Abercrombie & Fitch continues on its rocky road to turn-around, and announced several initiatives at its November 6th meeting. However today, November 21, 2013, the financials came out reporting $15.6 million net loss. Sales were down 11.7% to $1.03 billion from $1.67 billion in Q3 last year.
The transfer of Gilly Hicks to their Hollister stores and closure of the stand-alone Gilly Hicks stores also made an impact.
According to Mike Jeffries, Chairman and CEO, “Our results for the third quarter reflect weakness in top-line performance, which we expect to continue in the fourth quarter. However, we continue to work hard to offset these conditions and are aggressively pursuing initiatives we believe will improve the sales trend as we go forward.
We believe a disciplined approach to execution of our long-term strategic plan will drive meaningful improvements in both the short and long-term. We have iconic brands with global appeal, a clearly defined aesthetic and a reputation for quality, heritage, and timeless fashion. We will continue to leverage those strengths as we adapt to changing markets and consumer dynamics.”
The Company ended the third quarter with approximately $257.5 million in cash and cash equivalents, and borrowings under the Term Loan Agreement of $138.8 million, compared to $349.7 million in cash and cash equivalents, $19.9 million in marketable securities, and $60.0 million in borrowings last year. During the quarter, the Company opened five international Hollister chain stores, including its first store in Japan, and an Abercrombie & Fitch flagship store in Seoul. Additionally, the Company opened a combined Abercrombie & Fitch and abercrombie kids outlet and a Hollister outlet in Italy.
The Company continues to anticipate opening approximately 20 international Hollister chain stores throughout the year. In addition, the Company will open a small number of international and U.S. outlet stores during the year. The Company continues to expect to close approximately 40-50 stores in the U.S. during Fiscal 2013 through natural lease expirations. The planned opening of an Abercrombie & Fitch flagship store in Shanghai is expected in the Spring of 2014.