What changed in this filing

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Item 1. Financial Statements

2023-06-06 compared with 2022-12-06 · 186 added, 246 removed, 402 unchanged (52% of the section changed)

1 unchanged sentence

Abercrombie & Fitch Co.

Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

(Thousands, except per share amounts)

Thirteen Weeks Ended Thirty-Nine Weeks Ended

October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021

Thirteen Weeks Ended

April 29, 2023 April 30, 2022

Net sales $ 835,994 $ 812,762

5 unchanged sentences

Other operating income, net ( 2,894 ) ( 3,842 )

Operating income 17,543 72,731 5,626 244,951

Operating income (loss) 34,008 ( 9,726 )

Interest expense, net 3,443 7,307

Income (loss) before income taxes 30,565 ( 17,033 )

Income tax expense 10,966 16,383 14,413 15,560

Net (loss) income ( 718 ) 49,078 ( 30,306 ) 202,240

Income tax expense (benefit) 12,718 ( 2,187 )

Net income (loss) 17,847 ( 14,846 )

Net income attributable to noncontrolling interests 1,276 1,623

Net (loss) income attributable to A&F $ ( 2,214 ) $ 47,233 $ ( 35,517 ) $ 197,501

Net (loss) income per share attributable to A&F

Net income (loss) attributable to A&F $ 16,571 $ ( 16,469 )

Net income (loss) per share attributable to A&F

Basic $ 0.33 $ ( 0.32 )

3 unchanged sentences

Diluted 51,467 52,077

Other comprehensive (loss) income

Other comprehensive income (loss)

Foreign currency translation adjustments, net of tax $ 311 $ ( 10,403 )

Derivative financial instruments, net of tax 405 1,712

Other comprehensive (loss) income ( 12,227 ) ( 1,213 ) ( 27,561 ) 829

Comprehensive (loss) income ( 12,945 ) 47,865 ( 57,867 ) 203,069

Other comprehensive income (loss) 716 ( 8,691 )

Comprehensive income (loss) 18,563 ( 23,537 )

Comprehensive income attributable to noncontrolling interests 1,276 1,623

Comprehensive (loss) income attributable to A&F $ ( 14,441 ) $ 46,020 $ ( 63,078 ) $ 198,330

Comprehensive income (loss) attributable to A&F $ 17,287 $ ( 25,160 )

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

4 unchanged sentences

(Thousands, except par value amounts)

October 29, 2022 January 29, 2022

April 29, 2023 January 28, 2023

Current assets:

28 unchanged sentences

Treasury stock, at average cost:

54,300 and 50,315 shares as of October 29, 2022 and January 29, 2022, respectively

53,238 and 54,298 shares as of April 29, 2023 and January 28, 2023, respectively

( 1,907,586 ) ( 1,953,735 )

10 unchanged sentences

(Thousands, except per share amounts)

Thirteen Weeks Ended October 29, 2022

Common Stock Paid-in

capital Non-controlling interests Retained

earnings AOCL Treasury stock Total

stockholders’

outstanding Par

value Shares At average

Balance, July 30, 2022 49,471 $ 1,033 $ 405,127 $ 11,139 $ 2,333,867 $ ( 130,040 ) 53,829 $ ( 1,948,199 ) $ 672,927

Net income (loss) — — — 1,496 ( 2,214 ) — — — ( 718 )

Purchase of Common Stock ( 510 ) — — — — — 510 ( 8,000 ) ( 8,000 )

Share-based compensation issuances and exercises 39 — ( 1,396 ) — ( 923 ) — ( 39 ) 1,893 ( 426 )

Share-based compensation expense — — 7,310 — — — — — 7,310

Derivative financial instruments, net of tax — — — — — ( 1,206 ) — — ( 1,206 )

Foreign currency translation adjustments, net of tax — — — — — ( 11,021 ) — — ( 11,021 )

Distributions to noncontrolling interests, net — — — ( 2,801 ) — — — — ( 2,801 )

Ending balance at October 29, 2022 49,000 $ 1,033 $ 411,041 $ 9,834 $ 2,330,730 $ ( 142,267 ) 54,300 $ ( 1,954,306 ) $ 656,065

Thirteen Weeks Ended October 30, 2021

Thirteen Weeks Ended April 29, 2023

Common Stock Paid-in

4 unchanged sentences

value Shares At average

Balance, July 31, 2021 59,691 $ 1,033 $ 399,891 $ 10,367 $ 2,275,009 $ ( 100,265 ) 43,609 $ ( 1,619,102 ) $ 966,933

Balance, January 28, 2023 49,002 $ 1,033 $ 416,255 $ 11,728 $ 2,368,815 $ ( 137,527 ) 54,298 $ ( 1,953,735 ) $ 706,569

Net income — — — 1,276 16,571 — — — 17,847

Purchase of Common Stock ( 2,692 ) — — — 2,692 ( 100,000 ) ( 100,000 )

Share-based compensation issuances and exercises 1,060 — ( 23,644 ) — ( 40,864 ) — ( 1,060 ) 46,149 ( 18,359 )

3 unchanged sentences

Distributions to noncontrolling interests, net — — — ( 3,888 ) — — — — ( 3,888 )

Ending balance at October 30, 2021 57,037 $ 1,033 $ 406,305 $ 9,395 $ 2,320,800 $ ( 101,478 ) 46,263 $ ( 1,717,726 ) $ 918,329

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

Abercrombie & Fitch Co.

2022 3Q Form 10-Q

Abercrombie & Fitch Co.

Condensed Consolidated Statements of Stockholders’ Equity

(Thousands, except per share amounts)

Thirty-Nine Weeks Ended October 29, 2022

Ending balance at April 29, 2023 50,062 $ 1,033 $ 400,699 $ 9,116 $ 2,344,522 $ ( 136,811 ) 53,238 $ ( 1,907,586 ) $ 710,973

Thirteen Weeks Ended April 30, 2022

Common Stock Paid-in

12 unchanged sentences

Distributions to noncontrolling interests, net — — — ( 3,413 ) — — — — ( 3,413 )

Ending balance at October 29, 2022 49,000 $ 1,033 $ 411,041 $ 9,834 $ 2,330,730 $ ( 142,267 ) 54,300 $ ( 1,954,306 ) $ 656,065

Thirty-Nine Weeks Ended October 30, 2021

Common Stock Paid-in

capital Non-controlling interests Retained

earnings AOCL Treasury stock Total

stockholders’

outstanding Par

value Shares At average

Balance, January 30, 2021 62,399 $ 1,033 $ 401,283 $ 12,684 $ 2,149,470 $ ( 102,307 ) 40,901 $ ( 1,512,851 ) $ 949,312

