First Quarter Net Income Up 39%; NEW ALBANY, Ohio, May 16
/PRNewswire-FirstCall/ -- Abercrombie & Fitch Co. (NYSE:ANF)
today reported unaudited results which reflected record first
quarter net income of $56.2 million and net income per share on a
fully- diluted basis of $0.62 for the first quarter ended April 29,
2006. First Quarter Developments - Total Company net sales
increased 20% to $657.3 million; comparable store sales increased
by 6% - Abercrombie & Fitch net sales increased 4% to $312.7
million; Abercrombie & Fitch comparable store sales decreased
by 4% - abercrombie net sales increased 26% to $79.5 million;
abercrombie comparable store sales increased by 30% - Hollister net
sales increased 45% to $259.5 million; Hollister comparable store
sales increased by 13% - Net income for the first quarter increased
39% to $56.2 million from $40.4 million in fiscal 2005 - Net income
per share on a fully-diluted basis increased 38% to $0.62 in the
first quarter of 2006 from $0.45 in fiscal 2005 Mike Jeffries,
Chief Executive Officer and Chairman of the Board of Abercrombie
& Fitch Co., said: "This was an excellent quarter for our
Company; we are continuing to achieve strong financial results
against the results we posted in 2005. We made progress for the
first quarter including increased sales and margin. This
improvement, resulting in net income growth of 39%, represents a
good start to fiscal 2006. Although our results will continue to be
measured against the growth we attained last year, I am confident
that our brands are positioned to generate strong financial returns
this year." First Quarter Financial Results Net sales for the
thirteen weeks ended April 29, 2006 increased 20% to $657.3 million
from $546.8 million for the thirteen weeks ended April 30, 2005.
Total Company comparable store sales increased 6% for the quarter.
The gross profit rate for the quarter was 65.4%, up 10 basis points
compared to last year. The improvement in gross profit rate was
primarily due to a slight improvement in initial markup combined
with a slightly lower markdown rate versus last year. Stores and
Distribution expense, as a percentage of sales, decreased 130 basis
points to 39.3% from 40.6%. The decrease in rate versus last year
primarily resulted from the Company's ability to leverage store
related fixed costs combined with a reduction in store repair and
maintenance expense partially offset by increased payroll expense.
Marketing, General and Administrative expense, as a percentage of
sales, increased 130 basis points to 13.6% from 12.3%. The increase
in rate is primarily attributed to increased home office payroll,
which includes the effect of the adoption of FAS 123(R). The effect
of the adoption of FAS 123(R) for the first quarter of fiscal 2006
was $6.2 million on a pre-tax basis. The effective tax rate for the
first quarter was 35.5% as compared to 41.9% for the 2005 fiscal
year comparable period. The tax rate in the first quarter of 2006
includes a tax provision benefit related to the settlement of a tax
audit. Net income for the quarter increased 39% to $56.2 million,
or $0.62 per share on a fully-diluted basis, from $40.4 million, or
$0.45 per share on a fully-diluted basis, for the first quarter of
fiscal 2005. The effect of the adoption of FAS 123(R) for the first
quarter of fiscal 2006 was $0.04 per share on a fully-diluted
basis. 2006 Outlook Based on its first quarter results, the Company
now expects net income per share on a fully-diluted basis for the
first-half of fiscal 2006 to be in the range of $1.28 to $1.33,
including a charge of approximately $0.08 attributable to the
adoption of FAS 123(R), an increase from its previously issued
guidance for the first-half of fiscal 2006 of $1.23 to $1.28,
including the same charge related to the adoption of FAS 123(R).
The Company now expects total capital expenditures for fiscal 2006
to be between $400 million and $420 million with approximately $260
million of this amount allocated to new store construction, store
remodels, conversions, and improvements to existing stores, with
the remainder related to home office and distribution center
investments. For fiscal 2006, the Company now expects to increase
gross square-footage by approximately 11% primarily through the
addition of approximately 70 Hollister Co. stores, 20 abercrombie
stores, ten Abercrombie & Fitch stores and seven RUEHL stores.
Other Developments The Company plans to open its first European
location in London in early 2007. The Company remains on plan to
open a flagship Abercrombie & Fitch store located at The Grove
in Los Angeles in July 2006. The Board of Directors declared a
quarterly cash dividend of $0.175 per share on the Class A Common
Stock of Abercrombie & Fitch Co. payable on June 20, 2006 to
shareholders of record at the close of business on May 30, 2006.
The Company operated 348 Abercrombie & Fitch stores, 161
abercrombie stores, 327 Hollister Co. stores, and ten RUEHL stores
at the end of the first quarter of 2006. The Company operates
e-commerce websites at http://www.abercrombie.com/,
http://www.abercrombiekids.com/, and http://www.hollisterco.com/.
