The US clothing group Abercrombie & Fitch Co. returned to profitability in the first quarter of the 2023/24 financial year. The company was also able to announce a small increase in sales on Wednesday.
For the 13 weeks ended April 29, consolidated sales reached $836.0 million (EUR 775.0 million), up 3 percent (+4 percent at constant currency) from the same quarter last year. This was ensured by the Abercrombie division with the Abercrombie & Fitch brand and the children’s clothing line Abercrombie Kids, whose revenues grew by 14 percent to 436.0 million US dollars. In contrast, sales in the Hollister segment, which includes the labels Hollister, Gilly Hicks and Social Tourist, fell by seven percent (-6 percent at constant currency) to USD 399.9 million.
Earnings also improved significantly thanks to a higher gross margin and lower selling expenses. Operating income was $34.0 million compared to an operating loss of $9.7 million in the same period last year. The bottom line was net income attributable to shareholders of $16.6 million. The group had closed the first quarter of the previous year with a corresponding deficit of 16.5 million US dollars.
In view of the development in the first three months, the company slightly raised its forecast for the full 2023/24 financial year. The management now expects sales to increase by two to four percent to around 3.7 billion US dollars. Previously, only growth of one to three percent had been promised. The target for the operating margin was increased from four to five percent to five to six percent.