Net income — — — 4,739 197,501 — — — 202,240

Purchase of Common Stock ( 6,143 ) — — — 6,143 ( 235,249 ) ( 235,249 )

Share-based compensation issuances and exercises 781 — ( 17,247 ) — ( 26,171 ) — ( 781 ) 30,374 ( 13,044 )

Share-based compensation expense — — 22,269 — — — — — 22,269

Derivative financial instruments, net of tax — — — — — 9,718 — — 9,718

Foreign currency translation adjustments, net of tax — — — — — ( 8,889 ) — — ( 8,889 )

Distributions to noncontrolling interests, net — — — ( 8,028 ) — — — — ( 8,028 )

Ending balance at October 30, 2021 57,037 $ 1,033 $ 406,305 $ 9,395 $ 2,320,800 $ ( 101,478 ) 46,263 $ ( 1,717,726 ) $ 918,329

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

Ending balance at April 30, 2022 50,442 $ 1,033 $ 398,412 $ 9,444 $ 2,350,807 $ ( 123,397 ) 52,858 $ ( 1,931,494 ) $ 704,805

Abercrombie & Fitch Co.

2 unchanged sentences

Condensed Consolidated Statements of Cash Flows

Thirty-Nine Weeks Ended

October 29, 2022 October 30, 2021

Thirteen Weeks Ended

April 29, 2023 April 30, 2022

Operating activities

Net (loss) income $ ( 30,306 ) $ 202,240

Adjustments to reconcile net (loss) income to net cash (used for) provided by operating activities:

Net income (loss) $ 17,847 $ ( 14,846 )

Adjustments to reconcile net income (loss) to net cash used for operating activities:

Depreciation and amortization 36,028 33,888

Asset impairment 4,436 3,422

(Gain) loss on disposal ( 198 ) 3,500

Benefit for deferred income taxes ( 9,585 ) ( 32,931 )

Loss (gain) on disposal 489 ( 2,798 )

Provision for (benefit from) deferred income taxes 9,689 ( 5,853 )

Share-based compensation 8,088 8,356

(Gain) loss on extinguishment of debt ( 52 ) 5,347

Changes in assets and liabilities:

5 unchanged sentences

Other liabilities 112 231

Net cash (used for) provided by operating activities ( 301,194 ) 131,287

Net cash used for operating activities ( 560 ) ( 217,787 )

Investing activities

1 unchanged sentence

Proceeds from the sale of property and equipment — 7,751

Withdrawal of funds from Rabbi Trust assets 12,000 —

Net cash used for investing activities ( 46,391 ) ( 18,541 )

Financing activities

Purchase of senior secured notes ( 7,862 ) ( 46,969 )

Payment of debt issuance or modification costs and fees ( 181 ) ( 2,016 )

Purchases of Common Stock — ( 100,000 )

9 unchanged sentences

Supplemental information related to cash activities

Cash paid for interest 13,574 14,950

Cash paid for income taxes 3,007 2,887

9 unchanged sentences

REVENUE RECOGNITION

NET (LOSS) INCOME PER SHARE

NET INCOME (L OSS) PER SHARE

PROPERTY AND EQUIPMENT, NET

4 unchanged sentences

SEGMENT REPORTING

SUBSEQUENT EVENTS

Abercrombie & Fitch Co.

6 unchanged sentences

The Company offers a broad assortment of apparel, personal care products and accessories for men, women and kids, which are sold primarily through its digital channels and Company-owned stores, as well as through various third-party arrangements.

The Company’s two brand-based operating segments are Hollister, which includes the Company’s Hollister, Gilly Hicks, and Social Tourist brands, and Abercrombie, which includes the Company’s Abercrombie & Fitch and abercrombie kids brands.

These five brands share a commitment to offering unique products of enduring quality and exceptional comfort that allow customers around the world to express their own individuality and style.

The Company operates primarily in North America, Europe, and Asia.

The Company’s two brand-based operating segments are Abercrombie, which includes the Company’s Abercrombie & Fitch and abercrombie kids brands, and Hollister, which includes the Company’s Hollister, Gilly Hicks, and Social Tourist brands.

These brands share a commitment to offering unique products of enduring quality and exceptional comfort that allow customers around the world to express their own individuality and style.

The Company operates primarily in North America, Europe, Middle East, and Asia.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1 unchanged sentence

The accompanying Condensed Consolidated Financial Statements include historical financial statements of, and transactions applicable to, the Company and reflect its financial position, results of operations and cash flows.

The Company has interests in an Emirati business venture and in a Kuwaiti business venture with Majid al Futtaim Fashion L.L.C.

The Company has interests in an Emirati business venture, in a Kuwaiti business venture with Majid al Futtaim Fashion L.L.C.

(“MAF”) and in a United States of America (the “U.S.”) business venture with Dixar L.L.C.

2 unchanged sentences

The Company is deemed to be the primary beneficiary of these VIEs;

therefore, the Company has consolidated the operating results, assets and liabilities of these VIEs, with the noncontrolling interests’ (“NCI”) portions of net (loss) income presented as net income attributable to NCI on the Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income and the NCI portion of stockholders’ equity presented as NCI on the Condensed Consolidated Balance Sheets.

therefore, the Company has consolidated the operating results, assets and liabilities of these VIEs, with the noncontrolling interests’ (“NCI”) portions of net income (loss) presented as net income attributable to NCI on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) and the NCI portion of stockholders’ equity presented as NCI on the Condensed Consolidated Balance Sheets.

The Company’s fiscal year ends on the Saturday closest to January 31.

4 unchanged sentences

Fiscal 2022 January 28, 2023 52

Fiscal 2023 February 3, 2024 53

Fiscal 2024 February 1, 2025 52

Interim financial statements

The Condensed Consolidated Financial Statements as of October 29, 2022, and for the thirteen and thirty-nine week periods ended October 29, 2022 and October 30, 2021, are unaudited and are presented pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim consolidated financial statements.

The Condensed Consolidated Financial Statements as of April 29, 2023, and for the thirteen week periods ended April 29, 2023 and April 30, 2022, are unaudited and are presented pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim consolidated financial statements.

Accordingly, the Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and notes thereto contained in A&F’s Annual Report on Form 10-K for Fiscal 2022 filed with the SEC on March 27, 2023 (the “Fiscal 2022 Form 10-K”).

