Abercrombie & Fitch shares slide as sales miss estimates

Teen apparel retailer Abercrombie & Fitch posted a bigger-than-expected drop in quarterly sales as fewer customers visited its namesake stores.

Shares of the company, whose brands include Hollister and Abercrombie kids, fell 13.17 per cent to $14.70 in premarket trading on Friday.

Abercrombie’s net sales fell 6.5 per cent to $821.73 million (€776m), down for the 15th straight quarter.

"While Hollister improved sequentially, it was more than offset by disappointing performance in A&F," executive chairman Arthur Martinez said in a statement.

Abercrombie and other apparel retailers have struggled with increasing competition from fast-fashion retailers such as H&M and Inditex’s Zara that offer trendier but cheaper clothing. Online and off-price retailers have also lured shoppers away with discounted offerings.

Comparable sales at its flagship Abercrombie stores fell 14 per cent in the third quarter ended October 29th, compared with a 5 per cent drop in the year-earlier period. Analysts on average had expected a 6.2 per cent fall, according to research firm Consensus Metrix.

Sales at the company’s established stores fell 6 per cent, while analysts on average had expected a 3.9 per cent fall.

Net income attributable to the company fell to $7.88 million in the quarter, from $41.89 million a year earlier.

Excluding certain items, Abercrombie earned 2 cent per share, well below the average analyst estimate of 21 cent. - Reuters