Abercrombie shares stung by sluggishness overseas

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NEW ALBANY, Ohio (AP) -- Abercrombie & Fitch Co.'s stock plunged after it reported sluggish overseas growth for the third quarter, even as revenue at all stores open at least a year increased 7 percent.

That beat expectations for the preppy teen retailer, but the bleaker international picture sent its shares down more than 20 percent.

Analysts polled by FactSet had anticipated a 6.3 percent increase for the quarter ending Oct. 29. By brand, the figure rose 4 percent for Abercrombie & Fitch, 6 percent for Abercrombie Kids and 8 percent for Hollister Co.

Revenue at stores open at least a year is considered an important indicator of financial performance for retailers because it excludes stores that recently opened or closed.

The company said the measure of sales trends improved at its U.S. stores, which was more than offset by a weak quarter for its international business. The company said sales slowed in Europe, including drops at some of its flagship stores there. Stores in Japan and Canada also reported declines.

The declines are worrisome because clothing sellers have been depending on international growth to make up for sluggish growth in the U.S.

The news sent shares of Abercrombie & Fitch down $15.71, more than 21 percent, to $58.30 in early morning trading.

Abercrombie's total revenue for the quarter increased 21 percent to $1.08 billion. That is higher than the $1.07 billion that analysts expected.

U.S. revenue, including online and catalog sales, rose 14 percent to $820.2 million. International revenue rose 56 percent to $255.7 million.

The company, based in New Albany, Ohio, is scheduled to report complete third-quarter financial results later this month.

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