1 unchanged sentence

In the opinion of management, the accompanying Condensed Consolidated Financial Statements reflect all adjustments (which are of a normal recurring nature) necessary to state fairly, in all material respects, the financial position, results of operations and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for Fiscal 2023.

During the first quarter of 2022, the Company reclassified flagship store exit benefits into stores and distribution expense on the Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income.

There were no changes to operating (loss) income or net (loss) income.

Prior period amounts have been reclassified to conform to current year’s presentation.

Abercrombie & Fitch Co.

3 unchanged sentences

Due to the inherent uncertainty involved with estimates, actual results may differ.

Additionally, these estimates and assumptions may change as a result of the impact of global economic conditions such as the uncertainty regarding a slowing economy, rising interest rates, continued inflation, fluctuation in foreign exchange rates, the coronavirus ("COVID-19") pandemic, and the ongoing conflict in Ukraine and result in material impacts to the Company’s consolidated financial statements in future reporting periods.

Additionally, these estimates and assumptions may change as a result of the impact of global economic conditions, such as the uncertainty regarding a slowing economy, rising interest rates, continued inflation, fluctuation in foreign exchange rates, and the ongoing conflict in Ukraine, and result in material impacts to the Company’s consolidated financial statements in future reporting periods.

Recent accounting pronouncements

The Company reviews recent accounting pronouncements on a quarterly basis and has excluded discussion of those not applicable to the Company and those that did not have, or are not expected to have, a material impact on the Company’s consolidated financial statements.

The following table provides a brief description of certain accounting pronouncements that the company has adopted.

Accounting Standards Update (ASU) Description Date of adoption Effect on the financial statements or other significant matters

ASU 2022-04, Liabilities — Supplier Finance Programs (Subtopic 405-50):

Disclosure of Supplier Finance Program Obligations

The update relates to disclosure requirements for buyers in supplier finance programs.

The amendments in the update require that a buyer disclose qualitative and quantitative information about their supplier finance programs.

Interim and annual requirements include disclosure of outstanding amounts under the obligations as of the end of the reporting period, and annual requirements include a roll-forward of those obligations for the annual reporting period, as well as a description of payment and other key terms of the programs.

This update is effective for annual periods beginning after December 15, 2022, and interim periods within those fiscal years, except for the requirement to disclose roll-forward information, which is effective for fiscal years beginning after December 15, 2023.

January 29, 2023 The Company adopted the changes to the standard under the retrospective method in the first quarter of Fiscal 2023, except for roll-forward information, which is effective for fiscal years beginning after December 15, 2023.

The adoption of this guidance did not have a significant impact on the Company's condensed consolidated financial statements.

Supply Chain Finance Program

On January 29, 2023, the Company adopted the changes to the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) described in Accounting Standards Update (“ASU”) No.

ASU 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50):

Disclosure of Supplier Finance Program Obligations, which enhances the transparency of supplier finance programs and requires certain disclosures for a buyer in a supplier finance program.

Under the supply chain finance (“SCF”) program, which is administered by a third party, the Company’s vendors, at their sole discretion, are given the opportunity to sell receivables from the Company to a participating financial institution at a discount that leverages the Company’s credit profile.

The commercial terms negotiated by the Company with its vendors are consistent, irrespective of whether a vendor participates in the SCF program.

A participating vendor has the option to be paid by the financial institution earlier than the original invoice due date.

The Company’s responsibility is limited to making payment on the terms originally negotiated by the Company with each vendor, regardless of whether the vendor sells its receivable to a financial institution.

If a vendor chooses to participate in the SCF program, the Company pays the financial institution the stated amount of confirmed merchandise invoices on the stated maturity date, which is 75 days from the invoice date.

The agreement with the financial institution does not require the Company to provide assets pledged as security or other forms of guarantees for the SCF program.

As of April 29, 2023 and January 28, 2023, $ 58.1 million and $ 68.4 million of SCF program liabilities were recorded in “Accounts payable” in the Condensed Consolidated Balance Sheet, respectively, and reflected as a cash flow from operating activities in the Condensed Consolidated Statements of Cash Flows when settled.

Abercrombie & Fitch Co.

2023 1Q Form 10-Q

Condensed Consolidated Statements of Cash Flows reconciliation

The following table provides a reconciliation of cash and equivalents and restricted cash and equivalents to the amounts shown on the Condensed Consolidated Statements of Cash Flows:

(in thousands) Location October 29, 2022 January 29, 2022 October 30, 2021 January 30, 2021

(in thousands) Location April 29, 2023 January 28, 2023 April 30, 2022 January 29, 2022

Cash and equivalents Cash and equivalents $ 446,952 $ 517,602 $ 468,378 $ 823,139

Long-term restricted cash and equivalents Other assets 9,712 9,967 10,100 11,229

Short-term restricted cash and equivalents Other current assets — — 3,280 4,481

Cash and equivalents and restricted cash and equivalents $ 456,664 $ 527,569 $ 478,478 $ 834,368

1 unchanged sentence

Disaggregation of revenue

All revenues are recognized in net sales in the Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income.

All revenues are recognized in net sales in the Condensed Consolidated Statements of Operations and Comprehensive Income.

For information regarding the disaggregation of revenue, refer to Note 14, “ SEGMENT REPORTING .

Contract liabilities

The following table details certain contract liabilities representing unearned revenue as of October 29, 2022, January 29, 2022 and October 30, 2021:

(in thousands) October 29, 2022 January 29, 2022 October 30, 2021

The following table details certain contract liabilities representing unearned revenue as of April 29, 2023, January 28, 2023, April 30, 2022 and January 29, 2022:

(in thousands) April 29, 2023 January 28, 2023 ⁽¹⁾ April 30, 2022 January 29, 2022 ⁽¹⁾

Gift card liability (1)

$ 37,630 $ 39,235 $ 35,665 $ 36,984

Loyalty programs liability 23,552 25,640 22,177 22,757

The following table details recognized revenue associated with the Company’s gift card program and loyalty programs for the thirteen and thirty-nine weeks ended October 29, 2022 and October 30, 2021:

Thirteen Weeks Ended Thirty-Nine Weeks Ended

(in thousands) October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021

(1) Includes $ 13.4 million and $ 12.1 million of revenue recognized during the thirteen weeks ended April 29, 2023 and April 30, 2022, respectively, that was included in the gift card liability at the beginning of January 28, 2023 and January 29, 2022, respectively .

