NEW YORK — Abercrombie & Fitch Co. muscled through the holidays, reporting another quarter of robust earnings while watching sales reach nearly $1 billion.
But the company tempered expectations for same-store sales growth in the first half of 2006, saying that, while comps should remain positive, they might not be at the high double-digit levels seen over the past year.
The New Albany, Ohio-based company said Tuesday after the close of the stock market that profits in the three months ended Jan. 28 were up 57.9 percent at $164.6 million, or $1.80 a diluted share, versus $104.3 million, or $1.15, last year. Net sales surged 40 percent to $961.4 million from $687.3 million a year ago, while same-store sales were up 28 percent. Wall Street's expectations called for a profit of $1.78 on revenues of $947.2 million.
"Fiscal 2005 was an exceptional year for Abercrombie & Fitch, as we achieved record sales and earnings while enhancing the quality of our brands through strategic business investments," Michael Jefferies, chief executive officer and chairman of Abercrombie & Fitch, said in a Tuesday statement. "Our ongoing commitment to building quality in every aspect of the business gives me the confidence that we will continue our success through 2006 and beyond."
By division, sales at Abercrombie & Fitch stores were up 19 percent in the quarter to $473.6 million as same-store sales rose 18 percent. Kids' abercrombie stores saw same-store sales skyrocket 59 percent and total sales rose 57 percent to $121.8 million. At Hollister, sales jumped 71 percent to $358.9 million while same-store sales were up 34 percent.
Gross profits expanded by 20 basis points to 66.5 percent in the quarter. The company cited an improved shrink and initial markup rates.
In the full year, the specialty retailer earned $334 million, or $3.66, compared with $216.4 million, or $2.28, last year. Full-year sales jumped 37.8 percent to $2.8 billion. Excluding a 9 cent after-tax charge taken in the third quarter, the company earned $3.75, which beat analysts' expectations for $3.74.
During the fourth quarter, Abercrombie & Fitch opened five stores in Canada, made up of two Abercrombie & Fitch stores and three Hollister stores. It also opened a flagship on Fifth Avenue here.
Hermès is launching a Laundromat pop-up shop in NYC - dubbed Hermèsmatic - where customers can bring their old scarves to be dip-dyed by an expert. Get all the details on WWD.com. #wwdnews (📷: @donstahl)