A&F Will Open A New Concept Store In Tsim Sha Tsui.

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Brand group

Co. (NYSE:ANF) said on Thursday that it will open its new concept store in Harbour City Harbour City, Tsim Sha Tsui at the end of the year.

At the end of last year, Abercrombie&Fitch was located at the Pedder 25600 Building, four foot flagship store in the Pedder Building biwar street, Pedder Street, Hongkong. It closed for group repositioning. The Harbour City new store, which is expected to open at the end of the year, will have an area of 6800 square feet, or 631 square meters, which is only 1/4 of the shop in the former Hongkong.

Abercrombie&Fitch Co. said the new store used the concept of Polaris Fashion Mall in Columbo, Ohio, in February. The group tried to pform Abercrombie&Fitch from the original dark, psychedelic and noisy store to "warm, tolerant, open and attractive".

Style and customer experience focus on selling clothes in the first store of new concept stores.

Fran Horowitz, the group's chief executive, said in a statement that Harbour City is a world-famous shopping center, hoping that this smaller shop can provide more efficient performance than the previous group's flagship store in the flagship store.

Abercrombie&Fitch Co. also said that the Harbour City store is part of the group's 6 new concept stores this year, with the exception of Harbour City store, the other 5 are located in the United States.

Abercrombie&Fitch first store with new image and retail style

The Harbour City flagship store plan also shows that Abercrombie&Fitch Co. continues to take Asia, especially the Chinese market as an important part of the group.

In April, the group also announced the signing of a wholesale agreement with Zalora, a Southeast Asian electricity supplier, which will be the brand of the latter brand and its fast fashion brand Hollister.

Fran Horowitz said in its cooperation statement that it hopes to cooperate with Zalora in building a brand loyal customer base in the Southeast Asian market.

Zalora, founded in 2002, is the world's most famous Shanzhai business incubator Rocket Internet SE (RKET.DE), like the Lazada Group SpA of the market department store.

Zalora claims to have 600 million users, currently covering 11 markets such as Malaysia, Singapore, Indonesia, Thailand, Philippines, Vietnam, Brunei, Taiwan and Hongkong.

Abercrombie&Fitch Co. did not disclose the scale of its business in the statement, which is expected to have similar cooperation with ASOS PLC (ASC.L) and Zalando SE (ZAL.DE).

After announcing the withdrawal of the flagship store in Hongkong last year, Abercrombie&Fitch has only 11 stores in the Southeast Asian market, which are mainly covered by Zalora, only a store in Singapore's Orchard Road, which is very thin.

However, according to the brand Chinese official website, Abercrombie&Fitch has 11 stores in the Chinese market, and the brand has 1 and 5 stores in Korea and Japan respectively.

At the same time, the group's Hollister brand has 17 stores in the Chinese market, including one outlets.

In 2011, Abercrombie&Fitch announced its entry into Hongkong and opened a four Square flagship store with 25600 square feet on the street. The Hongkong store opened its "sexy marketing" brand, and many male models were celebrating in the nude.

As a window market for the retail market in Southeast Asia, the retail industry in Hongkong has been hit hard in the past three years. Due to the intensification of the civil conflicts between the mainland and Hong Kong, and the strong fluctuation of the exchange rate, the Hong Kong dollar, which is linked to the US dollar, continues to be strong.

In November 2016, Abercrombie&Fitch Co. decided to close the Hongkong flagship store which rents up to HK $7 million / month. The early withdrawal of the lease due to the expiry of the lease in 2019 resulted in a one-time cost of $16 million for the group.

Apart from the sluggish retail market in Hongkong, the closure of the Hongkong store also shows that Abercrombie&Fitch Co., which has been in a dilemma, can no longer be entangled in some minor markets. At present, the group's four Asian markets have special status. China does not have to mention that Japan and Korea are the most desirable overseas destinations for Chinese tourists in the past three years, while Singapore's orchard road is one of the most important retail outlets in Asia.

Abercrombie&Fitch Co. continued its 4 year sales decline in the first quarter.

Abercrombie&Fitch Co. released its first quarter results at the end of May, showing that group performance is still in the doldrums. The Hollister brand, which contributed more revenue to the group, achieved a 3% sales growth in the same quarter as of the first quarter of April 29th. Thanks to this, the overall sales of the same store in the first quarter narrowed to 3% from 5% in the fourth quarter and last year.

Same store sales, an important indicator for performance to spy on sales performance, has not been able to grow for Abercrombie&Fitch Co. for 17 consecutive quarters, or more than 4 years.

Dragging the group's performance is the brand Abercrombie&Fitch of the same name. In the first quarter, the brand sold 10% in the same store, though it has narrowed by 13% compared with the four quarter and 11% last year, but it was worse than the 7% expected by Consensus Metrix.

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Abercrombie&Fitch Co., which has been unable to rebound in recent years, has been hovering over the past 17 years.

The group confirmed its willingness to sell in early May and has hired investment bank Perella Weinberg Partners LP to handle contacts from other retailers.

Market sources said that the biggest competitor, American Eagle Outfitters Inc. (NYSE:AEO), was jointly pursuing private Holdings Company Cerberus Capital Management LP bron asset management, and garment retailer Express Inc. (LP) was also interested.

In the first quarter, net sales of Abercrombie&Fitch Co. fell 3.6% to 661 million 100 thousand US dollars compared with the same period, which is better than the US $651 million 300 thousand of the market expectation, and the net loss increased to 61 million 700 thousand US dollars, which was 39 million 590 thousand US dollars in the same period last year, and EPS expanded from -0.59 US dollars to -0.91 US dollars.

The adjusted EPS is US $-0.72, and the market is expected to be US $-0.70.

Gross margins were depressed by sales discounts, which reduced the average retail sales by 130 basis points to 60.3% over the same period last year.

The stock as at April 29th was $398 million 800 thousand, an annual decrease of 8.5%.

Fran Horowitz, chief executive, said in the earnings report that it was encouraged by the progress of all its brands in 3 and April. She pointed out that the performance of the same brand is consistent with expectations, and the group is applying Hollister's success to the brand.

Fran Horowitz expects the current two quarter sales environment to remain unchanged, and same store sales will still face many challenges. But with the return of strategic investment in marketing and all channels, it is expected that the performance in the second half of this year will be further improved.

In her earnings analysis room teleconference, she revealed that the close cooperation between the group and Snap Inc. (NYSE:SNAP) Snapchat and Facebook Inc. (NASDAQ:FB) Instagram increased the brand immersion. The chief financial officer, Joanne Crevoiserat, also mentioned that after the improvement of the mobile platform, the mobile conversion rate side achieved "very, very strong double-digit growth".

During the first quarter, the two major brands of Abercrombie&Fitch and Hollister closed 6 and 1 stores respectively. At the end of the season, the former had 308 stores and 43 stores in the US and the international market respectively, while the latter had 397 stores and 145 stores in the US and the international market respectively.

The group maintains a plan to shut down 60 shops throughout the year through the natural loss of tenancies.

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