Abercrombie & Fitch Co. drove fourth-quarter net income up 9.4 percent on a 7.9 percent sales increase, but a steep decline in sales at Ruehl is forcing the company to slow the concept store’s growth in 2008.
For the quarter ended Feb. 3, net income rose to $216.8 million, or $2.40 a diluted share, from $198.2 million, or $2.14 a year earlier as sales climbed to $1.23 billion from $1.14 billion. Comparable-store sales slid 1 percent during the quarter.
At Ruehl, comps fell 16 percent, and the company said on a conference call Friday morning that it will “will moderate the pace of new store openings” and “continue to focus on improving the quality level of the merchandise in order to be consistent with the brand’s positioning.”
Companywide, management said it is working to bolster its market position. “We continue to make strategic investments in the business to sustain and to enhance brand quality and to support future growth, both domestically and internationally,” said Mike Jeffries, chief executive officer.
This year, Abercrombie plans to expand gross square footage by about 11 percent, primarily by adding 110 new North American stores.
For complete coverage, see Tuesday’s WWD.