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Abercrombie & Fitch Co.

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Abercrombie posted wider than estimated losses for the second consecutive quarter as it reported second-quarter fiscal 2016 results. Also, the company’s sales missed expectations and fell year over year owing to soft traffic trends in its U.S. flagship and tourist stores. Further, the company warned of challenging comps performance in the second half of fiscal 2016, anticipating the aforementioned traffic trends to continue along with adverse impacts from currency rates. Though not very encouraging, the company’s gross margin and operating expense guidance for fiscal 2016 reflect some recovery from the previous forecast mainly backed by tight expense and inventory controls. However, the company remains encouraged by the performance of its Hollister brand. Also, the company remains optimistic about its prospects, given its efficient cost management and constant focus on reviving its brands and enhancing performance.


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