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Abercrombie Shares Surge on Hollister Sales Jump

Abercrombie & Fitch forecast robust sales for the holiday quarter as its surf-wear brand Hollister helped revive the previously struggling retailer.
Hollister | Source: Courtesy
By
  • Reuters

NEW ALBANY, United States — Abercrombie & Fitch Co. topped estimates with third-quarter same-store sales on Friday and forecast robust sales for the holiday quarter as its California-themed surf-wear brand Hollister helped revive the previously struggling retailer.

Shares of the company, which also beat its third-quarter headline sales and profit estimates, jumped 19.5 percent to $15 in premarket trading on Friday. They are still down 23 percent in the past 12 months.

Excluding one-time items, the company, which earned 30 cents per share, beating estimates of 22 cents per share.

Same-store sales of Hollister, the key revenue contributor in recent quarters, rose 8 percent. Analysts on average had expected a 2.9 percent rise, according to Thomson Reuters I/B/E/S.

Net revenue rose nearly 5 percent to $859.11 million, beating analysts' average estimate of $818.9 million, according to Thomson Reuters I/B/E/S.

Abercrombie, which abandoned talks on a sale of its business in July after failing to find a buyer who would meet the board's valuation, said overall same-store sales rose 4 percent, beating analysts' average estimate of a 0.3 percent rise.

The company forecast percentage growth of fourth-quarter comparable sales in the low-single digits and for net sales in the mid-to-high-single digits.

By Gayathree Ganesan; editors: Sai Sachin Ravikumar and Patrick Graham.

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