Abercrombie soars on profits jump

Written By Unknown on Kamis, 15 November 2012 | 20.24

14 November 2012 Last updated at 11:21 ET Continue reading the main story

Abercrombie and Fitch has reported a surprise jump in profits and raised its full-year profit target, thanks to strong overseas sales.

The US teenage fashion retailer made $72m (£45m) net income in the 13 weeks to 27 October, up from $51m a year ago.

While US sales were unchanged from a year ago, international sales rose 37%.

On Wall Street, shares jumped 27% in early Wednesday trading on results that suggest the firm is more than holding its own against competitors.

Abercrombie, which also owns the Hollister brand, did not give a country-by-country breakdown of its foreign sales. However, it highlighted the opening of a new flagship store in Hong Kong, as well as other stores in Munich and Dublin.

Direct-to-consumer sales continued to displace store sales, rising 20% worldwide, while store sales fell 3% on the year. In the previous three-month period, store sales had been down by 10%.

As well as growth in the top line, the company also benefited from greater efficiency, with its net profit margin rising from 4.7% of sales to 6.1%.

The firm said it now expected to make profits for the year of $2.85-$3.00 per share, compared with market expectations before the announcement of about $2.48.


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