Abercrombie & Fitch 2011 Annual Report Download - page 11
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• our stock price may be volatile and investors may not be able to resell shares of our Common Stock
at or above the price paid to acquire the shares;
• our ability to attract customers to our stores depends, in part, on the success of the shopping malls in
which most of our stores are located;
• our net sales fluctuate on a seasonal basis, causing our results of operations to be susceptible to
changes in Back-to-School and Holiday shopping patterns;
• our inability to accurately plan for product demand and allocate merchandise effectively could have
a material adverse effect on our results;
• our failure to protect our reputation could have a material adverse effect on our brands;
• we rely on the experience and skills of our senior executive officers, the loss of whom could have a
material adverse effect on our business;
• interruption in the flow of merchandise from our key vendors and international manufacturers could
disrupt our supply chain, which could result in lost sales and could increase our costs;
• we do not own or operate any manufacturing facilities and, therefore, depend upon independent
third parties for the manufacture of all our merchandise;
• our reliance on two distribution centers domestically and two third-party distribution centers
internationally makes us susceptible to disruptions or adverse conditions affecting our distribution
centers;
• our reliance on third parties to deliver merchandise from our distribution centers to our stores and
direct-to-consumer customers could result in disruptions to our business;
• we may be exposed to risks and costs associated with credit card fraud and identity theft that would
cause us to incur unexpected expenses and loss of revenues;
• modifications and/or upgrades to our information technology systems may disrupt our operations;
• our facilities, systems and stores, as well as the facilities and systems of our vendors and
manufacturers, are vulnerable to natural disasters, pandemic disease and other unexpected events,
any of which could result in an interruption to our business and adversely affect our operating
results;
• our litigation exposure could have a material adverse effect on our financial condition and results of
operations;
• our inability or failure to adequately protect our trademarks could have a negative impact on our
brand image and limit our ability to penetrate new markets;
• fluctuations in our tax obligations and effective tax rate may result in volatility in our operating
results;
• the effects of war or acts of terrorism could have a material adverse effect on our operating results
and financial condition;
• our inability to obtain commercial insurance at acceptable prices or our failure to adequately reserve
for self-insured exposures might increase our expenses and adversely impact our financial results;
• operating results and cash flows at the store level may cause us to incur impairment charges;
8