Abercrombie & Fitch Company · NYSE:ANF
Abercrombie & Fitch — Q4 2010 Earnings Presentation
21 slides from Abercrombie & Fitch's earnings presentation, Feb 18, 2011
Slide 1: Investor Presentation 2010 Fourth Quarter
Investor Presentation 2010 Fourth Quarter
Slide 2: Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
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 of A&F involve risks and uncertaint
Slide 3: Q4 P&L Summary
Q4 P&L Summary Unaudited Unaudited % of % of 2010 Net Sales 2009 Net Sales Net Sales $ 1,149,396 100.0% $ 935,991 100.0% Cost of Goods Sold 418,410 36.4% 341,449 36.5% Gross Profit 730,986 63.6% 594,542 63.5% Operating Expense (1) 591,829 51.5% 506,373 54.1% Other Operating Income, Net (5,549) -0.5%
Slide 4: 2010 Full Year P&L Summary
2010 Full Year P&L Summary Unaudited % of % of 2010 Net Sales 2009 Net Sales Net Sales $ 3,468,777 100.0% $ 2,928,626 100.0% Cost of Goods Sold 1,256,596 36.2% 1,045,028 35.7% Gross Profit 2,212,181 63.8% 1,883,598 64.3% Operating Expense (1) 1,990,305 57.4% 1,779,219 60.8% Other Operating Income, N
Slide 5: Non-GAAP EPS Reconciliation
Non-GAAP EPS Reconciliation Unaudited Unaudited Fourth Quarter Fiscal 2010 Fiscal 2009 Net income per diluted share on a GAAP basis $ 1.03 $ 0.53 Plus: Net loss from discontinued operations (1) $ — $ 0.15 Plus: Store-related asset impairment charges (2) $ 0.33 $ 0.23 Plus: Store closure charges (3)
Slide 6: Sales Analysis Versus Prior Year
Sales Analysis Versus Prior Year Q4 Fiscal Year Total Sales + 23% Total Sales + 18% Comparable Store Sales + 13% Comparable Store Sales + 7% DTC Net Merchandise Sales + 43% DTC Net Merchandise Sales + 41% Total Domestic Sales + 16% Total Domestic Sales + 10% Total International Sales + 61% Total Int
Slide 7: Gross Margin
Gross Margin 2010 2009 Ģ bps(1) Q4 63.6% 63.5% 10 FY 63.8% 64.3% (50) (1) Rounded based on reported percentages
Slide 8: Operating Expense
Operating Expense % of % of 2010 Net Sales 2009 Net Sales Ģ bps (5) Fourth Quarter 1149396 935991 Store Occupancy (1)(2) $ 220,056 19.1% $ 193,226 20.6% (150) All Other (4) 265,418 23.1% 220,757 23.6% (50) Stores and Distribution 485,475 42.2% 413,983 44.2% (200) Marketing, General & Administrative
Slide 9: Inventory Analysis
Inventory Analysis As of As of January 29, 2011 January 30, 2010 % Ģ Inventory on Hand $ 330,876 $ 270,778 + 22% Inventory in Transit $ 54,981 $ 39,867 + 38% Total Inventory $ 385,857 $ 310,645 + 24%
Slide 10: Inventory Days On Hand Excluding In-Transit
Inventory Days On Hand Excluding In-Transit* 125 100 75 50 2005 2006 2007 2008 2009 2010 * Q4 ending inventory, less in-transit, divided by trailing quarter average daily COGS; 2005 — 2008 includes Ruehl
Slide 11: Liquidity
Liquidity As of As of January 29, 2011 January 30, 2010 Cash and Cash Equivalents $826 million $670 million Credit Agreement: Borrowings $44 million $51 million Outstanding Letters of Credit $3 million $50 million “Net” Cash Position $780 million $569 million
Slide 12: Share Repurchases
Share Repurchases FY 2010 FY 2009 Shares Average Shares Average Repurchased (1) Cost Cost Repurchased (1) Cost Cost Fiscal Quarter Q1 — - — - — - Q2 — - — - — -Q3 669.1 $ 29,207 $ 43.65 — - -Q4 912.6 $ 46,951 $ 51.45 — - -TOTAL 1,581.7 $ 76,158 $ 48.15 — - - Remaining shares authorized for future re
Slide 13: International Store Openings — Cumulative
International Store Openings — Cumulative 2007 2008 2009 2010 A&F Flagship 1 1 3 5 Canada 3 3 3 4 Hollister Canada 3 6 6 9 UK 3 10 19 Germany 1 4 Italy 1 3 Spain 3 Kids 2 4 4 Gilly Hicks 1 TOTAL 7 15 28 52
Slide 14: 2011 Flagship Openings
2011 Flagship Openings City Timing Type Paris May 2011 A&F Madrid Q3 2011 A&F Dusseldorf Q4 2011 A&F / kids Brussels Q4 2011 A&F Singapore Q4 2011 A&F Dublin Q4 2011 A&F
Slide 15: 2011 Outlook
2011 Outlook Sales · Targeting comparable store sales growth approximately in line with 2010 on a full year basis · Continued strong DTC growth · 30 — 40 new international Hollister store openings (weighted heavily to Q3 and Q4) · 6 international Abercrombie & Fitch flagship openings Gross Margin ·
Slide 16: 2011 Outlook
2011 Outlook Operating Expenses · Marketing, General and Administrative: Mid-single digit year-over-year percentage increase; excludes potential liability accounting charges if insufficient shares in LTIP · Store Occupancy: Approximately $166 million in Q1 · All Other Stores and Distribution: Approx
Slide 17: DC Consolidation
DC Consolidation · Commenced in Q4 2010; expected completion in mid-2012 · Approximately $26 million in gross capex; approximately $19 million in 2011 · Accelerated depreciation expected to total $28 million or slightly higher; $4 million recognized in Q4 2010; approximately $4 million per quarter e
Slide 18: Investor Day, April 5, 2011, New Albany, OH
Tuesday, April 5, 2011 — Investor Day New Albany, OH · 9:30am — 2:30pm (registration begins at 9:00am) · Presentations and Q&A on the state of the business from Mike Jeffries and Jonathan Ramsden · Presentations by senior leadership · Optional Distribution Center tour Register today by visiting www.
Slide 19: Appendix: EPS (Unaudited)
Appendix: EPS (Unaudited) Q4 Fiscal Year 2010 (1) 2009 (2) 2010 (3) 2009 (4) Net Income Per Share from Continuing Operations Basic $ 1.06 $ 0.69 $ 1.71 $ 0.90 Diluted $ 1.03 $ 0.68 $ 1.67 $ 0.89 Net Loss Per Share from Discontinued Operations Basic $ — $ (0.15) $ — $ (0.90) Diluted $ — $ (0.15) $ —
Slide 20: Appendix: Q4 Store Count Activity
Appendix: Q4 Store Count Activity ALL BRANDS* Store Count — By Brand and Region abercrombie kids Total US Canada Europe Asia Total US Canada Europe Asia Start of Q4 1,106 1,068 15 22 1 Start of Q4 205 201 3 1 -Openings 19 5 1 12 1 Openings 2 2 — - -Closings (56) (56) — - — Closings (22) (22) — - -En
Slide 21: Appendix: Year-To-Date Store Count Activity
Appendix: Year-To-Date Store Count Activity ALL BRANDS* Store Count — By Brand and Region abercrombie kids Total US Canada Europe Asia Total US Canada Europe Asia Start of 2010 1,096 1,068 12 15 1 Start of 2010 209 205 3 1 -Openings 37 13 4 19 1 Openings 3 3 — - -Closings (64) (64) — - - Closings (2