A Financial Ratio Quarterly Trend Analysis of:

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  • Topic: Financial ratios, Financial ratio, Hollister Co.
  • Pages : 9 (2430 words )
  • Download(s) : 178
  • Published : December 18, 2010
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Table of Contents
Section A1
Financial Ratios1
Liquidity3
Assets Ratio5
Profitability Ratios5
Debt Ratios6
Market Ratios6
Section B7
Quarterly Financial Analysis7
Liquidity7
Assets Utilization8
Profitability8.
Debt Analysis8
Market Position8
Section C9
Abercrombie & Fitch and Clothing Industry10
Section D10
SWOT Analysis10
Strengths10
Weaknesses10
Opportunities10
Threats11
Section E12
Ethics and Corporate Governance12
Section F13
Conclusions and Decisions13
Appendix A14
Industry vs. Abercrombie and Fitch15
References16

Financial Ratio

Abercrombie & Fitch Co. (A&F) through its subsidiaries, is a specialty retailer that operates stores and direct-to-consumer operations selling casual sportswear apparel, including knit and woven shirts, graphic t-shirts, fleece, jeans and woven pants, shorts, sweaters, outerwear, personal care products, and accessories for men, women and kids under the Abercrombie & Fitch, Abercrombie kids, and Hollister brands. In addition, the Company operates stores and direct-to-consumer operations offering bras, underwear, personal care products, and sleepwear and at-home products for women under the Gilly Hicks brand. As of January 30, 2010, the Company operated 1,096 stores in North America, Europe and Asia. Its brands include Abercrombie & Fitch, Abercrombie kids, Hollister and Gilly Hicks. During the fiscal year ended January 30, 2009 (fiscal 2009), the Company completed the closure of the RUEHL branded stores and related direct-to-consumer operations (MSN Money).

Liquidity Q1 Q2 Q3 Q4 Yearly
Current Ratio 2.9 2.82.42.22.2
Quick Ratio 2.1 2.1 1.7 1.5 1.5 Cash Ratio1.41.5.95.83.83

Assets RatioQ1Q2Q3Q4Yearly
Inventory Turnover Ratio 3.22 3.443.453.43.4

Average Inventory Ratio 19 14161816

Profitability RatiosQ1Q2Q3Q4Yearly
Return on Assets Ratio .004 .01.01.01.01
Return on Equity Ratio .006 .02.02.01.01
Profit Margin Ratio.62.7 64636666

Debt Ratios
Debt Ratio34.3 2635.73434
Interest Coverage Ratio 0 0000
Debt/Equity Ratio .657 .478.643.66.66

Market RatiosQ1Q2Q3Q4
EPS Ratio.13 .53.43.3.3
Interest Coverage Ratio 0 0000
Debt/Equity Ratio .657 .678.643.66.66

Liquidity

For Abercrombie and Fitch, last year prove to be very tough not only for the company but for all retailers in the United States. This was very much the case for retailer Abercrombie & Fitch. During this very tough time opportunities were presented for the company to be a fitter and business to boot. According to the Wall Street Journal had a lot of offshore followers who were will to buy the high end prices. It is very important that a business deliver considerable shareholder value through the years ahead. The ANF line was, tough times create opportunities. In this regard, we based our initial Abercrombie buy recommendation on our view that not only would the company come out the other side; it would be a fitter, leaner business to boot. In looking at the balance sheet, the company held $680 million in cash and cash equivalents at the end of the quarter. This compares to debt of $101 million and management is quite rightly can say that they are very comfortable with their liquidity position very comfortable with their liquidity position. In terms of the result, Abercrombie’s fourth quarter sales fell 5% to $936 million, while same store sales decreased by 13%. According to my research of the company sales within the quarter, November and December were weaker, with January being stronger. This was partly due to Abercrombie’s winter sale, which occurred during January. Discounting for a very long time has not been a feature of Abercrombie’s business model until recently. Abercrombie’s gross margin contracted by 1.1 percentage...
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