Abercrombie & Fitch (ANF) Second Quarter 2024 Earnings | Wilnesh News

Abercrombie & FitchRevenue rose 21% in the fiscal second quarter as the apparel company continued to build on its rapid growth.

The sales growth followed a 16% gain in the same period last year, prompting the company to issue bullish guidance for the quarter. Still, its full-year outlook remains broadly in line with expectations, as it has one week less to prepare this year than last year.

Chief Executive Fran Horowitz, who often says good companies win in any economic environment, may be bracing for a turbulent second half of the year as she cited uncertainty about economic conditions in the company’s earnings report for the first time in four quarters.

“We delivered strong first-half results and are raising our full-year outlook. While we continue to operate in an increasingly uncertain environment, we remain steadfast in executing our global strategy and maintaining discipline on inventory and spending.” Horowitz. “We are confident in our ambition to deliver sustainable profitable growth this year, while making strategic long-term investments in marketing, digital and technology, and stores to deliver future growth.”

Here’s how Abercrombie performed compared to Wall Street expectations, according to a survey of analysts by LSEG (formerly Refinitiv):

• Earnings per share: $2.50 vs expected $2.22
• income: $1.13 billion vs. $1.10 billion expected

The company reported net income of $133 million, or $2.50 a share, for the three months ended Aug. 3, compared with $57 million, or $1.10 a share, a year earlier.

Sales increased to US$1.13 billion, an increase of approximately 21% from US$935 million in the same period last year.

This quarter, same-store sales jumped 18% on better-than-expected summer and back-to-school sales.

Abercrombie expects sales to grow by a low double-digit percentage this quarter, better than the 8.9% growth expected by LSEG analysts.

Abercrombie raised its full-year sales guidance to 12% to 13% growth from 10%, which is roughly in line with the 12% growth LSEG analysts had expected.

The company’s fiscal 2024 will be one week shorter than fiscal 2023, which could affect its full-year guidance. Abercrombie expects the loss of one week’s sales to impact its holiday quarter by $80 million, or 5.5 percentage points. The company expects full-year sales to grow by $50 million, or 1.2 percent.

Last year, Abercrombie was hailed as retail’s biggest comeback story, and investors have been watching to see whether the company can keep growing.

Horowitz sees international markets and the company’s Hollister and Abercrombie Kids brands, which are already driving sales, as growth vehicles.

This quarter, Hollister sales grew 17%, and comparable sales grew 15%. In the company’s Europe, Middle East and Africa division, sales grew 16%.

Costly international expansion has been one of the missteps that have hampered Abercrombie’s performance in the past, but the company is taking a different approach this time around.

Earlier this month, the company announced a partnership with children’s apparel licensor Haddad Brands to create new distribution channels for Abercrombie Kids and expand its product line to include infant and toddler categories.

“As we work to diversify A&F Co.’s pipeline portfolio and drive sustainable profitable growth, we are excited to partner with Haddad Brands to build on our success and create opportunities for the future by engaging with new customers. Several years of opportunity to grow the brand globally,” Horowitz said in a statement at the time.

Abercrombie Kids products will be available at Haddad Brands’ global showrooms next month.