Executive Summary

• Abercrombie & Fitch (A&F) reported 2Q EPS of $(0.25) versus consensus of ($0.20).
• Total revenue was $783.2 million versus expectations of $782.6 million. Comps were down 4%, in-line with consensus. Abercrombie comps were (7)% versus consensus of (7.2)% and Hollister comps were (2)% versus consensus of (2.3)%. Traffic remained a significant headwind in the quarter. Sales recovered in the Hollister European business.
• Looking toward 2H16, comps are expected to remain challenging with a disproportionate effect from flagship and tourist locations.