US fashion chain sets its sights on Dublin

DUBLIN could be set for its first Abercrombie & Fitch (A&F) & store, as the US fashion retailer begins a big international expansion.

After only a year, the retailer’s first European venture near London’s Savile Row charges twice as much as its US stores and has sales of about $4,500 (€3,000) a square foot — matching the main shop on New York’s Fifth Avenue.

A&F is set to open a store in Tokyo and four in Britain, and may set up more in Europe as part of a plan to almost double the number of stores to 2,050 worldwide.

The company, which says overseas sales may account for half of its revenue in about a decade, is poised to outpace US clothing companies that cater to older customers abroad.

Guess Inc’s European revenue has risen each year since 2004, while GAP’s overseas same-store sales have fallen.

Abercrombie’s “preppy” fashions have “much more potential overseas than any other US brand”, said Bear Stearns analyst Randal Konik.

Sales outside the US may add $2 a share to profit in five years, he added.

Abercrombie — based in New Albany, Ohio — may climb 37% to $97 in the next year, on plans for growth abroad and at home, said Christine Chen, an analyst at Needham.

Bear Stearns has predicted the stock will rise 48% to $105 this year.

A&F chief financial officer Michael Kramer said international growth will ramp up in 2010. Abercrombie has a total of 1,035 shops under five brands.

“Right now, you’re seeing onesies, twosies,” said Mr Kramer. “You’re going to start seeing more like 10 to 20 to 30 stores opening up internationally within a season.”

Revenue in London, Canada and from overseas web sales totals about $200 million annually and may climb to $1.5 billion in five years, it has been estimated.