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Abercrombie Sales Decline More Than Estimated After Slow Holiday

Abercrombie & Fitch Co., the teen retailer looking for a new chief executive officer, posted a worse fourth-quarter sales decline than expected after struggling to lure customers during the holidays.
Abercrombie & Fitch in Seoul | Source: Abercrombie & Fitch
By
  • Bloomberg

NEW YORK, United States — Abercrombie & Fitch Co., the teen retailer looking for a new chief executive officer, posted a worse fourth-quarter sales decline than expected after struggling to lure customers during the holidays.

Sales at comparable stores, which includes locations open at least a year as well as e-commerce orders, fell 10 percent, the New Albany, Ohio-based company said in a statement on Wednesday. Analysts had projected an 8.2 percent drop, according to Consensus Metrix. Excluding some items, earnings amounted to $1.15 in the period, which ended Jan. 31. That matched estimates, according to data compiled by Bloomberg.

Abercrombie is trying to reconnect with teen customers by revamping marketing, updating stores and and reducing the use of its logo, which suffered from overexposure. The retailer is looking for a new CEO after Mike Jeffries, 70, left the company in December. The company also is working to cut costs and limit discounting.

“They seem to be very promotional,” Jeffrey Toohig, a New York-based analyst at International Technology Group Inc., said in an interview before the results. “They’re losing the very defining logo business, and they don’t seem to have found a way to replace it with something identifiable.”

The shares fell 0.6 percent to $23.84 in early trading at 7:42 a.m. New York time. Abercrombie had slid 16 percent this year through Tuesday’s close of regular trading, compared with a 2.4 percent gain for the Standard & Poor’s 500 Index.

A strong U.S. dollar also will continue to hamper spending by tourists and reduce profit from Europe.

“We expect the first half of 2015 to remain challenging,” Chairman Arthur Martinez said in the statement.

By: Lindsey Rupp; editor: Nick Turner.

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