Aug 24, 2017
Abercrombie posts much smaller loss than expected, shares soar
Aug 24, 2017
U.S. teen apparel retailer Abercrombie & Fitch Co posted a much smaller than expected quarterly loss on Thursday, helped by robust demand for its Hollister brand, sending the company's shares soaring nearly 20 percent.
Hollister, the retailer's California beach-themed brand of surfwear, reported a 5 percent rise in comparable sales in the second quarter ended July 29, beating analysts' average estimate for a 2.9 percent increase, according to Consensus Metrix.
Abercrombie said total sales at established stores fell 1 percent. That result, too, topped analysts' expectations.
The company's upbeat results come as several teen apparel companies struggle in the face of intense competition from fast-fashion retailers such as H&M and Zara as well as online merchants such as Amazon.com Inc.
Net loss attributable to Abercrombie widened to $15.5 million, or 23 cents per share in the second quarter, from $13.1 million, or 19 cents per share, a year earlier.
Excluding one-time items, the company posted a loss of 16 cents per share. Analysts on average had expected a loss of 33 cents, according to Thomson Reuters I/B/E/S.
The retailer's net sales fell slightly to $779.3 million, also handily beating analyst expectations of $758.6 million.
Abercrombie's shares were up 18.8 percent at $11.42 in premarket trading.
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