(Tiper Stock Exchange) – Abercrombie & Fitcha US fashion house focused primarily on youth casual fashion, closed its second quarter of fiscal year 2023 (ended July 29, 2023) with net sales $935 million, up 16% year-over-year (+16% on a constant currency basis). The gross margin it was 62.5%, up about 460 basis points from last year.
L’operational profit it was $90 million, compared to last year’s $2 million operating loss. L’net earnings per share it was $1.10, compared to a year-ago net loss per share of $0.33 and market expectations of $0.17 (according to Refinitiv data).
“Our net sales and operating margin have exceeded our expectations as global growth accelerated during the second quarter – commented the CEO Fran Horowitz – We continue to see strong customer receptiveness to our brands and products, driven by 26% net sales growth across Abercrombie Brands. To date, our efforts to evolve the positioning and assortment of Hollister brands are paying off, delivering a positive 8% return to net sales growth for the quarter. Both brands saw an improvement in their gross profit rate due to higher average unit retail sales and lower transportation costs.”
“Operating leverage from sales growth and gross margin performance contributed to an operating margin of 9.6%, a significant expansion over the second quarter of 2022,” he added. “These strong results demonstrate the power of our playbook. and our team’s ability to align product, voice and experience to meet the needs of our customers.At an operational level, we are strategically managing inventory“.
Abercrombie & Fitch has raised its forecast for the full year. It now expects net sales growth of about 10% to $3.7 billion (vs. earlier forecasts for a 2% to 4% increase) and an operating margin of 8% to 9% ( vs previous expectations for a range of 5% to 6%).
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