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Abercrombie & Fitch to close 60 more stores; shares surge

CNBC logo CNBC 3/7/2018 Lauren Thomas

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Abercrombie & Fitch announced on Wednesday it will be closing 60 additional stores later this year.

The teen apparel retailer, which also owns Hollister, has been reconfiguring its store fleet in malls as more shoppers opt to buy clothes online. Last year, it closed another 60 stores. In 2015, it closed about 50 locations.

The company has said many of its leases are up for renewal by the end of fiscal 2018, which gives it some flexibility to move out without a fight with landlords. Abercrombie hasn't disclosed exactly which locations will be closing this year.

Mall owners have been met with a handful of significant store closure announcements already this year. Best BuyBBY is closing all roughly 250 of its mobile phone stores, Foot LockerFL is closing more than 100 stores, while department store chain Bon-Ton filed for bankruptcy and is closing about 40 stores, to name a few. Walking Co.WALK, another popular mall tenant, also filed for bankruptcy protection earlier this week and said it's seeking significant rent relief from its landlords.

In shuttering some of its stores, though, Abercrombie has been able to invest in upgrading existing locations and recently rolled out a new store prototype. Those stores are smaller and more open, with amenities like phone chargers in dressing rooms.

Also on Wednesday, Abercrombie reported strong earnings results for the holiday period, sending the stock up more than 7 percent in early trading to hit a more than one-year high.

Same-store sales were up 9 percent overall, surpassing analysts' forecast for growth of 7.4 percent, according to a Thomson Reuters survey. Same-store sales for the Hollister banner jumped 11 percent.

Abercrombie shares have climbed nearly 30 percent so far this year.


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