Abercrombie & Fitch Co (ANF), the global specialty retailer has announced 13.25 percent rise in profit for the quarter ended Aug. 02, 2014. The company earned $12.88 million or $0.17 a share in the second-quarter compared with $11.37 million or $0.14 a share a year ago.
Adjusted earnings per share came in at $0.19, when analysts expected $0.11.
Revenue during the second quarter reduced by 5.83 percent to $890.61 million from $945.70 million in the last year period.
Gross margin contracted by 179 basis points over the previous year period to 62.09 percent. Total expenses as a percentage of revenues increased to 97.81 percent from 97.97 percent in the same period last year. That has resulted in expansion of 16 basis points in operating margins to 2.19 percent.
Mike Jeffries, chief executive officer, said, "In the past quarter, we believe we have made great progress in evolving the fashion component of our assortment, and this progress is clearly evident in our Back-to-School presentation. In a continued challenging environment, our sales for the second quarter were somewhat below plan, but we have seen modest improvement since the Back-to-School floorset. We are confident that the evolution of our assortment will drive further improvements going forward, in particular as we move past the headwind of adverse likes in our logo business as we work to strategically reduce that element in our assortment.
Despite the challenging conditions, we were able to exceed our earnings expectations coming into the quarter through continued excellent progress on our profit improvement initiative. We remain highly focused on returning to top-line growth and driving long-term value for our shareholders."
Cash Position
As on Aug. 02, 2014, the company's cash balance stood at $310.74 million, down 7.25 percent or $24.28 million from Aug. 03, 2013.
Working Capital
Abercrombie & Fitch Co has witnessed a decline in the working capital over the last one year. The company's working capital stood at $509.87 million as at Aug. 02, 2014, down $126.97 million or 19.94 percent from $636.84 million on Aug. 03, 2013. It registered a decrease in current ratio to 1.91 as at Aug. 02, 2014 from 2.10 on Aug. 03, 2013.
Shares of the company went down by $2.13 or 4.84 percent to settle at $41.87 on Thursday.
