Record 1Q for A&F

American lifestyle clothing brand Abercrombie & Fitch increased its net income to $62.1 million in the first quarter of this year, which is a record for the company. After just over four months Abercrombie & Fitch net sales increased 7% to $357.7 million and its comparable store sales increased 3%.

Mike Jeffries, Chief Executive Officer and Chairman of the Board of Abercrombie & Fitch Co., said: “Our first quarter financial results demonstrate our ability to effectively position our brands. Despite a tough selling environment, we produced bottom-line growth while still remaining true to the aspirational positioning of our brands. We continue to focus on improving the quality of our product and thee motional store experience, which gives us our competitive advantage and is critical to our long-term sustainability.”

In 2008 Abercrombie & Fitch’ net sales increased with 8% to $800.2 million compared to $742.4 million last year. Total Company direct-to-consumer net sales increased 44% to $62.5 million. The gross profit rate for the quarter was 66.8%, up 120 basis points compared to last year. The improvement in gross profit rate was due to a higher initial mark-up rate and lower shrink rate, partially offset by a higher markdown rate versus last year.

Abercrombie & Fitch is looking to allocate $50 million to ‘refresh’ improvements and make other brand enhancing investments for existing stores. The brand also wants to invest in home office, information technology, and direct-to-consumer infrastructure.

Further more the Company plans to open its first Abercrombie flagship on Fifth Avenue in New York in 2010. Currently Abercrombie & Fitch feature 353 and 202 Abercrombie stores in the United States at the end of the first quarter. The Company also operated three Abercrombie & Fitch stores in Canada, and one in London.

Image: Abercrombie & Fitch

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