Today at 4:30 PM, Eastern Time, the Company will conduct a
conference call. Management will discuss the Company's performance,
its plans for the future and will accept questions from
participants. To listen to the live conference call, dial (800)
811-0667 or internationally at (913) 981-4901. To listen via the
internet, go to http://www.abercrombie.com/, select the Investor
Relations page and click on Calendar of Events. Replays of the call
will be available shortly after its completion. The audio replay
can be accessed for two weeks following the reporting date by
calling (888) 203-1112 or internationally at (719) 457-0820
followed by the conference ID number 4031334; or for 12 months by
visiting the Company's website at http://www.abercrombie.com/. SAFE
HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
OF 1995 A&F cautions that any forward-looking statements (as
such term is defined in the Private Securities Litigation Reform
Act of 1995) contained in this Press Release or made by management
of A&F involve risks and uncertainties and are subject to
change based on various important factors, many of which may be
beyond the Company's control. Words such as "estimate," "project,"
"plan," "believe," "expect," "anticipate," "intend," and similar
expressions may identify forward-looking statements. The following
factors, in addition to those included in the disclosure under the
heading "FORWARD-LOOKING STATEMENTS AND RISK FACTORS" in "ITEM 1A.
RISK FACTORS" of A&F's Annual Report on Form 10-K for the
fiscal year ended January 28, 2006, in some cases have affected and
in the future could affect the Company's financial performance and
could cause actual results for the 2006 fiscal year and beyond to
differ materially from those expressed or implied in any of the
forward-looking statements included in this Press Release or
otherwise made by management: changes in consumer spending patterns
and consumer preferences; the effects of political and economic
events and conditions domestically and in foreign jurisdictions in
which the Company operates, including, but not limited to, acts of
terrorism or war; the impact of competition and pricing; changes in
weather patterns; postal rate increases and changes; paper and
printing costs; market price of key raw materials; ability to
source product from its global supplier base; political stability;
currency and exchange risks and changes in existing or potential
duties, tariffs or quotas; availability of suitable store locations
at appropriate terms; ability to develop new merchandise; ability
to hire, train and retain associates; and the outcome of pending
litigation. Future economic and industry trends that could
potentially impact revenue and profitability are difficult to
predict. Therefore, there can be no assurance that the
forward-looking statements included in this Press Release will
prove to be accurate. In light of the significant uncertainties in
the forward- looking statements included herein, the inclusion of
such information should not be regarded as a representation by the
Company, or any other person, that the objectives of the Company
will be achieved. The forward-looking statements herein are based
on information presently available to the management of the
Company. Except as may be required by applicable law, the Company
assumes no obligation to publicly update or revise its
forward-looking statements even if experience or future changes
make it clear that any projected results expressed or implied
therein will not be realized. Abercrombie & Fitch Co. Condensed
Consolidated Statements of Income (Unaudited) Thirteen Weeks Ended
April 29, 2006 and Thirteen Weeks Ended April 30, 2005 (in
thousands except per share data) ACTUAL ACTUAL % of % of 2006 Sales
2005 Sales Net Sales $657,271 100.0% $546,810 100.0% Cost of Goods
Sold 227,355 34.6% 189,558 34.7% Gross Profit 429,915 65.4% 357,252
65.3% Total Stores and Distribution Expense 258,352 39.3% 222,223
40.6% Total Marketing, General and Administrative Expense 89,699
13.6% 67,146 12.3% Other Operating Income, Net (2,121) -0.3% (406)
-0.1% Operating Income 83,985 12.8% 68,289 12.5% Interest Income,
Net (3,166) -0.5% (1,220) -0.2% Income Before Income Taxes 87,151
13.3% 69,509 12.7% Income Tax Expense 30,911 4.7% 29,150 5.3%
Effective Rate 35.5% 41.9% Net Income $56,240 8.6% $40,359 7.4% Net
Income Per Share: Basic $0.64 $0.47 Fully-Diluted $0.62 $0.45
Weighted-Average Shares Outstanding: Basic 87,858 86,221
Fully-Diluted 91,327 89,800 Abercrombie & Fitch Co. Condensed
Consolidated Balance Sheets (in thousands) (unaudited) ASSETS April
29, 2006 January 28, 2006 Current Assets Cash and Equivalents
$79,552 $50,687 Marketable Securities 349,690 411,167 Receivables
33,813 41,855 Inventories 336,654 362,536 Deferred Income Taxes
27,333 29,654 Other Current Assets 49,888 51,185 Total Current
Assets 876,930 947,084 Property and Equipment, Net 881,536 813,603
Other Assets 28,607 29,031 Total Assets $1,787,073 $1,789,718
LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Accounts
Payable and Outstanding Checks $125,501 $145,313 Accrued Expenses
218,701 215,034 Deferred Lease Credits 32,876 31,727 Income Taxes
Payable 53,629 99,480 Total Current Liabilities 430,707 491,554
Long-Term Liabilities Deferred Income Taxes 32,714 38,496 Deferred
Lease Credits 196,980 191,225 Other Liabilities 78,382 73,326 Total
Long-Term Liabilities 308,076 303,047 Total Shareholders' Equity
1,048,290 995,117 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
$1,787,073 $1,789,718 DATASOURCE: Abercrombie & Fitch CONTACT:
Thomas D. Lennox, Vice President, Corporate Communications of
Abercrombie & Fitch Co., +1-614-283-6751 Web site:
http://www.abercrombie.com/ http://www.abercrombiekids.com/
http://www.hollisterco.com/
Copyright
Abercrombie and Fitch (NYSE:ANF)
Historical Stock Chart
From Jun 2024 to Jul 2024
Abercrombie and Fitch (NYSE:ANF)
Historical Stock Chart
From Jul 2023 to Jul 2024