Abercrombie & Fitch 2006 Annual Report Download

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Table of contents

  • Page 1

  • Page 2
    ... Income 26 Consolidated Balance Sheets 27 Consolidated Statements of Shareholders' Equity 28 Consolidated Statements of Cash Flows 29 Notes to Consolidated Financial Statements 30 Report of Independent Registered Public Accounting Firm 42 Corporate Information 45 Senior Management and Board of...

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  • Page 4
    ... of investment relates to international growth. We entered Canada by opening three Abercrombie & Fitch and three Hollister stores. The stores performed exceptionally well in 2006, generating approximately three times more sales per square foot and more than three times the four-wall profit than our...

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  • Page 6
    ... Capital Expenditures Long-Term Debt Shareholders' Equity Return on Average Shareholders' Equity Comparable Store Sales** Net Retail Sales Per Average Gross Square Foot Stores at End of Year and Average Associates $2,248,067 21% $ 403,476 - $1,405,297 35% 2% $ 500 Total Number of Stores Open Gross...

  • Page 7
    ... on a flat to slightly positive comparable store sales increase in Fiscal 2007. The Company ended the fourth quarter of Fiscal 2006 with inventories, at cost, up 6% per gross square foot versus the fourth quarter of Fiscal 2005. The Company believes it will end the first quarter of Fiscal 2007 with...

  • Page 8
    ...impact of the Abercrombie & Fitch Fifth Avenue Flagship store and six stores in Canada; a 58% increase in direct-to-consumer business (including shipping and handling revenue); and a fourteen week quarter in Fiscal 2006 versus a thirteen week quarter in Fiscal 2005, partially offset by a 3% decrease...

  • Page 9
    ..., fleece and personal care categories for the quarter, offset by decreases in woven shirts and sweaters. Direct-to-consumer merchandise net sales, which are sold through the Company's web sites and catalogue, in the fourth quarter of Fiscal 2005 were $47.5 million, an increase of 18.5% versus net...

  • Page 10
    ...executive officer and legal costs. OTHER OPERATING INCOME, NET Other operating income per quarter. The Board of Directors will review the Company's cash position and results of operations and address the appropriateness of future dividend amounts. A summary of the Company's working capital (current...

  • Page 11
    ... of video walls at existing Hollister stores and fixtures to stores throughout the Hollister chain. The Company is planning approximately $85 million in capital expenditures at the home office related to new office buildings, information technology investment and new direct-to-consumer distribution...

  • Page 12
    ... accounts for gift cards by recognizing a liability at the time a gift card the lower of average cost or market utilizing the retail method. The Company determines market value as the anticipated future selling price of the merchandise less a normal margin. An initial markup is applied to inventory...

  • Page 13
    ... The Company established an irrevocable rabbi trust during the third quarter of Fiscal 2006, the purpose is to be a source of funds to match respective funding obligations to participants in the Abercrombie & Fitch Nonqualified Savings and Supplemental Retirement Plan and the Chief Executive Officer...

  • Page 14
    ... CONSOLIDATED STATEMENTS OF NET INCOME AND COMPREHENSIVE INCOME Abercrombie & Fitch CONSOLIDATED BALANCE SHEETS (Thousands, except per share amounts) Net Sales Cost of Goods Sold Gross Profit Stores and Distribution Expense Marketing, General & Administrative Expense Other Operating Income, Net...

  • Page 15
    ...- - - 422,186 (4,419) 19,964 13,643 15,155 (61,623) 41 (239) Capital Expenditures Purchases of Trust Owned Life Insurance Policies Purchases of Marketable Securities Proceeds of Sales of Marketable Securities Net Cash (Used for) Provided by Investing Activities Financing Activities: Dividends Paid...

  • Page 16
    ... in each of the following areas: class of consumer, economic characteristics, nature of products, nature of production processes and distribution methods. Revenues relating to the Company's international sales in Fiscal 2006 were not material and are not reported separately from domestic revenues...

  • Page 17
    ...Company recognizes retail sales at the time the customer takes possession of the merchandise and purchases are paid for, primarily with either cash or credit card. Directto-consumer sales are recorded upon customer receipt of merchandise. Amounts relating to shipping and handling billed to customers...

  • Page 18
    ... based on estimated fair values at the date of grant using an option-pricing model. Previously, the Company accounted for share-based compensation using the intrinsic value method in accordance with APB Opinion No. 25, " Accounting for Stock Issued to Employees," and related interpretations, for...

  • Page 19
    ... of employment with 1,000 or more hours of service. In addition, the Company maintains the Abercrombie & Fitch Co. Nonqualified Savings and Supplemental Retirement Plan. Participation in this plan is based on service and (thousands): 2006* Currently payable: Federal State $236,553 24,885 $261,438...

  • Page 20
    ... class of managers in training and assistant managers, that the Company did not properly pay overtime compensation. The complaint seeks liquidated damages, interest, and attorneys' fees and costs. On September 2, 2005, a purported class action, styled Robert Ross v. Abercrombie & Fitch Company...

  • Page 21
    ... Exchange under the symbol "ANF." The table below sets forth the high and low sales prices of A&F's Common Stock on the New York Stock Exchange for Fiscal 2006 and Fiscal 2005: Sales Price $350 $300 *Fourth Quarter Fiscal 2006 is a fourteen week quarter. Fiscal 2005 Quarter Net sales Gross profit...

  • Page 22
    ... Abercrombie & Fitch REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM for its assessment of the effectiveness of internal control over financial reporting. Our responsibility is to express opinions on management's assessment and on the effectiveness of the Company's internal control over...

  • Page 23
    ... Fitch Headquarters, 6301 Fitch Path New Albany, Ohio 43054 STOCK EXCHANGE LISTING For further information on Abercrombie & Fitch, additional copies of this report, Form 10-K or other financial information, contact: Thomas Lennox Vice President Corporate Communications Abercrombie & Fitch P .O. Box...

  • Page 24
    ... Senior Vice President - Human Resources BEVERLY R. HOUSE Senior Vice President and General Manager MOLLY HUNT Senior Vice President - Design MARK D. KABBES Senior Vice President - Technical Design ABED W. KARAZE Senior Vice President - Store Construction CHARLES F. KESSLER Senior Vice President...