The following table details recognized revenue associated with the Company’s gift card program and loyalty programs for the thirteen weeks ended April 29, 2023 and April 30, 2022:

Thirteen Weeks Ended

(in thousands) April 29, 2023 April 30, 2022

Revenue associated with gift card redemptions and gift card breakage $ 24,224 $ 23,001

Revenue associated with reward redemptions and breakage related to the Company’s loyalty programs 12,282 10,181

Abercrombie & Fitch Co.

2022 3Q Form 10-Q

NET (LOSS) INCOME PER SHARE

Net (loss) income per basic and diluted share attributable to A&F is computed based on the weighted-average number of outstanding shares of Class A Common Stock (“Common Stock”).

Additional information pertaining to net (loss) income per share attributable to A&F follows:

Thirteen Weeks Ended Thirty-Nine Weeks Ended

(in thousands) October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021

NET INCOME (LOSS) PER SHARE

Net income (loss) per basic and diluted share attributable to A&F is computed based on the weighted-average number of outstanding shares of Class A Common Stock (“Common Stock”).

Additional information pertaining to net income (loss) per share attributable to A&F follows:

Thirteen Weeks Ended

(in thousands) April 29, 2023 April 30, 2022

Shares of Common Stock issued 103,300 103,300

4 unchanged sentences

Anti-dilutive shares (1)

4,199 1,228 4,285 1,212

(1) Reflects the total number of shares related to outstanding share-based compensation awards that have been excluded from the computation of net (loss) income per diluted share because the impact would have been anti-dilutive.

(1) Reflects the total number of shares related to outstanding share-based compensation awards that have been excluded from the computation of net income (loss) per diluted share because the impact would have been anti-dilutive.

Unvested shares related to restricted stock units with performance-based and market-based vesting conditions can achieve up to 200% of their target vesting amount and are reflected at the maximum vesting amount less any dilutive portion.

Abercrombie & Fitch Co.

2023 1Q Form 10-Q

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

5 unchanged sentences

The lowest level of significant input determines the placement of the entire fair value measurement in the hierarchy.

The three levels of the hierarchy and the distribution of the Company’s assets measured at fair value on a recurring basis, as of October 29, 2022 and January 29, 2022, were as follows:

Assets and Liabilities at Fair Value as of October 29, 2022

The three levels of the hierarchy and the distribution of the Company’s assets measured at fair value on a recurring basis, as of April 29, 2023 and January 28, 2023, were as follows:

Assets and Liabilities at Fair Value as of April 29, 2023

(in thousands) Level 1 Level 2 Level 3 Total

2 unchanged sentences

Derivative instruments (2)

— 3,802 — 3,802

Rabbi Trust assets (3)

6 unchanged sentences

Total liabilities $ — $ 4,139 $ — $ 4,139

Assets at Fair Value as of January 29, 2022

Assets and Liabilities at Fair Value as of January 28, 2023

(in thousands) Level 1 Level 2 Level 3 Total

2 unchanged sentences

Derivative instruments (2)

— 4,973 — 4,973

Rabbi Trust assets (3)

3 unchanged sentences

Total assets $ 52,055 $ 56,887 $ — $ 108,942

Derivative instruments (2)

$ — $ 4,986 $ — $ 4,986

Total liabilities $ — $ 4,986 $ — $ 4,986

(1) Level 1 assets consisted of investments in money market funds and U.S.

4 unchanged sentences

Level 2 assets consisted of trust-owned life insurance policies.

Abercrombie & Fitch Co.

2022 3Q Form 10-Q

The Company’s Level 2 assets consisted of:

5 unchanged sentences

The carrying amount and fair value of the Company’s long-term gross borrowings were as follows:

(in thousands) October 29, 2022 January 29, 2022

(in thousands) April 29, 2023 January 28, 2023

Gross borrowings outstanding, carrying amount $ 299,730 $ 299,730

Gross borrowings outstanding, fair value 304,975 304,975

Abercrombie & Fitch Co.

2023 1Q Form 10-Q

PROPERTY AND EQUIPMENT, NET

Property and equipment, net consisted of:

(in thousands) October 29, 2022 January 29, 2022

(in thousands) April 29, 2023 January 28, 2023

Property and equipment, at cost $ 2,532,642 $ 2,517,862

1 unchanged sentence

Property and equipment, net $ 550,810 $ 551,585

R efer to Note 8, “ ASSET IMPAIRMENT ,” for details related to property and equipment impairment charges incurred during the thirteen and thirty-nine weeks ended October 29, 2022 and October 30, 2021.

R efer to Note 8, “ ASSET IMPAIRMENT ,” for details related to property and equipment impairment charges incurred during the thirteen weeks ended April 29, 2023 and April 30, 2022.

The Company is a party to leases related to its Company-operated retail stores as well as for certain of its distribution centers, office space, information technology and equipment.

The following table provides a summary of the Company’s operating lease costs for the thirteen and thirty-nine weeks ended October 29, 2022 and October 30, 2021:

Thirteen Weeks Ended Thirty-Nine Weeks Ended

(in thousands) October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021

The following table provides a summary of the Company’s operating lease costs for the thirteen weeks ended April 29, 2023 and April 30, 2022:

Thirteen Weeks Ended

(in thousands) April 29, 2023 April 30, 2022

Single lease cost (1)

3 unchanged sentences

Operating lease right-of-use asset impairment (3)

1,205 5,512 4,693 8,216

Sublease income (4)

2 unchanged sentences

(1) Included amortization and interest expense associated with operating lease right-of-use assets and the impact from remeasurement of operating lease liabilities.

(2) Includes variable payments related to both lease and nonlease components, such as contingent rent payments made by the Company based on performance, and payments related to taxes, insurance, and maintenance costs, as well as the benefit of $ 0.8 million and $ 3.3 million of rent abatements during the thirteen and thirty-nine weeks ended October 29, 2022, respectively, related to the effects of the COVID-19 pandemic that resulted in the total payments required by the modified contract being substantially the same as or less than total payments required by the original contract.

The benefit related to rent abatements recognized during the thirteen and thirty-nine weeks ended October 30, 2021 was $ 1.7 million and $ 14.6 million respectively.

(2) Includes variable payments related to both lease and nonlease components, such as contingent rent payments made by the Company based on performance, and payments related to taxes, insurance, and maintenance costs, as well as the benefit of $ 0.1 million of rent abatements during the thirteen weeks ended April 29, 2023, respectively, related to the effects of the COVID-19 pandemic that resulted in the total payments required by the modified contract being substantially the same as or less than total payments required by the original contract.

The benefit related to rent abatements recognized during the thirteen weeks ended April 30, 2022 was $ 1.7 million.

