Abercrombie & Fitch’s first quarter doesn’t go well—online or offline
May 28, 2015 02:54 PM
The first quarter was rough one for Abercrombie & Fitch Inc., both online and offline.
The retailer’s e-commerce sales, excluding discontinuing operations, were flat during the quarter and its overall revenue declined 13.7%.
Because Abercrombie is in the midst of a major transition that includes hiring new executives, rethinking its merchandising strategy and closing underperforming stores, the retailer was ready for the first quarter to be “difficult,” says Arthur Martinez, executive chairman.
“We knew the first quarter was going to be difficult due to a number of factors, both internal and external and, most significantly, because many of the actions we are taking to improve our business are in the early stages of implementation and have not yet been fully realized,” he says.
Martinez notes that Abercrombie’s strategy for turning around its sagging financials involves heavy investments in its “omnichannel capabilities.”
For the fiscal first quarter ended May 2, Abercrombie, No. 55 in the Internet Retailer 2015 Top 500 Guide, reported:
- Direct-to-consumer sales, which are all online, and omnichannel sales, which include an online transaction, were an estimated $163.2 million based on Internet Retailer's calculations (the retailer reported that approximately 23% of its total net sales stemmed from direct-to-consumer and omnichannel sales). Excluding discontinued operations, those sales were flat. A year ago the retailer sold roughly $172.7 million online.
- Total revenue declined 13.7% to $709.4 million from $822.4 million.
- Comparable-store sales, which include U.S. and international, declined 8%. U.S. comparable-store sales decreased 7%.
- Net loss was $63.2 million in 2015 compared with a $23.7 million loss a year ago.
- The web accounted for 23.0% of total sales compared with 21.0% in 2013.