On Wednesday Abercrombie & Fitch reported Q1 results that were well above expectations, buoyed by its Hollister brand and strong sales in Europe.
The US clothing group, whose garments are very popular with teenagers and young adults, generated record sales of $1.1bn in the three months to the end of May, up 8% y-o-y, exceeding both the company's and market expectations.
Growth was driven by higher sales in all regions: first in Europe, the Middle East and Africa (EMEA) with a 12% jump, then in the Americas (+7%) and Asia-Pacific (+5%).
Brand performance was more mixed: the Hollister sportswear range grew by 22%, but Abercrombie, which is more positioned at the high end, declined by 4%.
The US group's profitability also exceeded expectations, with an operating margin of 9.3% and earnings per share (EPS) of $1.59, propelling the stock up 27% in pre-market trading on Wall Street.
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Abercrombie & Fitch Co. is a global, digitally led omnichannel specialty retailer of apparel and accessories. The Company offers an assortment of apparel, personal care products and accessories for men, women and kids, which are sold primarily through its Company-owned stores and digital channels, as well as through various third-party arrangements. The Company’s brands include Abercrombie brands, which includes Abercrombie & Fitch, abercrombie kids, and Your Personal Best (YPB), and Hollister brands, which include Hollister and Gilly Hicks. Its geographic segments include the Americas, EMEA, and APAC. The Company also offers its loyalty programs, which include Abercrombie’s myAbercrombie and Hollister’s Hollister House Rewards. The Company operates approximately 790 stores under these brands across North America, Europe, Asia and the Middle East, as well as the e-commerce sites abercrombie.com, abercrombiekids.com, and hollisterco.com.
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