(3) Refer to Note 8, “ ASSET IMPAIRMENT ,” for details related to operating lease right-of-use asset impairment charges.

1 unchanged sentence

Financial Statements and Supplementary Data” of the Fiscal 2022 Form 10-K.

Sublease income is recognized in other operating income, net on the Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income.

The Company had minimum commitments related to operating lease contracts that have not yet commenced, primarily for its Company-operated retail stores, of approximately $ 31.5 million as of October 29, 2022.

Abercrombie & Fitch Co.

2022 3Q Form 10-Q

Sublease income is recognized in other operating income, net on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

The Company had minimum commitments related to operating lease contracts that have not yet commenced, primarily for certain Company-operated retail stores, of approximately $ 11.5 million as of April 29, 2023.

ASSET IMPAIRMENT

Asset impairment charges for the thirteen and thirty-nine weeks ended October 29, 2022 and October 30, 2021 were as follows:

Thirteen Weeks Ended Thirty-Nine Weeks Ended

(in thousands) October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021

Asset impairment charges for the thirteen weeks ended April 29, 2023 and April 30, 2022 were as follows:

Thirteen Weeks Ended

(in thousands) April 29, 2023 April 30, 2022

Operating lease right-of-use asset impairment $ 1,414 $ 1,915

Property and equipment asset impairment 3,022 1,507

2,539 1,237 4,643 1,983

Total asset impairment $ 4,436 $ 3,422

(1) Amounts include $ 0.6 million of store asset impairment and $ 1.9 million other asset impairment for the thirteen weeks ended October 29, 2022 and

$ 2.7 million of store asset impairment and $ 1.9 million other asset impairment for the thirty-nine weeks ended October 29, 2022.

Amounts for the thirteen and thirty-nine weeks ended October 30, 2021 only include store asset impairment.

Asset impairment charges for the thirteen and thirty-nine weeks ended October 29, 2022 and October 30, 2021 related to certain of the Company’s assets including stores across brands, geographies and store formats and other assets.

The store impairment charges for the thirty-nine weeks ended October 29, 2022 reduced the then carrying amount of the impaired stores’ assets to their fair value of approximately $ 38.7 million, including $ 37.8 million related to operating lease right-of-use assets.

The impairment charges for the thirty-nine weeks ended October 30, 2021 reduced the then carrying amount of the impaired stores’ assets to their fair value of approximately $ 19.5 million, including $ 17.0 million related to operating lease right-of-use assets.

Asset impairment charges for the thirteen weeks ended April 29, 2023 and April 30, 2022 related to certain of the Company’s assets including stores across brands, geographies and store formats.

The store impairment charges for the thirteen weeks ended April 29, 2023 reduced the then carrying amount of the impaired stores’ assets to their fair value of approximately $ 12.4 million, including $ 8.8 million related to operating lease right-of-use assets.

Abercrombie & Fitch Co.

2023 1Q Form 10-Q

The quarterly provision for income taxes is based on the current estimate of the annual effective income tax rate and the tax effect of discrete items occurring during the quarter.

3 unchanged sentences

The impact of these items on the effective tax rate will be greater at lower levels of pre-tax earnings.

On August 16, 2022, the Inflation Reduction Act of 2022 (the “Inflation Reduction Act”) was enacted into law.

The Company does not currently expect that the Inflation Reduction Act will have a material impact on its income taxes.

Impact of valuation allowances and other tax charges

During the thirteen and thirty-nine weeks ended October 29, 2022, the Company did not recognize income tax benefits on $ 30.0 million and $ 69.7 million, respectively, of pretax losses, primarily in Switzerland, resulting in adverse tax impacts of $ 5.6 million and $ 12.8 million, respectively.

As of October 29, 2022, there were approximately $ 11.2 million of net deferred tax assets in China.

The realization of these net deferred tax assets is dependent upon the future generation of sufficient taxable profits in China.

During the thirty-nine weeks ended October 29, 2022, the company recorded a $ 0.2 million valuation allowance on net operating losses currently not projected to be utilized in future years.

While the Company believes that the remaining net deferred tax assets are more-likely-than-not to be realized, it is not a certainty, as the Company continues to evaluate and respond to certain situations, such as the COVID-19 pandemic.

The Company is closely monitoring its operations in China.

During the thirteen weeks ended April 29, 2023, the Company did not recognize income tax benefits on $ 20.3 million of pretax losses, primarily in Switzerland, resulting in adverse tax impacts of $ 3.1 million.

As of April 29, 2023, the Company had net deferred tax assets of approximately $ 9.8 million, $ 8.5 million, and $ 15.4 million in China, Japan and United Kingdom, respectively.

While the Company believes that these net deferred tax assets are more-likely-than-not to be realized, it is not a certainty, as the Company continues to evaluate and respond to emerging situations.

Should circumstances change, the net deferred tax assets may become subject to additional valuation allowances in the future.

Additional valuation allowances would result in additional tax expense.

During the thirteen weeks ended October 30, 2021, the Company recognized $ 3.5 million of tax benefits due to the expected utilization of deferred tax assets against projected pre-tax income for the full fiscal year, primarily in the U.S.

and Germany, based on information available, on which a valuation allowance had previously been established.

During the thirty-nine weeks ended October 30, 2021, the Company recognized $ 23.4 million of discrete tax benefits due to the release of valuation allowances, primarily in the U.S.

and Germany, and a discrete tax benefit of $ 3.9 million due to a rate change in the U.K.

The Company also recognized $ 13.6 million of tax benefits due to the expected utilization of deferred tax assets against projected pre-tax income for the full fiscal year, primarily in the U.S.

and Germany, based on information available, on which a valuation allowance had previously been established.

The Company continues to maintain valuation allowances in certain jurisdictions, principally Switzerland and Japan.

Abercrombie & Fitch Co.

2022 3Q Form 10-Q

During the thirteen weeks ended April 30, 2022, the Company did not recognize income tax benefits on $ 13.4 million of pretax losses, primarily in Switzerland, resulting in adverse tax impacts of $ 2.4 million.

As of April 30, 2022, there were approximately $ 11.4 million, $ 10.4 million, and $ 17.9 million of net deferred tax assets in China, Japan, and the United Kingdom, respectively.

Share-based compensation

Refer to Note 11, “ SHARE-BASED COMPENSATION ,” for details on income tax benefits and charges related to share-based compensation awards during the thirteen and thirty-nine weeks ended October 29, 2022 and October 30, 2021.

