Wednesday’s proved to be a tricky session as main players

within the American fashion industry saw their stocks weighted by a gloomy report on weaker retail spending. It was the case of American Apparel or Abercrombie & Fitch, both reporting strong quarterly results yet seeing their respective profit wiped off during the trading hours.

The Commerce Department issued a report pointing out that Americans cut back on spending in October. After this news broke, the Dow Jones industrial average was down 55 points at 12,701 at noon Wednesday, while the Standard & Poor’s 500 index slipped four points to 1,370 and the Nasdaq composite was down three points at 2,881.

Abercrombie & Fitch was among the leading stocks, jumping 27 percent after reporting that its net income soared in the most recent quarter, published ‘The Washington Post’. bercrombie & Fitch Co.'s ANF fiscal third-quarter earnings rose 40 percent as the teen apparel retailer posted stronger margins and stronger sales abroad.

Shares surged 21 percent to 37.70 dollars in premarket trading as the results topped expectations and Abercrombie raised its fiscal-year earnings outlook. The stock was down 36 percent this year.

For the fiscal year, Abercrombie now expects per-share earnings of 2.85 to 3 dollars, compared with the company's prior estimate for 2.50 to 2.75 dollars. For the period ended Oct. 27, Abercrombie reported a profit of 71.5 million, or 87 cents a share, up from 50.9 million dollars (57 cents a share) it reported a year ago. Revenue increased 8.7 percent to 1.17 billion. This topped the market’s estimates, as analysts polled by Thomson Reuters had projected earnings of 59 cents on revenue of 1.11 billion dollars.

Summing up the company’s momentum, Chief Executive Mike Jeffries on Wednesday said "Our U.S. chain store business posted healthy growth on top of a strong quarter a year ago, and we saw sequential trend improvement in our international business."

Meanwhile, American Apparel (NYSE: APP) announced its earnings results on Tuesday. The company reported 0.05 dollars earnings per share (EPS) for the quarter, missing the consensus estimate of 0.03 dollars by 0.02. The company had revenue of 162.16 million dollarsfor the quarter, compared to the consensus estimate of 159.69 million dollars.

"We are pleased with our third quarter results that again show solid growth and continuing momentum in all business segments and major geographies. Significant sales growth allowed us to more than double our EBITDA performance to 13 million dollars for the third quarter of 2012 from 6 million dollars for the third quarter of 2011,” assured Dov Charney, Chairman and CEO of American Apparel, Inc.

Year-to-date American Apparel’s EBITDA performance has improved in 14 million dollars, reaching the 19 million.




Latest jobs