Abercrombie & Fitch Company · NYSE:ANF
Abercrombie & Fitch — Q3 2014 Earnings Presentation
16 slides from Abercrombie & Fitch's earnings presentation, Dec 4, 2014
Slide 1: Investor Presentation 2014 Third Quarter
INVESTOR PRESENTATION 2014 THIRD QUARTER
Slide 2: Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
2 SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 A&F cautions that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this presentation or made by management or spokespeople of A&F involve ri
Slide 3: Q3 Adjusted P&L Summary
3 Q3 ADJUSTED P&L SUMMARY* * The Q3 Adjusted P&L Summary for the current and prior periods is presented on a non-GAAP basis and excludes the charges set out on page 4. A reconciliation between GAAP and non-GAAP results is included as an appendix to the presentation. 2014 % OF NET SALES 2013 % OF NET
Slide 4: Excluded Charges (Pre-Tax)
4 EXCLUDED CHARGES (PRE-TAX) 2014 Q1 Q2 Q3 Q4 YEAR TO DATE ASSET IMPAIRMENT, LEASE TERMINATION AND STORE CLOSURE COSTS — — $18,958 $18,958 PROFIT IMPROVEMENT AND CORPORATE GOVERANCE 9,964 1,964 1,310 13,238 GILLY HICKS RESTRUCTURING CHARGES 5,633 419 — 6,052 TOTAL $15,597 $2,383 $20,268 $38,248 2013
Slide 5: Q3 Comparable Sales and Geographic Sales Mix
5 * Includes comparable store and DTC sales. Q3 COMPARABLE SALES* GEOGRAPHIC SALES MIXQ3 TOTAL COMPANY -10% GEOGRAPHIC: US -7% INTERNATIONAL -15% BRAND: ABERCROMBIE & FITCH -6% abercrombie kids -10% HOLLISTER CO. -12% INTERNATIONAL 34.8% U.S. 65.2%
Slide 6: Year-to-Date Comparable Sales
6 * Includes comparable store and DTC sales. YEAR-TO-DATE COMPARABLE SALES* YTD TOTAL COMPANY -7% GEOGRAPHIC: US -6% INTERNATIONAL -10% BRAND: ABERCROMBIE & FITCH -3% abercrombie kids -8% HOLLISTER CO. -10% GEOGRAPHIC SALES MIX INTERNATIONAL 37.3% U.S. 62.7%
Slide 7: Q3 Adjusted Operating Expense
7 Q3 ADJUSTED OPERATING EXPENSE* * Third quarter adjusted operating expense excludes the charges set out on page 4. A reconciliation between GAAP and non-GAAP results is included as an appendix to the presentation. (1) Includes rent, other landlord charges, utilities, depreciation and other occupanc
Slide 8: Q3 Adjusted P&L Analysis
8 Q3 ADJUSTED P&L ANALYSIS* * Third quarter adjusted operating income excludes the charges set out on page 4. A reconciliation between GAAP and non-GAAP results is included as an appendix to the presentation. (1) Operating Income for U.S. Stores and International Stores is reported on an aggregate f
Slide 9: Share Repurchases
9 SHARE REPURCHASES FY 2014 FY 2013 SHARES REPURCHASED COST AVERAGE COST SHARES REPURCHASED COST AVERAGE COST FIRST QUARTER 3,825.7 $150,000 $39.21 349.7 $16,305 $46.63 SECOND QUARTER 1,459.4 $60,000 $41.11 2,033.0 $99,501 $48.94 THIRD QUARTER 2,039.0 $75,038 $36.80 - - - FOURTH QUARTER - - - TOTAL
Slide 10: Q3 Store Openings
10 Q3 STORE OPENINGS BRAND CENTER CITY DATE A&F IFS Chengdu Chengdu, CN 8/30/2014 abercrombie kids Savile Row London, UK 8/30/2014 A&F Centro Oberhausen Oberhausen, DE 9/4/2014 A&F Gilroy Outlet Gilroy, US 9/18/2014 Hollister Mall of Berlin Berlin, DE 9/25/2014 A&F Atlantic City Outlet Atlantic City
Slide 11: Full Year Guidance Updates
11 FULL YEAR GUIDANCE UPDATES* FULL YEAR ADJUSTED DILUTED EARNINGS PER SHARE IN THE RANGE OF $1.50-$1.65 FOURTH QUARTER COMPARABLE SALES DOWN BY A MID-TO-HIGH SINGLE-DIGIT FOURTH QUARTER GROSS MARGIN RATE HIGHER THAN FOURTH QUARTER OF FISCAL 2013, LOWER THAN YEAR- TO-DATE RATE FULL YEAR TAX RATE IN
Slide 12: Q3 Store Count Activity
12 Q3 STORE COUNT ACTIVITY * Includes Asia, Australia and the Middle East. ALL BRANDS TOTAL U.S. CANADA EUROPE REST OF WORLD* START OF Q3 2014 997 836 18 119 24 OPENINGS 7 2 - 3 2 CLOSINGS (4) (4) - - - END OF Q3 2014 1,000 834 18 122 26 A&F START OF Q3 2014 279 254 4 15 6 OPENINGS 4 2 - 1 1 CLOSING
Slide 13: Appendix: Reconciliation of Q3 2014 Non-GAAP Financial Measures
13 APPENDIX: RECONCILIATION OF Q3 2014 NON-GAAP FINANCIAL MEASURES GAAP EXCLUDED CHARGES (1) ADJUSTED NON-GAAP (2) STORES AND DISTRIBUTION EXPENSE $413,551 $2,357 $411,194 MARKETING, GENERAL AND ADMINISTRATIVE EXPENSE 104,981 1,205 103,776 ASSET IMPAIRMENT 16,706 16,706 — INCOME (LOSS) BEFORE TAXES
Slide 14: Appendix: Reconciliation of 2014 YTD Non-GAAP Financial Measures
14 APPENDIX: RECONCILIATION OF 2014 YTD NON-GAAP FINANCIAL MEASURES (1) Excluded charges consists of pre-tax charges of $16.7 million for store-related asset impairments for stores whose asset carrying value exceeded the fair value, primarily associated with 4 Abercrombie & Fitch, including the Ginz
Slide 15: Appendix: Reconciliation of Q3 2013 Non-GAAP Financial Measures
15 APPENDIX: RECONCILIATION OF Q3 2013 NON-GAAP FINANCIAL MEASURES (1) Excluded charges consists of pre-tax charges of $43.6 million for store-related asset impairments for stores whose asset carrying value exceeded the fair value, primarily associated with 23 Abercrombie & Fitch, 3 abercrombie and
Slide 16: Appendix: Reconciliation of 2013 YTD Non-GAAP Financial Measures
16 APPENDIX: RECONCILIATION OF 2013 YTD NON-GAAP FINANCIAL MEASURES (1) Excluded charges consists of pre-tax charges of $43.6 million for store-related asset impairments for stores whose asset carrying value exceeded the fair value, primarily associated with 23 Abercrombie & Fitch, 3 abercrombie and