For the for the thirteen weeks period ended May 2, 2015, GAAP net loss soared at apparel retailer and NYSE listed Abercrombie & Fitch Co.
First quarter of fiscal 2016 GAAP net loss surged to $63.2 million or $0.91 loss per diluted share from GAAP net loss of $23.7 million and $0.32 loss per diluted share for the thirteen weeks ended May 3, 2014.
Net sales for the reporting quarter too fell 14 per cent year on year to $709.4 million, driven by a comparable sales decline of 8 per cent and a 6 per cent adverse effect from foreign currency exchange rates.
“In the US, net sales declined 11 per cent from a fiscal ago quarter to $448.9 million, while global net sales reduced higher at 18 per cent to $260.5 million in the quarter under review,” the retailer said in a press release.
However, net sales from direct-to-consumer and omni-channel grew to approximately 23 per cent of total net sales as against approximately 21 per cent of total net sales in first quarter of last fiscal.
The gross profit rate for the first quarter of fiscal 2016 was 58.0 per cent, 420 basis points lower than previous fiscal’s first quarter.
Excluding certain charges, Abercrombie & Fitch added, the gross profit rate for the first quarter of fiscal 2016 was 61.8 per cent, 70 basis points higher on a constant currency basis.
Stores and distribution expense for the first quarter of fiscal 2016 amounted to $391.6 million, down from $417.6 million from a fiscal ago quarter.
Excluding certain charges, stores and distribution expense decreased $29.9 million, as a result of benefits from changes in foreign currency exchange rates, as well as additional expense reduction.
Marketing, general and administrative expense for the first quarter too was down to $107.5 million as against $123.6 million in the first quarter of last fiscal.
The retailer recognised a restructuring benefit of $1.6 million in the first quarter, compared to a restructuring charge of $5.6 million last year, associated with the closure of the Gilly Hicks stand-alone stores.
Net other operating income stood at $2.0 million for the quarter under review compared to $3.6 million, which included insurance recoveries of $3.1 million.
The effective tax rate for the first quarter of fiscal 2016 was higher at 33.3 per cent compared to 29.3 per cent in the first quarter of last fiscal.
The Company ended the quarter with $383.2 million in cash and cash equivalents, and gross borrowings under the Company's term loan agreement of $298.5 million.
This compares with $357.1 million in cash and cash equivalents and $131.3 million in borrowings in the first quarter of fiscal 2015.
As on May 2, 2015 Abercrombie & Fitch had $441.0 million in inventory at cost, down 9 per cent year over year, which includes impact of the inventory write-down.
During the quarter, Abercrombie & Fitch opened two international Hollister stores and one international Abercrombie & Fitch store and three US Abercrombie & Fitch outlet stores.
