Abercrombie & Fitch: FY18 comparable sales rise by 3 percent
For the full year ended February 2, 2019, Abercrombie & Fitch said, net sales of 3.6 billion dollars increased 3 percent from last year, despite the adverse impact from the loss of fiscal 2017's 53rd week, while comparable sales increased 3 percent on top of 3 percent last year. Gross profit rate was 60.2 percent, up 50 basis points from last year and up approximately 20 basis points on a constant currency basis, net of hedging and operating income was 127.4 million dollars compared to 72.1 million dollars last year, while excluding certain items, adjusted non-GAAP operating income was 138.6 million dollars compared to 100.8 million dollars last year.
Commenting on the financial update, Fran Horowitz, the company’s Chief Executive Officer, said in a statement: "We ended 2018 on a strong note, recording our sixth consecutive quarter and second consecutive full year of positive comparable sales while exceeding 1 billion dollars in annual digital sales. While delivering on the top-line, we drove gross profit rate improvement and operating expense leverage resulting in 100 basis points of adjusted EBIT margin expansion and a 77 percent improvement in adjusted net income for the full year."
Highlights of Abercrombie & Fitch’s Q4 results
Abercrombie & Fitch Co., for the fourth quarter ended February 2, 2019 reported net sales of 1.2 billion dollars, a decrease of 3 percent from last year, reflecting a combined adverse impact of approximately 6 percent from the calendar shift, the loss of fiscal 2017's 53rd week and changes in foreign currency exchange rates, while comparable sales increased 3 percent on top of 9 percent last year.
Gross profit rate was 59.1 percent, up 70 basis points and up approximately 20 basis points on a constant currency basis, while operating income was 129.7 million dollars compared to 140.3 million dollars last year. Excluding certain items, adjusted non-GAAP operating income was 148.4 million dollars last year.
Abercrombie & Fitch reveals expectations for FY19
For fiscal 2019, the company expects net sales to be up in the range of 2 percent to 4 percent, driven by positive comparable sales and net new store contribution, partially offset by an adverse impact of changes in foreign currency exchange rates of approximately 15 million dollars primarily in the first quarter of fiscal 2019. Comparable sales are expected to be up low-single digits and gross profit rate to be up slightly from the fiscal 2018 rate of 60.2 percent.
For the first quarter of fiscal 2019, the company expects net sales to be flat to last year and changes in foreign currency exchange rates to adversely impact net sales by approximately 15 million dollars, while comparable sales are expected to be in the range of flat to up 2 percent. The company’s gross profit rate is anticipated to be flat to up slightly from the fiscal 2018 rate of 60.5 percent.
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