Abercrombie & Fitch, Dollar Tree Q4 Profit Down, While Kohl's Slips To Loss

(RTTNews) - U.S. retailers Abercrombie & Fitch Co. (ANF), Dollar Tree Inc. (DLTR) and Kohl's Corp. (KSS) on Wednesday reported results for the fourth quarter, with profit at Abercrombie & Fitch declining, and profit at Dollar Tree edging down from last year, while Kohl's slipped to a loss.

In pre-market trading, Abercrombie & Fitch shares are down $0.10 or 0.34 percent to trade at $29.31 and Kohl's shares are down $1.64 or 5.85 percent to trade at $26.40 on the NYSE, while Dollar Tree shares are slipping $2.03 or 1.40 percent to trade at $143.25 on the NASDAQ.

Specialty retailer Abercrombie & Fitch reported net income attributable to the company of $38.33 million or $0.75 per share for the fourth quarter, lower than $65.61 million or $1.12 per share in the prior-year quarter.

Excluding items, adjusted earnings for the quarter were $0.81 per share, compared to $1.14 per share last year.

Net sales for the quarter grew 3 percent to $1.20 billion from $1.16 billion in the same quarter last year, led by 14 percent growth in Abercrombie brands. Net sales were up 5 percent on a constant currency basis.

On average, analysts polled by Thomson Reuters expected the company to report earnings of $0.86 per share on revenues of $1.18 billion for the quarter. Analysts' estimates typically exclude special items.

Gross profit margin was down approximately 260 basis points from last year, primarily hurt by 160 basis points of higher product costs and 100 basis points from the adverse impact of exchange rates.

Looking ahead, Abercrombie projects net sales for the first quarter to be around flat to first quarter 2022 level of $813 million and net sales growth of 1 to 3 percent for fiscal 2023 from $3.7 billion in 2022.

The Street is looking for a net sales decline of 2.1 percnet to $795.74 million for the quarter and net sales growth of 0.9 percent to $3.71 billion for the year.

Meanwhile, Dollar Tree reported that net income for the fourth quarter was $452.2 million or $2.04 per share, compared to $454.2 million or $2.01 per share in the prior-year quarter. Net sales for the quarter grew 9.0 percent to $7.72 billion from $7.08 billion in the same quarter last year. Same-Store Sales were up 7.4 percent.

The Street expected the company to report earnings of $2.02 per share on revenues of $7.60 billion for the quarter.

Gross margin for the quarter improved 70 basis points to 30.9 percent, primarily driven by higher initial mark-on and lower freight costs, partially offset by a product mix shift to lower-margin consumable products, as well as higher shrink and markdowns.

Looking ahead to the first quarter, the company estimates earnings in a range of $1.46 to $1.56 per share on consolidated net sales between $7.2 billion and $7.4 billion, based on a mid-single-digit increase in same-store sales for the combined enterprise. Analysts expect the company to report earnings of $1.85 per share on sales of $7.20 billion for the quarter.

For fiscal 2023, the company now projects earnings in a range of $6.30 to $6.80 per share on consolidated net sales between $29.9 billion and $30.5 billion, based on a low to mid-single-digit increase in same-store sales and 3.0 to 3.5 percent square footage growth.

Fiscal 2023 is a 53-week year, with the extra week expected to benefit the fourth quarter by approximately $500 million in sales and $0.29 in earnings per share.

The Street is looking for earnings of $7.79 per share on sales of $29.86 billion for the year.

Meanwhile, department store chain Kohl's reported a net loss for the fourth quarter of $273 million or $2.49 per share, compared to net income of $299 million or $2.20 per share in the prior-year quarter.

Total revenue for the quarter declined to $6.02 billion from $6.50 billion in the same quarter last year.

Analysts expected earnings of $0.98 per share on revenues of $5.98 billion for the quarter.

Net sales were $5.78 billion, down 7.2 percent from last year's $6.22 billion. Comparable sales decreased 6.6 percent.

Gross margin as a percentage of net sales was 23.0 percent, a decrease of 1,016 basis points. Clearance markdowns impacted margin by approximately 750 basis points and product cost inflation impacted margin by approximately 200 basis points.

Looking ahead to fiscal 2023, the company now projects adjusted earnings in a range of $2.10 to $2.70 per share on a net sales decline of 2 to 4 percent. The Street is looking for earnings of $3.20 per share on net sales growth of o.7 percent to $17.49 billion for the year.

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