Abercrombie & Fitch 2008 Annual Report Download - page 31

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Table of Contents
The following measurements are among the key business indicators reviewed by various members of
management to gauge the Company’s results:
• Comparable store sales by brand, by product and by store, defined as year-over-year sales for a
store that has been open as the same brand at least one year and its square footage has not been
expanded or reduced by more than 20% within the past year;
• Direct-to-consumer sales growth;
• International and flagship store performance;
• New store productivity;
• Initial Mark Up (“IMU”);
• Markdown rate;
• Gross profit rate;
• Selling margin, defined as sales price less original cost, by brand and by product category;
• Stores and distribution expense as a percentage of net sales;
• Marketing, general and administrative expense as a percentage of net sales;
• Operating income and operating income as a percentage of net sales;
• Net income;
• Inventory per gross square foot;
• Cash flow and liquidity determined by the Company’s current ratio and cash provided by
operations; and
• Store metrics such as sales per gross square foot, sales per selling square foot, average unit retail,
average number of transactions per store, average transaction values, store contribution (defined as
store sales less direct costs of running the store), and average units per transaction.
While not all of these metrics are disclosed publicly by the Company due to the proprietary nature of
the information, the Company publicly discloses and discusses many of these metrics as part of its
“Financial Summary” and in several sections within this Management’s Discussion and Analysis of
Financial Condition and Results of Operations.
FISCAL 2008 COMPARED TO FISCAL 2007
FOURTH QUARTER RESULTS
Net Sales
Fourth quarter net sales for the thirteen week period ended January 31, 2009 were $998.0 million,
down 18.8% from net sales of $1.229 billion for the thirteen week period ended February 2, 2008. The net
sales decrease was attributed primarily to the 25% decrease in comparable store sales and an 11.9%
decrease in direct-to-consumer business, including shipping and handling revenue, partially offset by a net
addition of 90 stores.
28
Source: ABERCROMBIE & FITCH CO /DE/, 10-K, March 27, 2009 Powered by Morningstar® Document Research℠