Abercrombie Q4 profit tops view; same-store sales decline
New Albany, Ohio — Abercrombie & Fitch Co.’s net income rose to $157.2 million for the fourth quarter, compared with $45.8 million a year earlier for a 13-week period. The chain said its net income was calculated using a new system for valuing inventory
Sales rose 11% to $1.47 billion for the 14 weeks ended Feb. 2, led by a 34% rise in international sales. (The period, however, includes an extra week compared to year earlier.)
Same-store sales were flat for the namesake chain, down 2% at Hollister and down 3% abroad.
Abercrombie changed its method of accounting for inventory in the fourth quarter. Previously, the retailer valued inventory based on its weighted average cost and initial retail selling price, then recorded charges to the cost of goods sold when the selling price was reduced. In the new system, Abercrombie doesn’t reduce the value of inventory unless it expects to sell the merchandise below its original cost.
Net sales for the fifty-three weeks ended Feb. 2, 2013, increased 8% to $4.511 billion from $4.158 billion for the fifty-two weeks ended Jan. 28, 2012.
Comparable sales for the full year increased 1% for the U.S., with same- store sales decreasing by 1% and comparable direct-to-consumer sales up 15%. Comparable sales for the full year decreased 8% for international, with comparable store sales decreasing by 19% and comparable direct to consumer sales up 46%.
In fiscal 2013, the company expects to open Abercrombie & Fitch flagship locations in Seoul and Shanghai, as well as approximately 20 international Hollister stores throughout the year. It expects to close approximately 40-50 stores in the U.S. during 2013, primarily through natural lease expirations.
Based on current new store plans and other planned expenditures, Abercrombie expects total capital expenditures for fiscal 2013 to be approximately $200 million, predominately related to new stores and investments in IT initiatives.
Walmex capital spending up
New York — Wal-Mart de Mexico expects to spend up to $1.4 billion on investments in 2013. But the chain declined to discuss how many stores it will open.
The chain did say that it expects to increase total store space by 8% to 9% in Mexico and 6% in Central America this year.
"We think that the number of stores does not communicate much," said CEO Scot Rank in response to a question by an analyst, Reuters reported.
Home Hardware Center completes implementation of Epicor Eagle in a hosted environment
Dublin, Calif. — Epicor Software Corp. announced that Home Hardware Center, part of Central Network Retail Group, completed its integration of Epicor Eagle in February 2013. It is Epicor’s first major installation of Epicor Eagle delivered in a software as a service (SaaS) hosted environment.
CNRG operates 41 home center and hardware stores in seven Southern states – 38 of those currently operate using Epicor solutions. CNRG strives to offer consumers regional merchandise selection and availability provided by independent hardware chains and home centers while taking advantage of the merchandising efficiencies enjoyed by national chains.
“CNRG is a multi-brand, multi-format retailer in the hardware and home center industry,” said Boyden Moore, president of CNRG. “Many of our acquisitions have been Epicor customers and we needed to pull them together. We challenged the team at Epicor to come up with a solution that made more sense to us. We feel strongly that a cloud-based or hosted solution provides a better infrastructure for the speed and flexibility our company needs. Epicor was able to fulfill that requirement by offering us the Epicor Eagle hosting service for our 21 Home Hardware Center stores. The transition from our server to the hosted server was extremely smooth.”
Home Hardware Center, based in Mississippi, is the first CNRG retailer to make the switch.
“The conversion and go-live was an absolute success,” said Jimmy Smith, chairman of CNRG and founder of Home Hardware Center. “The integration with our multi-store layout was fast and seamless. There was no downtime, all our stores and terminals were up and running first thing Monday morning.”
“We are pleased to announce the successful implementation of the hosted Epicor Eagle solution in partnership with CNRG,” said Craig McCollum, executive vice president and general manager, retail distribution solutions for Epicor. “In today’s businesses, every resource must be weighed in order to operate at maximum efficiency with cost effectiveness at the top-of-mind. Hosted solutions can provide significant time savings over on-premise environments, which allows for more time to focus on driving business initiatives and serving customers.”
CNRG’s Home Hardware Center now runs their business from a highly error-tolerant datacenter environment by subscribing to the Epicor Eagle hosting service.
“We believe with Epicor Eagle hosting our data and our business is safer than it has ever been,” said Smith.
The company’s critical business data is located in an Epicor Tier-4 datacenter that provides significant redundancy and fault-tolerance in regards to power, network circuits, backups, security, and server hardware.
The latest version of the Epicor Eagle software includes the comprehensive hosting capability that enables businesses, like CNRG, to offer use of their software to independent retail members. This important feature allows for the support, growth, increased efficiency, and safety for the retailers. All proprietary information is protected for each business using the Epicor Eagle hosting service.