Details on the Company’s long-term borrowings, net, as of October 29, 2022 and January 29, 2022 are as follows:

(in thousands) October 29, 2022 January 29, 2022

Refer to Note 11, “ SHARE-BASED COMPENSATION ,” for details on income tax benefits and charges related to share-based compensation awards during the thirteen weeks ended April 29, 2023 and April 30, 2022.

Details on the Company’s long-term borrowings, net, as of April 29, 2023 and January 28, 2023 are as follows:

(in thousands) April 29, 2023 January 28, 2023

Long-term portion of borrowings, gross at carrying amount $ 299,730 $ 299,730

2 unchanged sentences

Senior Secured Notes

During the thirteen weeks ended October 29, 2022, Abercrombie & Fitch Management Co.(“A&F Management”), a wholly-owned indirect subsidiary of A&F, purchased $ 8.0 million of outstanding Senior Secured Notes and incurred a $ 0.1 million gain on extinguishment of debt, recognized in interest expense, net on the Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income.

The terms of the Senior Secured Notes have remained unchanged from those disclosed in Note 13, “BORROWINGS,” of the Notes to Consolidated Financial Statements contained in “Item 8.

2 unchanged sentences

Financial Statements and Supplementary Dat a ” of the Fiscal 2022 Form 10-K.

The Company did not have any borrowings outstanding under the ABL Facility as of October 29, 2022 or as of January 29, 2022.

As of October 29, 2022, availability under the ABL Facility was $ 399.4 million, net of $ 0.6 million in outstanding stand-by letters of credit.

As the Company must maintain excess availability equal to the greater of 10% of the loan cap or $30 million under the ABL Facility, borrowing capacity available to the Company under the ABL Facility was $ 359.4 million as of October 29, 2022.

The Company did not have any borrowings outstanding under the ABL Facility as of April 29, 2023 or as of January 28, 2023.

As of April 29, 2023, availability under the ABL Facility was $ 345.4 million, net of $ 0.6 million in outstanding stand-by letters of credit.

Abercrombie & Fitch Co.

2023 1Q Form 10-Q

Representations, warranties and covenants

9 unchanged sentences

Certain of the agreements related to the Senior Secured Notes and the ABL Facility also contain certain affirmative covenants, including reporting requirements such as delivery of financial statements, certificates and notices of certain events, maintaining insurance and providing additional guarantees and collateral in certain circumstances.

The Company was in compliance with all debt covenants under these agreements as of October 29, 2022.

Abercrombie & Fitch Co.

2022 3Q Form 10-Q

The Company was in compliance with all debt covenants under these agreements as of April 29, 2023.

SHARE-BASED COMPENSATION

Financial statement impact

The following table details share-based compensation expense and the related income tax impacts for the thirteen and thirty-nine weeks ended October 29, 2022 and October 30, 2021:

Thirteen Weeks Ended Thirty-Nine Weeks Ended

(in thousands) October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021

The following table details share-based compensation expense and the related income tax impacts for the thirteen weeks ended April 29, 2023 and April 30, 2022:

Thirteen Weeks Ended

(in thousands) April 29, 2023 April 30, 2022

Share-based compensation expense $ 8,088 $ 8,356

Income tax benefit associated with share-based compensation expense recognized 1,005 965

The following table details discrete income tax benefits and charges related to share-based compensation awards during the thirteen and thirty-nine weeks ended October 29, 2022 and October 30, 2021:

Thirteen Weeks Ended Thirty-Nine Weeks Ended

(in thousands) October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021

Income tax discrete (charges) benefits realized for tax deductions related to the issuance of shares $ ( 29 ) $ 150 $ 1,970 $ 4,166

Income tax discrete (charges) benefits realized upon cancellation of stock appreciation rights ( 10 ) — ( 213 ) ( 3 )

Total income tax discrete (charges) benefits related to share-based compensation awards $ ( 39 ) $ 150 $ 1,757 $ 4,163

The following table details the amount of employee tax withheld by the Company upon the issuance of shares associated with restricted stock units vesting and the exercise of stock appreciation rights for the thirteen and thirty-nine weeks ended October 29, 2022 and October 30, 2021:

Thirteen Weeks Ended Thirty-Nine Weeks Ended

(in thousands) October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021

The following table details discrete income tax benefits and charges related to share-based compensation awards during the thirteen weeks ended April 29, 2023 and April 30, 2022:

Thirteen Weeks Ended

(in thousands) April 29, 2023 April 30, 2022

Income tax discrete benefits realized for tax deductions related to the issuance of shares $ 1,117 $ 2,111

Income tax discrete charges realized upon cancellation of stock appreciation rights ( 101 ) ( 195 )

Total income tax discrete benefits related to share-based compensation awards $ 1,016 $ 1,916

Thirteen Weeks Ended

(in thousands) April 29, 2023 April 30, 2022

Employee tax withheld upon issuance of shares (1)

1 unchanged sentence

(1) Classified within other financing activities on the Condensed Consolidated Statements of Cash Flows.

Abercrombie & Fitch Co.

2023 1Q Form 10-Q

Restricted stock units

The following table summarizes activity for restricted stock units for the thirty-nine weeks ended October 29, 2022:

The following table summarizes activity for restricted stock units for the thirteen weeks ended April 29, 2023:

Service-based Restricted

16 unchanged sentences

Forfeited ( 35,766 ) 26.65 — — — —

Unvested at October 29, 2022 (1)

Unvested at April 29, 2023 (1)

2,463,304 $ 24.29 558,693 $ 30.00 279,360 $ 43.81

1 unchanged sentence

Unvested shares related to restricted stock units with performance-based and market-based vesting conditions can be achieved at up to 200% of their target vesting amount.

The following table details unrecognized compensation cost and the remaining weighted-average period over which these costs are expected to be recognized for restricted stock units as of October 29, 2022:

(in thousands) Service-based Restricted

3 unchanged sentences

Remaining weighted-average period cost is expected to be recognized (years) 1.4 1.3 1.2

Abercrombie & Fitch Co.

