvement,” Ramsen said. “We have a road map for Gilly stretching out over the next few years. For 2010 and 2011, that road map requires us to hold close to the current store count while achieving aggressive goals for increased productivity. Assuming we can achieve those goals, […] we expect to begin a ramp up of the store base in 2012.”
Mike Jeffries, chairman and chief executive officer of Abercrombie & Fitch, remarked about 2009: “We’ve been through a difficult year, but we firmly believe it was a year in which we laid foundations for future success.”
According to Jeffries, the company’s male assortment has “a clear identity,” while the women’s assortment is improving. He reported that the company plans to focus on international expansion, cash preservation while maintaining quality, and improving its product assortment over the next year.
As of the end of fiscal 2009, Abercrombie & Fitch operated 1,096 total stores including 340 Abercrombie & Fitch, 205 abercrombie, 507 Hollister Co. and 16 Gilly Hicks locations domestically, as well as six Abercrombie & Fitch, four abercrombie kids and 18 Hollister Co. locations internationally. For further information, contact the company’s investor relations department by calling (614) 283-6751, or e-mailing Investor_Relations@Abercrombie.com.
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