Profits at the Irish outlets of US teen apparel retailer Abercrombie & Fitch and Hollister fell 29 per cent as sales continued to slow down at the company's two Dublin stores.
The global retailer, which set up in Ireland near the height of the recession, recorded profit before tax of €286,231 for the 12 month period to February 3rd. Turnover, meanwhile, dropped 13.35 per cent to €9.9 million.
Recently filed accounts for A&F Hollister Ireland Ltd show the company decided not to pay a dividend to its parent company in the year.
The retail chain, which opened in Ireland to much fanfare as part of a global expansion strategy, employed 178 staff in the period, down from 220, with staff costs increasing marginally to €1.59 million.
Nasdaq-listed Abercrombie & Fitch established its first Hollister store here in Dundrum Town Centre south Dublin in July 2011. Its Abercrombie & Fitch store followed on College Green in the city centre in November 2012.
Operating leases for the group’s two Irish outlets rose 3.2 per cent to €1.53 million while cost of sales fell more than 20 per cent to €4.85 million.
The group has 117 stores across Europe – an area where it sees growth potential – but it has been pulling back on its US footprint, having closed more than 400 stores since 2010. Last year it put itself up for sale before deciding to go it alone after private-equity company Cerberus Capital and rival American Eagle were said to be putting together a bid.
Earlier this year Reuters reported the company had seen higher demand this year after struggling for the past five years, after it revamped stores and launched more sophisticated designs.
The picture for the company’s Irish outlets is, however, somewhat grim, with falling sales and profits recorded since 2014. At its height, the group posted a pre-tax profit of €702,839 with sales exceeding €16.5 million in the Republic having turned profitable after only two years in the market.
Separately on Thursday, the company posted results, missing quarterly estimates as a result of lower demand as the Hollister brand underperformed while its flagship brand looked to be on shaky ground. While net sales rose 8.1 per cent to $842.4 million in the second quarter, that fell slightly below analyst estimates.
– Additional reporting: Reuters
