Abercrombie & Fitch, Kohl's Q2 Results Top Estimates

(RTTNews) - U.S. retailers Abercrombie & Fitch Co. (ANF) and Kohl's Corp. (KSS) reported on Wednesday results for the second quarter that topped analysts' estimates, with Abercrombie & Fitch raising its outlook for the full-year 2024, while Kohl's slashed its adjusted earnings and sales growth guidance for fiscal 2024.

Following the results, Abercrombie & Fitch shares are plunging $26.43 or 15.86 percent to trade at $140.18 and Kohl's shares are surging $1.13 or 5.74 percent to trade at $20.73 on the NYSE.

Specialty retailer Abercrombie & Fitch reported net income attributable to the company soared to $133.17 million or $2.50 per share from $56.89 million or $1.10 per share in the prior-year quarter.

Excluding items, adjusted earnings for the quarter were $2.50 per share, compared to $1.08 per share last year.

Net sales for the quarter grew 21 percent to $1.13 billion from $935.35 million in the same quarter last year. Net sales were also up 22 percent on a constant currency basis. Total company comparable sales growth was 18 percent.

On average, analysts polled by Thomson Reuters expected the company to report earnings of $2.22 per share on revenues of $1.10 billion for the quarter. Analysts' estimates typically exclude special items.

Looking ahead to the third quarter, the company expects net sales growth in the low double-digits compared to fiscal third quarter 2023 level of $935 million.

For fiscal 2024, the company now projects net sales growth of 12 and 13 percent from $4.3 billion in fiscal 2023, up from the prior forecast for a growth of around 10 percent.

The Street is looking for revenues of $1.15 billion for the quarter and revenue growth of 12.0 percent to $4.79 billion for the year.

Meanwhile, department store chain Kohl's reported net income for the second quarter grew to $66 million or $0.59 per share from $58 million or $0.52 per share in the prior-year quarter.

Total revenue for the quarter declined to $3.73 billion from $3.90 billion in the same quarter last year.

Analysts expected earnings of $0.45 per share on revenues of $3.58 billion for the quarter.

Net sales were $3.53 billion, down 4.2 percent from last year's $3.68 billion. Comparable sales decreased 5.1 percent. Gross margin increased 59 basis points.

Tom Kingsbury, Kohl's chief executive officer, said, "During the second quarter, our customers exhibited more discretion in their spending, which pressured our sales even as customers transacted more frequently. This overshadowed strong performance in our key growth areas, including Sephora, home decor, gifting, and impulse."

Looking ahead to fiscal 2024, the company now projects adjusted earnings in a range of $1.75 to $2.25 per share on a net sales decline of 4 to 6 percent, with comparable sales decline of 3 to 5 percent.

Previously, the company expected adjusted earnings in the range of $2.10 to $2.70 per share on a net sales decline of 2 to 4 percent.

Analysts expect earnings of $1.56 per share on revenue decline of 3.4 percent to $16.01 billion for the year.

On August 13, 2024, Kohl's Board of Directors declared a quarterly cash dividend on the Company's common stock of $0.50 per share, payable on September 25, 2024 to shareholders of record at the close of business on September 11, 2024.

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