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Last Update: 14-Nov-12 08:42 ET
Abercrombie & Fitch shares soar 30% following beat on earnings and upside guidance
Abercrombie & Fitch (ANF $40.60 +9.42) reported third quarter earnings of $0.87 per share, $0.27 better than the Capital IQ consensus of $0.60, while revenues rose 8.7% year/year to $1.17 billion versus the $1.11 bln consensus. Total U.S. sales, including direct-to-consumer sales, were approximately flat at $818.6 million. Total international sales, including direct-to-consumer sales, increased 37% to $351.1 million. Total Company direct-to-consumer sales, including shipping and handling, increased 20% to $158.3 million. Total comparable store sales for the quarter decreased 3% relative to last year. By brand, comparable store sales decreased 4% for Abercrombie & Fitch, 3% for abercrombie kids, and 1% for Hollister Co. The gross profit rate for the third quarter was 62.5%, 240 basis points higher than last year's third quarter gross profit rate, driven by a decrease in average unit cost and an international mix benefit, partially off-set by a slight decrease in average unit retail and an adverse effect of exchange rates. The company issued upside guidance for fiscal year 2013 with raised EPS to approximately $2.85-3.00, excluding non-recurring items, from $2.50-2.75 versus the $2.49 consensus. This projection assumes a mid single digit percentage decrease in comparable store sales for the fourth quarter and a slightly higher gross margin rate for the quarter relative to the year-to-date rate. During Q3, the co repurchased 3.0 million shares of its common stock at an aggregate cost of ~$104.3 million.