2022 3Q Form 10-Q

Additional information pertaining to restricted stock units for the thirty-nine weeks ended October 29, 2022 and October 30, 2021 follows:

(in thousands) October 29, 2022 October 30, 2021

Additional information pertaining to restricted stock units for the thirteen weeks ended April 29, 2023 and April 30, 2022 follows:

(in thousands) April 29, 2023 April 30, 2022

Service-based restricted stock units:

7 unchanged sentences

Total grant date fair value of awards vested 16,040 4,105

The weighted-average assumptions used for market-based restricted stock units in the Monte Carlo simulation during the thirty-nine weeks ended October 29, 2022 and October 30, 2021 were as follows:

October 29, 2022 October 30, 2021

The weighted-average assumptions used for market-based restricted stock units in the Monte Carlo simulation during the thirteen weeks ended April 29, 2023 and April 30, 2022 were as follows:

April 29, 2023 April 30, 2022

Grant date market price $ 28.36 $ 32.07

6 unchanged sentences

Average correlation coefficient of peer companies 0.5295 0.5146

Abercrombie & Fitch Co.

2023 1Q Form 10-Q

Stock appreciation rights

The following table summarizes stock appreciation rights activity for the thirty-nine weeks ended October 29, 2022:

The following table summarizes stock appreciation rights activity for the thirteen weeks ended April 29, 2023:

Shares Weighted-Average

3 unchanged sentences

Outstanding at January 28, 2023 190,589 $ 29.43

Exercised ( 7,700 ) 24.05

Forfeited or expired ( 23,700 ) 45.69

Outstanding at October 29, 2022

Outstanding at April 29, 2023

159,189 $ 27.27 $ 106,556 1.6

Stock appreciation rights exercisable at October 29, 2022 198,339 $ 29.47 $ — 1.9

No stock appreciation rights were exercised during the thirty-nine weeks ended October 29, 2022 or October 30, 2021.

Stock appreciation rights exercisable at April 29, 2023 159,189 $ 27.27 $ 106,556 1.6

No stock appreciation rights were exercised during the thirteen weeks ended April 30, 2022.

DERIVATIVE INSTRUMENTS

6 unchanged sentences

Foreign currency exchange forward contracts represent agreements to exchange the currency of one country for the currency of another country at an agreed upon settlement date.

These foreign currency exchange forward contracts typically have a maximum term

Abercrombie & Fitch Co.

2022 3Q Form 10-Q

of twelve months.

These foreign currency exchange forward contracts typically have a maximum term of twelve months.

The sale of the inventory to the Company’s customers will result in the reclassification of related derivative gains and losses that are reported in AOCL into earnings.

3 unchanged sentences

The Company has chosen not to apply hedge accounting to these instruments because there are no anticipated differences in the timing of gain or loss recognition on the hedging instruments and the hedged items.

As of October 29, 2022, the Company had outstanding the following foreign currency exchange forward contracts that were entered into to hedge either a portion, or all, of forecasted foreign-currency-denominated intercompany inventory transactions, the resulting settlement of the foreign-currency-denominated intercompany accounts receivable, or both:

As of April 29, 2023, the Company had outstanding the following foreign currency exchange forward contracts that were entered into to hedge either a portion, or all, of forecasted foreign-currency-denominated intercompany inventory transactions, the resulting settlement of the foreign-currency-denominated intercompany accounts receivable, or both:

(in thousands) Notional Amount (1)

4 unchanged sentences

(1) Amounts reported are the U.S.

Dollar notional amounts outstanding as of October 29, 2022.

The fair value of derivative instruments is valued using quoted market prices of the same or similar instruments, adjusted for counterparty risk.

The location and amounts of derivative fair values of foreign currency exchange forward contracts on the Condensed Consolidated Balance Sheets as of October 29, 2022 and January 29, 2022 were as follows:

(in thousands) Location October 29, 2022 January 29, 2022 Location October 29, 2022 January 29, 2022

Dollar notional amounts outstanding as of April 29, 2023.

The fair value of derivative instruments is determined using quoted market prices of the same or similar instruments, adjusted for counterparty risk.

The location and amounts of derivative fair values of foreign currency exchange forward contracts on the Condensed Consolidated Balance Sheets as of April 29, 2023 and January 28, 2023 were as follows:

(in thousands) Location April 29, 2023 January 28, 2023 Location April 29, 2023 January 28, 2023

Derivatives designated as cash flow hedging instruments Other current assets $ 7 $ 32 Accrued expenses $ 4,139 $ 4,986

Derivatives not designated as hedging instruments

Other current assets — — Accrued expenses — —

$ 3,802 $ 4,973 $ 10 $ —

Information pertaining to derivative gains or losses from foreign currency exchange forward contracts designated as cash flow hedging instruments for the thirteen and thirty-nine weeks ended October 29, 2022 and October 30, 2021 follows:

Thirteen Weeks Ended Thirty-Nine Weeks Ended

(in thousands) October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021

Gain recognized in AOCL (1)

Abercrombie & Fitch Co.

2023 1Q Form 10-Q

Information pertaining to derivative gains or losses from foreign currency exchange forward contracts designated as cash flow hedging instruments for the thirteen weeks ended April 29, 2023 and April 30, 2022 follows:

Thirteen Weeks Ended

(in thousands) April 29, 2023 April 30, 2022

(Loss) gain recognized in AOCL (1)

$ ( 507 ) $ 5,363

Gain (loss) reclassified from AOCL to cost of sales, exclusive of depreciation and amortization (2)

(Loss) gain reclassified from AOCL to cost of sales, exclusive of depreciation and amortization (2)

( 906 ) 3,684

1 unchanged sentence

(2) Amount represents gain (loss) reclassified from AOCL to cost of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) when the hedged item affects earnings, which is when merchandise is converted to cost of sales, exclusive of depreciation and amortization.

Substantially all of the unrealized gain will be recognized in costs of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income over the next twelve months .

Additional information pertaining to derivative gains or losses from foreign currency exchange forward contracts not designated as hedging instruments for the thirteen and thirty-nine weeks ended October 29, 2022 and October 30, 2021 follows:

Thirteen Weeks Ended Thirty-Nine Weeks Ended

(in thousands) October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021

Gain recognized in other operating income, net

Additional information pertaining to derivative gains or losses from foreign currency exchange forward contracts not designated as hedging instruments for the thirteen weeks ended April 29, 2023 and April 30, 2022 follows:

Thirteen Weeks Ended

(in thousands) April 29, 2023 April 30, 2022

(Gain) loss, net recognized in other operating income, net

$ ( 547 ) $ 1,141

Abercrombie & Fitch Co.

2022 3Q Form 10-Q

ACCUMULATED OTHER COMPREHENSIVE LOSS

Fo r the thirteen and thirty-nine weeks ended October 29, 2022, the activity in AOCL was as follows:

Thirteen Weeks Ended October 29, 2022

(in thousands) Foreign Currency Translation Adjustment Unrealized Gain (Loss) on Derivative Financial Instruments Total

Beginning balance at July 30, 2022 $ ( 136,006 ) $ 5,966 $ ( 130,040 )

Other comprehensive (loss) income before reclassifications ( 11,021 ) 2,723 ( 8,298 )

Reclassified gain from AOCL (1)

— ( 3,909 ) ( 3,909 )

Tax effect — ( 20 ) ( 20 )

Other comprehensive loss after reclassifications ( 11,021 ) ( 1,206 ) ( 12,227 )

Ending balance at October 29, 2022 $ ( 147,027 ) $ 4,760 $ ( 142,267 )

Thirty-Nine Weeks Ended October 29, 2022

Fo r the thirteen weeks ended April 29, 2023, the activity in AOCL was as follows:

Thirteen Weeks Ended April 29, 2023

(in thousands) Foreign Currency Translation Adjustment Unrealized Gain (Loss) on Derivative Financial Instruments Total

Beginning balance at January 28, 2023 $ ( 132,653 ) $ ( 4,874 ) $ ( 137,527 )

Other comprehensive (loss) income before reclassifications ( 26,338 ) 10,447 ( 15,891 )

Reclassified gain from AOCL (1)

— ( 11,718 ) ( 11,718 )

Tax effect — 48 48

Other comprehensive loss after reclassifications ( 26,338 ) ( 1,223 ) ( 27,561 )

Ending balance at October 29, 2022 $ ( 147,027 ) $ 4,760 $ ( 142,267 )

(1) Amount represents gain reclassified from AOCL to cost of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income.

For the thirteen and thirty-nine weeks ended October 30, 2021, the activity in AOCL was as follows:

Thirteen Weeks Ended October 30, 2021

(in thousands) Foreign Currency Translation Adjustment Unrealized Gain (Loss) on Derivative Financial Instruments Total

Beginning balance at July 31, 2021 $ ( 101,032 ) $ 767 $ ( 100,265 )

Other comprehensive (loss) income before reclassifications ( 5,629 ) 4,589 ( 1,040 )

Reclassified gain from AOCL (1)

— ( 141 ) ( 141 )

Other comprehensive income (loss) before reclassifications 311 ( 507 ) ( 196 )

Reclassified loss from AOCL (1)

Tax effect — 6 6

Other comprehensive (loss) income after reclassifications ( 5,629 ) 4,416 ( 1,213 )

Ending balance at October 30, 2021 $ ( 106,661 ) $ 5,183 $ ( 101,478 )

Thirty-Nine Weeks Ended October 30, 2021

Other comprehensive income after reclassifications 311 405 716

Ending balance at April 29, 2023 $ ( 132,342 ) $ ( 4,469 ) $ ( 136,811 )

(1) Amount represents loss reclassified from AOCL to cost of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

For the thirteen weeks ended April 30, 2022, the activity in AOCL was as follows:

Thirteen Weeks Ended April 30, 2022

(in thousands) Foreign Currency Translation Adjustment Unrealized Gain (Loss) on Derivative Financial Instruments Total

1 unchanged sentence

Other comprehensive (loss) income before reclassifications ( 10,403 ) 5,363 ( 5,040 )

Reclassified loss from AOCL (1)

Reclassified gain from AOCL (1)

— ( 3,684 ) ( 3,684 )

1 unchanged sentence

Other comprehensive (loss) income after reclassifications ( 10,403 ) 1,712 ( 8,691 )

Ending balance at October 30, 2021 $ ( 106,661 ) $ 5,183 $ ( 101,478 )

(1) Amount represents loss reclassified from AOCL to cost of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income.

Ending balance at April 30, 2022 $ ( 131,092 ) $ 7,695 $ ( 123,397 )

(1) Amount represents loss reclassified from AOCL to cost of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

Abercrombie & Fitch Co.

2 unchanged sentences

The Company’s two operating segments are brand-based:

Hollister, which includes the Company’s Hollister, Gilly Hicks and Social Tourist brands, and Abercrombie, which includes the Company’s Abercrombie & Fitch and abercrombie kids brands.

Abercrombie, which includes the Company’s Abercrombie & Fitch and abercrombie kids brands, and Hollister, which includes the Company’s Hollister, Gilly Hicks, and Social Tourist brands.

These operating segments have similar economic characteristics, classes of consumers, products, and production and distribution methods, operate in the same regulatory environments, and have been aggregated into one reportable segment.

Amounts shown below include net sales from wholesale, franchise and licensing operations, which are not a significant component of total revenue, and are aggregated within their respective operating segment and geographic area.

The Company’s net sales by operating segment for the thirteen and thirty-nine weeks ended October 29, 2022 and October 30, 2021 were as follows:

Thirteen Weeks Ended Thirty-Nine Weeks Ended

(in thousands) October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021

Hollister $ 457,752 $ 522,311 $ 1,323,492 $ 1,479,202

The Company’s net sales by operating segment for the thirteen weeks ended April 29, 2023 and April 30, 2022 were as follows:

Thirteen Weeks Ended

(in thousands) April 29, 2023 April 30, 2022

Abercrombie 436,044 383,928

Hollister $ 399,950 $ 428,834

Total $ 835,994 $ 812,762

Net sales by geographic area are presented by attributing revenues to an individual country on the basis of the country in which the merchandise was sold for in-store purchases and on the basis of the shipping location provided by customers for digital and wholesale orders.

The Company’s net sales by geographic area for the thirteen and thirty-nine weeks ended October 29, 2022 and October 30, 2021 were as follows:

Thirteen Weeks Ended Thirty-Nine Weeks Ended

(in thousands) October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021

The Company’s net sales by geographic area for the thirteen weeks ended April 29, 2023 and April 30, 2022 were as follows:

Thirteen Weeks Ended

(in thousands) April 29, 2023 April 30, 2022

$ 636,117 $ 585,106

4 unchanged sentences

Total $ 835,994 $ 812,762

(1) Europe, Middle East and Africa (“EMEA”).

(1) Europe, Middle East and Africa region (“EMEA”).

(2) Asia-Pacific region (“APAC”).

(3) Other includes all sales that do not fall within the United States, EMEA, or APAC regions, which are derived primarily in Canada.

SUBSEQUENT EVENT

During the second quarter of Fiscal 2023, operating segments were reorganized into three geographic operating segments:

Americas, Asia-Pacific (APAC), and Europe, the Middle East and Africa (EMEA).

Beginning with the second quarter of Fiscal 2023, all periods presented will be recast to conform to this classification.

Abercrombie & Fitch Co.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements