10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 

Form 10-Q 

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2020

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission File Number 001-12107

Abercrombie & Fitch Co.

(Exact name of Registrant as specified in its charter)

Delaware				31-1469076
(State or other jurisdiction of incorporation or organization)				(I.R.S. Employer Identification No.)
6301 Fitch Path,	New Albany,	Ohio		43054
(Address of principal executive offices)				(Zip Code)
Registrant’s telephone number, including area code:			(614)	283-6500

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock, $0.01 Par Value	ANF	New York Stock Exchange

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    x  Yes    ¨  No

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).    x  Yes    ¨  No

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    ¨

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   ☐  Yes    x  No

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class A Common Stock	Shares outstanding as of December 2, 2020
$0.01 Par Value	62,390,672

Table of Contents

PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)
	Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)	3
	Condensed Consolidated Balance Sheets	4
	Condensed Consolidated Statements of Stockholders’ Equity	5
	Condensed Consolidated Statements of Cash Flows	7
	Index for Notes to Condensed Consolidated Financial Statements	8
	Notes to Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	44
Item 4.	Controls and Procedures	45
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	46
Item 1A.	Risk Factors	46
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	47
Item 6.	Exhibits	48
	Signatures	49

2

PART I. FINANCIAL INFORMATION

Item 1.     Financial Statements (Unaudited)

Abercrombie & Fitch Co.

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

(Thousands, except per share amounts)

(Unaudited)

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Net sales	$	819,653	$	863,472	$	2,003,340	$	2,438,522
Cost of sales, exclusive of depreciation and amortization	295,220		344,541		791,154		976,868
Gross profit	524,433		518,931		1,212,186		1,461,654
Stores and distribution expense	346,263		377,697		978,757		1,110,656
Marketing, general and administrative expense	121,000		114,075		326,509		341,716
Flagship store exit (benefits) charges	(8,063)		285		(12,490)		47,023
Asset impairment, exclusive of flagship store exit charges	6,329		12,610		57,340		14,987
Other operating loss (income), net	288		(215)		(1,562)		(465)
Operating income (loss)	58,616		14,479		(136,368)		(52,263)
Interest expense, net	8,808		2,922		19,277		4,908
Income (loss) before income taxes	49,808		11,557		(155,645)		(57,171)
Income tax expense (benefit)	5,779		3,987		38,565		(16,931)
Net income (loss)	44,029		7,570		(194,210)		(40,240)
Less: Net income attributable to noncontrolling interests	1,758		1,047		2,203		3,534
Net income (loss) attributable to A&F	$	42,271	$	6,523	$	(196,413)	$	(43,774)
Net income (loss) per share attributable to A&F
Basic	$	0.68	$	0.10	$	(3.14)	$	(0.67)
Diluted	$	0.66	$	0.10	$	(3.14)	$	(0.67)
Weighted-average shares outstanding
Basic	62,558		63,099		62,541		64,932
Diluted	63,877		63,911		62,541		64,932
Other comprehensive (loss) income
Foreign currency translation, net of tax	$	2,142	$	1,355	$	5,477	$	(5,219)
Derivative financial instruments, net of tax	(5,234)		(3,654)		1,224		(574)
Other comprehensive (loss) income	(3,092)		(2,299)		6,701		(5,793)
Comprehensive income (loss)	40,937		5,271		(187,509)		(46,033)
Less: Comprehensive income attributable to noncontrolling interests	1,758		1,047		2,203		3,534
Comprehensive income (loss) attributable to A&F	$	39,179	$	4,224	$	(189,712)	$	(49,567)

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

3

Abercrombie & Fitch Co.

Condensed Consolidated Balance Sheets

(Thousands, except par value amounts)

(Unaudited)

	October 31, 2020		February 1, 2020
Assets
Current assets:
Cash and equivalents	$	812,881	$	671,267
Receivables	89,074		80,251
Inventories	545,548		434,326
Other current assets	73,776		78,905
Total current assets	1,521,279		1,264,749
Property and equipment, net	593,932		665,290
Operating lease right-of-use assets	955,781		1,230,954
Other assets	205,970		388,672
Total assets	$	3,276,962	$	3,549,665
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	334,775	$	219,919
Accrued expenses	356,370		302,214
Short-term portion of operating lease liabilities	255,775		282,829
Income taxes payable	6,663		10,392
Total current liabilities	953,583		815,354
Long-term liabilities:
Long-term portion of operating lease liabilities	1,010,051		1,252,634
Long-term borrowings, net	343,559		231,963
Other liabilities	110,965		178,536
Total long-term liabilities	1,464,575		1,663,133
Stockholders’ equity
Class A Common Stock - $0.01 par value: 150,000 shares authorized and 103,300 shares issued for all periods presented	1,033		1,033
Paid-in capital	396,505		404,983
Retained earnings	2,067,521		2,313,745
Accumulated other comprehensive loss, net of tax (“AOCL”)	(102,185)		(108,886)
Treasury stock, at average cost: 40,916 and 40,514 shares as of October 31, 2020 and February 1, 2020, respectively	(1,513,495)		(1,552,065)
Total Abercrombie & Fitch Co. stockholders’ equity	849,379		1,058,810
Noncontrolling interests	9,425		12,368
Total stockholders’ equity	858,804		1,071,178
Total liabilities and stockholders’ equity	$	3,276,962	$	3,549,665

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

4

Abercrombie & Fitch Co.

Condensed Consolidated Statements of Stockholders’ Equity

(Thousands, except per share amounts)

(Unaudited)

	Thirteen Weeks Ended October 31, 2020
	Common Stock			Paid-in capital		Non-controlling interests		Retained earnings		AOCL		Treasury stock			Total stockholders’ equity
	Shares outstanding	Par value										Shares	At average cost
Balance, August 1, 2020	62,365	$	1,033	$	392,272	$	7,929	$	2,025,911	$	(99,093)	40,935	$	(1,514,442)	$	813,610
Net income	—	—		—		1,758		42,271		—		—	—		44,029
Share-based compensation issuances and exercises	19	—		(436)		—		(661)		—		(19)	947		(150)
Share-based compensation expense	—	—		4,669		—		—		—		—	—		4,669
Derivative financial instruments, net of tax	—	—		—		—		—		(5,234)		—	—		(5,234)
Foreign currency translation adjustments, net of tax	—	—		—		—		—		2,142		—	—		2,142
Distributions to noncontrolling interests, net	—	—		—		(262)		—		—		—	—		(262)
Ending balance at October 31, 2020	62,384	$	1,033	$	396,505	$	9,425	$	2,067,521	$	(102,185)	40,916	$	(1,513,495)	$	858,804
	Thirteen Weeks Ended November 2, 2019
	Common Stock			Paid-in capital		Non-controlling interests		Retained earnings		AOCL		Treasury stock			Total stockholders’ equity
	Shares outstanding	Par value										Shares	At average cost
Balance, August 3, 2019	63,146	$	1,033	$	394,694	$	11,318	$	2,251,032	$	(105,946)	40,154	$	(1,548,836)	$	1,003,295
Net income	—	—		—		1,047		6,523		—		—	—		7,570
Purchase of Common Stock	(412)	—		—		—		—		—		412	(5,730)		(5,730)
Dividends ($0.20 per share)	—	—		—		—		(12,574)		—		—	—		(12,574)
Share-based compensation issuances and exercises	23	—		(509)		—		(831)		—		(23)	1,159		(181)
Share-based compensation expense	—	—		5,796		—		—		—		—	—		5,796
Derivative financial instruments, net of tax	—	—		—		—		—		(3,654)		—	—		(3,654)
Foreign currency translation adjustments, net of tax	—	—		—		—		—		1,355		—	—		1,355
Distributions to noncontrolling interests, net	—	—		—		(1,511)		—		—		—	—		(1,511)
Ending balance at November 2, 2019	62,757	$	1,033	$	399,981	$	10,854	$	2,244,150	$	(108,245)	40,543	$	(1,553,407)	$	994,366

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

5

Abercrombie & Fitch Co.

Condensed Consolidated Statements of Stockholders’ Equity

(Thousands, except per share amounts)

(Unaudited)

	Thirty-nine Weeks Ended October 31, 2020
	Common Stock			Paid-in capital		Non-controlling interests		Retained earnings		AOCL		Treasury stock			Total stockholders’ equity
	Shares outstanding	Par value										Shares	At average cost
Balance, February 1, 2020	62,786	$	1,033	$	404,983	$	12,368	$	2,313,745	$	(108,886)	40,514	$	(1,552,065)	$	1,071,178
Net loss	—	—		—		2,203		(196,413)		—		—	—		(194,210)
Purchase of Common Stock	(1,397)	—		—		—		—		—		1,397	(15,172)		(15,172)
Dividends ($0.20 per share)	—	—		—		—		(12,556)		—		—	—		(12,556)
Share-based compensation issuances and exercises	995	—		(22,053)		—		(37,255)		—		(995)	53,742		(5,566)
Share-based compensation expense	—	—		13,575		—		—		—		—	—		13,575
Derivative financial instruments, net of tax	—	—		—		—		—		1,224		—	—		1,224
Foreign currency translation adjustments, net of tax	—	—		—		—		—		5,477		—	—		5,477
Distributions to noncontrolling interests, net	—	—		—		(5,146)		—		—		—	—		(5,146)
Ending balance at October 31, 2020	62,384	$	1,033	$	396,505	$	9,425	$	2,067,521	$	(102,185)	40,916	$	(1,513,495)	$	858,804
	Thirty-nine Weeks Ended November 2, 2019
	Common Stock			Paid-in capital		Non-controlling interests		Retained earnings		AOCL		Treasury stock			Total stockholders’ equity
	Shares outstanding	Par value										Shares	At average cost
Balance, February 2, 2019	66,227	$	1,033	$	405,379	$	9,721	$	2,418,544	$	(102,452)	37,073	$	(1,513,604)	$	1,218,621
Impact from adoption of the new lease accounting standard	—	—		—		—		(75,165)		—		—	—		(75,165)
Net loss	—	—		—		3,534		(43,774)		—		—	—		(40,240)
Purchase of Common Stock	(3,957)	—		—		—		—		—		3,957	(63,542)		(63,542)
Dividends ($0.60 per share)	—	—		—		—		(38,959)		—		—	—		(38,959)
Share-based compensation issuances and exercises	487	—		(13,862)		—		(16,496)		—		(487)	23,739		(6,619)
Share-based compensation expense	—	—		8,464		—		—		—		—	—		8,464
Derivative financial instruments, net of tax	—	—		—		—		—		(574)		—	—		(574)
Foreign currency translation adjustments, net of tax	—	—		—		—		—		(5,219)		—	—		(5,219)
Distributions to noncontrolling interests, net	—	—		—		(2,401)		—		—		—	—		(2,401)
Ending balance at November 2, 2019	62,757	$	1,033	$	399,981	$	10,854	$	2,244,150	$	(108,245)	40,543	$	(1,553,407)	$	994,366

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

6

Abercrombie & Fitch Co.

Condensed Consolidated Statements of Cash Flows

(Thousands)

(Unaudited)

	Thirty-nine Weeks Ended
	October 31, 2020		November 2, 2019
Operating activities
Net loss	$	(194,210)	$	(40,240)
Adjustments to reconcile net loss to net cash provided by (used for) operating activities:
Depreciation and amortization	127,248		124,910
Asset impairment	57,340		18,216
Loss on disposal	7,586		5,326
Provision for (benefit from) deferred income taxes	27,432		(20,631)
Share-based compensation	13,575		8,464
Changes in assets and liabilities:
Inventories	(109,665)		(154,791)
Accounts payable and accrued expenses	186,806		34,752
Operating lease right-of-use assets and liabilities	(41,976)		42,990
Income taxes	(7,168)		(2,264)
Other assets	30,403		(47,138)
Withdrawal of funds from Rabbi Trust assets	50,000		—
Other liabilities	11,523		(3,433)
Net cash provided by (used for) operating activities	158,894		(33,839)
Investing activities
Purchases of property and equipment	(91,748)		(154,373)
Net cash used for investing activities	(91,748)		(154,373)
Financing activities
Proceeds from issuance of senior secured notes	350,000		—
Proceeds from borrowings under the senior secured asset-based revolving credit facility	210,000		—
Repayment of borrowings under the term loan facility	(233,250)		(10,000)
Repayment of borrowings under the senior secured asset-based revolving credit facility	(210,000)		—
Payment of debt issuance costs and fees	(7,151)		—
Purchases of Common Stock	(15,172)		(63,542)
Dividends paid	(12,556)		(38,959)
Other financing activities	(11,742)		(10,407)
Net cash provided by (used for) financing activities	70,129		(122,908)
Effect of foreign currency exchange rates on cash	2,269		(2,686)
Net increase (decrease) in cash and equivalents, and restricted cash and equivalents	139,544		(313,806)
Cash and equivalents, and restricted cash and equivalents, beginning of period	692,264		745,829
Cash and equivalents, and restricted cash and equivalents, end of period	$	831,808	$	432,023
Supplemental information related to non-cash activities
Purchases of property and equipment not yet paid at end of period	$	26,554	$	36,951
Operating lease right-of-use assets additions, net of terminations, impairments and other reductions	$	(41,305)	$	293,281
Supplemental information related to cash activities
Cash paid for interest	$	9,182	$	12,022
Cash paid for income taxes	$	10,412	$	18,697
Cash received from income tax refunds	$	4,001	$	8,570
Cash paid for amounts included in measurement of operating lease liabilities	$	224,827	$	311,275

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

7

Abercrombie & Fitch Co.

Index for Notes to Condensed Consolidated Financial Statements (Unaudited)

		Page No.
Note 1.	NATURE OF BUSINESS	9
Note 2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9
Note 3.	IMPACT OF COVID-19	10
Note 4.	REVENUE RECOGNITION	12
Note 5.	NET INCOME (LOSS) PER SHARE	12
Note 6.	FAIR VALUE	13
Note 7.	PROPERTY AND EQUIPMENT, NET	14
Note 8.	LEASES	14
Note 9.	ASSET IMPAIRMENT	15
Note 10.	RABBI TRUST ASSETS	15
Note 11.	INCOME TAXES	16
Note 12.	BORROWINGS	16
Note 13.	SHARE-BASED COMPENSATION	18
Note 14.	DERIVATIVE INSTRUMENTS	20
Note 15.	ACCUMULATED OTHER COMPREHENSIVE LOSS	22
Note 16.	SEGMENT REPORTING	23
Note 17.	FLAGSHIP STORE EXIT (BENEFITS) CHARGES	24

8

Abercrombie & Fitch Co.

Notes to Condensed Consolidated Financial Statements (Unaudited)

1. NATURE OF BUSINESS

Abercrombie & Fitch Co. (“A&F”), a company incorporated in Delaware in 1996, through its subsidiaries (collectively, A&F and its subsidiaries are referred to as “Abercrombie & Fitch” or the “Company”), is a global multi-brand omnichannel specialty retailer, whose products are sold primarily through its Company-owned store and digital channels, as well as through various third-party wholesale, franchise and licensing arrangements. The Company offers a broad assortment of apparel, personal care products and accessories for men, women and kids under the Hollister, Abercrombie & Fitch and abercrombie kids brands. The 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 primarily has operations in North America, Europe and Asia, among other regions.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation

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. (“MAF”), each of which meets the definition of a variable interest entity (“VIE”). 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 MAF’s portion of net income presented as net income attributable to noncontrolling interests (“NCI”) on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) and MAF’s portion of equity presented as NCI on the Condensed Consolidated Balance Sheets.

Fiscal year

The Company’s fiscal year ends on the Saturday closest to January 31. This typically results in a fifty-two week year, but occasionally gives rise to an additional week, resulting in a fifty-three week year. Fiscal years are designated in the Condensed Consolidated Financial Statements and notes, as well as the remainder of this Quarterly Report on Form 10-Q, by the calendar year in which the fiscal year commences. All references herein to the Company’s fiscal years are as follows:

Fiscal year	Year ended	Number of weeks
Fiscal 2019	February 1, 2020	52
Fiscal 2020	January 30, 2021	52

Interim financial statements

The Condensed Consolidated Financial Statements as of October 31, 2020, and for the thirteen and thirty-nine week periods ended October 31, 2020 and November 2, 2019, are unaudited and are presented pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). 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 2019 filed with the SEC on March 31, 2020. The February 1, 2020 consolidated balance sheet data, included herein, were derived from audited consolidated financial statements, but do not include all disclosures required by accounting principles generally accepted in the United States of America (“GAAP”).

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 2020.

Use of estimates

The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of net sales and expenses during the reporting period. Due to the inherent uncertainty involved with estimates, actual results may differ. The extent to which the current outbreak of coronavirus disease (“COVID-19”) impacts the Company’s business and financial results will depend on numerous evolving factors including, but not limited to: the magnitude and duration of the COVID-19 pandemic and its impact on the length or frequency of store closures, and the extent to

9

which COVID-19 will impact worldwide macroeconomic conditions including interest rates, the speed of the economic recovery, and governmental, business and consumer reactions to the pandemic. The Company’s assessment of these, as well as other factors, could impact management's estimates 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.

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 31, 2020		February 1, 2020		November 2, 2019		February 2, 2019
Cash and equivalents	Cash and equivalents	$	812,881	$	671,267	$	410,775	$	723,135
Long-term restricted cash and equivalents	Other assets	14,633		18,696		18,698		22,694
Short-term restricted cash and equivalents	Other current assets	4,294		2,301		2,550		—
Cash and equivalents and restricted cash and equivalents		$	831,808	$	692,264	$	432,023	$	745,829

3. IMPACT OF COVID-19

Recent developments

The Company has seen, and may continue to see, material adverse impacts as a result of COVID-19. The extent of future impacts of COVID-19 on the Company’s business, including the duration and impact on overall customer demand, are uncertain as current circumstances are dynamic and depend on future developments, including, but not limited to, the duration and spread of COVID- 19 and the availability and acceptance of an effective vaccine or medical treatments.

In January 2020, the Company began to experience business disruptions in the Asia-Pacific (“APAC”) region as a result of COVID-19. In February 2020, the situation escalated as the scope of COVID-19 worsened beyond the APAC region, with the United States (the “U.S.”) and the Europe, Middle East and Africa (“EMEA”) region experiencing significant outbreaks. In March 2020, the COVID-19 outbreak was declared to be a global pandemic by the World Health Organization. In response to COVID-19, certain governments have imposed travel restrictions and local statutory quarantines and the Company has recommended associates who are able to perform their role remotely continue to do so. The Company is reacting to COVID-19 on a daily basis, including by conforming to local government guidance and monitoring developments in government legislation or other government actions in response to the COVID-19 outbreak. The Company has also implemented a range of precautionary health and safety measures with the well-being of the Company’s customers, associates and business partners in mind.

As a result of COVID-19, in January 2020, the Company temporarily closed the majority of its stores in the APAC region and in March 2020, the Company temporarily closed its stores across brands in North America and the EMEA region. The majority of APAC stores were reopened during March 2020, and the Company began to reopen stores in North America and the EMEA region on a rolling basis in late April 2020. As of October 31, 2020, approximately 97% of Company-operated stores had reopened for in-store service, although many with modified operating hours. The Company plans to follow the guidance of local governments to determine when it can reopen stores that have been closed due to COVID-19 and to evaluate whether further store closures will be necessary.

The Company’s digital operations across brands have continued to serve the Company’s customers during this unprecedented period of temporary store closures as the Company’s distribution centers implemented enhanced cleaning and social distancing measures in order to remain operational. In response to elevated digital demand during this period, the Company has increased its omnichannel capabilities by continuing to offer Purchase-Online-Pickup-in-Store, including curbside pick-up at a majority of U.S. locations, and by utilizing ship-from-store capabilities. In addition, to prepare for the Fiscal 2020 holiday season, the Company has entered into a short-term lease for an additional distribution center and has partnered with incremental carriers.

Impact of COVID-19

The Company has seen, and may continue to see, material reductions in sales across brands and regions as a result of COVID-19. Total net sales decreased approximately 5% and 18% for the thirteen and thirty-nine weeks ended October 31, 2020

10

as compared to the comparable periods ended November 2, 2019, respectively. The year-over-year decrease in total net sales was primarily driven by temporary widespread store closures and a decline in traffic as compared to the previous year as a result of COVID-19. The year-over-year decline in store sales was partially offset by digital sales growth of approximately 43% and 42% for the thirteen and thirty-nine weeks ended October 31, 2020 as compared to the comparable periods ended November 2, 2019, respectively.

Primarily as a result of COVID-19 and the temporary closure of the Company’s stores, the Company recognized $14.8 million of charges to reduce the carrying value of inventory in cost of sales, exclusive of depreciation and amortization on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) during the thirteen weeks ended May 2, 2020.

During the thirty-nine weeks ended October 31, 2020, reductions in revenue have not been offset by proportional decreases in expense, as the Company continued to incur store occupancy costs such as operating lease costs, net of rent abatements agreed upon during the period, depreciation expense, and certain other costs such as compensation, net of government payroll relief, and administrative expenses resulting in a negative effect on the relationship between the Company’s costs and revenues. During this period, the Company suspended rent payments for a significant number of stores that were closed, and continues to engage with its landlords to find a mutually beneficial and agreeable path forward. The Company has elected to account for all qualifying lease concessions, those that are a direct consequence of COVID-19 and that result in revised lease consideration that is substantially the same or less than the original consideration, as if the enforceable rights and obligations associated with the concession existed in the original lease agreement. Rent abatements associated with such concessions are recognized in variable lease cost. Lease concessions granted as part of an agreement that substantially increases the total consideration as a result of the inclusion of additional terms, such as rent payments associated with a lease term extension, are treated as lease modifications. For stores where the Company suspended payments, the Company reclassified related amounts from operating lease liability to accrued expenses in the period during which rent was due, while continuing to recognize operating lease cost in the Condensed Consolidated Statement of Operations and Comprehensive Income (Loss).

On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), which among other things, provides refundable employee retention tax credits for wages paid to employees who are unable to work during the COVID-19 outbreak and the deferral of the employer–paid portion of social security taxes. Similar relief programs have also been established throughout the EMEA and APAC regions. Based on the Company's evaluation of the CARES Act and legislation across regions, the Company qualifies for certain payroll tax credits, and such government subsidies have been treated as offsets to the related operating expenses when recognized. During the thirteen and thirty-nine weeks ended October 31, 2020, the Company recognized qualified payroll tax credits reducing payroll expenses by approximately $2.8 million and $14.7 million, respectively, on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss), The Company intends to continue to defer qualified payroll and other tax payments as permitted by the CARES Act and other regional legislation.

The Company also recognized asset impairment charges related to the Company’s right-of-use assets and property and equipment of $6.3 million and $57.3 million during the thirteen and thirty-nine weeks ended October 31, 2020, respectively, which were principally the result of the impact of COVID-19 on store cash flows. Refer to Note 9, “ASSET IMPAIRMENT,” for additional information.

In addition, the Company has also experienced other material impacts as a result of COVID-19, such as deferred tax valuation allowances and other tax charges during the thirty-nine weeks ended October 31, 2020, adversely impacting results by $77.4 million. Refer to Note 11, “INCOME TAXES,” for additional information.

Balance sheet, cash flow and liquidity

During the thirty-nine weeks ended October 31, 2020, the Company has taken various actions to preserve liquidity and manage cash flows in order to best position the business for key stakeholders, including (i) partnering with merchandise and non-merchandise vendors in regards to payment terms; (ii) tightly managing inventory receipts to align inventory with expected market demand; (iii) significantly reducing expenses to better align operating costs with sales; and (iv) temporarily suspending its share repurchase program in March 2020 and its dividend program in May 2020. In addition, despite the Company's recent history of partnering with its vendors regarding payment terms, certain payment term extensions were temporary and certain previously deferred payments have since been made. There can be no assurance that the Company will be able to maintain extended payment terms or continue to defer payments, which may result in incremental operating cash outflows in future periods.

As a precautionary measure in response to COVID-19, in March 2020, the Company borrowed $210.0 million under its senior secured asset-based revolving credit facility (the “ABL Facility”) to improve its near-term cash position and withdrew the majority of excess funds from the overfunded Rabbi Trust assets, providing the Company with $50.0 million of additional cash. In July 2020, the Company completed a private offering of $350.0 million aggregate principal amount of senior secured notes (the “Senior Secured Notes”) and used the net proceeds to repay all outstanding borrowings under the Company’s term loan facility (the “Term Loan Facility”), to repay a portion of the outstanding borrowings under the ABL Facility and to pay fees and expenses in connection with such repayments and the offering. Refer to Note 12, “BORROWINGS,” and Note 10, “ RABBI TRUST ASSETS,” for additional information.

As of October 31, 2020, the Company had liquidity of $1.158 billion as compared to $913.8 million as of February 1, 2020, comprised of cash and equivalents and actual incremental borrowing available to the Company under the ABL Facility.

11

4. REVENUE RECOGNITION

Disaggregation of revenue

All revenues are recognized in net sales in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). For information regarding the disaggregation of revenue, refer to Note 16, “SEGMENT REPORTING.”

Contract liabilities

The following table details certain contract liabilities representing unearned revenue as of October 31, 2020, February 1, 2020, November 2, 2019 and February 2, 2019:

(in thousands)	October 31, 2020		February 1, 2020		November 2, 2019		February 2, 2019
Gift card liability	$	22,910	$	28,844	$	19,855	$	26,062
Loyalty program liability	$	19,640	$	23,051	$	21,396	$	19,904

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 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Revenue associated with gift card redemptions and gift card breakage	$	11,717	$	12,653	$	32,792	$	40,729
Revenue associated with reward redemptions and breakage related to the Company’s loyalty programs	$	9,686	$	9,249	$	23,377	$	23,795

5. 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		Thirty-nine Weeks Ended
(in thousands)	October 31, 2020	November 2, 2019	October 31, 2020	November 2, 2019
Shares of Common Stock issued	103,300	103,300	103,300	103,300
Weighted-average treasury shares	(40,742)	(40,201)	(40,759)	(38,368)
Weighted-average — basic shares	62,558	63,099	62,541	64,932
Dilutive effect of share-based compensation awards	1,319	812	—	—
Weighted-average — diluted shares	63,877	63,911	62,541	64,932
Anti-dilutive shares (1)	1,828	2,912	1,988	1,572

(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.

12

6. FAIR VALUE

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. The inputs used to measure fair value are prioritized based on a three-level hierarchy. The three levels of inputs to measure fair value are as follows:

•Level 1—inputs are unadjusted quoted prices for identical assets or liabilities that are available in active markets that the Company can access at the measurement date.

•Level 2—inputs are other than quoted market prices included within Level 1 that are observable for assets or liabilities, directly or indirectly.

•Level 3—inputs to the valuation methodology are unobservable.

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 and liabilities that are measured at fair value on a recurring basis, as of October 31, 2020 and February 1, 2020 were as follows:

	Assets at Fair Value as of October 31, 2020
(in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents (1)	$	68,271	$	43,596	$	—	$	111,867
Derivative instruments (2)	—		461		—		461
Rabbi Trust assets (3)	1		60,418		—		60,419
Restricted cash equivalents (4)	6,670		7,918		—		14,588
Total assets	$	74,942	$	112,393	$	—	$	187,335
Liabilities:
Derivative instruments (2)	$	—	$	367	$	—	$	367
Total liabilities	$	—	$	367	$	—	$	367

	Assets and Liabilities at Fair Value as of February 1, 2020
(in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents (1)	$	225	$	58,447	$	—	$	58,672
Derivative instruments (2)	—		1,969		—		1,969
Rabbi Trust assets (3)	1		109,048		—		109,049
Restricted cash equivalents (4)	9,765		4,601		—		14,366
Total assets	$	9,991	$	174,065	$	—	$	184,056
Liabilities:
Derivative instruments (2)	$	—	$	1,460	$	—	$	1,460
Total liabilities	$	—	$	1,460	$	—	$	1,460

(1)    Level 1 assets consist of investments in money market funds. Level 2 assets consist of time deposits.

(2)    Level 2 assets and liabilities consist primarily of foreign currency exchange forward contracts.

(3)    Level 1 assets consist of investments in money market funds. Level 2 assets consist of trust-owned life insurance policies.

(4)    Level 1 assets consist of investments in U.S. treasury bills and money market funds. Level 2 assets consist of time deposits.

The Company’s Level 2 assets and liabilities consist of:

•Time deposits, which are valued at cost approximating fair value due to the short-term nature of these investments;

•Trust-owned life insurance policies which are valued using the cash surrender value of the life insurance policies; and

•Derivative instruments, primarily foreign currency exchange forward contracts, which are valued using quoted market prices of the same or similar instruments, adjusted for counterparty risk.

Fair value of long-term borrowings

The Company’s borrowings under the Term Loan Facility and the Senior Secured Notes are carried at historical cost in the accompanying Condensed Consolidated Balance Sheets. The carrying amount and fair value of the Company’s long-term gross borrowings were as follows:

(in thousands)	October 31, 2020		February 1, 2020
Gross borrowings outstanding, carrying amount	$	350,000	$	233,250
Gross borrowings outstanding, fair value	$	374,063	$	233,979

13

7. PROPERTY AND EQUIPMENT, NET

Property and equipment, net consisted of:

(in thousands)	October 31, 2020		February 1, 2020
Property and equipment, at cost	$	2,741,167	$	2,744,967
Less: Accumulated depreciation and amortization	(2,147,235)		(2,079,677)
Property and equipment, net	$	593,932	$	665,290

Refer to Note 9, “ASSET IMPAIRMENT,” for details related to property and equipment impairment charges incurred during the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019.

8. LEASES

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.

During thirty-nine weeks ended October 31, 2020, the Company suspended rent payments for a significant number of stores that were closed as a result of COVID-19, and continues to engage with its landlords to find a mutually beneficial and agreeable path forward. The Company has elected to account for all qualifying lease concessions, those that are a direct consequence of COVID-19 and that result in revised lease consideration that is substantially the same or less than the original consideration, as if the enforceable rights and obligations associated with the concession existed in the original lease agreement. Rent abatements associated with such concessions are recognized in variable lease cost. Lease concessions granted as part of an agreement that substantially increases the total consideration as a result of the inclusion of additional terms, such as rent payments associated with a lease term extension, are treated as lease modifications. For stores where the Company suspended payments, the Company reclassified related amounts from operating lease liability to accrued expenses in the period during which rent was due, while continuing to recognize operating lease cost in the Condensed Consolidated Statement of Operations and Comprehensive Income (Loss).

In addition, during the thirteen weeks ended October 31, 2020, the Company entered into a sublease agreement with a third party for the remaining lease term of one of its European Abercrombie & Fitch flagship store locations upon its expected closure during the thirteen weeks ending January 30, 2021. As of October 31, 2020, the Company's subleased property had a remaining lease term of 7.1 years with the sublease term from February 1, 2021 through November 30, 2027. The sublease arrangement provides for rent and occupancy related costs such as taxes, utilities and maintenance costs. Initial sublease terms provide for rent escalations based on the index under the lease, which were estimated upon initial measurement of the operating lease right-of-use asset and liability. The sublease agreement does not include residual value guarantees. Consistent with the Company's real estate leases, the sublease contains usage restrictions, but does not contain financial covenants and restrictions. Future minimum tenant operating lease payments remaining under this sublease as of October 31, 2020 were $29.0 million.

The following table provides a summary of the Company’s operating lease costs for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Single lease cost (1)	$	83,743	$	104,726	$	264,932	$	318,270
Variable lease cost (2)	14,428		25,990		61,763		129,073
Operating lease right-of-use asset impairment (3)	3,979		9,047		44,397		12,636
Total operating lease cost	$	102,150	$	139,763	$	371,092	$	459,979

(1)Includes 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 rent abatements 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.

(3)Refer to Note 9, “ASSET IMPAIRMENT,” for details related to operating lease right-of-use asset impairment charges.

During the thirty-nine weeks ended October 31, 2020 and November 2, 2019, the Company paid $224.8 million and $311.3 million, respectively, for amounts included in the measurement of operating lease liabilities, net of rent abatements agreed upon during the period. These payments are included within operating activities on the Condensed Consolidated Statements of Cash Flows.

As of October 31, 2020, the Company had minimum commitments related to additional operating lease contracts the terms of which have not yet commenced, primarily for its Company-operated retail stores, of approximately $3.3 million.

14

9. ASSET IMPAIRMENT

Asset impairment charges for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 were as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Operating lease right-of-use asset impairment (1)	$	3,979	$	9,047	$	44,397	$	12,636
Property and equipment asset impairment	2,350		3,563		12,943		5,580
Total asset impairment	$	6,329	$	12,610	$	57,340	$	18,216

(1)     Includes $3.2 million of operating lease right-of-use asset impairment related to flagship store exit charges for each of the thirteen and thirty-nine weeks ended November 2, 2019. Refer to Note 17, “FLAGSHIP STORE EXIT (BENEFITS) CHARGES.”

Asset impairment charges for the thirteen and thirty-nine weeks ended October 31, 2020 were principally the result of the impact of COVID-19 and were related to certain of the Company’s stores across brands, geographies and store formats. The impairment charges for the thirty-nine weeks ended October 31, 2020 reduced the then carrying amount of the impaired stores’ assets to their fair value of approximately $102.2 million, including $94.2 million related to operating lease right-of-use assets.

Asset impairment charges for the thirteen weeks and thirty-nine weeks ended November 2, 2019, primarily related to certain of the Company’s international flagship stores. The impairment charges for the thirty-nine weeks ended November 2, 2019 reduced the then carrying amount of the impaired stores’ assets to their fair value of approximately $36.8 million, including $32.3 million related to operating lease right-of-use assets.

10. RABBI TRUST ASSETS

As a precautionary measure and to preserve liquidity in light of the circumstances surrounding COVID-19, during the thirty-nine weeks ended October 31, 2020, the Company withdrew the majority of excess funds from the overfunded Rabbi Trust assets, providing the Company with $50.0 million of additional cash.

Investments of Rabbi Trust assets consisted of the following as of October 31, 2020 and February 1, 2020:

(in thousands)	October 31, 2020		February 1, 2020
Trust-owned life insurance policies (at cash surrender value)	$	60,418	$	109,048
Money market funds	1		1
Rabbi Trust assets	$	60,419	$	109,049

Realized gains resulting from the change in cash surrender value of the Rabbi Trust assets for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 were as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Realized gains related to Rabbi Trust assets	$	391	$	805	$	1,369	$	2,394

15

11. INCOME TAXES

The quarterly provision for income taxes is based on the current estimate of the annual effective income tax rate and is adjusted as necessary for discrete quarterly events. The Company’s quarterly provision and the estimate of the annual effective tax rate are subject to significant variation due to several factors. These factors include variability in the pre-tax jurisdictional mix of earnings, changes in how the Company does business including entering into new businesses or geographies, changes in foreign currency exchange rates, changes in laws, regulations, interpretations and administrative practices, relative changes in expenses or losses for which tax benefits are not recognized and the impact of discrete items. In addition, jurisdictions where the Company anticipates an ordinary loss for the fiscal year for which the Company does not anticipate future benefits are excluded from the overall computation of estimated annual effective tax rate and no tax benefits are recognized in the period related to losses in such jurisdictions. The impact of these items on the effective tax rate will be greater at lower levels of pre-tax earnings.

Impact of valuation allowances and other tax charges during Fiscal 2020

The Company’s effective tax rate for the thirty-nine weeks ended October 31, 2020 was impacted by $77.4 million of adverse tax impacts, ultimately giving rise to income tax expense on a consolidated pre-tax year-to-date loss. Further details regarding these adverse tax impacts are as follows:

•The Company anticipates pre-tax losses for the full fiscal year in certain jurisdictions, based on information currently available, primarily due to the significant adverse impacts of COVID-19. The Company did not recognize income tax benefits on $180.7 million of pre-tax losses during the thirty-nine weeks ended October 31, 2020, resulting in an adverse tax impact of $41.8 million.

•The Company recognized charges of $35.6 million related to the establishment of valuation allowances and other tax charges in certain jurisdictions during the thirty-nine weeks ended October 31, 2020, principally as a result of the significant adverse impacts of COVID–19. These charges related to valuation allowances recognized by the Company of $10.6 million and $6.0 million related to the U.S. and Germany, respectively, as well as valuation allowances and other tax charges in certain other jurisdictions against underlying tax asset balances that existed as of February 1, 2020. The Company also recognized valuation allowances of $78.9 million related to Switzerland with a U.S. branch equally offsetting amount, which in net, did not have an impact on the Condensed Consolidated Statement of Operations and Comprehensive Income (Loss). Changes in assumptions may occur based on new information that becomes available resulting in adjustments in the period in which a determination is made.

Global legislation in response to COVID-19

In March 2020, the CARES Act was enacted into U.S. law, intended to provide economic relief to those impacted by COVID-19 and enhance business’ liquidity. The Company continues to examine impacts that the provisions of the CARES Act may have on U.S. income taxes; however, the Company does not currently expect that these provisions will have a material impact on its income taxes.

The Company is still assessing the applicability of other recently passed global legislation, including the potential income tax measures offered in international jurisdictions where the Company’s operations have also been impacted by COVID-19.

Share-based compensation

Refer to Note 13, “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 November 2, 2019.

12. BORROWINGS

Details on the Company’s long-term borrowings, net, as of October 31, 2020 and February 1, 2020 are as follows:

(in thousands)	October 31, 2020		February 1, 2020
Long-term portion of borrowings, gross at carrying amount	$	350,000	$	233,250
Unamortized fees	(6,441)		(932)
Unamortized discount	—		(355)
Long-term borrowings, net	$	343,559	$	231,963

Senior Secured Notes

On July 2, 2020, Abercrombie & Fitch Management Co. (“A&F Management”), a wholly-owned indirect subsidiary of A&F, completed the private offering of the Senior Secured Notes, with $350 million aggregate principal amount due in 2025 at an offering price of 100% of the principal amount thereof. The Senior Secured Notes were issued pursuant to an indenture, dated as

16

of July 2, 2020, by and among A&F Management, A&F and certain of its wholly-owned subsidiaries, as guarantors, and U.S. Bank National Association, as trustee, and as collateral agent.

The Senior Secured Notes will mature on July 15, 2025 and bear interest at a rate of 8.75% per annum, with semi-annual interest payments beginning in January 2021.

The Company used the net proceeds from the offering of the Senior Secured Notes to repay outstanding borrowings and accrued interest of $233.6 million and $110.8 million under the Term Loan Facility and the ABL Facility, respectively, with the remaining net proceeds used towards fees and expenses in connection with such repayments and the offering of the Senior Secured Notes.

The Company recorded deferred financing fees associated with the issuance of the Senior Secured Notes, which are being amortized to interest expense over the contractual term of the Senior Secured Notes.

ABL Facility

The ABL Facility, which was entered into on August 7, 2014 through A&F Management as the lead borrower (with A&F and certain other subsidiaries of A&F as borrowers or guarantors) and later amended on October 19, 2017, provides for a senior secured asset-based revolving credit facility of up to $400 million (the “ABL Facility”).

The ABL Facility will mature on October 19, 2022.

As a precautionary measure and to improve the Company’s cash position in light of the circumstances surrounding COVID-19, during the thirteen weeks ended May 2, 2020, the Company borrowed $210.0 million under the ABL Facility. During the thirteen weeks ended August 1, 2020, the Company used a portion of the net proceeds from the offering of the Senior Secured Notes and cash on hand to repay all outstanding borrowings under the ABL Facility.

The Company did not have any borrowings outstanding under the ABL Facility as of October 31, 2020 or as of February 1, 2020.

As of October 31, 2020, the Company had availability under the ABL Facility of $383.7 million, net of $0.8 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, actual incremental borrowing available to the Company under the ABL Facility was $345.2 million as of October 31, 2020.

The provisions under the credit agreement applicable to the ABL Facility have not changed from those described in Note 12, “BORROWINGS,” in the Notes to Consolidated Financial Statements contained in “ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA” of A&F’s Annual Report on Form 10-K for Fiscal 2019.

Term Loan Facility

The Term Loan Facility, which was entered into on August 7, 2014 through A&F Management as the lead borrower (with A&F and certain other subsidiaries of A&F as borrowers or guarantors) and later amended on June 22, 2018, provided for a term loan facility of $300 million.

The Company had gross borrowings outstanding under the Term Loan Facility of $233.3 million as of February 1, 2020. During the thirteen weeks ended August 1, 2020, the Company used a portion of the proceeds from the issuance of the Senior Secured Notes to repay all outstanding borrowings under the Term Loan Facility and upon repayment the Term Loan Facility was terminated effective as of July 2, 2020.

The Term Loan Facility was previously scheduled to mature on August 7, 2021.

Representations, warranties and covenants

The agreements related to the Senior Secured Notes and ABL Facility contain various representations, warranties and restrictive covenants that, among other things and subject to specified exceptions, restrict the ability of the Company and its subsidiaries to: grant or incur liens; incur, assume or guarantee additional indebtedness; sell or otherwise dispose of assets, including capital stock of subsidiaries; make investments in certain subsidiaries; pay dividends, make distributions or redeem or repurchase capital stock; change the nature of their business; and consolidate or merge with or into, or sell substantially all of the Company’s or A&F Management’s assets to, another entity.

The Senior Secured Notes are guaranteed on a senior secured basis, jointly and severally, by A&F and each of the existing and future wholly-owned domestic restricted subsidiaries of A&F that guarantee or will guarantee A&F Management’s ABL Facility or certain future capital markets indebtedness.

17

Certain of the agreements related to the Senior Secured Notes and 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 31, 2020.

13. 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 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Share-based compensation expense	$	4,669	$	5,796	$	13,575	$	8,464
Income tax benefit associated with share-based compensation expense recognized (1)	$	—	$	1,211	$	—	$	1,566

(1)    No income tax benefit was recognized related to share-based compensation expense during the thirteen and thirty-nine weeks ended October 31, 2020 due to the U.S. being a loss jurisdiction.

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 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Income tax discrete benefits realized for tax deductions related to the issuance of shares (1)	$	—	$	6	$	—	$	1,175
Income tax discrete charges realized upon cancellation of stock appreciation rights (1)	—		(447)		—		(611)
Total income tax discrete (charges) benefits related to share-based compensation awards	$	—	$	(441)	$	—	$	564

(1)    No income tax benefits or charges related to these items were recognized during the thirteen and thirty-nine weeks ended October 31, 2020 due to the U.S. being a loss jurisdiction.

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 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Employee tax withheld upon issuance of shares (1)	$	150	$	181	$	5,566	$	6,619

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

18

Restricted stock units

The following table summarizes activity for restricted stock units for the thirty-nine weeks ended October 31, 2020:

	Service-based Restricted Stock Units			Performance-based Restricted Stock Units			Market-based Restricted Stock Units
	Number of  Underlying Shares (1)	Weighted- Average Grant Date Fair Value		Number of  Underlying Shares	Weighted- Average Grant Date Fair Value		Number of  Underlying Shares	Weighted- Average Grant Date Fair Value
Unvested at February 1, 2020	1,676,831	$	18.68	747,056	$	15.11	421,784	$	23.05
Granted	2,280,194	8.57		—	—		519,905	16.24
Adjustments for performance achievement	—	—		38,381	11.37		134,122	11.79
Vested	(790,429)	17.42		(481,304)	9.63		(350,447)	11.79
Forfeited	(107,795)	13.83		(6,917)	22.80		(3,485)	35.61
Unvested at October 31, 2020 (2)	3,058,801	$	11.63	297,216	$	22.43	721,879	$	21.46

(1)    Includes 66,624 unvested restricted stock units as of October 31, 2020, subject to vesting requirements related to the achievement of certain performance metrics, such as operating income and net income, for the fiscal year immediately preceding the vesting date. Holders of these restricted stock units have the opportunity to earn back one or more installments of the award if the cumulative performance requirements are met in a subsequent year.

(2)    Unvested shares related to restricted stock units with performance-based and market-based vesting conditions are reflected at 100% of their target vesting amount in the table above. Certain unvested shares related to restricted stock units with performance-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 these costs are expected to be recognized for restricted stock units as of October 31, 2020:

(in thousands)	Service-based Restricted Stock Units		Performance-based Restricted Stock Units		Market-based Restricted Stock Units
Unrecognized compensation cost	$	27,879	$	—	$	9,939
Remaining weighted-average period cost is expected to be recognized (years)	1.3		0.0		1.1

Additional information pertaining to restricted stock units for the thirty-nine weeks ended October 31, 2020 and November 2, 2019 follows:

(in thousands)	October 31, 2020		November 2, 2019
Service-based restricted stock units:
Total grant date fair value of awards granted	$	19,541	$	16,175
Total grant date fair value of awards vested	$	13,769	$	13,087
Performance-based restricted stock units:
Total grant date fair value of awards granted	$	—	$	5,379
Total grant date fair value of awards vested	$	4,635	$	—
Market-based restricted stock units:
Total grant date fair value of awards granted	$	8,443	$	4,176
Total grant date fair value of awards vested	$	4,132	$	511

19

The weighted-average assumptions used for market-based restricted stock units in the Monte Carlo simulation during the thirty-nine weeks ended October 31, 2020 and November 2, 2019, respectively, were as follows:

	October 31, 2020			November 2, 2019
Grant date market price	$	12.31		$	25.34
Fair value	$	16.24		$	36.24
Assumptions:
Price volatility	67		%	57		%
Expected term (years)	2.4			2.9
Risk-free interest rate	0.2		%	2.2		%
Dividend yield	—		%	3.2		%
Average volatility of peer companies	66.0		%	40.0		%
Average correlation coefficient of peer companies	0.4967			0.2407

Stock appreciation rights

The following table summarizes stock appreciation rights activity for the thirty-nine weeks ended October 31, 2020:

	Number of Underlying Shares	Weighted-Average Exercise Price		Aggregate Intrinsic Value		Weighted-Average Remaining Contractual Life (years)
Outstanding at February 1, 2020	796,725	$	40.06
Granted	—	—
Exercised	—	—
Forfeited or expired	(382,225)	47.87
Outstanding at August 1, 2020	414,500	$	32.86	$	—	3.2
Stock appreciation rights exercisable at October 31, 2020	414,500	$	32.86	$	—	3.2
Stock appreciation rights expected to become exercisable in the future as of October 31, 2020	—	$	—	$	—	0.0

No stock appreciation rights were exercised during the thirty-nine weeks ended October 31, 2020. Additional information pertaining to stock appreciation rights for the thirty-nine weeks ended November 2, 2019 follows:

(in thousands)	November 2, 2019
Total grant date fair value of awards exercised	$	620

14. DERIVATIVE INSTRUMENTS

The Company is exposed to risks associated with changes in foreign currency exchange rates and uses derivative instruments, primarily forward contracts, to manage the financial impacts of these exposures. The Company does not use forward contracts to engage in currency speculation and does not enter into derivative financial instruments for trading purposes.

The Company uses derivative instruments, primarily foreign currency exchange forward contracts designated as cash flow hedges, to hedge the foreign currency exchange rate exposure associated with forecasted foreign currency denominated intercompany inventory sales to foreign subsidiaries and the related settlement of the foreign currency denominated intercompany receivables. Fluctuations in foreign currency exchange rates will either increase or decrease the Company’s intercompany equivalent cash flows and affect the Company’s U.S. Dollar earnings. Gains or losses on the foreign currency exchange forward contracts that are used to hedge these exposures are expected to partially offset this variability. 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 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.

The Company also uses foreign currency exchange forward contracts to hedge certain foreign-currency-denominated net monetary assets/liabilities. Examples of monetary assets/liabilities include cash balances, receivables and payables. Fluctuations in foreign currency exchange rates result in transaction gains or losses being recorded in earnings, as U.S. GAAP requires that monetary assets/liabilities be remeasured at the spot exchange rate at quarter-end or upon settlement. The Company has chosen not to apply hedge accounting to these instruments because there are no differences in the timing of gain or loss recognition on the hedging instruments and the hedged items.

20

As of October 31, 2020, 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 sales, the resulting settlement of the foreign-currency-denominated intercompany accounts receivable, or both:

(in thousands)	Notional Amount (1)
Euro	$	65,537
British pound	$	29,603
Canadian dollar	$	11,239

(1)    Amount reported is the U.S. Dollar notional amount outstanding as of October 31, 2020.

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 Sheet as of February 1, 2020 were as follows:

(in thousands)	Location	October 31, 2020		February 1, 2020		Location	October 31, 2020		February 1, 2020
Derivatives designated as cash flow hedging instruments	Other current assets	$	461	$	1,869	Accrued expenses	$	367	$	1,377
Derivatives not designated as hedging instruments	Other current assets	—		100		Accrued expenses	—		83
Total		$	461	$	1,969		$	367	$	1,460

As a result of COVID-19, there was a significant change in the expected timing of previously hedged intercompany sales transactions, resulting in a dedesignation of the related hedge instruments. At the time of dedesignation of these hedges, they were in a net gain position of approximately $12.6 million. Due to the extenuating circumstances leading to dedesignation, gains associated with these hedges at the time of dedesignation are deferred in AOCL until being reclassified into cost of goods sold, exclusive of depreciation and amortization when the originally forecasted transactions occur and the hedged items affect earnings. During the thirty-nine weeks ended October 31, 2020, $11.1 million had been reclassified from AOCL into earnings. During the thirty-nine weeks ended October 31, 2020 and subsequent to the dedesignation of these hedges, these hedge contracts were settled.

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 31, 2020 and November 2, 2019 follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Gain (loss) recognized in AOCL (1)	$	93	$	(1,136)	$	12,328	$	5,918
Gain reclassified from AOCL into cost of sales, exclusive of depreciation and amortization (2)	$	5,327	$	2,541	$	11,104	$	6,845

(1)Amount represents the change in fair value of derivative contracts.

(2)Amount represents gain 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 Income (Loss) 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 31, 2020 and November 2, 2019 follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
(Loss) gain recognized in other operating (income) loss, net	$	—	$	(1,023)	$	742	$	157

21

15. ACCUMULATED OTHER COMPREHENSIVE LOSS

For the thirteen and thirty-nine weeks ended October 31, 2020, the activity in AOCL was as follows:

	Thirteen Weeks Ended October 31, 2020
(in thousands)	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivative Financial Instruments		Total
Beginning balance at August 1, 2020	$	(106,632)	$	7,539	$	(99,093)
Other comprehensive income before reclassifications	2,142		93		2,235
Reclassified gain from accumulated other comprehensive loss (1)	—		(5,327)		(5,327)
Other comprehensive income (loss) after reclassifications (2)	2,142		(5,234)		(3,092)
Ending balance at October 31, 2020	$	(104,490)	$	2,305	$	(102,185)
	Thirty-nine Weeks Ended October 31, 2020
(in thousands)	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivative Financial Instruments		Total
Beginning balance at February 1, 2020	$	(109,967)	$	1,081	$	(108,886)
Other comprehensive income before reclassifications	5,477		12,328		17,805
Reclassified gain from accumulated other comprehensive loss (1)	—		(11,104)		(11,104)
Other comprehensive income after reclassifications (2)	5,477		1,224		6,701
Ending balance at October 31, 2020	$	(104,490)	$	2,305	$	(102,185)

(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 Income (Loss).

(2)    No tax effect was recognized during the thirteen and thirty-nine weeks ended October 31, 2020 due to the U.S. being a loss jurisdiction.

For the thirteen and thirty-nine weeks ended November 2, 2019, the activity in AOCL was as follows:

	Thirteen Weeks Ended November 2, 2019
(in thousands)	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivative Financial Instruments		Total
Beginning balance at August 3, 2019	$	(111,461)	$	5,515	$	(105,946)
Other comprehensive (loss) income before reclassifications	1,355		(1,136)		219
Reclassified gain from accumulated other comprehensive loss (1)	—		(2,541)		(2,541)
Tax effect	—		23		23
Other comprehensive income (loss) after reclassifications	1,355		(3,654)		(2,299)
Ending balance at November 2, 2019	$	(110,106)	$	1,861	$	(108,245)
	Thirty-nine Weeks Ended November 2, 2019
(in thousands)	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivative Financial Instruments		Total
Beginning balance at February 2, 2019	$	(104,887)	$	2,435	$	(102,452)
Other comprehensive (loss) income before reclassifications	(5,219)		5,918		699
Reclassified gain from accumulated other comprehensive loss (1)	—		(6,845)		(6,845)
Tax effect	—		353		353
Other comprehensive (loss) income after reclassifications	(5,219)		(574)		(5,793)
Ending balance at November 2, 2019	$	(110,106)	$	1,861	$	(108,245)

(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 Income (Loss).

22

16. SEGMENT REPORTING

The Company’s two operating segments are brand-based: Hollister and Abercrombie, the latter of which includes the Company’s Abercrombie & Fitch and abercrombie kids 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 31, 2020 and November 2, 2019 were as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Hollister	$	476,665	$	514,772	$	1,178,925	$	1,447,975
Abercrombie	342,988		348,700		824,415		990,547
Total	$	819,653	$	863,472	$	2,003,340	$	2,438,522

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 orders. The Company’s net sales by geographic area for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 were as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
U.S.	$	557,814	$	583,593	$	1,339,347	$	1,596,723
EMEA	190,214		191,977		474,165		566,563
APAC	43,618		55,910		117,768		188,836
Other	28,007		31,992		72,060		86,400
International	$	261,839	$	279,879	$	663,993	$	841,799
Total	$	819,653	$	863,472	$	2,003,340	$	2,438,522

23

17. FLAGSHIP STORE EXIT (BENEFITS) CHARGES

Reflecting a continued focus on one of the Company’s key transformation initiatives ‘Global Store Network Optimization,’ the Company continues to pivot away from its large format flagship stores and strives to open smaller, more productive omnichannel focused brand experiences. As a result, the Company has closed certain of its flagship stores and may have additional closures as it executes against this strategy.

As part of this ongoing effort, the Company recently announced the early exit of four European Abercrombie & Fitch flagship locations. Three of the leases will be transferred through assignment while the fourth lease will be subleased to a new tenant. The Company no longer has lease obligations beyond Fiscal 2020 for the three transfers and is scheduled to receive payments to fully offset its lease obligations on the sublease. Refer to Note 8, “ LEASES,” for additional information on the sublease arrangement.

Future fixed lease payments associated with closed flagship stores are reflected within short-term and long-term operating lease liabilities on the Condensed Consolidated Balance Sheets. Future fixed lease payments associated with flagship stores that were closed as of October 31, 2020, excluding the subleased flagship store, are scheduled to be paid through the fiscal year ending January 30, 2029 (“Fiscal 2028”) and are not expected to exceed $15 million in aggregate in any fiscal year.

The Company recognizes impacts related to the exit of its flagship stores in flagship store exit (benefits) charges on the Consolidated Statements of Operations and Comprehensive Income (Loss). Details of the (benefits) charges incurred during the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 related to this initiative follow:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Operating lease cost	(1,729)		—		(6,959)		46,716
Gain on lease assignment	(5,237)		—		(5,237)		—
Asset disposals and other store-closure costs (1)	(405)		—		(3,610)		(1,687)
Employee severance and other employee transition costs	(692)		285		3,316		1,994
Total flagship store exit (benefits) charges	$	(8,063)	$	285	$	(12,490)	$	47,023

(1)    Amounts represent costs incurred or benefits associated with returning the store to its original condition, including updated estimates to previously established accruals for asset retirement obligations and costs to remove inventory and store assets.

As the Company continues its ‘Global Store Network Optimization’ efforts, it may incur future cash expenditures or incremental charges or realize benefits not currently contemplated due to events that may occur as a result of, or that are associated with, previously announced flagship store closures and flagship store closures that have not yet been finalized. At this time, the Company is not able to quantify the amount of future impacts, including any cash expenditures that may take place in future periods resulting from any potential flagship store closures given the unpredictable nature of lease exit negotiations and ultimate lease renewal decisions.

24

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read together with the Company’s Condensed Consolidated Financial Statements and notes thereto included in this Quarterly Report on Form 10-Q in “ITEM 1. FINANCIAL STATEMENTS (UNAUDITED),” to which all references to Notes in MD&A are made.

INTRODUCTION

MD&A is provided as a supplement to the accompanying Condensed Consolidated Financial Statements and notes thereto to help provide an understanding of the Company’s results of operations, financial condition, and liquidity. MD&A is organized as follows:

•Overview. This section provides a general description of the Company’s business and certain segment information.

•Current Trends and Outlook. This section provides a discussion related to COVID-19’s impact on the Company’s business and other certain risks and challenges, as well as a summary of the Company’s performance for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019.

•Results of Operations. This section provides an analysis of certain components of the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019.

•Liquidity and Capital Resources. This section provides a discussion of the Company’s financial condition, changes in financial condition and liquidity as of October 31, 2020, which includes (i) an analysis of changes in cash flows for the thirty-nine weeks ended October 31, 2020 as compared to the thirty-nine weeks ended November 2, 2019; and (ii) an analysis of liquidity, including a discussion related to preserving liquidity during COVID-19, remaining availability under the ABL Facility, the Company’s share repurchase and dividend programs, and outstanding debt and covenant compliance.

•Recent Accounting Pronouncements. The recent accounting pronouncements the Company has adopted or is currently evaluating, including the dates of adoption and/or expected dates of adoption, and anticipated effects on the Company’s Condensed Consolidated Financial Statements, are discussed, as applicable.

•Critical Accounting Policies and Estimates. This section discusses accounting policies considered to be important to the Company’s results of operations and financial condition, which typically require significant judgment and estimation on the part of management in their application.

•Non-GAAP Financial Measures. MD&A provides a discussion of certain financial measures that have been determined to not be in accordance with GAAP. This section includes certain reconciliations for non-GAAP financial measures and additional details on these financial measures, including information as to why the Company believes the non-GAAP financial measures provided within MD&A are useful to investors.

The following risks, categorized by the primary nature of the associated risk, including the disclosures in “ITEM 1A. RISK FACTORS” of A&F’s Annual Report on Form 10-K for Fiscal 2019, as well as those disclosed in the Current Report on Form 8-K filed with the Securities and Exchange Commission on June 17, 2020 and in “ITEM 1A. RISK FACTORS” of this Quarterly Report on Form 10-Q, in some cases have affected and in the future could affect the Company’s financial performance and cause actual results for Fiscal 2020 and beyond to differ materially from those expressed or implied in any of the forward-looking statements included in this Quarterly Report on Form 10-Q or otherwise made by management. The following risks, or a combination of risks, may be exacerbated by COVID-19 and could result in adverse impacts on the Company’s business, results of operations, financial condition and cash flows.

Macroeconomic and industry risks include:

•Changes in global economic and financial conditions, and the resulting impact on consumer confidence and consumer spending, as well as other changes in consumer discretionary spending habits could have a material adverse impact on our business;

•Failure to engage our customers, anticipate customer demand and changing fashion trends, and manage our inventory commensurately could have a material adverse impact on our business;

•Our failure to operate in a highly competitive and constantly evolving industry could have a material adverse impact on our business;

•Fluctuations in foreign currency exchange rates could have a material adverse impact on our business;

25

•Our ability to attract customers to our stores depends, in part, on the success of the shopping malls or area attractions that our stores are located in or around;

•The impact of war, acts of terrorism, mass casualty events or civil unrest could have a material adverse impact on our business;

•The impact of extreme weather, infectious disease outbreaks, including COVID-19, and other unexpected events could result in an interruption to our business, as well as to the operations of our third-party partners, and have a material adverse impact on our business; and

•The current outbreak of the novel coronavirus, or COVID‐19, has materially adversely impacted and disrupted, and may continue to materially adversely impact and cause disruption to, our business, financial performance and condition, operating results, liquidity and cash flows. The spread of the COVID‐19 outbreak has caused significant disruptions in the United States and global economy, the extent of the impact and duration of which is not yet known. Any future outbreak of any other highly infectious or contagious disease could have a similar impact. 

Strategic risks include:

•Failure to successfully develop an omnichannel shopping experience, a significant component of our growth strategy, or failure to successfully invest in customer, digital and omnichannel initiatives could have a material adverse impact on our business;

•Our failure to optimize our global store network could have a material adverse impact on our business; and

•Our failure to execute our international growth strategy successfully and inability to conduct business in international markets as a result of legal, tax, regulatory, political and economic risks could have a material adverse impact on our business.

Operational risks include:

•Failure to protect our reputation could have a material adverse impact on our business;

•If our information technology systems are disrupted or cease to operate effectively it could have a material adverse impact on our business;

•We may be exposed to risks and costs associated with cyber-attacks, data protection, credit card fraud and identity theft that could have a material adverse impact on our business;

•Our reliance on our distribution centers makes us susceptible to disruptions or adverse conditions affecting our supply chain;

•Changes in the cost, availability and quality of raw materials, labor, transportation, and trade relations could have a material adverse impact on our business;

•We depend upon independent third parties for the manufacture and delivery of all our merchandise, and a disruption of the manufacture or delivery of our merchandise could have a material adverse impact on our business; and

•We rely on the experience and skills of our executive officers and associates, and the failure to attract or retain this talent, or effectively manage succession could have a material adverse impact on our business.

Legal, tax, regulatory and compliance risks include:

•Fluctuations in our tax obligations and effective tax rate may result in volatility in our results of operations and could have a material adverse impact on our business;

•Our litigation exposure, or any securities litigation and shareholder activism, could have a material adverse impact on our business;

•Failure to adequately protect our trademarks could have a negative impact on our brand image and limit our ability to penetrate new markets which could have a material adverse impact on our business;

•Changes in the regulatory or compliance landscape could have a material adverse impact on our business; and

•The agreements related to our senior secured asset-based revolving credit facility and our senior secured notes include restrictive covenants that limit our flexibility in operating our business and our inability to obtain credit on reasonable terms in the future could have an adverse impact on our business.

The factors listed above are not our only risks. Additional risks may arise, and current evaluations of risks may change, which could lead to material, adverse effects on our business, operating results and financial condition.

The Company cautions that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this Quarterly Report on Form 10-Q or made by the Company, its management or spokespeople involve risks and uncertainties and are subject to change based on various important factors, many of which may be beyond the Company’s control. Words such as “estimate,” “project,” “plan,” “believe,” “expect,” “anticipate,” “intend,” and similar expressions may identify forward-looking statements. Future economic and industry trends that could potentially impact revenue and profitability are difficult to predict. Therefore, there can be no assurance that the forward-looking statements included in this Quarterly Report on Form 10-Q will prove to be accurate. In light of the significant uncertainties in the forward-looking statements included herein, including the uncertainty surrounding COVID-19, the inclusion of such information should not be regarded as a representation by the Company, or any other person, that the objectives of the Company will be achieved. The forward-looking statements included herein are based on information presently available to the management of the Company. Except as may be required by applicable law, the Company assumes no obligation to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized.

26

OVERVIEW

Business summary

The Company is a global multi-brand omnichannel specialty retailer, whose products are sold primarily through its Company-owned store and digital channels, as well as through various third-party wholesale, franchise and licensing arrangements. The Company offers a broad assortment of apparel, personal care products and accessories for men, women and kids under the Hollister, Abercrombie & Fitch and abercrombie kids brands. The 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 primarily has operations in North America, Europe and Asia, among other regions. The Company’s two operating segments are brand-based: Hollister and Abercrombie, the latter of which includes the Company’s Abercrombie & Fitch and abercrombie kids brands.

The Company’s fiscal year ends on the Saturday closest to January 31. All references herein to the Company’s fiscal years are as follows:

Fiscal year	Year ended	Number of weeks
Fiscal 2018	February 2, 2019	52
Fiscal 2019	February 1, 2020	52
Fiscal 2020	January 30, 2021	52

Due to the seasonal nature of the retail apparel industry, the results of operations for any current period are not necessarily indicative of the results expected for the full fiscal year and the Company could have significant fluctuations in certain asset and liability accounts. The Company historically experiences its greatest sales activity during the fall season, the third and fourth fiscal quarters, due to back-to-school and holiday sales periods, respectively.

CURRENT TRENDS AND OUTLOOK

COVID-19

In January 2020, the Company began to experience business disruptions in the Asia-Pacific (“APAC”) region as a result of COVID-19. In February 2020, the situation escalated as the scope of COVID-19 worsened beyond the APAC region, with the United States (the “U.S.”) and the Europe, Middle East and Africa (“EMEA”) region experiencing significant outbreaks. In March 2020, the COVID-19 outbreak was declared to be a global pandemic by the World Health Organization. In response to COVID-19, certain governments have imposed travel restrictions and local statutory quarantines and the Company has recommended associates who are able to perform their role remotely continue to do so. The Company is reacting to COVID-19 on a daily basis, including by conforming to local government guidance and monitoring developments in government legislation or other government actions in response to the COVID-19 outbreak.

As a result of COVID-19, in January 2020, the Company temporarily closed the majority of its stores in the APAC region and in March 2020, the Company temporarily closed its stores across brands in North America and the EMEA region. The majority of APAC stores were reopened during March 2020, and the Company began to reopen stores in North America and the EMEA region on a rolling basis in late April 2020. The Company had reopened approximately 97% of Company-operated stores for in-store service as of October 31, 2020. Since October 31, 2020, the Company has experienced additional store reclosures in response to COVID-19, primarily in the EMEA region, most of which have since reopened. As of December 4, 2020 approximately 98% of the Company-operated stores were open for in-store service. The Company plans to follow the guidance of local governments to determine when it can reopen closed stores and to evaluate whether further store closures will be necessary.

The Company has also implemented a range of precautionary health and safety measures with the well-being of the Company’s customers, associates and business partners in mind, including:

•Requiring associates to use face coverings, depending on geographic region;

•Encouraging or requiring customers to use face coverings, depending on geographic region;

•Conducting associate wellness checks in accordance with local government direction;

•Enhancing cleaning routines and installing plexiglass barriers in the majority of store locations;

•Implementing various measures to encourage social distancing, including managing occupancy limits;

•Encouraging contactless payment options, where available;

•Opening fitting rooms where permissible, with additional cleaning procedures for clothing that has been tried on;

•Removing returned merchandise from the sales floor for a period of time where mandated by local government;

•Reducing store hours in select locations;

•Continuing to offer Purchase-Online-Pickup-in-Store;

•Increasing its omnichannel capabilities by introducing curbside pick-up at a majority of U.S. locations;

•Following recommended cleaning and distancing measures in the Company's distribution centers; and

•Maximizing work-from-home and digital collaboration alternatives to minimize in-person meetings whenever possible.

27

The Company has seen, and may continue to see, material reductions in sales across brands and regions as a result of COVID-19. Total net sales decreased approximately 5% and 18% for the thirteen and thirty-nine weeks ended October 31, 2020 as compared to the comparable periods ended November 2, 2019, respectively, primarily driven by temporary store closures and a decline in traffic as compared to the previous year as a result of COVID-19. For the U.S. and the EMEA region, which collectively accounted for 89% of total net sales in Fiscal 2019, the Company experienced sales productivity for reopened stores of approximately 75%, as compared to last year’s levels during the thirteen weeks ended October 31, 2020.

The Company’s digital operations across brands have continued to serve the Company’s customers during this unprecedented period of temporary store closures as the Company’s distribution centers implemented enhanced cleaning and social distancing measures in order to remain operational. In response to elevated digital demand during this period, the Company has increased its omnichannel capabilities by continuing to offer Purchase-Online-Pickup-in-Store, including curbside pick-up at a majority of U.S. locations, and by utilizing ship-from-store capabilities. In addition, to prepare for the Fiscal 2020 holiday season, the Company has entered into a short-term lease for an additional distribution center and has partnered with incremental carriers. Digital sales increased approximately 43% and 42% for the thirteen and thirty-nine weeks ended October 31, 2020 as compared to the comparable periods ended November 2, 2019, respectively. Despite the recent strength in digital sales, the Company has historically generated the majority of its annual net sales through stores and there can be no assurance that the current performance in the digital channel will continue.

The Company has seen, and may continue to see, material adverse impacts as a result of COVID-19. The extent of future impacts of COVID-19 on the Company’s business, including the duration and impact on overall customer demand, are uncertain as current circumstances are dynamic and depend on future developments, including, but not limited to, the duration and spread of COVID- 19 and the availability and acceptance of an effective vaccine or medical treatments.

The Company is also focused on managing inventories and the impacts COVID-19 has had, and continues to have, on its global supply chain, including potential disruptions of product deliveries. The Company sources the majority of its merchandise outside of the U.S. through arrangements with vendors primarily located in southeast Asia and, as of October 31, 2020, the vast majority of the factories the Company partners with were operating at full capacity. In order to complete production, these manufacturing factories are dependent on raw materials from fabric mills that are primarily located in the APAC region. The Company continues to collaborate with its third-party partners to mitigate significant delays in delivery of merchandise. During Fiscal 2020, the Company has reduced certain orders that were not already in production, delayed and altered the cadence of deliveries and implemented various strategies to tightly manage inventories, including utilizing ship-from-store capabilities in select locations.

Despite these near-term challenges presented by COVID-19, the Company remains committed to, and confident in, its long-term vision. The Company continues to evaluate opportunities to make progress against its key transformation initiatives while balancing the near-term challenges and unprecedented uncertainty presented by COVID-19. The Company’s progress executing against the following key transformation initiatives has created the foundation to allow the Company to respond quickly to COVID-19:

•Optimizing the global store network;

•Enhancing digital and omnichannel capabilities;

•Increasing the speed and efficiency of the concept-to-customer product life cycle by further investing in capabilities to position the supply chain for greater speed, agility and efficiency, while leveraging data and analytics to offer the right product at the right time and the right price; and

•Improving customer engagement through loyalty programs and marketing optimization.

The Company entered this period of uncertainty with a healthy liquidity position and has taken and continues to take immediate, aggressive and prudent actions, including reevaluating all expenditures, to balance short and long-term liquidity needs, in order to best position the business for its key stakeholders. Actions to preserve liquidity and manage cash flows during Fiscal 2020, include, but are not limited to:

•Partnering with merchandise and non-merchandise vendors in regards to payment terms;

•Tightly managing inventory receipts to align inventory with expected market demand;

•Reducing expenses to better align operating costs with sales;

•Borrowed $210.0 million under the ABL Facility in March 2020 which was then repaid in July 2020 along with the Term Loan Facility;

•Completed a private offering of $350.0 million aggregate principal amount of senior secured notes;

•Withdrew $50.0 million from the overfunded Rabbi Trust assets, which represented the majority of excess funds;

•Temporarily suspended the Company's share repurchase and dividend programs; and

•Assessing government policy and economic stimulus responses to COVID-19 for both business and individuals.

In addition, despite the Company's recent history of partnering with its vendors regarding payment terms, certain payment term extensions were temporary and certain previously deferred payments have since been made. There can be no assurance that the Company will be able to maintain extended payment terms or continue to defer payments, which may result in incremental operating cash outflows in future periods.

As of October 31, 2020, the Company had liquidity of $1.158 billion as compared to $913.8 million as of February 1, 2020, comprised of cash and equivalents and actual incremental borrowing available to the Company under the ABL Facility.

28

It is possible that our preparations for the events listed above are not adequate to mitigate their impact, and that these events could further adversely affect our business and results of operations. For a discussion of significant risks that have the potential to cause our actual results to differ materially from our expectations, refer to the disclosures under the heading “FORWARD-LOOKING STATEMENTS AND RISK FACTORS” in “ITEM 1A. RISK FACTORS” of A&F’s Annual Report on Form 10-K for Fiscal 2019. as well as the discussion provided in the Current Report on Form 8-K filed with the Securities and Exchange Commission on June 17, 2020 and in “ITEM 1A. RISK FACTORS” of this Quarterly Report on Form 10-Q.

United Kingdom’s withdrawal from the European Union (“Brexit”)

In June 2016, the United Kingdom passed a referendum to recommend withdrawing from the European Union. Although the United Kingdom left the European Union in January 2020, the final terms of the United Kingdom’s withdrawal remain unclear. The Company believes that this referendum and the uncertainty surrounding the terms of the United Kingdom’s withdrawal adversely impacted international sales results in Fiscal 2019, with decreased traffic and declining values of the Euro and British Pound as compared to the U.S. Dollar over Fiscal 2018.

Upon withdrawal from the European Union in January 2020, the United Kingdom entered a transition period during which there will be on-going negotiations. During this transition period, the United Kingdom’s existing trading relationship with the European Union will remain in place and it will continue to follow the European Union's rules. It is not clear at this time what, if any, agreements will be reached by the current December 31, 2020 transition period deadline, or the impact that COVID-19 may have on the negotiation timeline.

There is continued uncertainty related to the impact on consumer behavior, trade relations, economic conditions, foreign currency exchange rates and the free movement of goods, services, people and capital between the United Kingdom and the European Union during this time of transition. The United Kingdom’s withdrawal from the European Union could also adversely impact other areas of the business, including, but not limited to, an increase in duties and delays in the delivery of merchandise from the Company’s Netherlands distribution center to its customers in the United Kingdom if trade barriers materialize. The United Kingdom’s withdrawal from the European Union could also adversely impact the operations of the Company’s vendors and of our other third-party partners. In order to mitigate the risks associated with the United Kingdom’s withdrawal from the European Union, the Company is: collaborating across the organization and testing systems; working with external partners to develop contingency plans for potential adverse impacts; and taking actions to reduce, to the extent possible, the potential impact of any incremental duty exposure. It is possible that preparations for the events listed above are not adequate to mitigate their impact, and that these events could further adversely affect the business and results of operations.

Global Store Network Optimization

A component of optimizing the Company’s global store fleet is pivoting away from large format flagship stores and striving towards opening smaller, more productive omnichannel focused brand experiences that cater to local customers. As a result, the Company has closed certain of its flagship stores and may have additional closures in the future as the Company executes against this strategy. Although some of these closures may be completed through natural lease expirations, certain other of the Company’s leases include early termination options that can be exercised under specific conditions. The Company may also elect to exit or modify other leases, and could incur charges or realize benefits related to these actions.

As part of its ongoing global store network optimization, the Company recently announced the early exit of four European Abercrombie & Fitch flagship locations. The Dusseldorf flagship closed during the third quarter of Fiscal 2020, and the London, Munich and Paris flagships will close by the end of Fiscal 2020, all well ahead of their natural lease expirations. Three of the leases will be transferred through assignment while the fourth lease will be subleased to a new tenant. The Company no longer has lease obligations beyond Fiscal 2020 for the three transfers and is scheduled to receive payments to fully offset its lease obligations on the sublease. In addition to these four early lease exits, the Brussels, Madrid and Fukuoka Abercrombie & Fitch flagships are expected to close by the end of Fiscal 2020 due to natural lease expirations. These recent actions removed approximately $85 million of lease liabilities from the balance sheet, and will leave the Company with eight operating flagships at the end of Fiscal 2020, down from 15 at the beginning of Fiscal 2020.

Details related to recently closed flagship stores follow:

Brand (1)	Flagship location	Timing of store closure
Abercrombie & Fitch	Pedder Street, Hong Kong Special Administrative Region, China	First quarter of Fiscal 2017
Abercrombie & Fitch	Copenhagen, Denmark	First quarter of Fiscal 2019
Hollister	SoHo, New York City, U.S.	Second quarter of Fiscal 2019
Abercrombie	Milan, Italy	Fourth quarter of Fiscal 2019
abercrombie kids (2)	London, United Kingdom	Fourth quarter of Fiscal 2019
Abercrombie	Dusseldorf, Germany	Third quarter of Fiscal 2020

(1)    Abercrombie includes the Abercrombie & Fitch and abercrombie kids brands and, when used in the table above, signifies a location with an abercrombie kids carveout within an Abercrombie & Fitch store that would be represented as a single store count.

(2)    The abercrombie kids store in London is expected to be converted to corporate office space to be utilized as the Company’s EMEA regional headquarters.

29

Additional details related to store count and gross square footage follow:

	Hollister (1)		Abercrombie (2)		Total Company
	U.S.	International	U.S.	International	U.S.	International	Total
Number of stores:
February 1, 2020	391	155	256	52	647	207	854
New	2	2	4	4	6	6	12
Permanently closed	(7)	(3)	(5)	(2)	(12)	(5)	(17)
October 31, 2020	386	154	255	54	641	208	849
Gross square footage (in thousands):
October 31, 2020	2,568	1,257	1,817	575	4,385	1,832	6,217

(1)     Locations with Gilly Hicks carveouts within Hollister stores are represented as a single store count. Excludes nine international franchise stores as of each of October 31, 2020 and February 1, 2020. Excludes 15 Company-operated temporary stores as of October 31, 2020 and 16 as of February 1, 2020.

(2)     Abercrombie includes the Company's Abercrombie & Fitch and abercrombie kids brands. Locations with abercrombie kids carveouts within Abercrombie & Fitch stores are represented as a single store count. Excludes eight international franchise stores as of October 31, 2020 and seven as of February 1, 2020. Excludes five Company-operated temporary stores as of October 31, 2020 and eight as of February 1, 2020.

Summary of results

A summary of results for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 follows:

	GAAP						Non-GAAP (1)
(in thousands, except change in net sales, gross profit rate, operating margin and per share amounts)	October 31, 2020(2)			November 2, 2019(3)			October 31, 2020(2)			November 2, 2019(3)
Thirteen Weeks Ended
Net sales	$	819,653		$	863,472
Change in net sales	(5.1)		%	0.3		%
Gross profit rate	64.0		%	60.1		%
Operating income	$	58,616		$	14,479		$	64,945		$	24,947
Operating income margin	7.2		%	1.7		%	7.9		%	2.9		%
Net income attributable to A&F	$	42,271		$	6,523		$	48,231		$	14,506
Net income per diluted share attributable to A&F	$	0.66		$	0.10		$	0.76		$	0.23
Thirty-nine Weeks Ended
Net sales	$	2,003,340		$	2,438,522
Change in net sales	(17.8)		%	0.2		%
Gross profit rate	60.5		%	59.9		%
Operating loss	$	(136,368)		$	(52,263)		$	(79,028)		$	(41,795)
Operating loss margin	(6.8)		%	(2.1)		%	(3.9)		%	(1.7)		%
Net loss attributable to A&F	$	(196,413)		$	(43,774)		$	(142,708)		$	(35,791)
Net loss per diluted share attributable to A&F	$	(3.14)		$	(0.67)		$	(2.28)		$	(0.55)

(1)    Discussion as to why the Company believes that these non-GAAP financial measures are useful to investors is provided below under “NON-GAAP FINANCIAL MEASURES.”

(2)    Results for Fiscal 2020 reflect significant adverse tax impacts related to valuation allowances on deferred tax assets and other tax charges. Refer to Note 11, “INCOME TAXES.”

(3)    Results for Fiscal 2019 reflect significant adverse impacts related to flagship store exit charges. Refer to Note 17, “FLAGSHIP STORE EXIT (BENEFITS) CHARGES.”

Certain components of the Company’s Condensed Consolidated Balance Sheets as of October 31, 2020 and February 1, 2020 were as follows:

(in thousands)	October 31, 2020		February 1, 2020
Cash and equivalents	$	812,881	$	671,267
Gross long-term borrowings outstanding, carrying amount	$	350,000	$	233,250
Inventories	$	545,548	$	434,326

Certain components of the Company’s Condensed Consolidated Statements of Cash Flows for the thirty-nine week periods ended October 31, 2020 and November 2, 2019 were as follows:

(in thousands)	October 31, 2020		November 2, 2019
Net cash provided by (used for) operating activities	$	158,894	$	(33,839)
Net cash used for investing activities	$	(91,748)	$	(154,373)
Net cash provided by (used for) financing activities	$	70,129	$	(122,908)

30

RESULTS OF OPERATIONS

Net sales

The Company’s net sales by operating segment for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 were as follows:

	Thirteen Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		$ Change		% Change
Hollister	$	476,665	$	514,772	$	(38,107)	(7)%
Abercrombie (1)	342,988		348,700		(5,712)		(2)%
Total	$	819,653	$	863,472	$	(43,819)	(5)%
	Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		$ Change		% Change
Hollister	$	1,178,925	$	1,447,975	$	(269,050)	(19)%
Abercrombie (1)	824,415		990,547		(166,132)		(17)%
Total	$	2,003,340	$	2,438,522	$	(435,182)	(18)%

(1)    Includes Abercrombie & Fitch and abercrombie kids brands.

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 the shipping location provided by customers for digital orders. The Company’s net sales by geographic area for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 were as follows:

	Thirteen Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		$ Change		% Change
U.S.	$	557,814	$	583,593	$	(25,779)	(4)%
EMEA	190,214		191,977		(1,763)		(1)%
APAC	43,618		55,910		(12,292)		(22)%
Other	28,007		31,992		(3,985)		(12)%
International	$	261,839	$	279,879	$	(18,040)	(6)%
Total	$	819,653	$	863,472	$	(43,819)	(5)%
	Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		$ Change		% Change
U.S.	$	1,339,347	$	1,596,723	$	(257,376)	(16)%
EMEA	474,165		566,563		(92,398)		(16)%
APAC	117,768		188,836		(71,068)		(38)%
Other	72,060		86,400		(14,340)		(17)%
International	$	663,993	$	841,799	$	(177,806)	(21)%
Total	$	2,003,340	$	2,438,522	$	(435,182)	(18)%

For the third quarter of Fiscal 2020, net sales decreased 5% as compared to the third quarter of Fiscal 2019, primarily due to a decrease in units sold driven by reduced store traffic, including as it relates to temporary store closures as a result of COVID-19, partially offset by 43% digital sales growth. Average unit retail increased year-over-year, driven by less promotions and lower clearance levels, with benefits from changes in foreign currency exchange rates of approximately $12 million. Excluding the benefit from changes in foreign currency exchange rates, net sales for the third quarter of Fiscal 2020 decreased 6% as compared to the third quarter of Fiscal 2019.

For the year-to-date period of Fiscal 2020, net sales decreased 18% as compared to the year-to-date period of Fiscal 2019, primarily due to a decrease in units sold driven by reduced store traffic, including as it relates to temporary store closures as a result of COVID-19, partially offset by 42% digital sales growth. Average unit retail increased year-over-year, driven by less promotions and lower clearance levels, with benefits from changes in foreign currency exchange rates of approximately $3 million. Excluding the benefit from changes in foreign currency exchange rates, net sales for the year-to-date period of Fiscal 2020 decreased 18% as compared to the year-to-date period of Fiscal 2019.

31

Cost of sales, exclusive of depreciation and amortization

	Thirteen Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net sales			% of Net sales	BPS Change (1)
Cost of sales, exclusive of depreciation and amortization	$	295,220	36.0%	$	344,541	39.9%	(390)
	Thirty-nine Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net Sales			% of Net Sales	BPS Change (1)
Cost of sales, exclusive of depreciation and amortization	$	791,154	39.5%	$	976,868	40.1%	(60)

(1) )The estimated basis point (“BPS”) change has been rounded based on the change in the percentage of net sales.

For the third quarter of Fiscal 2020, cost of sales, exclusive of depreciation and amortization, as a percentage of net sales decreased by approximately 390 basis points as compared to the third quarter of Fiscal 2019. The year-over-year decline was primarily attributable to increased average unit retail and lower average unit cost, benefiting from inventory shrink favorability and changes in foreign currency exchange rates.

For the year-to-date period of Fiscal 2020, cost of sales, exclusive of depreciation and amortization, as a percentage of net sales decreased by approximately 60 basis points as compared to the year-to-date period of Fiscal 2019. The year-over-year decline reflects benefits from inventory shrink favorability and changes in foreign currency exchange rates, as well as adverse impacts related to charges reducing the carrying value of inventory during the first quarter of Fiscal 2020 of approximately $15 million.

Gross profit, exclusive of depreciation and amortization

	Thirteen Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net sales			% of Net sales	BPS Change (1)
Gross profit, exclusive of depreciation and amortization	$	524,433	64.0%	$	518,931	60.1%	390
	Thirty-nine Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net Sales			% of Net Sales	BPS Change (1)
Gross profit, exclusive of depreciation and amortization	$	1,212,186	60.5%	$	1,461,654	59.9%	60

(1)    The estimated basis point change has been rounded based on the change in the percentage of net sales.

32

Stores and distribution expense

	Thirteen Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net sales			% of Net sales	BPS Change (1)
Stores and distribution expense	$	346,263	42.2%	$	377,697	43.7%	(150)
	Thirty-nine Weeks Ended
	November 2, 2019			November 3, 2018
(in thousands)			% of Net Sales			% of Net Sales	BPS Change (1)
Stores and distribution expense	$	978,757	48.9%	$	1,110,656	45.5%	340

(1)    The estimated basis point change has been rounded based on the change in the percentage of net sales.

For the third quarter of Fiscal 2020, stores and distribution expense decreased 8% as compared to the third quarter of Fiscal 2019, primarily driven by a $24 million reduction in store occupancy expense and a $11 million reduction in payroll expense, which was net of a benefit of $3 million related to expected government subsidies in certain jurisdictions where the Company qualifies, reflecting the impact of COVID-19 on operations including temporary store closures. These reductions in expense were partially offset by a $10 million increase in shipping and fulfillment expense related to 43% year-over-year digital sales growth.

For the year-to-date period of Fiscal 2020, stores and distribution expense decreased 12% as compared to the year-to-date period of Fiscal 2019, primarily driven by a $77 million reduction in payroll expense, which was net of a benefit of $15 million related to expected government subsidies in certain jurisdictions where the Company qualifies, and a $64 million reduction in store occupancy expense, reflecting the impact of COVID-19 on operations including temporary store closures. These reductions in expense were partially offset by a $31 million increase in shipping and fulfillment expense related to 42% year-over-year digital sales growth.

Marketing, general and administrative expense

	Thirteen Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net sales			% of Net sales	BPS Change (1)
Marketing, general and administrative expense	$	121,000	14.8%	$	114,075	13.2%	160
	Thirty-nine Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net Sales			% of Net Sales	BPS Change (1)
Marketing, general and administrative expense	$	326,509	16.3%	$	341,716	14.0%	230

(1)    The estimated basis point change has been rounded based on the change in the percentage of net sales.

For the third quarter of Fiscal 2020, marketing, general and administrative expense increased 6% as compared to the third quarter of Fiscal 2019, primarily driven by an increase in payroll expense as a result of higher performance-based compensation expense, partially offset by lower non-customer facing and in-store marketing costs.

For the year-to-date period of Fiscal 2020, marketing, general and administrative expense decreased 4% as compared to the year-to-date period of Fiscal 2019, primarily by driven by lower marketing and other controllable expenses, partially offset by an increase in payroll expense as a result of higher performance-based compensation expense.

33

Flagship store exit (benefits) charges

	Thirteen Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net sales			% of Net sales	BPS Change (1)
Flagship store exit (benefits) charges	$	(8,063)	(1.0)%	$	285	—%	(100)
	Thirty-nine Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net Sales			% of Net Sales	BPS Change (1)
Flagship store exit (benefits) charges	$	(12,490)	(0.6)%	$	47,023	1.9%	(250)

(1)    The estimated basis point change has been rounded based on the change in the percentage of net sales.

Flagship store exit benefits in Fiscal 2020 primarily relate to the planned closure of several international Abercrombie & Fitch flagship stores. Flagship store exit charges for Fiscal 2019 primarily relate to the closure of the Company’s SoHo, New York City Hollister flagship store. Refer to Note 17, “FLAGSHIP STORE EXIT (BENEFITS) CHARGES.”

Asset impairment, exclusive of flagship store exit charges

	Thirteen Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net sales			% of Net sales	BPS Change (1)
Asset impairment, exclusive of flagship store exit charges	$	6,329	0.8%	$	12,610	1.5%	(70)
Excluded items:
Asset impairment charges (2)	(6,329)		(0.8)%	(10,468)		(1.2)%	40
Adjusted non-GAAP asset impairment, exclusive of flagship store exit charges	$	—	0.0%	$	2,142	0.2%	(20)
	Thirty-nine Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net Sales			% of Net Sales	BPS Change (1)
Asset impairment, exclusive of flagship store exit charges	$	57,340	2.9%	$	14,987	0.6%	230
Excluded items:
Asset impairment charges (2)	(57,340)		(2.9)%	(10,468)		(0.4)%	(250)
Adjusted non-GAAP asset impairment, exclusive of flagship store exit charges	$	—	0.0%	$	4,519	0.2%	(20)

(1) The estimated basis point change has been rounded based on the change in the percentage of net sales.

(2)    Refer to “NON-GAAP FINANCIAL MEASURES,” for further details.

Refer to Note 9, “ASSET IMPAIRMENT.”

Other operating (loss) income, net

	Thirteen Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net sales			% of Net sales	BPS Change (1)
Other operating (loss) income, net	$	(288)	—%	$	215	—%	—
	Thirty-nine Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net Sales			% of Net Sales	BPS Change (1)
Other operating income, net	$	1,562	0.1%	$	465	—%	10

(1)    The estimated basis point change has been rounded based on the change in the percentage of net sales.

34

Operating income (loss)

	Thirteen Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net sales			% of Net sales	BPS Change (1)
Operating income	$	58,616	7.2%	$	14,479	1.7%	550
Excluded items:
Asset impairment charges (2)	6,329		0.8%	10,468		1.2%	(40)
Adjusted non-GAAP operating income	$	64,945	7.9%	$	24,947	2.9%	500
	Thirty-nine Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net Sales			% of Net Sales	BPS Change (1)
Operating loss	$	(136,368)	(6.8)%	$	(52,263)	(2.1)%	(470)
Excluded items:
Asset impairment charges (2)	57,340		2.9%	10,468		0.4%	250
Adjusted non-GAAP operating loss	$	(79,028)	(3.9)%	$	(41,795)	(1.7)%	(220)

(1)    The estimated basis point change has been rounded based on the change in the percentage of net sales.

(2)    Refer to “NON-GAAP FINANCIAL MEASURES,” for further details.

Interest expense, net

	Thirteen Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net sales			% of Net sales	BPS Change (1)
Interest expense	$	9,408	1.1%	$	5,500	0.6%	50
Interest income	(600)		(0.1)%	(2,578)		(0.3)%	20
Interest expense, net	$	8,808	1.1%	$	2,922	0.3%	80
	Thirty-nine Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net Sales			% of Net Sales	BPS Change (1)
Interest expense	$	22,242	1.1%	$	14,518	0.6%	50
Interest income	(2,965)		(0.1)%	(9,610)		(0.4)%	30
Interest expense, net	$	19,277	1.0%	$	4,908	0.2%	80

(1)    The estimated basis point change has been rounded based on the change in the percentage of net sales.

For the third quarter of Fiscal 2020, interest expense, net increased $5.9 million as compared to the third quarter of Fiscal 2019. For the year-to-date period of Fiscal 2020, interest expense, net increased $14.4 million as compared to the year-to-date period of Fiscal 2019.

The increase in interest expense, net, for the aforementioned periods is primarily driven by higher interest expense in the current year, reflecting incremental expense in connection with the issuance of the Senior Secured Notes and an increase in interest expense related to certain of the Company’s long-term obligations, as well as lower interest income earned on the Company’s investments and cash holdings.

35

Income tax expense (benefit)

	Thirteen Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands, except ratios)			Effective Tax Rate			Effective Tax Rate
Income tax expense	$	5,779	11.6%	$	3,987	34.5%
Excluded items:
Tax effect of pre-tax excluded items (1)	369			2,485
Adjusted non-GAAP income tax expense	$	6,148	11.0%	$	6,472	29.4%
	Thirty-nine Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands, except ratios)			Effective Tax Rate			Effective Tax Rate
Income tax expense (benefit)	$	38,565	(24.8)%	$	(16,931)	29.6%
Deduct:
Tax effect of pre-tax excluded items (1)	3,635			2,485
Adjusted non-GAAP income tax expense (benefit)	$	42,200	(42.9)%	$	(14,446)	30.9%

(1)    The tax effect of pre-tax excluded items is the difference between the tax provision calculation on a GAAP basis and on an adjusted non-GAAP basis. Refer to “Operating income (loss)” for details of pre-tax excluded items. 

The Company’s effective tax rate for the year-to-date period of Fiscal 2020 was impacted by $77.4 million of adverse tax impacts, ultimately giving rise to income tax expense on a consolidated pre-tax loss. These adverse tax impacts are as follows:

•The Company did not recognize income tax benefits on $180.7 million of pre-tax losses generated in the thirty-nine weeks ended October 31, 2020 in certain jurisdictions as the Company currently anticipates pre-tax losses in these jurisdictions for the fiscal year, resulting in adverse tax impacts of $41.8 million.

•The Company recognized discrete charges of $35.6 million related to the establishment of valuation allowances and other tax charges in certain jurisdictions, including, but not limited to Switzerland, Germany and the U.S. principally as a result of the significant adverse impacts of COVID-19.

Refer to Note 11, “INCOME TAXES.”

Net income (loss) attributable to A&F

	Thirteen Weeks Ended
	October 31, 2020			November 2, 2019
(in thousands)			% of Net sales			% of Net sales	BPS Change (1)
Net income attributable to A&F	$	42,271	5.2%	$	6,523	0.8%	440
Excluded items, net of tax (2)	5,960		0.7%	7,983		0.9%	(20)
Adjusted non-GAAP net income attributable to A&F	$	48,231	5.9%	$	14,506	1.7%	420
	Thirty-nine Weeks Ended
	October 31, 2020 (3)			November 2, 2019
(in thousands)			% of Net Sales			% of Net Sales	BPS Change (1)
Net loss attributable to A&F	$	(196,413)	(9.8)%	$	(43,774)	(1.8)%	(800)
Excluded items, net of tax (2)	53,705		2.7%	7,983		0.3%	240
Adjusted non-GAAP net loss attributable to A&F	$	(142,708)	(7.1)%	$	(35,791)	(1.5)%	(560)

(1)    The estimated basis point change has been rounded based on the change in the percentage of net sales.

(2)    Excluded items presented above under “Operating income (loss),” and “Income tax expense (benefit).” 

(3)    Results for Fiscal 2020 reflect significant adverse tax impacts related to valuation allowances on deferred tax assets and other tax charges. Refer to Note 11, “INCOME TAXES.”

36

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

	Thirteen Weeks Ended
	October 31, 2020		November 2, 2019		$ Change
Net income per diluted share attributable to A&F	$	0.66	$	0.10	$0.56
Excluded items, net of tax (1)	$	0.09	$	0.12	$(0.03)
Adjusted non-GAAP net income per diluted share attributable to A&F	$	0.76	$	0.23	$0.53
Impact from changes in foreign currency exchange rates	$	—	$	0.15	$(0.15)
Adjusted non-GAAP net income per diluted share attributable to A&F on a constant currency basis	$	0.76	$	0.37	$0.39
	Thirty-nine Weeks Ended
	October 31, 2020 (2)		November 2, 2019		$ Change
Net loss per diluted share attributable to A&F	$	(3.14)	$	(0.67)	$(2.47)
Excluded items, net of tax (1)	$	0.86	$	0.12	$0.74
Adjusted non-GAAP net loss per diluted share attributable to A&F	$	(2.28)	$	(0.55)	$(1.73)
Impact from changes in foreign currency exchange rates	$	—	$	0.12	$(0.12)
Adjusted non-GAAP net loss per diluted share attributable to A&F on a constant currency basis	$	(2.28)	$	(0.43)	$(1.85)

(1)    Excluded items presented above under “Operating income (loss),” and “Income tax expense (benefit).” 

(2)    Results for Fiscal 2020 reflect significant adverse tax impacts related to valuation allowances on deferred tax assets and other tax charges. Refer to Note 11, “INCOME TAXES.”

37

LIQUIDITY AND CAPITAL RESOURCES

Overview

The Company’s capital allocation strategy, priorities and investments are reviewed by A&F’s Board of Directors considering both liquidity and valuation factors. The Company’s current capital allocation strategy is to prioritize navigating the near-term challenges that COVID-19 presents and continuing to fund operating activities. The Company believes that it will have adequate liquidity to fund operating activities over the next 12 months.

Primary sources and uses of cash

The Company’s business has two principal selling seasons: the spring season, which includes the first and second fiscal quarters (“Spring”) and the fall season, which includes the third and fourth fiscal quarters (“Fall”). The Company generally experiences its greatest sales activity during the Fall season, due to the back-to-school and holiday sales periods. The Company relies on excess operating cash flows, which are largely generated in Fall, to fund operations throughout the year and to reinvest in the business to support future growth. The Company also has the ABL Facility available as a source of additional funding, which is described further below under “Credit facilities and Senior Secured Notes”.

As a precautionary measure in response to COVID-19, in March 2020, the Company borrowed $210.0 million under the ABL Facility to improve its near-term cash position and withdrew the majority of excess funds from the overfunded Rabbi Trust assets, providing the Company with $50.0 million of additional cash. In July 2020, the Company completed the issuance of the Senior Secured Notes and received gross proceeds of $350.0 million. The Company used the net proceeds from the offering of the Senior Secured Notes, along with existing cash on hand, to repay outstanding borrowings and accrued interest under the Term Loan Facility and the ABL Facility, with the remaining net proceeds used towards fees and expenses in connection with such repayments and the offering of the Senior Secured Notes.

Over the next twelve months, the Company expects its primary cash requirements to be directed towards funding operating activities, including the acquisition of inventory, and obligations related to compensation, marketing, leases and any lease buyouts or modifications it may exercise, taxes and other operating activities. The Company entered this period of uncertainty with a healthy liquidity position and has taken and continues to take immediate, aggressive and prudent actions, including reevaluating all expenditures, in order to balance the Company’s short and long-term liquidity needs and best position the business for key stakeholders.

The Company also evaluates opportunities for investments in line with its key transformation initiatives, which have positioned the business to quickly respond to the COVID-19 pandemic, and strives to invest in projects that have high expected returns. These improvements may include new store experiences or investments in its omnichannel initiatives or loyalty programs. In addition, the Company evaluates store closures, including flagship lease buyouts and options to early terminate store leases. Historically, the Company has utilized free cash flow generated from operations to fund any discretionary capital expenditures, which have been prioritized towards new store experiences, as well as digital and omnichannel investments, information technology, and other projects. For the year-to-date period ended October 31, 2020, the Company used $91.7 million towards capital expenditures. Total capital expenditures for Fiscal 2020 are expected to be approximately $110 million, down from $202.8 million of capital expenditures in Fiscal 2019.

Share repurchases and dividends

In order to preserve liquidity and maintain financial flexibility in light of COVID-19, in March 2020, the Company announced that it had temporarily suspended its share repurchase program and in May 2020, the Company announced that it had temporarily suspended its dividend program. The Company will review these temporary suspensions throughout the year to determine, in light of facts and circumstances at that time, whether and when to reinstate these programs.

Dividends are declared at the discretion of A&F’s Board of Directors. A quarterly dividend, of $0.20 per share outstanding, was declared in February for Fiscal 2020 and in each of February, May, August and November in Fiscal 2019 and Fiscal 2018. Dividends were paid in March for Fiscal 2020, and each of March, June, September and December in Fiscal 2019 and Fiscal 2018. A&F’s Board of Directors reviews the dividend on a quarterly basis and establishes the dividend amount based on A&F’s financial condition, results of operations, capital requirements, current and projected cash flows, business prospects and other factors, including the potential severity of impacts to the business resulting from COVID-19 and any restrictions related to the Company’s agreements related to the Senior Secured Notes and the ABL Facility. There can be no assurance that the Company will reinstate its dividend program in the future or, if dividends are paid, that they will be in amounts similar to past dividends.

Historically, the Company has repurchased shares of its Common Stock from time to time, dependent on market and business conditions, with the primary objective to offset dilution from issuances of Common Stock associated with the exercise of employee stock appreciation rights and the vesting of restricted stock units. Shares may be repurchased in the open market, including pursuant to any trading plans established in accordance with Rule 10b5-1 of the Exchange Act, through privately negotiated transactions or other transactions or by a combination of such methods. Refer to “ITEM 2. UNREGISTERED SALES

38

OF EQUITY SECURITIES AND USE OF PROCEEDS” of Part II of this Quarterly Report on Form 10-Q for the number of shares remaining available for purchase under the Company’s June 2019 publicly announced stock repurchase authorization.

Credit facilities and Senior Secured Notes

In July 2020, the Company completed the private offering of the Senior Secured Notes, and received gross proceeds of $350.0 million. The Senior Secured Notes will mature on July 15, 2025 and bear interest at a rate of 8.75% per annum, with semi-annual interest payments beginning in January 2021. The Company’s debt related to the Senior Secured Notes is presented on the Condensed Consolidated Balance Sheet, net of the unamortized fees. As of October 31, 2020, the Company had $350.0 million of gross borrowings outstanding under the Senior Secured Notes.

In addition, the ABL Facility provides for a senior secured asset-based revolving credit facility of up to $400 million. As of October 31, 2020, the Company did not have any borrowings outstanding under the ABL Facility. The ABL Facility matures on October 19, 2022.

Details regarding the remaining borrowing capacity under the ABL Facility as of October 31, 2020 are as follows:

(in thousands)	October 31, 2020
Borrowing base	$	384,544
Less: Outstanding stand-by letters of credit	(847)
Borrowing capacity	383,697
Less: Minimum excess availability (1)	(38,454)
Actual incremental borrowing available	$	345,243

(1)    The Company must maintain excess availability equal to the greater of 10% of the loan cap or $30 million under the ABL Facility.

Refer to Note 12, “BORROWINGS.”

Income taxes

The Company’s earnings and profits from its foreign subsidiaries could be repatriated to the U.S., without incurring additional federal income tax. The Company has determined that the balance of the Company’s undistributed earnings and profits from its foreign subsidiaries as of February 2, 2019 are considered indefinitely reinvested outside of the U.S., and if these funds were to be repatriated to the U.S., the Company would expect to incur an insignificant amount of state income taxes and foreign withholding taxes. The Company accrues for both state income taxes and foreign withholding taxes with respect to earnings and profits earned after February 2, 2019, in such a manner that these funds could be repatriated without incurring additional taxes.

As of October 31, 2020, $316.4 million of the Company’s $812.9 million of cash and equivalents were held by foreign affiliates. The Company is not dependent on dividends from its foreign affiliates to fund its U.S. operations or pay dividends, if any, to A&F’s stockholders.

Refer to Note 11, “INCOME TAXES.”

Analysis of cash flows

The table below provides certain components of the Company’s Condensed Consolidated Statements of Cash Flows for the thirty-nine weeks ended October 31, 2020 and November 2, 2019:

	Thirty-nine Weeks Ended
	October 31, 2020		November 2, 2019
(in thousands)
Cash and equivalents, and restricted cash and equivalents, beginning of period	$	692,264	$	745,829
Net cash provided by (used for) operating activities	158,894		(33,839)
Net cash used for investing activities	(91,748)		(154,373)
Net cash provided by (used for) financing activities	70,129		(122,908)
Effect of foreign currency exchange rates on cash	2,269		(2,686)
Net increase (decrease) in cash and equivalents, and restricted cash and equivalents	139,544		(313,806)
Cash and equivalents, and restricted cash and equivalents, end of period	$	831,808	$	432,023

Operating activities - The year-over-year change in operating cash flows was primarily due to actions taken by the Company during Fiscal 2020 to preserve liquidity and manage cash flows in light of COVID-19, including, but not limited to:

•Partnering with merchandise and non-merchandise vendors regarding payment terms;

•Reducing and altering the cadence of inventory receipts to align inventory with expected market demand;

•Reducing expenses to align operating costs with sales;

39

•Withdrawing $50.0 million from the overfunded Rabbi Trust assets, which represented the majority of excess funds; and

•Suspending rent payments for a significant number of stores that were closed for a period of time during Fiscal 2020 as a result of COVID-19, which, coupled with rent abatements and changes in payment cadence, attributed to a year-over-year decrease in cash paid for operating lease liabilities.

These benefits to operating cash flows were partially offset by lower cash receipts as a result of the 18% decrease in net sales from last year driven by temporary store closures and a decline in store traffic in response to COVID-19 during Fiscal 2020.

The Company continues to engage with its landlords to find a mutually beneficial and agreeable path forward. In addition, despite the Company's recent history of partnering with its vendors regarding payment terms, certain payment term extensions were temporary and certain previously deferred payments have since been made. There can be no assurance that the Company will be able to maintain extended payment terms or continue to defer payments, which may result in incremental operating cash outflows in future periods.

Investing activities - For the thirty-nine weeks ended October 31, 2020, net cash outflows for investing activities were used for capital expenditures of $91.7 million as compared to $154.4 million for the thirty-nine weeks ended November 2, 2019, reflecting actions taken in Fiscal 2020 to preserve liquidity and manage cash flows in light of the COVID-19 pandemic.

Financing activities - For the thirty-nine weeks ended October 31, 2020, net cash provided by financing activities primarily consisted of the issuance of the Senior Secured Notes and receipt of related gross proceeds of $350.0 million and borrowings under the ABL Facility of $210.0 million. The gross proceeds from the Senior Secured Notes offering were used along with existing cash on hand, to repay all then outstanding borrowings and accrued interest under the Term Loan Facility and ABL Facility, with the remaining net proceeds used towards fees and expenses in connection with such repayments and the offering. In addition, the Company returned $27.7 million to shareholders during the thirty-nine weeks ended October 31, 2020, prior to the Company’s decision to temporarily suspend its share repurchase and dividend programs in light of COVID-19, as compared to $102.5 million during the thirty-nine weeks ended November 2, 2019.

Off-balance sheet arrangements

As of October 31, 2020, the Company did not have any material off-balance sheet arrangements.

Contractual obligations

The Company’s contractual obligations consist primarily of operating leases, purchase orders for merchandise inventory, unrecognized tax benefits, certain retirement obligations, lease deposits and other agreements to purchase goods and services that are legally binding and that require minimum quantities to be purchased. These contractual obligations impact the Company’s short-term and long-term liquidity and capital resource needs.

During the thirteen weeks ended August 1, 2020, the Company issued the Senior Secured Notes, which mature in July 2025. The Company received $350.0 million in proceeds from this transaction and repaid all outstanding borrowings under the ABL Facility and the Term Loan Facility. Based on the aggregate principal amount of the Senior Secured Notes outstanding as of October 31, 2020, estimated interest payments related to the Senior Secured Notes are as follows:

(in thousands)	Total		Fiscal 2020		Fiscal 2021-Fiscal 2023		Fiscal 2024-Fiscal 2025		Fiscal 2026 and thereafter
Interest payments due by period	$	154,231	$	16,418	$	91,875	$	45,938	$	—

There have been no material changes during the thirteen weeks ended October 31, 2020 in the contractual obligations as of February 1, 2020, with the exception of those obligations which occurred in the normal course of business (primarily changes in the Company’s merchandise inventory-related purchases and lease obligations, which fluctuate throughout the year as a result of the seasonal nature of the Company’s operations).

RECENT ACCOUNTING PRONOUNCEMENTS

The Company describes its significant accounting policies in Note 2, “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES,” of the Notes to Consolidated Financial Statements contained in “ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA” of A&F’s Annual Report on Form 10-K for Fiscal 2019. 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.

40

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The Company describes its critical accounting policies and estimates in “ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS,” of A&F’s Annual Report on Form 10-K for Fiscal 2019. There have been no significant changes in critical accounting policies and estimates since the end of Fiscal 2019.

In Fiscal 2020, the Company incurred significant asset impairment charges which were principally the result of the impact of COVID-19 and were related to certain of the Company’s stores across brands, geographies and store formats. Additional details regarding the Company's long-lived assets are as follows:

Policy	Effect if Actual Results Differ from Assumptions
Long-lived Assets
Long-lived assets, primarily operating lease right-of-use assets, leasehold improvements, furniture, fixtures and equipment, are tested for recoverability whenever events or changes in circumstances indicate that the carrying amount of the long-lived asset group might not be recoverable. These include, but are not limited to, material declines in operational performance, a history of losses, an expectation of future losses, adverse market conditions and store closure or relocation decisions. On at least a quarterly basis, the Company reviews for indicators of impairment at the individual store level, the lowest level for which cash flows are identifiable. Stores that display an indicator of impairment are subjected to an impairment assessment. The Company’s impairment assessment requires management to make assumptions and judgments related, but not limited, to management’s expectations for future operations and projected cash flows. The key assumptions used in the Company’s undiscounted future store cash flow models include sales, gross profit and, to a lesser extent, operating expenses. An impairment loss may be recognized when these undiscounted future cash flows are less than the carrying amount of the asset group. In the circumstance of impairment, any loss would be measured as the excess of the carrying amount of the asset group over its fair value. Fair value of the Company’s store-related assets is determined at the individual store level based on the highest and best use of the asset group. The key assumptions used in the Company’s fair value analysis may include discounted future store cash flows and comparable market rents.	If actual results are not consistent with the estimates and assumptions used, there may be a material impact on the Company’s financial condition or results of operation. Store assets that were tested for impairment as of October 31, 2020 and not impaired, had long-lived assets with a net book value of $132.2 million, which included $108.8 million of operating lease right-of-use assets, as of October 31, 2020. Store assets that were previously impaired as of October 31, 2020, had a remaining net book value of $124.8 million, which included $114.1 million of operating lease right-of-use assets, as of October 31, 2020.

41

NON-GAAP FINANCIAL MEASURES

This Quarterly Report on Form 10-Q includes discussion of certain financial measures on both a GAAP and a non-GAAP basis. The Company believes that each of the non-GAAP financial measures presented in this “ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS” is useful to investors as it provides a meaningful basis to evaluate the Company’s operating performance excluding the effect of certain items that the Company believes do not reflect its future operating outlook, such as certain asset impairment charges related to the Company’s flagship stores and significant impairments primarily attributable to the COVID-19 pandemic, therefore supplementing investors’ understanding of comparability of operations across periods. Management used these non-GAAP financial measures during the periods presented to assess the Company’s performance and to develop expectations for future operating performance. These non-GAAP financial measures should be used as a supplement to, and not as an alternative to, the Company’s GAAP financial results, and may not be calculated in the same manner as similar measures presented by other companies.

Comparable sales

At times, the Company provides comparable sales, defined as the year-over-year percentage change in the aggregate of (1) sales for stores that have been open as the same brand at least one year and whose square footage has not been expanded or reduced by more than 20% within the past year, with the prior year’s net sales converted at the current year’s foreign currency exchange rates to remove the impact of foreign currency exchange rate fluctuations, and (2) digital sales with the prior year’s net sales converted at the current year’s foreign currency exchange rates to remove the impact of foreign currency exchange rate fluctuations. Comparable sales exclude revenue other than store and digital sales. Management uses comparable sales to understand the drivers of year-over-year changes in net sales and believes comparable sales is a useful metric as it can assist investors in distinguishing the portion of the Company’s revenue attributable to existing locations from the portion attributable to the opening or closing of stores. The most directly comparable GAAP financial measure is change in net sales. In light of store closures related to COVID-19, the Company has not disclosed comparable sales for Fiscal 2020.

Excluded items

The following financial measures are disclosed on a GAAP and on an adjusted non-GAAP basis excluding the following items, as applicable:

Financial measures (1)	Excluded items
Asset impairment, exclusive of flagship store exit charges	Certain asset impairment charges
Operating income (loss)	Certain asset impairment charges
Income tax expense (benefit) (2)	Tax effect of pre-tax excluded items
Net income (loss) and net income (loss) per share attributable to A&F (2)	Pre-tax excluded items and the tax effect of pre-tax excluded items

(1) Certain of these financial measures are also expressed as a percentage of net sales.

(2)    The tax effect of excluded items is the difference between the tax provision calculation on a GAAP basis and on an adjusted non-GAAP basis.

42

Financial information on a constant currency basis

The Company provides certain financial information on a constant currency basis to enhance investors’ understanding of underlying business trends and operating performance by removing the impact of foreign currency exchange rate fluctuations. Management also uses financial information on a constant currency basis to award employee performance-based compensation. The effect from foreign currency exchange rates, calculated on a constant currency basis, is determined by applying the current period’s foreign currency exchange rates to the prior year’s results and is net of the year-over-year impact from hedging. The per diluted share effect from foreign currency exchange rates is calculated using a 26% effective tax rate.

A reconciliation of financial metrics on a constant currency basis to GAAP for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 follows:

(in thousands, except change in net sales, gross profit rate, operating margin and per share data)	Thirteen Weeks Ended					Thirty-nine Weeks Ended
Net sales	October 31, 2020		November 2, 2019		% Change	October 31, 2020		November 2, 2019		% Change
GAAP	$	819,653	$	863,472	(5)%	$	2,003,340	$	2,438,522	(18)%
Impact from changes in foreign currency exchange rates	—		11,896		(1)%	—		2,948		—%
Non-GAAP on a constant currency basis	$	819,653	$	875,368	(6)%	$	2,003,340	$	2,441,470	(18)%
Gross profit, exclusive of depreciation and amortization expense	October 31, 2020		November 2, 2019		BPS Change (1)	October 31, 2020		November 2, 2019		BPS Change (1)
GAAP	$	524,433	$	518,931	390	$	1,212,186	$	1,461,654	60
Impact from changes in foreign currency exchange rates	—		14,779		(90)	—		7,323		(30)
Non-GAAP on a constant currency basis	$	524,433	$	533,710	300	$	1,212,186	$	1,468,977	30
Operating income (loss)	October 31, 2020		November 2, 2019		BPS Change (1)	October 31, 2020		November 2, 2019		BPS Change (1)
GAAP	$	58,616	$	14,479	550	$	(136,368)	$	(41,795)	(470)
Excluded items (2)	(6,329)		(10,468)		50	(57,340)		—		(250)
Adjusted non-GAAP	$	64,945	$	24,947	500	$	(79,028)	$	(41,795)	(220)
Impact from changes in foreign currency exchange rates	—		7,410		(80)	—		5,221		20
Adjusted non-GAAP on a constant currency basis	$	64,945	$	32,357	420	$	(79,028)	$	(36,574)	(240)
Net income (loss) per diluted share attributable to A&F (3)	October 31, 2020		November 2, 2019		$ Change	October 31, 2020		November 2, 2019		$ Change
GAAP	$	0.66	$	0.10	$0.56	$	(3.14)	$	(0.67)	$(2.47)
Excluded items, net of tax (2)	(0.09)		(0.12)		0.03	(0.86)		(0.12)		(0.74)
Adjusted non-GAAP	$	0.76	$	0.23	$0.53	$	(2.28)	$	(0.55)	$(1.73)
Impact from changes in foreign currency exchange rates	—		0.15		(0.15)	—		0.12		(0.12)
Adjusted non-GAAP on a constant currency basis	$	0.76	$	0.37	$0.39	$	(2.28)	$	(0.43)	$(1.85)

(1)    The estimated basis point change has been rounded based on the change in the percentage of net sales.

(2)    Excluded items for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 consist of pre-tax store asset impairment charges and the tax effect of pre-tax excluded items.

43

Item 3. Quantitative and Qualitative Disclosures About Market Risk

INVESTMENT SECURITIES

The Company maintains its cash equivalents in financial instruments, primarily time deposits and money market funds, with original maturities of three months or less. Due to the short-term nature of these instruments, changes in interest rates are not expected to materially affect the fair value of these financial instruments.

The Rabbi Trust includes amounts to meet funding obligations to participants in the Abercrombie & Fitch Co. Nonqualified Savings and Supplemental Retirement Plan I, the Abercrombie & Fitch Co. Nonqualified Savings and Supplemental Retirement Plan II and the Supplemental Executive Retirement Plan. The Rabbi Trust assets primarily consist of trust-owned life insurance policies which are recorded at cash surrender value. The change in cash surrender value of the trust-owned life insurance policies held in the Rabbi Trust resulted in realized gains of $0.4 million and $1.4 million for the thirteen and thirty-nine weeks ended October 31, 2020, respectively, and $0.8 million and $2.4 million for the thirteen and thirty-nine weeks ended November 2, 2019, respectively. These gains are recorded in interest expense, net on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

The Rabbi Trust assets are included in other assets on the Condensed Consolidated Balance Sheets as of October 31, 2020 and February 1, 2020, and are restricted in their use as noted above.

INTEREST RATE RISK

Prior to July 2, 2020, our exposure to market risk due to changes in interest rates related primarily to the increase or decrease in the amount of interest expense from fluctuations in the LIBO rate, or an alternate base rate associated with the Term Loan Facility and ABL Facility. On July 2, 2020 the Company issued the Senior Secured Notes due in 2025 with a 8.75% fixed interest rate per annum and repaid all outstanding borrowings under the Term Loan Facility and the ABL Facility, thereby eliminating any then existing cash flow market risk due to changes in interest rates. The Senior Secured Notes are exposed to interest rate risk that is limited to changes in fair value. This analysis for the remainder of Fiscal 2020 may differ from the actual results due to potential changes in gross borrowings outstanding under the ABL Facility and potential changes in interest rate terms and limitations described within the credit agreement.

The expected transition from the widespread use of LIBO rate to alternative rates over the next several years is not expected to have a material impact on the Company’s interest expense. In addition, the Company has seen, and may continue to see, lower interest income earned on the Company’s investments and cash holdings, reflecting the lower interest rate environment.

FOREIGN CURRENCY EXCHANGE RATE RISK

A&F’s international subsidiaries generally operate with functional currencies other than the U.S. Dollar. Since the Company’s Condensed Consolidated Financial Statements are presented in U.S. Dollars, the Company must translate all components of these financial statements from functional currencies into U.S. Dollars at exchange rates in effect during or at the end of the reporting period. The fluctuation in the value of the U.S. Dollar against other currencies affects the reported amounts of revenues, expenses, assets and liabilities. The potential impact of foreign currency exchange rate fluctuations increases as international operations relative to domestic operations increase.

A&F and its subsidiaries have exposure to changes in foreign currency exchange rates associated with foreign currency transactions and forecasted foreign currency transactions, including the purchase of inventory between subsidiaries and foreign-currency-denominated assets and liabilities. The Company has established a program that primarily utilizes foreign currency exchange forward contracts to partially offset the risks associated with the effects of certain foreign currency transactions and forecasted transactions. Under this program, increases or decreases in foreign currency exchange rate exposures are partially offset by gains or losses on foreign currency exchange forward contracts, to mitigate the impact of foreign currency exchange gains or losses. The Company does not use forward contracts to engage in currency speculation. Outstanding foreign currency exchange forward contracts are recorded at fair value at the end of each fiscal period.

Foreign currency exchange forward contracts are sensitive to changes in foreign currency exchange rates. The Company assessed the risk of loss in fair values from the effect of a hypothetical 10% devaluation of the U.S. Dollar against the exchange rates for foreign currencies under contract. Such a hypothetical devaluation would decrease derivative contract fair values by approximately $10.6 million. As the Company’s foreign currency exchange forward contracts are primarily designated as cash flow hedges of forecasted transactions, the hypothetical change in fair values would be expected to be largely offset by the net change in fair values of the underlying hedged items.Refer to Note 14, “DERIVATIVE INSTRUMENTS,” for the fair value of outstanding foreign currency exchange forward contracts included in other current assets and accrued expenses as of October 31, 2020 and February 1, 2020.

44

Item 4.    Controls and Procedures

DISCLOSURE CONTROLS AND PROCEDURES

A&F maintains disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to provide reasonable assurance that information required to be disclosed in the reports that A&F files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to A&F’s management, including A&F’s principal executive officer and A&F’s principal financial officer, as appropriate to allow timely decisions regarding required disclosures. Because of inherent limitations, disclosure controls and procedures, no matter how well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of disclosure controls and procedures are met.

A&F’s management, including the Chief Executive Officer of A&F (who serves as Principal Executive Officer of A&F) and the Senior Vice President and Chief Financial Officer of A&F (who serves as Principal Financial Officer and Principal Accounting Officer of A&F), evaluated the effectiveness of A&F’s design and operation of its disclosure controls and procedures as of the end of the fiscal quarter ended October 31, 2020. The Chief Executive Officer of A&F (in such individual’s capacity as the Principal Executive Officer of A&F) and the Senior Vice President and Chief Financial Officer of A&F (in such individual’s capacity as the Principal Financial Officer of A&F) concluded that A&F’s disclosure controls and procedures were effective at a reasonable level of assurance as of October 31, 2020, the end of the period covered by this Quarterly Report on Form 10-Q.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There were no changes in A&F’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during A&F’s fiscal quarter ended October 31, 2020 that materially affected, or are reasonably likely to materially affect, A&F’s internal control over financial reporting.

As the COVID-19 pandemic evolves, the Company will continue to monitor and assess any potential impacts COVID-19 may have on the design and operating effectiveness of the Company’s internal controls.

45

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

The Company is a defendant in lawsuits and other adversary proceedings arising in the ordinary course of business. The Company’s legal costs incurred in connection with the resolution of claims and lawsuits are generally expensed as incurred, and the Company establishes estimated liabilities for the outcome of litigation where losses are deemed probable and the amount of loss, or range of loss, is reasonably estimable. The Company also determines estimates of reasonably possible losses or ranges of reasonably possible losses in excess of related accrued liabilities, if any, when it has determined that a loss is reasonably possible and it is able to determine such estimates. The Company’s accrued charges for certain legal contingencies are classified within accrued expenses on the Condensed Consolidated Balance Sheets included in “ITEM 1. FINANCIAL STATEMENTS (UNAUDITED),” of this Quarterly Report on Form 10-Q. Based on currently available information, the Company cannot estimate a range of reasonably possible losses in excess of the accrued charges for legal contingencies. In addition, the Company has not established accruals for certain claims and legal proceedings pending against the Company where it is not possible to reasonably estimate the outcome or potential liability, and the Company cannot estimate a range of reasonably possible losses for these legal matters. Actual liabilities may differ from the amounts recorded, due to uncertainties regarding final settlement agreement negotiations, court approvals and the terms of any approval by the courts, and there can be no assurance that the final resolution of legal matters will not have a material adverse effect on the Company’s financial condition, results of operations or cash flows. The Company’s assessment of the current exposure could change in the event of the discovery of additional facts.

Item 1A. Risk Factors.

The Company’s risk factors as of October 31, 2020 have not changed materially from those disclosed in Part I, “ITEM 1A. RISK FACTORS” of A&F’s Annual Report on Form 10-K for Fiscal 2019 and those furnished under “Item 7.01, Regulation FD Disclosure” of A&F’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 17, 2020, other than those disclosed below due to the issuance of the Senior Secured Notes and termination of the Term Loan Facility during the thirteen weeks ended August 1, 2020. The COVID-19 pandemic may exacerbate the risks discussed within the aforementioned Annual Report on Form 10-K and Current Report on Form 8-K, certain of which have had and could continue to have a material effect on the Company.

The risk factor titled “Our credit facilities include restrictive covenants that limit our flexibility in operating our business and our inability to obtain credit on reasonable terms in the future could have an adverse impact on our business” has been modified to read in full as follows:

The agreements related to our senior secured asset-based revolving credit facility and our senior secured notes include restrictive covenants that limit our flexibility in operating our business and our inability to obtain credit on reasonable terms in the future could have an adverse impact on our business.

Our senior secured asset-based revolving credit agreement, as amended (the “ABL Facility”) expires on October 19, 2022 and our senior secured notes, which have a fixed 8.75% interest rate, will mature on July 15, 2025 (the “Senior Secured Notes”). Both our ABL Facility and the indenture governing our Senior Secured Notes contain restrictive covenants that, subject to specified exemptions, restrict, among other things, the following: our ability to incur, assume or guarantee additional indebtedness; grant or incur liens; sell or otherwise dispose of assets, including capital stock of subsidiaries; make investments in certain subsidiaries; pay dividends or make distributions on our capital stock; redeem or repurchase capital stock; change the nature of our business; and consolidate or merge with or into, or sell substantially all of our assets to another entity.

If an event of default occurs, any outstanding obligations under the Senior Secured Notes and the ABL Facility could be declared immediately due and payable or the lenders could foreclose on or exercise other remedies with respect to the assets securing the indebtedness under the Senior Secured Notes and the ABL Facility. In addition, there is no assurance that we would have the cash resources available to repay such accelerated obligations. In addition, the Senior Secured Notes and ABL Facility are secured by certain of our real property, intellectual property, general intangibles and receivables, among other things, and lenders may exercise remedies against the collateral in the event of our default.

We have, and expect to continue to have, a level of indebtedness. In addition, we may, from time to time, incur additional indebtedness. We may need to refinance all or a portion of our existing indebtedness before maturity, including the Senior Secured Notes, and any indebtedness under the ABL Facility. There can be no assurance that we would be able to obtain sufficient funds to enable us to repay or refinance our debt obligations on commercially

46

reasonable terms, or at all. Changes in market conditions could potentially impact the size and terms of a replacement facility or facilities in the future. The inability to obtain credit on commercially reasonable terms in the future could adversely impact our liquidity and results of operations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

There were no sales of equity securities during the third quarter of Fiscal 2020 that were not registered under the Securities Act of 1933, as amended.

The following table provides information regarding the purchase of shares of Common Stock of A&F made by or on behalf of A&F or any “affiliated purchaser” as defined in Rule 10b-18(a)(3) under the Securities Exchange Act of 1934, as amended, during each fiscal month of the thirteen weeks ended October 31, 2020:

Period (fiscal month)	Total Number of Shares Purchased (1)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2)	Maximum Number of Shares that May Yet Be Purchased under the Plans or Programs (3)
August 2, 2020 through August 29, 2020	1,569	$	11.41	—	3,218,058
August 30, 2020 through October 3, 2020	5,324	$	13.58	—	3,218,058
October 4, 2020 through October 31, 2020	3,594	$	16.27	—	3,218,058
Total	10,487	$	14.18	—	3,218,058

(1)All 10,487 shares of A&F’s Common Stock purchased during the thirteen weeks ended October 31, 2020 were withheld for tax payments due upon the vesting of employee restricted stock units.

(2)On June 12, 2019, A&F’s Board of Directors authorized the repurchase of 5.0 million shares of A&F’s Common Stock, which was announced on June 12, 2019.

(3)The number shown represents, as of the end of each period, the maximum number of shares of A&F’s Common Stock that may yet be purchased under A&F’s publicly announced stock repurchase authorization described in footnote 2 above. The shares may be purchased, from time to time, depending on business and market conditions. The Company has temporarily suspended its share repurchase program in order to preserve liquidity and maintain financial flexibility in light of the circumstances surrounding COVID-19.

47

Item 6. Exhibits

Exhibit	Document
3.1	Amended and Restated Certificate of Incorporation of Abercrombie & Fitch Co., reflecting amendments through the date of this Quarterly Report on Form 10-Q, incorporated herein by reference to Exhibit 3.2 to A&F’s Quarterly Report on Form 10-Q for the quarterly period ended July 30, 2011 (File No. 001-12107). [This document represents the Amended and Restated Certificate of Incorporation of Abercrombie & Fitch Co. in compiled form incorporating all amendments. This compiled document has not been filed with the Delaware Secretary of State.]
3.2	Amended and Restated Bylaws of Abercrombie & Fitch Co. reflecting amendments through the date of this Quarterly Report on Form 10-Q, incorporated herein by reference to Exhibit 3.10 to A&F’s Annual Report on Form 10-K for the fiscal year ended February 3, 2018 (File No. 001-12107). [This document represents the Amended and Restated Bylaws of Abercrombie & Fitch Co. in compiled form incorporating all amendments.]
10.1	Form of Performance Share Award Agreement used to evidence the grant of performance shares to associates (employees) of Abercrombie & Fitch Co. and its subsidiaries under the Abercrombie & Fitch Co. 2016 Long-Term Incentive Plan for Associates on or after August 28, 2020.*
10.2	Form of Retention Restricted Stock Unit Award Agreement, made to be effective as of August 28, 2020, between Abercrombie & Fitch Co. and each of Scott Lipesky, Kristin Scott and Gregory J. Henchel, incorporated herein by reference to Exhibit 10.1 to A&F’s Current Report on Form 8-K dated and filed on September 2, 2020 (File No. 001-12107).
31.1	Certifications by Chief Executive Officer (Principal Executive Officer) pursuant to Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2	Certifications by Senior Vice President and Chief Financial Officer (Principal Financial Officer) pursuant to Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1	Certifications by Chief Executive Officer (who serves as Principal Executive Officer) and Senior Vice President and Chief Financial Officer (who serves as Principal Financial Officer) pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**
101.INS	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its Inline XBRL tags are embedded within the Inline XBRL document.*
101.SCH	Inline XBRL Taxonomy Extension Schema Document.*
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document.*
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document.*
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document.*
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document.*
104	Cover Page Interactive Data File (formatted as Inline XBRL with applicable taxonomy extension information contained in Exhibits 101).*

*     Filed herewith.

**    Furnished herewith.

48

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Abercrombie & Fitch Co.
Date: December 7, 2020	By:	/s/ Scott Lipesky
		Scott Lipesky
		Senior Vice President and Chief Financial Officer (Principal Financial Officer, Principal Accounting Officer and Authorized Officer)

49

EX-10.1

EXHIBIT 10.1

PERFORMANCE SHARE AWARD AGREEMENT

(2016 Long-Term Incentive Plan for Associates)

This PERFORMANCE SHARE AWARD AGREEMENT (this “AGREEMENT”) is made to be effective as of August 28, 2020 (the date on which the COMMITTEE (as defined below) approves the award, referred to as the “GRANT DATE”), by and between Abercrombie & Fitch Co., a Delaware corporation (the “COMPANY”), and [EXECUTIVE], an employee (associate) of the COMPANY or of one of the COMPANY’s subsidiaries or affiliates (“PARTICIPANT”).

WITNESSETH:

WHEREAS, pursuant to the provisions of the 2016 Long-Term Incentive Plan for Associates of the COMPANY (the “PLAN”), the Compensation and Organization Committee (the “COMMITTEE”) of the Board of Directors of the COMPANY (the “BOARD”) administers the PLAN; and

WHEREAS, the COMMITTEE has determined that PARTICIPANT should be granted rights to earn a target number of shares of Class A Common Stock, $0.01 par value (the “SHARES”), of the COMPANY equal to XX,XXX SHARES (such rights, the “AWARD”), subject to the restrictions, conditions and other terms set forth in this AGREEMENT;

NOW, THEREFORE, in consideration of the premises, the parties hereto make the following agreement, intending to be legally bound thereby:

1. Grant of AWARD. Pursuant to, and subject to, the terms and conditions set forth in this AGREEMENT and in the PLAN, the COMPANY hereby grants to PARTICIPANT an AWARD representing the right to earn a target number of SHARES of the COMPANY (the “TARGET AWARD”) equal to XX,XXX SHARES (subject to adjustment as provided in Section 11(c) of the PLAN and Section 5(F) of this AGREEMENT, if applicable). The AWARD also represents the right to earn up to 200% of the TARGET AWARD, subject to the restrictions, conditions and other terms set forth in this AGREEMENT.

2. Terms and Conditions of the AWARD.

(A) EARNED UNITS. The issuance of SHARES of the COMPANY pursuant to this AGREEMENT shall be subject to the COMPANY’s level of achievement with respect to the performance goal of RELATIVE TOTAL SHAREHOLDER RETURN as set forth in the table below (the “PERFORMANCE GOAL”). If the PERFORMANCE GOAL for the three-fiscal-year period ending January 28, 2023(the “PERFORMANCE PERIOD”)does not equal or exceed the THRESHOLD performance level set forth in the table below, the AWARD and PARTICIPANT’s right to receive any SHARES of the COMPANY pursuant to this AGREEMENT shall expire and be forfeited without payment of any additional consideration, effective as of the last day of the fiscal year ending January 28, 2023. Subject to the foregoing, the number of “EARNED UNITS” for purposes of this AGREEMENT shall be determined in accordance with the following table:

(i) RELATIVE TOTAL SHAREHOLDER RETURN:

Performance Level	FY 2020 through FY 2022 Relative Total Shareholder Return (1) Required to Achieve Performance Leve	% of TARGET AWARD Earned
BELOW THRESHOLD	Below 30th percentile of COMPARATOR GROUP	0%
THRESHOLD	30th percentile as compared to COMPARATOR GROUP	25%
TARGET	55th percentile as compared to COMPARATOR GROUP	100%
MAXIMUM	At or above 80th percentile as compared to COMPARATOR GROUP	200%

(1) Relative Total Shareholder Return is measured against the following thirteen companies (the “COMPARATOR GROUP”): AMERICAN EAGLE OUTFITTERS, INC.; CARTER’S, INC.; CHICO’S FAS, INC.; THE CHILDREN’S PLACE, INC.; EXPRESS, INC.; FOSSIL GROUP, INC.; GUESS?, INC.; L BRANDS, INC.; LEVI STRAUSS & CO.; LULULEMON ATHLETICA INC.; RALPH LAUREN CORPORATION; TAPESTRY, INC.; and URBAN OUTFITTERS, INC. Relative Total Shareholder Return shall be measured as follows:

(a)Total Shareholder Return shall be measured using an average of the closing stock price for the 20 trading days immediately before the first day of the COMPANY’s 2020 fiscal year and an average of the closing stock price for the 20 trading days immediately before and including the last day of the COMPANY’s 2022 fiscal year. Total shareholder return shall assume dividend reinvestment on the ex-dividend date.

(b)For companies that are in the COMPARATOR GROUP as of the first day of the COMPANY’s 2020 fiscal year but that do not remain in the COMPARATOR GROUP through the last day of the COMPANY’s 2022 fiscal year, treatment will be as follows:

i.Acquisition – For a company that is acquired (other than in connection with merger activity) during the PERFORMANCE PERIOD, it shall be removed entirely from the COMPARATOR GROUP and thus not considered for measurement purposes;

ii.Merger – For a company that is impacted by merger activity during the PERFORMANCE PERIOD:

1.Such company shall be removed from the COMPARATOR GROUP (and thus not considered for measurement purposes) if it is not the surviving company following a merger with either a non-COMPARATOR GROUP company or another COMPARATOR GROUP company; or

2

2.Such company shall be included in the COMPARATOR GROUP if it is the surviving company following a merger with another COMPARATOR GROUP company; or

3.Such company shall be included in the COMPARATOR GROUP if it is the surviving company in a merger with a non-COMPARATOR GROUP company (unless 50% or more of such company’s post-merger business has a non-retail GICS code, in which case such company shall be removed from the COMPARATOR GROUP and thus not considered for measurement purposes).

iii.Spin-Off – For a company that is spun-off during the PERFORMANCE PERIOD, such company shall be removed from the COMPARATOR GROUP (and thus not considered for measurement purposes); however, the parent company of such spun-off company shall be included for measurement purposes if such parent company remains in the COMPARATOR GROUP and remains at least 50% of such company’s pre-spin-off size as measured by revenues.

iv.Bankruptcy – For a company that goes bankrupt (either voluntarily or involuntarily) during the PERFORMANCE PERIOD, such company shall be placed at the bottom of the COMPARATOR GROUP for measurement purposes, with a deemed negative Total Shareholder Return of (-100%).

(c)Payout shall be capped at the TARGET AWARD if the COMPANY’s Total Shareholder Return over the full PERFORMANCE PERIOD is negative. In the event that the COMPANY’s level of achievement with respect to the PERFORMANCE GOAL is between the THRESHOLD and the TARGET performance levels, or between the TARGET and the MAXIMUM performance levels, linear interpolation will be used to determine the number of EARNED UNITS. Any portion of the TARGET AWARD not earned based upon the actual level of performance achieved by the COMPANY shall expire and be forfeited to the COMPANY without payment of any additional consideration, effective as of the last day of the fiscal year ending January 28, 2023. The COMPANY’s level of achievement with respect to the PERFORMANCE GOAL set forth in this Section 2(A) (and the extent or lack thereof) shall be evidenced by the COMMITTEE’s written certification.

(B) RESTRICTED PERIOD. Except as provided under Sections 3 and 4 of this AGREEMENT, the period of restriction (the “RESTRICTED PERIOD”), after which the EARNED UNITS shall become vested and no longer be subject to forfeiture to the COMPANY (except as provided in Section 5 of this AGREEMENT), shall lapse according to the following terms. The VESTING DATE shall be defined as the date for vesting which is approved by the COMMITTEE following completion of the PERFORMANCE PERIOD and then recorded and communicated through the System of Record, but not later than 60 days after the completion of the PERFORMANCE PERIOD (or the date of the filing of the COMPANY’s Annual Report on Form 10-K for the fiscal year ending January 28, 2023, if sooner). The RESTRICTED PERIOD shall lapse as to one hundred percent of the EARNED UNITS (subject to adjustment as provided in Section 11(c) of the PLAN), and such EARNED UNITS shall become vested, on the VESTING DATE, provided PARTICIPANT is employed by the COMPANY or by a subsidiary or affiliate of the

3

COMPANY on the VESTING DATE and PARTICIPANT remains in compliance with all of the covenants in Section 5 of this AGREEMENT.

(C) Non-Transferability of AWARD. The AWARD and, during the RESTRICTED PERIOD, any EARNED UNITS may not be pledged, hypothecated or otherwise encumbered or subject to any lien, obligation or liability of PARTICIPANT to any party (other than the COMPANY or a subsidiary or affiliate of the COMPANY), or assigned or transferred (whether by operation of law or otherwise) by PARTICIPANT, otherwise than by will or by the applicable laws of descent and distribution, and the AWARD and, during the RESTRICTED PERIOD, any EARNED UNITS shall not be subject to execution, attachment or similar process.

(D) Lapse of RESTRICTED PERIOD. Upon the lapse of the RESTRICTED PERIOD, as promptly as is reasonably practicable following the VESTING DATE, and in no case later than the 15th day of the third month following the end of the PERFORMANCE PERIOD, SHARES of the COMPANY shall be issued to PARTICIPANT equal in number to the vested EARNED UNITS (with each EARNED UNIT representing the right to receive one SHARE of the COMPANY) and the COMPANY shall deliver a stock certificate or other appropriate documentation evidencing the number of SHARES of the COMPANY issued in settlement of the vested EARNED UNITS to PARTICIPANT. Notwithstanding the foregoing, any SHARES of the COMPANY issued under this AGREEMENT shall remain subject to a risk of forfeiture if PARTICIPANT violates any of the covenants set forth in Section 5 of this AGREEMENT.

(E) Tax Withholding. The COMPANY shall have the right to require PARTICIPANT to remit to the COMPANY an amount sufficient to satisfy any applicable federal, state, local and foreign tax withholding requirements in respect of settlement of the AWARD. Unless PARTICIPANT is notified otherwise, the COMPANY will withhold SHARES of the COMPANY otherwise deliverable upon settlement of the AWARD having a FAIR MARKET VALUE (as defined in the PLAN) on the date of settlement equal to the amount required to be withheld (but only to the extent of the minimum amount that must be withheld to comply with applicable federal, state, local and foreign income, employment and wage tax laws).

(F) Rights as Holder of AWARD. With respect to the AWARD, PARTICIPANT shall have no rights as a stockholder of the COMPANY (including no right to vote or receive dividends) with respect to any SHARES of the COMPANY covered by the AWARD until the date of issuance to PARTICIPANT of a stock certificate or other evidence of ownership representing such SHARES in settlement thereof. In addition, dividend equivalents will not be paid or payable with respect to the SHARES of the COMPANY and/or the EARNED UNITS subject to this AGREEMENT until such date of issuance.

3. Change of Control. Unless the BOARD or the COMMITTEE provides otherwise prior to a “Change of Control” (as such term is defined in the PLAN), upon a Change of Control, Section 9 of the PLAN shall govern the treatment of the AWARD. For the avoidance of doubt, the performance period under this AGREEMENT for purposes of Section 9(b) of the PLAN shall be the three-fiscal-year period ending January 28, 2023. Notwithstanding anything in Section 9(b) of the PLAN to the contrary, for all purposes under this AGREEMENT, in the event of a Change of Control in which fifty percent (50%) or more of the full PERFORMANCE PERIOD applicable to the AWARD has elapsed as of the date of the Change of Control, PARTICIPANT shall be entitled to a pro-rata payment, vesting or settlement of the AWARD based upon actual level of performance achieved by the COMPANY with respect to the PERFORMANCE GOAL for the full PERFORMANCE PERIOD, with such pro-ration to be based on the percentage of the PERFORMANCE PERIOD that has elapsed between the GRANT DATE and the date of the Change of Control. In the event of a Change of Control in which less than

4

fifty percent (50%) of the full PERFORMANCE PERIOD applicable to the AWARD has elapsed as of the date of the Change of Control, the PARTICIPANT shall be entitled to a pro-rata payment, vesting or settlement of the AWARD based upon a TARGET level of performance being achieved by the COMPANY with respect to the PERFORMANCE GOAL, with such pro-ration to be based on the percentage of the PERFORMANCE PERIOD that has elapsed between the GRANT DATE and the date of the Change of Control.

4. Effect of Termination of Employment.

(A) The grant of the AWARD shall not confer upon PARTICIPANT any right to continue in the employment of the COMPANY or any of the subsidiaries or affiliates of the COMPANY or interfere with or limit in any way the right of the COMPANY or any of the subsidiaries or affiliates of the COMPANY to modify the terms of or terminate the employment of PARTICIPANT at any time in accordance with applicable law and the COMPANY’s or the applicable subsidiary’s or affiliate’s governing corporate documents.

(B) Except as the COMMITTEE may at any time provide, if the employment of PARTICIPANT with the COMPANY and the subsidiaries and affiliates of the COMPANY is terminated by the COMPANY for “CAUSE” or as a result of PARTICIPANT’s resignation for any reason other than “retirement” or “total disability” (each, as defined below), in either case, prior to the lapsing of the RESTRICTED PERIOD applicable to the AWARD and/or any EARNED UNITS, such AWARD and/or the EARNED UNITS shall be forfeited to the COMPANY without payment of any consideration by the COMPANY. For purposes of this AGREEMENT only, “CAUSE” shall mean: (i) PARTICIPANT’s conviction of, or entrance of a plea of guilty or nolo contendere to, a felony under federal or state law; or (ii) fraudulent conduct by PARTICIPANT in connection with the business affairs of the COMPANY or of any of the subsidiaries or affiliates of the COMPANY; or (iii) PARTICIPANT’s willful refusal to materially perform PARTICIPANT’s duties; or (iv) PARTICIPANT’s willful misconduct which has, or would have if generally known, a materially adverse effect on the business or reputation of the COMPANY or of any of the subsidiaries or affiliates of the COMPANY; or (v) PARTICIPANT’S material breach of a covenant, representation, warranty or obligation of PARTICIPANT to the COMPANY or to any of the subsidiaries or affiliates of the COMPANY. As to the grounds stated in the above-mentioned clauses (iii), (iv), and (v), such grounds will only constitute CAUSE once the COMPANY has provided PARTICIPANT written notice thereof and PARTICIPANT has failed to cure such grounds within 30 days of receipt of such written notice.

(C) If PARTICIPANT’s employment is terminated by the COMPANY without CAUSE prior to the lapsing of the RESTRICTED PERIOD, such RESTRICTED PERIOD shall immediately lapse and (1) if such termination occurs within the first fiscal year during the PERFORMANCE PERIOD, the AWARD and/or the EARNED UNITS shall be forfeited to the COMPANY without payment of any consideration by the COMPANY, or (2) if such termination occurs after the completion of the first fiscal year during the PERFORMANCE PERIOD, the AWARD shall remain outstanding, the number of EARNED UNITS shall be based upon the actual level of performance achieved by the COMPANY with respect to the PERFORMANCE GOAL over the full PERFORMANCE PERIOD and then pro-rated for the number of days PARTICIPANT was employed during the full PERFORMANCE PERIOD, and such pro-rated number of EARNED UNITS shall become vested upon the COMMITTEE’s written certification of the level of performance achieved by the COMPANY with respect to the PERFORMANCE GOAL over the full PERFORMANCE PERIOD and payable as of the VESTING DATE notwithstanding the fact that PARTICIPANT is not employed as of the VESTING DATE and any portion of the AWARD that does not become vested shall be forfeited to the COMPANY without payment of any consideration by the COMPANY.

5

(D) If PARTICIPANT becomes totally disabled prior to the lapsing of the RESTRICTED PERIOD, the RESTRICTED PERIOD shall immediately lapse and (1) if such total disability occurs after the end of the PERFORMANCE PERIOD, the EARNED UNITS shall become fully vested and payable immediately, or (2) if such total disability occurs prior to the end of the PERFORMANCE PERIOD, the TARGET AWARD shall become fully vested and payable immediately. For purposes of this AGREEMENT, “total disability” shall mean the PARTICIPANT’s termination of employment after having become disabled, as that term is defined in the Abercrombie & Fitch Co. Long Term Disability Plan.

(E) If PARTICIPANT dies while employed by the COMPANY or one of the subsidiaries or affiliates of the COMPANY prior to the lapsing of the RESTRICTED PERIOD, the RESTRICTED PERIOD shall immediately lapse and (1) if PARTICIPANT’s death occurs after the end of the PERFORMANCE PERIOD, the EARNED UNITS shall become fully vested and payable immediately, or (2) if PARTICIPANT’s death occurs prior to the end of the PERFORMANCE PERIOD, the TARGET AWARD shall become fully vested and payable immediately.

(F) If PARTICIPANT retires from employment with the COMPANY and all of the subsidiaries and affiliates of the COMPANY at or after attaining the age of 65 (such termination of employment, a “retirement”) prior to the lapsing of the RESTRICTED PERIOD, the RESTRICTED PERIOD shall immediately lapse and the EARNED UNITS shall become fully vested and payable as of the VESTING DATE notwithstanding the fact that PARTICIPANT is not employed as of the VESTING DATE (provided that if such retirement occurs prior to January 28, 2023, the number of EARNED UNITS shall be based upon the actual level of performance achieved by the COMPANY with respect to the PERFORMANCE GOAL over the full PERFORMANCE PERIOD and such EARNED UNITS shall become fully vested upon the COMMITTEE’s written certification of the level of performance achieved by the COMPANY with respect to the PERFORMANCE GOAL and payable as of the VESTING DATE notwithstanding the fact that PARTICIPANT is not employed as of the VESTING DATE, and any portion of the AWARD that does not become vested shall be forfeited to the COMPANY without payment of any consideration by the COMPANY.

5. Forfeiture of AWARD.

(A) The AWARD and any EARNED UNITS shall be subject to the following additional forfeiture conditions, to which PARTICIPANT, by accepting the AWARD, agrees. If any of the events specified in Section 5(B)(i), (ii), (iii) or (iv) of this AGREEMENT occurs (a “FORFEITURE EVENT”), the following forfeiture will result, in each case without payment of any consideration by the COMPANY:

(i) the AWARD and any EARNED UNITS held by PARTICIPANT and not then settled will be immediately forfeited to the COMPANY and canceled upon the occurrence of the FORFEITURE EVENT; and

(ii) PARTICIPANT will be obligated to repay to the COMPANY, in cash, within five business days after demand is made therefor by the COMPANY, the total amount of “AWARD GAIN” (as defined below) realized by PARTICIPANT upon settlement of the AWARD on or after (x) the date that is twenty-four months prior to the occurrence of the FORFEITURE EVENT, if the FORFEITURE EVENT occurred while PARTICIPANT was employed by the COMPANY or a subsidiary or affiliate of the COMPANY, or (y) the date that is twenty-four months prior to the date PARTICIPANT’s employment by the COMPANY or a subsidiary or affiliate of the COMPANY terminated, if the FORFEITURE EVENT occurred after PARTICIPANT ceased to be so employed.

6

For purposes of this AGREEMENT, the term “AWARD GAIN” shall mean, in respect of settlement of the AWARD, the FAIR MARKET VALUE of the SHARES of the COMPANY paid or payable to PARTICIPANT (regardless of any elective deferrals).

(B) The forfeitures specified in Section 5(A) of this AGREEMENT will be triggered upon the occurrence of any one of the following FORFEITURE EVENTS at any time during PARTICIPANT’s employment by the COMPANY or a subsidiary or affiliate of the COMPANY, or during the twenty-four-month period following termination of such employment:

(i) PARTICIPANT, acting alone or with others, directly or indirectly, (I) engages, either as employee, employer, consultant, advisor, or director, or as an owner, investor, partner, or stockholder unless PARTICIPANT’s interest is insubstantial, in any business in an area or region in which the COMPANY or any subsidiary or affiliate of the COMPANY conducts business at the date the event occurs, which is directly in competition with a business then conducted by the COMPANY or a subsidiary or affiliate of the COMPANY; (II) induces any customer or supplier of the COMPANY or a subsidiary or affiliate of the COMPANY, with which the COMPANY or a subsidiary or affiliate of the COMPANY has a business relationship, to curtail, cancel, not renew, or not continue his or her or its business with the COMPANY or any subsidiary or affiliate of the COMPANY; or (III) induces, or attempts to influence, any employee of or service provider to the COMPANY or a subsidiary or affiliate of the COMPANY to terminate such employment or service. The COMMITTEE shall, in its discretion, determine which lines of business the COMPANY and the subsidiaries and affiliates of the COMPANY conduct on any particular date and which third parties may reasonably be deemed to be in competition with the COMPANY or any subsidiary or affiliate of the COMPANY. For purposes of this Section 5(B)(i), PARTICIPANT’s interest as a stockholder is insubstantial if it represents beneficial ownership of less than five percent of the outstanding class of stock, and PARTICIPANT’s interest as an owner, investor, or partner is insubstantial if it represents ownership, as determined by the COMMITTEE in its discretion, of less than five percent of the outstanding equity of the entity;

(ii) PARTICIPANT discloses, uses, sells, or otherwise transfers, except in the course of employment with or other service to the COMPANY or any subsidiary or affiliate of the COMPANY, any confidential or proprietary information of the COMPANY or any subsidiary or affiliate of the COMPANY, including but not limited to information regarding the COMPANY’s or any subsidiary’s or affiliate’s current and potential customers, organization, employees, finances, and methods of operations and investments, so long as such information has not otherwise been disclosed to the public or is not otherwise in the public domain (other than by PARTICIPANT’s breach of this provision), except as required by law or pursuant to legal process, or PARTICIPANT makes statements or representations, or otherwise communicates, directly or indirectly, in writing, orally, or otherwise, or takes any other action which may, directly or indirectly, disparage or be damaging to the COMPANY or any of the subsidiaries or affiliates of the COMPANY or their respective officers, directors, employees, advisors, businesses or reputations, except as required by law or pursuant to legal process;

(iii) PARTICIPANT fails to cooperate with the COMPANY or any subsidiary or affiliate of the COMPANY in any way, including, without limitation, by making PARTICIPANT available to testify on behalf of the COMPANY or such subsidiary or affiliate of the COMPANY in any action, suit, or proceeding, whether civil, criminal, administrative, or investigative, or otherwise fails to assist the COMPANY or any subsidiary or affiliate of the COMPANY in any way, including, without limitation, in connection with any such action, suit, or proceeding by providing information and meeting and consulting with members of management of, other representatives of, or

7

counsel to, the COMPANY or such subsidiary or affiliate of the COMPANY, as reasonably requested; or

(iv) PARTICIPANT, during the period PARTICIPANT is employed by the COMPANY or any subsidiary or affiliate of the COMPANY and for twenty-four months thereafter (the “NON-SOLICITATION PERIOD”), alone or in conjunction with another person, (I) interferes with or harms, or attempts to interfere with or harm, the relationship of the COMPANY or any subsidiary or affiliate of the COMPANY with any person who at any time was a customer or supplier of the COMPANY or any subsidiary or affiliate of the COMPANY or otherwise had a business relationship with the COMPANY or any subsidiary or affiliate of the COMPANY; or (II) hires, solicits for hire, aids in or facilitates the hire, or causes to be hired, either as an employee, contractor or consultant, any person who is currently employed, or was employed at any time during the six-month period prior thereto, as an employee, contractor or consultant of the COMPANY or any subsidiary or affiliate of the COMPANY.

(C) Despite the conditions set forth in this Section 5, PARTICIPANT is not hereby prohibited from engaging in any activity set forth in Section 5(B)(i) of this AGREEMENT, including but not limited to competition with the COMPANY and the subsidiaries and affiliates of the COMPANY. Rather, the non-occurrence of the FORFEITURE EVENTS set forth in Section 5(B) of this AGREEMENT is a condition to PARTICIPANT’s right to realize and retain value from the AWARD, and the consequences under the PLAN and this AGREEMENT if PARTICIPANT engages in an activity giving rise to any such FORFEITURE EVENTS are the forfeitures specified therein and as otherwise provided in this AGREEMENT. The COMPANY and PARTICIPANT shall not be precluded by this provision or otherwise from entering into other agreements concerning the subject matter of Sections 5(A) and 5(B) of this AGREEMENT.

(D) The COMMITTEE may, in its discretion, waive in whole or in part the COMPANY’s right to forfeiture under this Section 5, but no such waiver shall be effective unless evidenced by a writing signed by a duly authorized officer of the COMPANY.

(E) In addition to the other provisions of this Section 5, PARTICIPANT agrees that any of the conduct described in Sections 5(B)(ii) and 5(B)(iv) of this AGREEMENT would result in irreparable injury and damage to the COMPANY for which the COMPANY would have no adequate remedy at law. PARTICIPANT agrees that in the event of such conduct or any threat thereof, the COMPANY shall be entitled to an immediate injunction and restraining order to prevent such conduct and threatened conduct and/or continued conduct by PARTICIPANT and/or any and all persons and/or entities acting for and/or with PARTICIPANT, and without having to prove damages and to all costs and expenses incurred by the COMPANY in seeking to enforce the COMPANY’s rights under this AGREEMENT. These remedies are in addition to any other remedies to which the COMPANY may be entitled at law or in equity. PARTICIPANT agrees that the covenants of PARTICIPANT contained in Section 5(B) of this AGREEMENT are reasonable. For the same reasons, the COMPANY shall be entitled to an immediate injunction without having to prove damages to enforce the COMPANY’s right to cause the AWARD and/or EARNED UNITS to be forfeited by PARTICIPANT pursuant to Section 5(A) and 5(C) for a violation of Section 5(B)(i).

(F) If the COMMITTEE determines that the earlier determination as to the level of performance achieved by the COMPANY with respect to the PERFORMANCE GOAL for the full PERFORMANCE PERIOD was based on incorrect data and that in fact such level of performance with respect to the PERFORMANCE GOAL for the full PERFORMANCE PERIOD had not been achieved or had been achieved to a lesser extent than originally determined and a

8

number of the EARNED UNITS would not have been earned and/or vested, given the correct data, then (i) the aggregate number of SHARES of the COMPANY subject to the TARGET AWARD set forth in Section 1 of this AGREEMENT, and/or the aggregate number of EARNED UNITS earned hereunder, shall be reduced by such number of EARNED UNITS that would not have been earned and/or vested (such EARNED UNITS, the “EXCESS UNITS”), (ii) any EXCESS UNITS that have not yet vested in accordance with the terms of this AGREEMENT shall be forfeited to the COMPANY without payment of any consideration by the COMPANY and (iii) any SHARES of the COMPANY received upon settlement of vested EXCESS UNITS (or if such SHARES were disposed of, the cash equivalent thereof) shall be returned to the COMPANY as provided by the COMMITTEE.

6. Restrictions on Transfers of SHARES. Anything contained in this AGREEMENT or elsewhere to the contrary notwithstanding, the COMPANY may postpone the issuance and delivery of SHARES of the COMPANY upon settlement of the AWARD until completion of any stock exchange listing or registration or other qualification of such SHARES under any state, federal or foreign law, rule or regulation as the COMPANY may consider appropriate; and may require PARTICIPANT in connection with the issuance of the SHARES to make such representations and furnish such information as the COMPANY may consider appropriate in connection with the issuance of the SHARES in compliance with applicable laws, rules and regulations. SHARES of the COMPANY issued and delivered upon settlement of the AWARD shall be subject to such restrictions on trading, including appropriate legending of stock certificates to that effect, as the COMPANY, in its discretion, shall determine are necessary to satisfy applicable laws, rules and regulations.

7. PLAN as Controlling; PARTICIPANT Acknowledgments. All terms and conditions of the PLAN applicable to the AWARD which are not set forth in this AGREEMENT shall be deemed incorporated herein by reference. In the event that any term or condition of this AGREEMENT is inconsistent with the terms and conditions of the PLAN, the PLAN shall be deemed controlling. PARTICIPANT acknowledges receipt of a copy of the PLAN and of the Prospectus related to the PLAN. PARTICIPANT also acknowledges that all decisions, determinations and interpretations of the COMMITTEE in respect of the PLAN, this AGREEMENT and the AWARD shall be final, conclusive and binding on PARTICIPANT, all other persons interested in the PLAN and stockholders of the COMPANY.

8. Governing Law. To the extent not preempted by applicable federal or foreign law, this AGREEMENT shall be governed by and construed in accordance with the laws of the State of Delaware, except with respect to provisions relating to the covenants set forth in Section 5 of this AGREEMENT, which shall be governed by the laws of the State of Ohio.

9. Rights and Remedies Cumulative. All rights and remedies of the COMPANY and of PARTICIPANT enumerated in this AGREEMENT shall be cumulative and, except as expressly provided otherwise in this AGREEMENT, none shall exclude any other rights or remedies allowed by law or in equity, and each of said rights or remedies may be exercised and enforced concurrently.

10. Captions. The captions contained in this AGREEMENT are included only for convenience of reference and do not define, limit, explain or modify this AGREEMENT or its interpretation, construction or meaning and are in no way to be construed as a part of this AGREEMENT.

11. Severability. If any provision of this AGREEMENT or the application of any provision hereof to any person or any circumstance shall be determined to be invalid or unenforceable, then such determination shall not affect any other provision of this AGREEMENT or the application of said

9

provision to any other person or circumstance, all of which other provisions shall remain in full force and effect, and it is the intention of each party to this AGREEMENT that if any provision of this AGREEMENT is susceptible of two or more constructions, one of which would render the provision enforceable and the other or others of which would render the provision unenforceable, then the provision shall have the meaning which renders it enforceable.

12. Number and Gender. When used in this AGREEMENT, the number and gender of each pronoun shall be construed to be such number and gender as the context, circumstances or its antecedent may require.

13. Entire Agreement. This AGREEMENT, including the PLAN incorporated herein by reference, constitutes the entire agreement between the COMPANY and PARTICIPANT in respect of the subject matter of this AGREEMENT, and this AGREEMENT supersedes all prior and contemporaneous agreements between the parties hereto in connection with the subject matter of this AGREEMENT. No officer, employee or other servant or agent of the COMPANY, and no servant or agent of PARTICIPANT, is authorized to make any representation, warranty or other promise not contained in this AGREEMENT. Other than as set forth in Section 11(e) of the PLAN, no change, termination or attempted waiver of any of the provisions of this AGREEMENT shall be binding upon either party hereto unless contained in a writing signed by the party to be charged.

14. Successors and Assigns of the COMPANY. The obligations of the COMPANY under this AGREEMENT shall be binding upon any successor corporation or organization resulting from the merger, consolidation or other reorganization of the COMPANY, or upon any successor corporation or organization succeeding to substantially all of the assets and businesses of the COMPANY.

[Remainder of page intentionally left blank; signature page follows]

10

IN WITNESS WHEREOF, the COMPANY has caused this AGREEMENT to be executed by its duly authorized officer, and PARTICIPANT has executed this AGREEMENT, in each case effective as of the GRANT DATE.

COMPANY:

ABERCROMBIE & FITCH CO.

By:

Title: Chief Executive Officer

PARTICIPANT:

Printed Name:

Address:

11

EX-31.1

EXHIBIT 31.1

CERTIFICATIONS

I, Fran Horowitz, certify that:

1.    I have reviewed this Quarterly Report on Form 10-Q of Abercrombie & Fitch Co. for the quarterly period ended October 31, 2020;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;    

(c)    Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.    The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

	Abercrombie & Fitch Co.
Date: December 7, 2020	By:	/s/ Fran Horowitz
		Fran Horowitz
		Chief Executive Officer
		(Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATIONS

I, Scott Lipesky, certify that:

1.    I have reviewed this Quarterly Report on Form 10-Q of Abercrombie & Fitch Co. for the quarterly period ended October 31, 2020;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;    

(c)    Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.    The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

	Abercrombie & Fitch Co.
Date: December 7, 2020	By:	/s/ Scott Lipesky
		Scott Lipesky
		Senior Vice President and Chief Financial Officer
		(Principal Financial Officer)

EX-32.1

EXHIBIT 32.1

Certifications by Chief Executive Officer (who serves as Principal Executive Officer) and Senior Vice President and Chief Financial Officer (who serves as Principal Financial Officer) pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

In connection with the Quarterly Report of Abercrombie & Fitch Co. (the “Corporation”) on Form 10-Q for the quarterly period ended October 31, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned Fran Horowitz, Chief Executive Officer of the Corporation (serving as Principal Executive Officer of the Corporation) and Scott Lipesky, Senior Vice President and Chief Financial Officer of the Corporation (serving as Principal Financial Officer of the Corporation), certify, pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)    The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and

(2)    The information contained in the Report fairly presents, in all material respects, the consolidated financial condition and results of operations of the Corporation and its subsidiaries.

/s/ Fran Horowitz	/s/ Scott Lipesky
Fran Horowitz Chief Executive Officer (Principal Executive Officer)	Scott Lipesky Senior Vice President and Chief Financial Officer (Principal Financial Officer)
Date: December 7, 2020	Date: December 7, 2020

*    These certifications are being furnished as required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 1350 of Chapter 63 of Title 18 of the United States Code, and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that Section. These certifications shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Corporation specifically incorporates these certifications by reference in such filing.

XML

Cover - shares	9 Months Ended
	Oct. 31, 2020	Dec. 02, 2020
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Oct. 31, 2020
Document Transition Report	false
Entity File Number	001-12107
Entity Registrant Name	Abercrombie & Fitch Co.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	31-1469076
Entity Address, Address Line One	6301 Fitch Path,
Entity Address, City or Town	New Albany,
Entity Address, State or Province	OH
Entity Address, Postal Zip Code	43054
City Area Code	(614)
Local Phone Number	283-6500
Title of 12(b) Security	Class A Common Stock, $0.01 Par Value
Trading Symbol	ANF
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		62,390,672
Entity Central Index Key	0001018840
Current Fiscal Year End Date	--01-30
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3
Amendment Flag	false

XML

Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended			9 Months Ended
	Oct. 31, 2020		Nov. 02, 2019	Oct. 31, 2020		Nov. 02, 2019
Document Period End Date				Oct. 31, 2020
Net sales	$ 819,653		$ 863,472	$ 2,003,340		$ 2,438,522
Cost of sales, exclusive of depreciation and amortization	295,220		344,541	791,154		976,868
Gross profit	524,433		518,931	1,212,186		1,461,654
Stores and distribution expense	346,263		377,697	978,757		1,110,656
Marketing, general and administrative expense	121,000		114,075	326,509		341,716
Flagship store exit (benefits) charges	(8,063)		285	(12,490)		47,023
Asset impairment, exclusive of flagship store exit charges	6,329		12,610	57,340		14,987
Other operating loss (income), net	288		(215)	(1,562)		(465)
Operating income (loss)	58,616		14,479	(136,368)		(52,263)
Interest expense, net	8,808		2,922	19,277		4,908
Income (loss) before income taxes	49,808		11,557	(155,645)		(57,171)
Income tax expense (benefit)	5,779		3,987	38,565		(16,931)
Net income (loss)	44,029		7,570	(194,210)		(40,240)
Less: Net income attributable to noncontrolling interests	1,758		1,047	2,203		3,534
Net income (loss) attributable to A&F	$ 42,271		$ 6,523	$ (196,413)		$ (43,774)
Net income (loss) per share attributable to A&F
Basic	$ 0.68		$ 0.10	$ (3.14)		$ (0.67)
Diluted	$ 0.66		$ 0.10	$ (3.14)		$ (0.67)
Weighted-average shares outstanding
Basic	62,558		63,099	62,541		64,932
Diluted	63,877		63,911	62,541		64,932
Other comprehensive (loss) income
Foreign currency translation, net of tax	$ 2,142		$ 1,355	$ 5,477		$ (5,219)
Derivative financial instruments, net of tax	(5,234)		(3,654)	1,224		(574)
Other comprehensive (loss) income	(3,092)	[1]	(2,299)	6,701	[1]	(5,793)
Comprehensive income (loss)	40,937		5,271	(187,509)		(46,033)
Less: Comprehensive income attributable to noncontrolling interests	1,758		1,047	2,203		3,534
Comprehensive income (loss) attributable to A&F	$ 39,179		$ 4,224	$ (189,712)		$ (49,567)

[1] No tax effect was recognized during the thirteen and thirty-nine weeks ended October 31, 2020 due to the U.S. being a loss jurisdiction.

XML

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Oct. 31, 2020	Feb. 01, 2020
Current assets:
Cash and equivalents	$ 812,881	$ 671,267
Receivables	89,074	80,251
Inventories	545,548	434,326
Other current assets	73,776	78,905
Total current assets	1,521,279	1,264,749
Property and equipment, net	593,932	665,290
Operating lease right-of-use assets	955,781	1,230,954
Other assets	205,970	388,672
Total assets	3,276,962	3,549,665
Current liabilities:
Accounts payable	334,775	219,919
Accrued expenses	356,370	302,214
Short-term portion of operating lease liabilities	255,775	282,829
Income taxes payable	6,663	10,392
Total current liabilities	953,583	815,354
Long-term liabilities:
Long-term portion of operating lease liabilities	1,010,051	1,252,634
Long-term portion of borrowings, net	343,559	231,963
Other liabilities	110,965	178,536
Total long-term liabilities	1,464,575	1,663,133
Stockholders’ equity
Class A Common Stock - $0.01 par value: 150,000 shares authorized and 103,300 shares issued for all periods presented	1,033	1,033
Paid-in capital	396,505	404,983
Retained earnings	2,067,521	2,313,745
Accumulated other comprehensive loss, net of tax (“AOCL”)	(102,185)	(108,886)
Treasury stock, at average cost: 40,916 and 40,514 shares as of October 31, 2020 and February 1, 2020, respectively	(1,513,495)	(1,552,065)
Total Abercrombie & Fitch Co. stockholders’ equity	849,379	1,058,810
Noncontrolling interests	9,425	12,368
Total stockholders’ equity	858,804	1,071,178
Total liabilities and stockholders’ equity	$ 3,276,962	$ 3,549,665

XML

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Oct. 31, 2020	Feb. 01, 2020
Stockholders’ equity
Treasury Stock, at Average Cost (in shares)	40,916,000	40,514,000
Class A Common Stock
Stockholders’ equity
Class A Common Stock, par value	$ 0.01	$ 0.01
Class A Common Stock, shares authorized	150,000,000	150,000,000
Class A Common Stock, shares issued	103,300,000	103,300,000

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Oct. 31, 2020	Nov. 02, 2019
Document Period End Date	Oct. 31, 2020
Operating activities
Net loss	$ (194,210)	$ (40,240)
Adjustments to reconcile net loss to net cash provided by (used for) operating activities:
Depreciation and amortization	127,248	124,910
Asset impairment		18,216
Loss on disposal	7,586	5,326
Provision for (benefit from) deferred income taxes	27,432	(20,631)
Share-based compensation	13,575	8,464
Changes in assets and liabilities:
Inventories	(109,665)	(154,791)
Accounts payable and accrued expenses	186,806	34,752
Operating lease right-of-use assets and liabilities	(41,976)	42,990
Income taxes	(7,168)	(2,264)
Other assets	30,403	(47,138)
Withdrawal from Rabbi Trust Assets	50,000	0
Other liabilities	11,523	(3,433)
Net cash provided by (used for) operating activities	158,894	(33,839)
Investing activities
Purchases of property and equipment	(91,748)	(154,373)
Net cash used for investing activities	(91,748)	(154,373)
Proceeds from Notes Payable	350,000	0
Financing activities
Purchase of treasury stock	(15,172)	(63,542)
Repayments of Short-term Debt	(210,000)	0
Repayment of borrowings under the senior secured asset-based revolving credit facility	(12,556)	(38,959)
Payments of Debt Issuance Costs	(7,151)	0
Proceeds from Short-term Debt	210,000	0
Repayments of Long-term Debt	(233,250)	(10,000)
Payment, Tax Withholding, Share-based Payment Arrangement	5,566	6,619
Other financing activities	(11,742)	(10,407)
Net cash provided by (used for) financing activities	70,129	(122,908)
Effect of foreign currency exchange rates on cash	2,269	(2,686)
Net increase (decrease) in cash and equivalents, and restricted cash and equivalents	139,544	(313,806)
Cash and equivalents, and restricted cash, beginning of period	692,264	745,829
Cash and equivalents, and restricted cash and equivalents, end of period	831,808	432,023
Supplemental information related to non-cash activities
Purchases of property and equipment not yet paid at end of period	26,554	36,951
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability	(41,305)	293,281
Supplemental information related to cash activities
Cash paid for interest	9,182	12,022
Cash paid for income taxes	10,412	18,697
Cash received from income tax refunds	4,001	8,570
Cash paid for operating lease liabilities	$ 224,827	$ 311,275

XML

Consolidated Statements of Stockholders Equity Statement - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Noncontrolling Interest [Member]	Retained Earnings [Member]	AOCI Including Portion Attributable to Noncontrolling Interest [Member]	Treasury Stock [Member]
Shares, Outstanding		66,227					37,073
Total Abercrombie & Fitch Co. stockholders’ equity		$ 1,033	$ 405,379		$ 2,418,544	$ (102,452)	$ (1,513,604)
Noncontrolling interests				$ 9,721
Total stockholders' equity	$ 1,218,621
Income (Loss) Attributable to Noncontrolling Interest, before Tax				3,534
Net Income (Loss) Attributable to Parent	(43,774)				(43,774)
Net loss	(40,240)
Treasury Stock, Shares, Acquired		(3,957)					3,957
Treasury Stock, Value, Acquired, Cost Method	(63,542)						$ (63,542)
Dividends	(38,959)				(38,959)
Shares Issued, Shares, Share-based Payment Arrangement, after Forfeiture		487					(487)
Shares Issued, Value, Share-based Payment Arrangement, after Forfeiture	(6,619)		(13,862)		(16,496)		$ 23,739
Share-based compensation expense	(8,464)		(8,464)
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax	(574)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax	(5,219)
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders	(2,401)			(2,401)
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification	(75,165)
Shares, Outstanding		63,146					40,154
Total Abercrombie & Fitch Co. stockholders’ equity		$ 1,033	394,694		2,251,032	(105,946)	$ (1,548,836)
Noncontrolling interests				11,318
Total stockholders' equity	1,003,295
Income (Loss) Attributable to Noncontrolling Interest, before Tax				1,047
Net Income (Loss) Attributable to Parent	6,523				6,523
Net loss	7,570
Treasury Stock, Shares, Acquired		(412)					412
Treasury Stock, Value, Acquired, Cost Method	(5,730)						$ (5,730)
Dividends	(12,574)				(12,574)
Shares Issued, Shares, Share-based Payment Arrangement, after Forfeiture		23					(23)
Shares Issued, Value, Share-based Payment Arrangement, after Forfeiture	(181)		(509)		(831)		$ 1,159
Share-based compensation expense	(5,796)		(5,796)
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax	(3,654)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax	1,355
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders	(1,511)			(1,511)
Shares, Outstanding		62,757					40,543
Total Abercrombie & Fitch Co. stockholders’ equity		$ 1,033	399,981		2,244,150	(108,245)	$ (1,553,407)
Noncontrolling interests				10,854
Total stockholders' equity	994,366
Shares, Outstanding		62,786					40,514
Total Abercrombie & Fitch Co. stockholders’ equity	1,058,810	$ 1,033	404,983		2,313,745	(108,886)	$ (1,552,065)
Noncontrolling interests	12,368			12,368
Total stockholders' equity	1,071,178
Income (Loss) Attributable to Noncontrolling Interest, before Tax				2,203
Net Income (Loss) Attributable to Parent	(196,413)				(196,413)
Net loss	(194,210)
Treasury Stock, Shares, Acquired		(1,397)					1,397
Treasury Stock, Value, Acquired, Cost Method	(15,172)						$ (15,172)
Dividends	(12,556)				(12,556)
Shares Issued, Shares, Share-based Payment Arrangement, after Forfeiture		995					(995)
Shares Issued, Value, Share-based Payment Arrangement, after Forfeiture	(5,566)		(22,053)		(37,255)		$ 53,742
Share-based compensation expense	(13,575)		(13,575)
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax	1,224
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax	5,477
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders	(5,146)			(5,146)
Shares, Outstanding		62,365					40,935
Total Abercrombie & Fitch Co. stockholders’ equity		$ 1,033	392,272		2,025,911	(99,093)	$ (1,514,442)
Noncontrolling interests				7,929
Total stockholders' equity	813,610
Income (Loss) Attributable to Noncontrolling Interest, before Tax				1,758
Net Income (Loss) Attributable to Parent	42,271				42,271
Net loss	44,029
Shares Issued, Shares, Share-based Payment Arrangement, after Forfeiture		19					(19)
Shares Issued, Value, Share-based Payment Arrangement, after Forfeiture	(150)		(436)		(661)		$ 947
Share-based compensation expense	(4,669)		(4,669)
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax	(5,234)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax	2,142
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders	(262)			(262)
Shares, Outstanding		62,384					40,916
Total Abercrombie & Fitch Co. stockholders’ equity	849,379	$ 1,033	$ 396,505		$ 2,067,521	$ (102,185)	$ (1,513,495)
Noncontrolling interests	9,425			$ 9,425
Total stockholders' equity	$ 858,804

XML

Nature of Business (Notes)	9 Months Ended
	Oct. 31, 2020
Nature of Business [Abstract]
Nature of Business	Abercrombie & Fitch Co. (“A&F”), a company incorporated in Delaware in 1996, through its subsidiaries (collectively, A&F and its subsidiaries are referred to as “Abercrombie & Fitch” or the “Company”), is a global multi-brand omnichannel specialty retailer, whose products are sold primarily through its Company-owned store and digital channels, as well as through various third-party wholesale, franchise and licensing arrangements. The Company offers a broad assortment of apparel, personal care products and accessories for men, women and kids under the Hollister, Abercrombie & Fitch and abercrombie kids brands. The 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 primarily has operations in North America, Europe and Asia, among other regions.

XML

Summary of Significant Accounting Policies

9 Months Ended

Oct. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Significant Accounting Policies [Text Block]

Principles of consolidation

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. (“MAF”), each of which meets the definition of a variable interest entity (“VIE”). 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 MAF’s portion of net income presented as net income attributable to noncontrolling interests (“NCI”) on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) and MAF’s portion of equity presented as NCI on the Condensed Consolidated Balance Sheets.

Fiscal year

The Company’s fiscal year ends on the Saturday closest to January 31. This typically results in a fifty-two week year, but occasionally gives rise to an additional week, resulting in a fifty-three week year. Fiscal years are designated in the Condensed Consolidated Financial Statements and notes, as well as the remainder of this Quarterly Report on Form 10-Q, by the calendar year in which the fiscal year commences. All references herein to the Company’s fiscal years are as follows:

Fiscal year	Year ended	Number of weeks
Fiscal 2019	February 1, 2020	52
Fiscal 2020	January 30, 2021	52

Interim financial statements

The Condensed Consolidated Financial Statements as of October 31, 2020, and for the thirteen and thirty-nine week periods ended October 31, 2020 and November 2, 2019, are unaudited and are presented pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). 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 2019 filed with the SEC on March 31, 2020. The February 1, 2020 consolidated balance sheet data, included herein, were derived from audited consolidated financial statements, but do not include all disclosures required by accounting principles generally accepted in the United States of America (“GAAP”).

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 2020.

Use of estimates

The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of net sales and expenses during the reporting period. Due to the inherent uncertainty involved with estimates, actual results may differ. The extent to which the current outbreak of coronavirus disease (“COVID-19”) impacts the Company’s business and financial results will depend on numerous evolving factors including, but not limited to: the magnitude and duration of the COVID-19 pandemic and its impact on the length or frequency of store closures, and the extent to

which COVID-19 will impact worldwide macroeconomic conditions including interest rates, the speed of the economic recovery, and governmental, business and consumer reactions to the pandemic. The Company’s assessment of these, as well as other factors, could impact management's estimates 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.

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 31, 2020		February 1, 2020		November 2, 2019		February 2, 2019
Cash and equivalents	Cash and equivalents	$	812,881	$	671,267	$	410,775	$	723,135
Long-term restricted cash and equivalents	Other assets	14,633		18,696		18,698		22,694
Short-term restricted cash and equivalents	Other current assets	4,294		2,301		2,550		—
Cash and equivalents and restricted cash and equivalents		$	831,808	$	692,264	$	432,023	$	745,829

BASIS OF PRESENTATION

Interim financial statements

The Condensed Consolidated Financial Statements as of October 31, 2020, and for the thirteen and thirty-nine week periods ended October 31, 2020 and November 2, 2019, are unaudited and are presented pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). 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 2019 filed with the SEC on March 31, 2020. The February 1, 2020 consolidated balance sheet data, included herein, were derived from audited consolidated financial statements, but do not include all disclosures required by accounting principles generally accepted in the United States of America (“GAAP”).

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 2020.

XML

Impact of COVID-19 (Notes)

3 Months Ended

Oct. 31, 2020

Unusual or Infrequent Item, or Both [Line Items]

Unusual or Infrequent Items, or Both, Disclosure [Text Block]

Recent developments

The Company has seen, and may continue to see, material adverse impacts as a result of COVID-19. The extent of future impacts of COVID-19 on the Company’s business, including the duration and impact on overall customer demand, are uncertain as current circumstances are dynamic and depend on future developments, including, but not limited to, the duration and spread of COVID- 19 and the availability and acceptance of an effective vaccine or medical treatments.

In January 2020, the Company began to experience business disruptions in the Asia-Pacific (“APAC”) region as a result of COVID-19. In February 2020, the situation escalated as the scope of COVID-19 worsened beyond the APAC region, with the United States (the “U.S.”) and the Europe, Middle East and Africa (“EMEA”) region experiencing significant outbreaks. In March 2020, the COVID-19 outbreak was declared to be a global pandemic by the World Health Organization. In response to COVID-19, certain governments have imposed travel restrictions and local statutory quarantines and the Company has recommended associates who are able to perform their role remotely continue to do so. The Company is reacting to COVID-19 on a daily basis, including by conforming to local government guidance and monitoring developments in government legislation or other government actions in response to the COVID-19 outbreak. The Company has also implemented a range of precautionary health and safety measures with the well-being of the Company’s customers, associates and business partners in mind.

As a result of COVID-19, in January 2020, the Company temporarily closed the majority of its stores in the APAC region and in March 2020, the Company temporarily closed its stores across brands in North America and the EMEA region. The majority of APAC stores were reopened during March 2020, and the Company began to reopen stores in North America and the EMEA region on a rolling basis in late April 2020. As of October 31, 2020, approximately 97% of Company-operated stores had reopened for in-store service, although many with modified operating hours. The Company plans to follow the guidance of local governments to determine when it can reopen stores that have been closed due to COVID-19 and to evaluate whether further store closures will be necessary.

The Company’s digital operations across brands have continued to serve the Company’s customers during this unprecedented period of temporary store closures as the Company’s distribution centers implemented enhanced cleaning and social distancing measures in order to remain operational. In response to elevated digital demand during this period, the Company has increased its omnichannel capabilities by continuing to offer Purchase-Online-Pickup-in-Store, including curbside pick-up at a majority of U.S. locations, and by utilizing ship-from-store capabilities. In addition, to prepare for the Fiscal 2020 holiday season, the Company has entered into a short-term lease for an additional distribution center and has partnered with incremental carriers.

Impact of COVID-19

The Company has seen, and may continue to see, material reductions in sales across brands and regions as a result of COVID-19. Total net sales decreased approximately 5% and 18% for the thirteen and thirty-nine weeks ended October 31, 2020

as compared to the comparable periods ended November 2, 2019, respectively. The year-over-year decrease in total net sales was primarily driven by temporary widespread store closures and a decline in traffic as compared to the previous year as a result of COVID-19. The year-over-year decline in store sales was partially offset by digital sales growth of approximately 43% and 42% for the thirteen and thirty-nine weeks ended October 31, 2020 as compared to the comparable periods ended November 2, 2019, respectively.

Primarily as a result of COVID-19 and the temporary closure of the Company’s stores, the Company recognized $14.8 million of charges to reduce the carrying value of inventory in cost of sales, exclusive of depreciation and amortization on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) during the thirteen weeks ended May 2, 2020.

During the thirty-nine weeks ended October 31, 2020, reductions in revenue have not been offset by proportional decreases in expense, as the Company continued to incur store occupancy costs such as operating lease costs, net of rent abatements agreed upon during the period, depreciation expense, and certain other costs such as compensation, net of government payroll relief, and administrative expenses resulting in a negative effect on the relationship between the Company’s costs and revenues. During this period, the Company suspended rent payments for a significant number of stores that were closed, and continues to engage with its landlords to find a mutually beneficial and agreeable path forward. The Company has elected to account for all qualifying lease concessions, those that are a direct consequence of COVID-19 and that result in revised lease consideration that is substantially the same or less than the original consideration, as if the enforceable rights and obligations associated with the concession existed in the original lease agreement. Rent abatements associated with such concessions are recognized in variable lease cost. Lease concessions granted as part of an agreement that substantially increases the total consideration as a result of the inclusion of additional terms, such as rent payments associated with a lease term extension, are treated as lease modifications. For stores where the Company suspended payments, the Company reclassified related amounts from operating lease liability to accrued expenses in the period during which rent was due, while continuing to recognize operating lease cost in the Condensed Consolidated Statement of Operations and Comprehensive Income (Loss).

On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), which among other things, provides refundable employee retention tax credits for wages paid to employees who are unable to work during the COVID-19 outbreak and the deferral of the employer–paid portion of social security taxes. Similar relief programs have also been established throughout the EMEA and APAC regions. Based on the Company's evaluation of the CARES Act and legislation across regions, the Company qualifies for certain payroll tax credits, and such government subsidies have been treated as offsets to the related operating expenses when recognized. During the thirteen and thirty-nine weeks ended October 31, 2020, the Company recognized qualified payroll tax credits reducing payroll expenses by approximately $2.8 million and $14.7 million, respectively, on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss), The Company intends to continue to defer qualified payroll and other tax payments as permitted by the CARES Act and other regional legislation.

The Company also recognized asset impairment charges related to the Company’s right-of-use assets and property and equipment of $6.3 million and $57.3 million during the thirteen and thirty-nine weeks ended October 31, 2020, respectively, which were principally the result of the impact of COVID-19 on store cash flows. Refer to Note 9, “ASSET IMPAIRMENT,” for additional information.

In addition, the Company has also experienced other material impacts as a result of COVID-19, such as deferred tax valuation allowances and other tax charges during the thirty-nine weeks ended October 31, 2020, adversely impacting results by $77.4 million. Refer to Note 11, “INCOME TAXES,” for additional information.

Balance sheet, cash flow and liquidity

During the thirty-nine weeks ended October 31, 2020, the Company has taken various actions to preserve liquidity and manage cash flows in order to best position the business for key stakeholders, including (i) partnering with merchandise and non-merchandise vendors in regards to payment terms; (ii) tightly managing inventory receipts to align inventory with expected market demand; (iii) significantly reducing expenses to better align operating costs with sales; and (iv) temporarily suspending its share repurchase program in March 2020 and its dividend program in May 2020. In addition, despite the Company's recent history of partnering with its vendors regarding payment terms, certain payment term extensions were temporary and certain previously deferred payments have since been made. There can be no assurance that the Company will be able to maintain extended payment terms or continue to defer payments, which may result in incremental operating cash outflows in future periods.

As a precautionary measure in response to COVID-19, in March 2020, the Company borrowed $210.0 million under its senior secured asset-based revolving credit facility (the “ABL Facility”) to improve its near-term cash position and withdrew the majority of excess funds from the overfunded Rabbi Trust assets, providing the Company with $50.0 million of additional cash. In July 2020, the Company completed a private offering of $350.0 million aggregate principal amount of senior secured notes (the “Senior Secured Notes”) and used the net proceeds to repay all outstanding borrowings under the Company’s term loan facility (the “Term Loan Facility”), to repay a portion of the outstanding borrowings under the ABL Facility and to pay fees and expenses in connection with such repayments and the offering. Refer to Note 12, “BORROWINGS,” and Note 10, “ RABBI TRUST ASSETS,” for additional information.

As of October 31, 2020, the Company had liquidity of $1.158 billion as compared to $913.8 million as of February 1, 2020, comprised of cash and equivalents and actual incremental borrowing available to the Company under the ABL Facility.

XML

Revenue Recognition (Notes)

9 Months Ended

Oct. 31, 2020

Revenue Recognition [Abstract]

Revenue from Contract with Customer [Text Block]

Disaggregation of revenue

All revenues are recognized in net sales in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). For information regarding the disaggregation of revenue, refer to Note 16, “SEGMENT REPORTING.”

Contract liabilities

The following table details certain contract liabilities representing unearned revenue as of October 31, 2020, February 1, 2020, November 2, 2019 and February 2, 2019:

(in thousands)	October 31, 2020		February 1, 2020		November 2, 2019		February 2, 2019
Gift card liability	$	22,910	$	28,844	$	19,855	$	26,062
Loyalty program liability	$	19,640	$	23,051	$	21,396	$	19,904

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 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Revenue associated with gift card redemptions and gift card breakage	$	11,717	$	12,653	$	32,792	$	40,729
Revenue associated with reward redemptions and breakage related to the Company’s loyalty programs	$	9,686	$	9,249	$	23,377	$	23,795

XML

Net Income (Loss) Per Share

9 Months Ended

Oct. 31, 2020

Earnings Per Share [Abstract]

NET 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		Thirty-nine Weeks Ended
(in thousands)	October 31, 2020	November 2, 2019	October 31, 2020	November 2, 2019
Shares of Common Stock issued	103,300	103,300	103,300	103,300
Weighted-average treasury shares	(40,742)	(40,201)	(40,759)	(38,368)
Weighted-average — basic shares	62,558	63,099	62,541	64,932
Dilutive effect of share-based compensation awards	1,319	812	—	—
Weighted-average — diluted shares	63,877	63,911	62,541	64,932
Anti-dilutive shares (1)	1,828	2,912	1,988	1,572

(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.

XML

Fair Value

9 Months Ended

Oct. 31, 2020

Fair Value Disclosures [Abstract]

FAIR VALUE

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. The inputs used to measure fair value are prioritized based on a three-level hierarchy. The three levels of inputs to measure fair value are as follows:

•Level 1—inputs are unadjusted quoted prices for identical assets or liabilities that are available in active markets that the Company can access at the measurement date.

•Level 2—inputs are other than quoted market prices included within Level 1 that are observable for assets or liabilities, directly or indirectly.

•Level 3—inputs to the valuation methodology are unobservable.

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 and liabilities that are measured at fair value on a recurring basis, as of October 31, 2020 and February 1, 2020 were as follows:

	Assets at Fair Value as of October 31, 2020
(in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents (1)	$	68,271	$	43,596	$	—	$	111,867
Derivative instruments (2)	—		461		—		461
Rabbi Trust assets (3)	1		60,418		—		60,419
Restricted cash equivalents (4)	6,670		7,918		—		14,588
Total assets	$	74,942	$	112,393	$	—	$	187,335
Liabilities:
Derivative instruments (2)	$	—	$	367	$	—	$	367
Total liabilities	$	—	$	367	$	—	$	367

	Assets and Liabilities at Fair Value as of February 1, 2020
(in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents (1)	$	225	$	58,447	$	—	$	58,672
Derivative instruments (2)	—		1,969		—		1,969
Rabbi Trust assets (3)	1		109,048		—		109,049
Restricted cash equivalents (4)	9,765		4,601		—		14,366
Total assets	$	9,991	$	174,065	$	—	$	184,056
Liabilities:
Derivative instruments (2)	$	—	$	1,460	$	—	$	1,460
Total liabilities	$	—	$	1,460	$	—	$	1,460

(1)    Level 1 assets consist of investments in money market funds. Level 2 assets consist of time deposits.

(2)    Level 2 assets and liabilities consist primarily of foreign currency exchange forward contracts.

(3)    Level 1 assets consist of investments in money market funds. Level 2 assets consist of trust-owned life insurance policies.

(4)    Level 1 assets consist of investments in U.S. treasury bills and money market funds. Level 2 assets consist of time deposits.

The Company’s Level 2 assets and liabilities consist of:

•Time deposits, which are valued at cost approximating fair value due to the short-term nature of these investments;

•Trust-owned life insurance policies which are valued using the cash surrender value of the life insurance policies; and

•Derivative instruments, primarily foreign currency exchange forward contracts, which are valued using quoted market prices of the same or similar instruments, adjusted for counterparty risk.

Fair value of long-term borrowings

The Company’s borrowings under the Term Loan Facility and the Senior Secured Notes are carried at historical cost in the accompanying Condensed Consolidated Balance Sheets. The carrying amount and fair value of the Company’s long-term gross borrowings were as follows:

(in thousands)	October 31, 2020		February 1, 2020
Gross borrowings outstanding, carrying amount	$	350,000	$	233,250
Gross borrowings outstanding, fair value	$	374,063	$	233,979

XML

Property and Equipment, Net

9 Months Ended

Oct. 31, 2020

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT, NET

Property and equipment, net consisted of:

(in thousands)	October 31, 2020		February 1, 2020
Property and equipment, at cost	$	2,741,167	$	2,744,967
Less: Accumulated depreciation and amortization	(2,147,235)		(2,079,677)
Property and equipment, net	$	593,932	$	665,290

Refer to Note 9, “ASSET IMPAIRMENT,” for details related to property and equipment impairment charges incurred during the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019.

XML

Leases (Notes)

9 Months Ended

Oct. 31, 2020

Leases [Abstract]

Leases of Lessee Disclosure [Text Block]

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.

During thirty-nine weeks ended October 31, 2020, the Company suspended rent payments for a significant number of stores that were closed as a result of COVID-19, and continues to engage with its landlords to find a mutually beneficial and agreeable path forward. The Company has elected to account for all qualifying lease concessions, those that are a direct consequence of COVID-19 and that result in revised lease consideration that is substantially the same or less than the original consideration, as if the enforceable rights and obligations associated with the concession existed in the original lease agreement. Rent abatements associated with such concessions are recognized in variable lease cost. Lease concessions granted as part of an agreement that substantially increases the total consideration as a result of the inclusion of additional terms, such as rent payments associated with a lease term extension, are treated as lease modifications. For stores where the Company suspended payments, the Company reclassified related amounts from operating lease liability to accrued expenses in the period during which rent was due, while continuing to recognize operating lease cost in the Condensed Consolidated Statement of Operations and Comprehensive Income (Loss).

In addition, during the thirteen weeks ended October 31, 2020, the Company entered into a sublease agreement with a third party for the remaining lease term of one of its European Abercrombie & Fitch flagship store locations upon its expected closure during the thirteen weeks ending January 30, 2021. As of October 31, 2020, the Company's subleased property had a remaining lease term of 7.1 years with the sublease term from February 1, 2021 through November 30, 2027. The sublease arrangement provides for rent and occupancy related costs such as taxes, utilities and maintenance costs. Initial sublease terms provide for rent escalations based on the index under the lease, which were estimated upon initial measurement of the operating lease right-of-use asset and liability. The sublease agreement does not include residual value guarantees. Consistent with the Company's real estate leases, the sublease contains usage restrictions, but does not contain financial covenants and restrictions. Future minimum tenant operating lease payments remaining under this sublease as of October 31, 2020 were $29.0 million.

The following table provides a summary of the Company’s operating lease costs for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Single lease cost (1)	$	83,743	$	104,726	$	264,932	$	318,270
Variable lease cost (2)	14,428		25,990		61,763		129,073
Operating lease right-of-use asset impairment (3)	3,979		9,047		44,397		12,636
Total operating lease cost	$	102,150	$	139,763	$	371,092	$	459,979

(1)Includes 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 rent abatements 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.

(3)Refer to Note 9, “ASSET IMPAIRMENT,” for details related to operating lease right-of-use asset impairment charges.

During the thirty-nine weeks ended October 31, 2020 and November 2, 2019, the Company paid $224.8 million and $311.3 million, respectively, for amounts included in the measurement of operating lease liabilities, net of rent abatements agreed upon during the period. These payments are included within operating activities on the Condensed Consolidated Statements of Cash Flows.

As of October 31, 2020, the Company had minimum commitments related to additional operating lease contracts the terms of which have not yet commenced, primarily for its Company-operated retail stores, of approximately $3.3 million.

XML

Asset Impairment (Notes)

9 Months Ended

Oct. 31, 2020

Asset Impairment [Abstract]

Asset Impairment [Text Block]

Asset impairment charges for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 were as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Operating lease right-of-use asset impairment (1)	$	3,979	$	9,047	$	44,397	$	12,636
Property and equipment asset impairment	2,350		3,563		12,943		5,580
Total asset impairment	$	6,329	$	12,610	$	57,340	$	18,216

(1)     Includes $3.2 million of operating lease right-of-use asset impairment related to flagship store exit charges for each of the thirteen and thirty-nine weeks ended November 2, 2019. Refer to Note 17, “FLAGSHIP STORE EXIT (BENEFITS) CHARGES.”

Asset impairment charges for the thirteen and thirty-nine weeks ended October 31, 2020 were principally the result of the impact of COVID-19 and were related to certain of the Company’s stores across brands, geographies and store formats. The impairment charges for the thirty-nine weeks ended October 31, 2020 reduced the then carrying amount of the impaired stores’ assets to their fair value of approximately $102.2 million, including $94.2 million related to operating lease right-of-use assets.

Asset impairment charges for the thirteen weeks and thirty-nine weeks ended November 2, 2019, primarily related to certain of the Company’s international flagship stores. The impairment charges for the thirty-nine weeks ended November 2, 2019 reduced the then carrying amount of the impaired stores’ assets to their fair value of approximately $36.8 million, including $32.3 million related to operating lease right-of-use assets.

XML

Rabbi Trust Assets (Notes)

9 Months Ended

Oct. 31, 2020

Investments, Debt and Equity Securities [Abstract]

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

As a precautionary measure and to preserve liquidity in light of the circumstances surrounding COVID-19, during the thirty-nine weeks ended October 31, 2020, the Company withdrew the majority of excess funds from the overfunded Rabbi Trust assets, providing the Company with $50.0 million of additional cash.

Investments of Rabbi Trust assets consisted of the following as of October 31, 2020 and February 1, 2020:

(in thousands)	October 31, 2020		February 1, 2020
Trust-owned life insurance policies (at cash surrender value)	$	60,418	$	109,048
Money market funds	1		1
Rabbi Trust assets	$	60,419	$	109,049

Realized gains resulting from the change in cash surrender value of the Rabbi Trust assets for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 were as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Realized gains related to Rabbi Trust assets	$	391	$	805	$	1,369	$	2,394

XML

Income Taxes

9 Months Ended

Oct. 31, 2020

Income Tax Disclosure [Abstract]

INCOME TAXES

The quarterly provision for income taxes is based on the current estimate of the annual effective income tax rate and is adjusted as necessary for discrete quarterly events. The Company’s quarterly provision and the estimate of the annual effective tax rate are subject to significant variation due to several factors. These factors include variability in the pre-tax jurisdictional mix of earnings, changes in how the Company does business including entering into new businesses or geographies, changes in foreign currency exchange rates, changes in laws, regulations, interpretations and administrative practices, relative changes in expenses or losses for which tax benefits are not recognized and the impact of discrete items. In addition, jurisdictions where the Company anticipates an ordinary loss for the fiscal year for which the Company does not anticipate future benefits are excluded from the overall computation of estimated annual effective tax rate and no tax benefits are recognized in the period related to losses in such jurisdictions. The impact of these items on the effective tax rate will be greater at lower levels of pre-tax earnings.

Impact of valuation allowances and other tax charges during Fiscal 2020

The Company’s effective tax rate for the thirty-nine weeks ended October 31, 2020 was impacted by $77.4 million of adverse tax impacts, ultimately giving rise to income tax expense on a consolidated pre-tax year-to-date loss. Further details regarding these adverse tax impacts are as follows:

•The Company anticipates pre-tax losses for the full fiscal year in certain jurisdictions, based on information currently available, primarily due to the significant adverse impacts of COVID-19. The Company did not recognize income tax benefits on $180.7 million of pre-tax losses during the thirty-nine weeks ended October 31, 2020, resulting in an adverse tax impact of $41.8 million.

•The Company recognized charges of $35.6 million related to the establishment of valuation allowances and other tax charges in certain jurisdictions during the thirty-nine weeks ended October 31, 2020, principally as a result of the significant adverse impacts of COVID–19. These charges related to valuation allowances recognized by the Company of $10.6 million and $6.0 million related to the U.S. and Germany, respectively, as well as valuation allowances and other tax charges in certain other jurisdictions against underlying tax asset balances that existed as of February 1, 2020. The Company also recognized valuation allowances of $78.9 million related to Switzerland with a U.S. branch equally offsetting amount, which in net, did not have an impact on the Condensed Consolidated Statement of Operations and Comprehensive Income (Loss). Changes in assumptions may occur based on new information that becomes available resulting in adjustments in the period in which a determination is made.

Global legislation in response to COVID-19

In March 2020, the CARES Act was enacted into U.S. law, intended to provide economic relief to those impacted by COVID-19 and enhance business’ liquidity. The Company continues to examine impacts that the provisions of the CARES Act may have on U.S. income taxes; however, the Company does not currently expect that these provisions will have a material impact on its income taxes.

The Company is still assessing the applicability of other recently passed global legislation, including the potential income tax measures offered in international jurisdictions where the Company’s operations have also been impacted by COVID-19.

Share-based compensation

Refer to Note 13, “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 November 2, 2019.

XML

Borrowings

9 Months Ended

Oct. 31, 2020

Debt Disclosure [Abstract]

Borrowings

Details on the Company’s long-term borrowings, net, as of October 31, 2020 and February 1, 2020 are as follows:

(in thousands)	October 31, 2020		February 1, 2020
Long-term portion of borrowings, gross at carrying amount	$	350,000	$	233,250
Unamortized fees	(6,441)		(932)
Unamortized discount	—		(355)
Long-term borrowings, net	$	343,559	$	231,963

Senior Secured Notes

On July 2, 2020, Abercrombie & Fitch Management Co. (“A&F Management”), a wholly-owned indirect subsidiary of A&F, completed the private offering of the Senior Secured Notes, with $350 million aggregate principal amount due in 2025 at an offering price of 100% of the principal amount thereof. The Senior Secured Notes were issued pursuant to an indenture, dated as

of July 2, 2020, by and among A&F Management, A&F and certain of its wholly-owned subsidiaries, as guarantors, and U.S. Bank National Association, as trustee, and as collateral agent.

The Senior Secured Notes will mature on July 15, 2025 and bear interest at a rate of 8.75% per annum, with semi-annual interest payments beginning in January 2021.

The Company used the net proceeds from the offering of the Senior Secured Notes to repay outstanding borrowings and accrued interest of $233.6 million and $110.8 million under the Term Loan Facility and the ABL Facility, respectively, with the remaining net proceeds used towards fees and expenses in connection with such repayments and the offering of the Senior Secured Notes.

The Company recorded deferred financing fees associated with the issuance of the Senior Secured Notes, which are being amortized to interest expense over the contractual term of the Senior Secured Notes.

ABL Facility

The ABL Facility, which was entered into on August 7, 2014 through A&F Management as the lead borrower (with A&F and certain other subsidiaries of A&F as borrowers or guarantors) and later amended on October 19, 2017, provides for a senior secured asset-based revolving credit facility of up to $400 million (the “ABL Facility”).

The ABL Facility will mature on October 19, 2022.

As a precautionary measure and to improve the Company’s cash position in light of the circumstances surrounding COVID-19, during the thirteen weeks ended May 2, 2020, the Company borrowed $210.0 million under the ABL Facility. During the thirteen weeks ended August 1, 2020, the Company used a portion of the net proceeds from the offering of the Senior Secured Notes and cash on hand to repay all outstanding borrowings under the ABL Facility.

The Company did not have any borrowings outstanding under the ABL Facility as of October 31, 2020 or as of February 1, 2020.

As of October 31, 2020, the Company had availability under the ABL Facility of $383.7 million, net of $0.8 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, actual incremental borrowing available to the Company under the ABL Facility was $345.2 million as of October 31, 2020.

The provisions under the credit agreement applicable to the ABL Facility have not changed from those described in Note 12, “BORROWINGS,” in the Notes to Consolidated Financial Statements contained in “ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA” of A&F’s Annual Report on Form 10-K for Fiscal 2019.

Term Loan Facility

The Term Loan Facility, which was entered into on August 7, 2014 through A&F Management as the lead borrower (with A&F and certain other subsidiaries of A&F as borrowers or guarantors) and later amended on June 22, 2018, provided for a term loan facility of $300 million.

The Company had gross borrowings outstanding under the Term Loan Facility of $233.3 million as of February 1, 2020. During the thirteen weeks ended August 1, 2020, the Company used a portion of the proceeds from the issuance of the Senior Secured Notes to repay all outstanding borrowings under the Term Loan Facility and upon repayment the Term Loan Facility was terminated effective as of July 2, 2020.

The Term Loan Facility was previously scheduled to mature on August 7, 2021.

Representations, warranties and covenants

The agreements related to the Senior Secured Notes and ABL Facility contain various representations, warranties and restrictive covenants that, among other things and subject to specified exceptions, restrict the ability of the Company and its subsidiaries to: grant or incur liens; incur, assume or guarantee additional indebtedness; sell or otherwise dispose of assets, including capital stock of subsidiaries; make investments in certain subsidiaries; pay dividends, make distributions or redeem or repurchase capital stock; change the nature of their business; and consolidate or merge with or into, or sell substantially all of the Company’s or A&F Management’s assets to, another entity.

The Senior Secured Notes are guaranteed on a senior secured basis, jointly and severally, by A&F and each of the existing and future wholly-owned domestic restricted subsidiaries of A&F that guarantee or will guarantee A&F Management’s ABL Facility or certain future capital markets indebtedness.

Certain of the agreements related to the Senior Secured Notes and 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 31, 2020.

XML

Share-Based Compensation

9 Months Ended

Oct. 31, 2020

Share-based Payment Arrangement [Abstract]

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 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Share-based compensation expense	$	4,669	$	5,796	$	13,575	$	8,464
Income tax benefit associated with share-based compensation expense recognized (1)	$	—	$	1,211	$	—	$	1,566

(1)    No income tax benefit was recognized related to share-based compensation expense during the thirteen and thirty-nine weeks ended October 31, 2020 due to the U.S. being a loss jurisdiction.

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 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Income tax discrete benefits realized for tax deductions related to the issuance of shares (1)	$	—	$	6	$	—	$	1,175
Income tax discrete charges realized upon cancellation of stock appreciation rights (1)	—		(447)		—		(611)
Total income tax discrete (charges) benefits related to share-based compensation awards	$	—	$	(441)	$	—	$	564

(1)    No income tax benefits or charges related to these items were recognized during the thirteen and thirty-nine weeks ended October 31, 2020 due to the U.S. being a loss jurisdiction.

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 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Employee tax withheld upon issuance of shares (1)	$	150	$	181	$	5,566	$	6,619

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

Restricted stock units

The following table summarizes activity for restricted stock units for the thirty-nine weeks ended October 31, 2020:

	Service-based Restricted Stock Units			Performance-based Restricted Stock Units			Market-based Restricted Stock Units
	Number of  Underlying Shares (1)	Weighted- Average Grant Date Fair Value		Number of  Underlying Shares	Weighted- Average Grant Date Fair Value		Number of  Underlying Shares	Weighted- Average Grant Date Fair Value
Unvested at February 1, 2020	1,676,831	$	18.68	747,056	$	15.11	421,784	$	23.05
Granted	2,280,194	8.57		—	—		519,905	16.24
Adjustments for performance achievement	—	—		38,381	11.37		134,122	11.79
Vested	(790,429)	17.42		(481,304)	9.63		(350,447)	11.79
Forfeited	(107,795)	13.83		(6,917)	22.80		(3,485)	35.61
Unvested at October 31, 2020 (2)	3,058,801	$	11.63	297,216	$	22.43	721,879	$	21.46

(1)    Includes 66,624 unvested restricted stock units as of October 31, 2020, subject to vesting requirements related to the achievement of certain performance metrics, such as operating income and net income, for the fiscal year immediately preceding the vesting date. Holders of these restricted stock units have the opportunity to earn back one or more installments of the award if the cumulative performance requirements are met in a subsequent year.

(2)    Unvested shares related to restricted stock units with performance-based and market-based vesting conditions are reflected at 100% of their target vesting amount in the table above. Certain unvested shares related to restricted stock units with performance-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 these costs are expected to be recognized for restricted stock units as of October 31, 2020:

(in thousands)	Service-based Restricted Stock Units		Performance-based Restricted Stock Units		Market-based Restricted Stock Units
Unrecognized compensation cost	$	27,879	$	—	$	9,939
Remaining weighted-average period cost is expected to be recognized (years)	1.3		0.0		1.1

Additional information pertaining to restricted stock units for the thirty-nine weeks ended October 31, 2020 and November 2, 2019 follows:

(in thousands)	October 31, 2020		November 2, 2019
Service-based restricted stock units:
Total grant date fair value of awards granted	$	19,541	$	16,175
Total grant date fair value of awards vested	$	13,769	$	13,087
Performance-based restricted stock units:
Total grant date fair value of awards granted	$	—	$	5,379
Total grant date fair value of awards vested	$	4,635	$	—
Market-based restricted stock units:
Total grant date fair value of awards granted	$	8,443	$	4,176
Total grant date fair value of awards vested	$	4,132	$	511

The weighted-average assumptions used for market-based restricted stock units in the Monte Carlo simulation during the thirty-nine weeks ended October 31, 2020 and November 2, 2019, respectively, were as follows:

	October 31, 2020			November 2, 2019
Grant date market price	$	12.31		$	25.34
Fair value	$	16.24		$	36.24
Assumptions:
Price volatility	67		%	57		%
Expected term (years)	2.4			2.9
Risk-free interest rate	0.2		%	2.2		%
Dividend yield	—		%	3.2		%
Average volatility of peer companies	66.0		%	40.0		%
Average correlation coefficient of peer companies	0.4967			0.2407

Stock appreciation rights

The following table summarizes stock appreciation rights activity for the thirty-nine weeks ended October 31, 2020:

	Number of Underlying Shares	Weighted-Average Exercise Price		Aggregate Intrinsic Value		Weighted-Average Remaining Contractual Life (years)
Outstanding at February 1, 2020	796,725	$	40.06
Granted	—	—
Exercised	—	—
Forfeited or expired	(382,225)	47.87
Outstanding at August 1, 2020	414,500	$	32.86	$	—	3.2
Stock appreciation rights exercisable at October 31, 2020	414,500	$	32.86	$	—	3.2
Stock appreciation rights expected to become exercisable in the future as of October 31, 2020	—	$	—	$	—	0.0

No stock appreciation rights were exercised during the thirty-nine weeks ended October 31, 2020. Additional information pertaining to stock appreciation rights for the thirty-nine weeks ended November 2, 2019 follows:

(in thousands)	November 2, 2019
Total grant date fair value of awards exercised	$	620

XML

Derivative Instruments

9 Months Ended

Oct. 31, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE INSTRUMENTS

The Company is exposed to risks associated with changes in foreign currency exchange rates and uses derivative instruments, primarily forward contracts, to manage the financial impacts of these exposures. The Company does not use forward contracts to engage in currency speculation and does not enter into derivative financial instruments for trading purposes.

The Company uses derivative instruments, primarily foreign currency exchange forward contracts designated as cash flow hedges, to hedge the foreign currency exchange rate exposure associated with forecasted foreign currency denominated intercompany inventory sales to foreign subsidiaries and the related settlement of the foreign currency denominated intercompany receivables. Fluctuations in foreign currency exchange rates will either increase or decrease the Company’s intercompany equivalent cash flows and affect the Company’s U.S. Dollar earnings. Gains or losses on the foreign currency exchange forward contracts that are used to hedge these exposures are expected to partially offset this variability. 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 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.

The Company also uses foreign currency exchange forward contracts to hedge certain foreign-currency-denominated net monetary assets/liabilities. Examples of monetary assets/liabilities include cash balances, receivables and payables. Fluctuations in foreign currency exchange rates result in transaction gains or losses being recorded in earnings, as U.S. GAAP requires that monetary assets/liabilities be remeasured at the spot exchange rate at quarter-end or upon settlement. The Company has chosen not to apply hedge accounting to these instruments because there are no differences in the timing of gain or loss recognition on the hedging instruments and the hedged items.

As of October 31, 2020, 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 sales, the resulting settlement of the foreign-currency-denominated intercompany accounts receivable, or both:

(in thousands)	Notional Amount (1)
Euro	$	65,537
British pound	$	29,603
Canadian dollar	$	11,239

(1)    Amount reported is the U.S. Dollar notional amount outstanding as of October 31, 2020.

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 Sheet as of February 1, 2020 were as follows:

(in thousands)	Location	October 31, 2020		February 1, 2020		Location	October 31, 2020		February 1, 2020
Derivatives designated as cash flow hedging instruments	Other current assets	$	461	$	1,869	Accrued expenses	$	367	$	1,377
Derivatives not designated as hedging instruments	Other current assets	—		100		Accrued expenses	—		83
Total		$	461	$	1,969		$	367	$	1,460

As a result of COVID-19, there was a significant change in the expected timing of previously hedged intercompany sales transactions, resulting in a dedesignation of the related hedge instruments. At the time of dedesignation of these hedges, they were in a net gain position of approximately $12.6 million. Due to the extenuating circumstances leading to dedesignation, gains associated with these hedges at the time of dedesignation are deferred in AOCL until being reclassified into cost of goods sold, exclusive of depreciation and amortization when the originally forecasted transactions occur and the hedged items affect earnings. During the thirty-nine weeks ended October 31, 2020, $11.1 million had been reclassified from AOCL into earnings. During the thirty-nine weeks ended October 31, 2020 and subsequent to the dedesignation of these hedges, these hedge contracts were settled.

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 31, 2020 and November 2, 2019 follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Gain (loss) recognized in AOCL (1)	$	93	$	(1,136)	$	12,328	$	5,918
Gain reclassified from AOCL into cost of sales, exclusive of depreciation and amortization (2)	$	5,327	$	2,541	$	11,104	$	6,845

(1)Amount represents the change in fair value of derivative contracts.

(2)Amount represents gain 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 Income (Loss) 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 31, 2020 and November 2, 2019 follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
(Loss) gain recognized in other operating (income) loss, net	$	—	$	(1,023)	$	742	$	157

XML

Accumulated Other Comprehensive Loss

9 Months Ended

Oct. 31, 2020

Equity [Abstract]

ACCUMULATED OTHER COMPREHENSIVE LOSS

r the thirteen and thirty-nine weeks ended October 31, 2020, the activity in AOCL was as follows:

	Thirteen Weeks Ended October 31, 2020
(in thousands)	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivative Financial Instruments		Total
Beginning balance at August 1, 2020	$	(106,632)	$	7,539	$	(99,093)
Other comprehensive income before reclassifications	2,142		93		2,235
Reclassified gain from accumulated other comprehensive loss (1)	—		(5,327)		(5,327)
Other comprehensive income (loss) after reclassifications (2)	2,142		(5,234)		(3,092)
Ending balance at October 31, 2020	$	(104,490)	$	2,305	$	(102,185)
	Thirty-nine Weeks Ended October 31, 2020
(in thousands)	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivative Financial Instruments		Total
Beginning balance at February 1, 2020	$	(109,967)	$	1,081	$	(108,886)
Other comprehensive income before reclassifications	5,477		12,328		17,805
Reclassified gain from accumulated other comprehensive loss (1)	—		(11,104)		(11,104)
Other comprehensive income after reclassifications (2)	5,477		1,224		6,701
Ending balance at October 31, 2020	$	(104,490)	$	2,305	$	(102,185)

(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 Income (Loss).

(2)    No tax effect was recognized during the thirteen and thirty-nine weeks ended October 31, 2020 due to the U.S. being a loss jurisdiction.

For the thirteen and thirty-nine weeks ended November 2, 2019, the activity in AOCL was as follows:

	Thirteen Weeks Ended November 2, 2019
(in thousands)	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivative Financial Instruments		Total
Beginning balance at August 3, 2019	$	(111,461)	$	5,515	$	(105,946)
Other comprehensive (loss) income before reclassifications	1,355		(1,136)		219
Reclassified gain from accumulated other comprehensive loss (1)	—		(2,541)		(2,541)
Tax effect	—		23		23
Other comprehensive income (loss) after reclassifications	1,355		(3,654)		(2,299)
Ending balance at November 2, 2019	$	(110,106)	$	1,861	$	(108,245)
	Thirty-nine Weeks Ended November 2, 2019
(in thousands)	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivative Financial Instruments		Total
Beginning balance at February 2, 2019	$	(104,887)	$	2,435	$	(102,452)
Other comprehensive (loss) income before reclassifications	(5,219)		5,918		699
Reclassified gain from accumulated other comprehensive loss (1)	—		(6,845)		(6,845)
Tax effect	—		353		353
Other comprehensive (loss) income after reclassifications	(5,219)		(574)		(5,793)
Ending balance at November 2, 2019	$	(110,106)	$	1,861	$	(108,245)

(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 Income (Loss).

XML

Segment Reporting

9 Months Ended

Oct. 31, 2020

Segment Reporting [Abstract]

SEGMENT REPORTING

The Company’s two operating segments are brand-based: Hollister and Abercrombie, the latter of which includes the Company’s Abercrombie & Fitch and abercrombie kids 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 31, 2020 and November 2, 2019 were as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Hollister	$	476,665	$	514,772	$	1,178,925	$	1,447,975
Abercrombie	342,988		348,700		824,415		990,547
Total	$	819,653	$	863,472	$	2,003,340	$	2,438,522

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 orders. The Company’s net sales by geographic area for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 were as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
U.S.	$	557,814	$	583,593	$	1,339,347	$	1,596,723
EMEA	190,214		191,977		474,165		566,563
APAC	43,618		55,910		117,768		188,836
Other	28,007		31,992		72,060		86,400
International	$	261,839	$	279,879	$	663,993	$	841,799
Total	$	819,653	$	863,472	$	2,003,340	$	2,438,522

XML

Flagship Store Exit (Benefits) Charges (Notes)

9 Months Ended

Oct. 31, 2020

Flagship Store Exit Charges [Abstract]

Restructuring and Related Activities Disclosure [Text Block]

Reflecting a continued focus on one of the Company’s key transformation initiatives ‘Global Store Network Optimization,’ the Company continues to pivot away from its large format flagship stores and strives to open smaller, more productive omnichannel focused brand experiences. As a result, the Company has closed certain of its flagship stores and may have additional closures as it executes against this strategy.

As part of this ongoing effort, the Company recently announced the early exit of four European Abercrombie & Fitch flagship locations. Three of the leases will be transferred through assignment while the fourth lease will be subleased to a new tenant. The Company no longer has lease obligations beyond Fiscal 2020 for the three transfers and is scheduled to receive payments to fully offset its lease obligations on the sublease. Refer to Note 8, “ LEASES,” for additional information on the sublease arrangement.

Future fixed lease payments associated with closed flagship stores are reflected within short-term and long-term operating lease liabilities on the Condensed Consolidated Balance Sheets. Future fixed lease payments associated with flagship stores that were closed as of October 31, 2020, excluding the subleased flagship store, are scheduled to be paid through the fiscal year ending January 30, 2029 (“Fiscal 2028”) and are not expected to exceed $15 million in aggregate in any fiscal year.

The Company recognizes impacts related to the exit of its flagship stores in flagship store exit (benefits) charges on the Consolidated Statements of Operations and Comprehensive Income (Loss). Details of the (benefits) charges incurred during the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 related to this initiative follow:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Operating lease cost	(1,729)		—		(6,959)		46,716
Gain on lease assignment	(5,237)		—		(5,237)		—
Asset disposals and other store-closure costs (1)	(405)		—		(3,610)		(1,687)
Employee severance and other employee transition costs	(692)		285		3,316		1,994
Total flagship store exit (benefits) charges	$	(8,063)	$	285	$	(12,490)	$	47,023

(1)    Amounts represent costs incurred or benefits associated with returning the store to its original condition, including updated estimates to previously established accruals for asset retirement obligations and costs to remove inventory and store assets.

As the Company continues its ‘Global Store Network Optimization’ efforts, it may incur future cash expenditures or incremental charges or realize benefits not currently contemplated due to events that may occur as a result of, or that are associated with, previously announced flagship store closures and flagship store closures that have not yet been finalized. At this time, the Company is not able to quantify the amount of future impacts, including any cash expenditures that may take place in future periods resulting from any potential flagship store closures given the unpredictable nature of lease exit negotiations and ultimate lease renewal decisions.

XML

Summary of Significant Accounting Policies Principles of Consolidation (Policies)

9 Months Ended

Oct. 31, 2020

Basis of Presentation [Abstract]

Consolidation, Policy [Policy Text Block]

Principles of consolidation

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. (“MAF”), each of which meets the definition of a variable interest entity (“VIE”). 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 MAF’s portion of net income presented as net income attributable to noncontrolling interests (“NCI”) on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) and MAF’s portion of equity presented as NCI on the Condensed Consolidated Balance Sheets.

XML

Summary of Significant Accounting Policies Fiscal Years (Policies)

9 Months Ended

Oct. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Fiscal Period, Policy [Policy Text Block]

Fiscal year

The Company’s fiscal year ends on the Saturday closest to January 31. This typically results in a fifty-two week year, but occasionally gives rise to an additional week, resulting in a fifty-three week year. Fiscal years are designated in the Condensed Consolidated Financial Statements and notes, as well as the remainder of this Quarterly Report on Form 10-Q, by the calendar year in which the fiscal year commences. All references herein to the Company’s fiscal years are as follows:

Fiscal year	Year ended	Number of weeks
Fiscal 2019	February 1, 2020	52
Fiscal 2020	January 30, 2021	52

XML

Summary of Significant Accounting Policies Recent Accounting Pronouncements (Tables)

9 Months Ended

Oct. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block]

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.

XML

Summary of Significant Accounting Policies Condensed Consolidated Statements of Cash Flows reconciliation (Tables)

9 Months Ended

Oct. 31, 2020

Condensed Statements of Cash Flows reconciliation [Abstract]

Reconciliation of Cash and Equivalents to Restricted cash and Equivalents [Table Text Block]

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 31, 2020		February 1, 2020		November 2, 2019		February 2, 2019
Cash and equivalents	Cash and equivalents	$	812,881	$	671,267	$	410,775	$	723,135
Long-term restricted cash and equivalents	Other assets	14,633		18,696		18,698		22,694
Short-term restricted cash and equivalents	Other current assets	4,294		2,301		2,550		—
Cash and equivalents and restricted cash and equivalents		$	831,808	$	692,264	$	432,023	$	745,829

XML

Revenue Recognition (Tables)

9 Months Ended

Oct. 31, 2020

Revenue Recognition [Abstract]

Deferred Revenue, by Arrangement, Disclosure [Table Text Block]

The following table details certain contract liabilities representing unearned revenue as of October 31, 2020, February 1, 2020, November 2, 2019 and February 2, 2019:

(in thousands)	October 31, 2020		February 1, 2020		November 2, 2019		February 2, 2019
Gift card liability	$	22,910	$	28,844	$	19,855	$	26,062
Loyalty program liability	$	19,640	$	23,051	$	21,396	$	19,904

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 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Revenue associated with gift card redemptions and gift card breakage	$	11,717	$	12,653	$	32,792	$	40,729
Revenue associated with reward redemptions and breakage related to the Company’s loyalty programs	$	9,686	$	9,249	$	23,377	$	23,795

XML

Net Income (Loss) Per Share (Table)

9 Months Ended

Oct. 31, 2020

Earnings Per Share [Abstract]

Schedule of Weighted Average Number of Shares

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

	Thirteen Weeks Ended		Thirty-nine Weeks Ended
(in thousands)	October 31, 2020	November 2, 2019	October 31, 2020	November 2, 2019
Shares of Common Stock issued	103,300	103,300	103,300	103,300
Weighted-average treasury shares	(40,742)	(40,201)	(40,759)	(38,368)
Weighted-average — basic shares	62,558	63,099	62,541	64,932
Dilutive effect of share-based compensation awards	1,319	812	—	—
Weighted-average — diluted shares	63,877	63,911	62,541	64,932
Anti-dilutive shares (1)	1,828	2,912	1,988	1,572

(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.

XML

Fair Value (Tables)

9 Months Ended

Oct. 31, 2020

Fair Value Disclosures [Abstract]

Company's Assets and Liabilities Measured at Fair Value

The three levels of the hierarchy and the distribution of the Company’s assets and liabilities that are measured at fair value on a recurring basis, as of October 31, 2020 and February 1, 2020 were as follows:

	Assets at Fair Value as of October 31, 2020
(in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents (1)	$	68,271	$	43,596	$	—	$	111,867
Derivative instruments (2)	—		461		—		461
Rabbi Trust assets (3)	1		60,418		—		60,419
Restricted cash equivalents (4)	6,670		7,918		—		14,588
Total assets	$	74,942	$	112,393	$	—	$	187,335
Liabilities:
Derivative instruments (2)	$	—	$	367	$	—	$	367
Total liabilities	$	—	$	367	$	—	$	367

	Assets and Liabilities at Fair Value as of February 1, 2020
(in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents (1)	$	225	$	58,447	$	—	$	58,672
Derivative instruments (2)	—		1,969		—		1,969
Rabbi Trust assets (3)	1		109,048		—		109,049
Restricted cash equivalents (4)	9,765		4,601		—		14,366
Total assets	$	9,991	$	174,065	$	—	$	184,056
Liabilities:
Derivative instruments (2)	$	—	$	1,460	$	—	$	1,460
Total liabilities	$	—	$	1,460	$	—	$	1,460

(1)    Level 1 assets consist of investments in money market funds. Level 2 assets consist of time deposits.

(2)    Level 2 assets and liabilities consist primarily of foreign currency exchange forward contracts.

(3)    Level 1 assets consist of investments in money market funds. Level 2 assets consist of trust-owned life insurance policies.

(4)    Level 1 assets consist of investments in U.S. treasury bills and money market funds. Level 2 assets consist of time deposits.

Fair Value Measurement Inputs and Valuation Techniques [Line Items]

Fair Value, Assets and Liabilities Measured on Nonrecurring Basis, Valuation Techniques [Table Text Block]

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

(in thousands)	October 31, 2020		February 1, 2020
Gross borrowings outstanding, carrying amount	$	350,000	$	233,250
Gross borrowings outstanding, fair value	$	374,063	$	233,979

XML

Property and Equipment, Net (Tables)

9 Months Ended

Oct. 31, 2020

Property, Plant and Equipment [Abstract]

Property and Equipment, Net

Property and equipment, net consisted of:

(in thousands)	October 31, 2020		February 1, 2020
Property and equipment, at cost	$	2,741,167	$	2,744,967
Less: Accumulated depreciation and amortization	(2,147,235)		(2,079,677)
Property and equipment, net	$	593,932	$	665,290

XML

Leases (Tables)

9 Months Ended

Oct. 31, 2020

Leases [Abstract]

Lease, Cost [Table Text Block]

The following table provides a summary of the Company’s operating lease costs for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Single lease cost (1)	$	83,743	$	104,726	$	264,932	$	318,270
Variable lease cost (2)	14,428		25,990		61,763		129,073
Operating lease right-of-use asset impairment (3)	3,979		9,047		44,397		12,636
Total operating lease cost	$	102,150	$	139,763	$	371,092	$	459,979

(1)Includes 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 rent abatements 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.

(3)Refer to Note 9, “ASSET IMPAIRMENT,” for details related to operating lease right-of-use asset impairment charges.

XML

Asset Impairment (Tables)

9 Months Ended

Oct. 31, 2020

Asset Impairment [Abstract]

Asset Impairment Charges [Text Block]

e thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 were as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Operating lease right-of-use asset impairment (1)	$	3,979	$	9,047	$	44,397	$	12,636
Property and equipment asset impairment	2,350		3,563		12,943		5,580
Total asset impairment	$	6,329	$	12,610	$	57,340	$	18,216

(1)     Includes $3.2 million of operating lease right-of-use asset impairment related to flagship store exit charges for each of the thirteen and thirty-nine weeks ended November 2, 2019. Refer to Note 17, “FLAGSHIP STORE EXIT (BENEFITS) CHARGES.”

Asset impairment charges for the thirteen and thirty-nine weeks ended October 31, 2020 were principally the result of the impact of COVID-19 and were related to certain of the Company’s stores across brands, geographies and store formats. The impairment charges for the thirty-nine weeks ended October 31, 2020 reduced the then carrying amount of the impaired stores’ assets to their fair value of approximately $102.2 million, including $94.2 million related to operating lease right-of-use assets.

Asset impairment charges for the thirteen weeks and thirty-nine weeks ended November 2, 2019, primarily related to certain of the Company’s international flagship stores. The impairment charges for the thirty-nine weeks ended November 2, 2019 reduced the then carrying amount of the impaired stores’ assets to their fair value of approximately $36.8 million, including $32.3 million related to operating lease right-of-use assets.

XML

Rabbi Trust Assets (Tables)

9 Months Ended

Oct. 31, 2020

Investments, Debt and Equity Securities [Abstract]

Components of Rabbi Trust Assets [Table Text Block]

Investments of Rabbi Trust assets consisted of the following as of October 31, 2020 and February 1, 2020:

(in thousands)	October 31, 2020		February 1, 2020
Trust-owned life insurance policies (at cash surrender value)	$	60,418	$	109,048
Money market funds	1		1
Rabbi Trust assets	$	60,419	$	109,049

Realized gains resulting from the change in cash surrender value of the Rabbi Trust assets for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 were as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Realized gains related to Rabbi Trust assets	$	391	$	805	$	1,369	$	2,394

XML

Borrowings (Tables)

9 Months Ended

Oct. 31, 2020

Debt Disclosure [Abstract]

Schedule of Borrowings

Details on the Company’s long-term borrowings, net, as of October 31, 2020 and February 1, 2020 are as follows:

(in thousands)	October 31, 2020		February 1, 2020
Long-term portion of borrowings, gross at carrying amount	$	350,000	$	233,250
Unamortized fees	(6,441)		(932)
Unamortized discount	—		(355)
Long-term borrowings, net	$	343,559	$	231,963

XML

Share-Based Compensation (Tables)

9 Months Ended

Oct. 31, 2020

Share-based Payment Arrangement, Expensed and Capitalized, Amount [Table Text Block]

The following table details share-based compensation expense and the related income tax impacts for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Share-based compensation expense	$	4,669	$	5,796	$	13,575	$	8,464
Income tax benefit associated with share-based compensation expense recognized (1)	$	—	$	1,211	$	—	$	1,566

Share-based Payment Arrangement, Discrete Tax Benefit (Charge) [Table Text Block]

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 31, 2020 and November 2, 2019:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Income tax discrete benefits realized for tax deductions related to the issuance of shares (1)	$	—	$	6	$	—	$	1,175
Income tax discrete charges realized upon cancellation of stock appreciation rights (1)	—		(447)		—		(611)
Total income tax discrete (charges) benefits related to share-based compensation awards	$	—	$	(441)	$	—	$	564

Schedule of Restricted Stock Unit Activity

The following table summarizes activity for restricted stock units for the thirty-nine weeks ended October 31, 2020:

	Service-based Restricted Stock Units			Performance-based Restricted Stock Units			Market-based Restricted Stock Units
	Number of  Underlying Shares (1)	Weighted- Average Grant Date Fair Value		Number of  Underlying Shares	Weighted- Average Grant Date Fair Value		Number of  Underlying Shares	Weighted- Average Grant Date Fair Value
Unvested at February 1, 2020	1,676,831	$	18.68	747,056	$	15.11	421,784	$	23.05
Granted	2,280,194	8.57		—	—		519,905	16.24
Adjustments for performance achievement	—	—		38,381	11.37		134,122	11.79
Vested	(790,429)	17.42		(481,304)	9.63		(350,447)	11.79
Forfeited	(107,795)	13.83		(6,917)	22.80		(3,485)	35.61
Unvested at October 31, 2020 (2)	3,058,801	$	11.63	297,216	$	22.43	721,879	$	21.46

(1)    Includes 66,624 unvested restricted stock units as of October 31, 2020, subject to vesting requirements related to the achievement of certain performance metrics, such as operating income and net income, for the fiscal year immediately preceding the vesting date. Holders of these restricted stock units have the opportunity to earn back one or more installments of the award if the cumulative performance requirements are met in a subsequent year.

(2)    Unvested shares related to restricted stock units with performance-based and market-based vesting conditions are reflected at 100% of their target vesting amount in the table above. Certain unvested shares related to restricted stock units with performance-based vesting conditions can be achieved at up to 200% of their target vesting amount.

Schedule of Stock Appreciation Rights Activity

The following table summarizes stock appreciation rights activity for the thirty-nine weeks ended October 31, 2020:

	Number of Underlying Shares	Weighted-Average Exercise Price		Aggregate Intrinsic Value		Weighted-Average Remaining Contractual Life (years)
Outstanding at February 1, 2020	796,725	$	40.06
Granted	—	—
Exercised	—	—
Forfeited or expired	(382,225)	47.87
Outstanding at August 1, 2020	414,500	$	32.86	$	—	3.2
Stock appreciation rights exercisable at October 31, 2020	414,500	$	32.86	$	—	3.2
Stock appreciation rights expected to become exercisable in the future as of October 31, 2020	—	$	—	$	—	0.0

No stock appreciation rights were exercised during the thirty-nine weeks ended October 31, 2020. Additional information pertaining to stock appreciation rights for the thirty-nine weeks ended November 2, 2019 follows:

(in thousands)	November 2, 2019
Total grant date fair value of awards exercised	$	620

Market-based restricted stock units [Member]

Schedule of Weighted-Average Estimated Fair Value and Assumptions of Restricted Stock Units with Market Vesting Conditions

Additional information pertaining to restricted stock units for the thirty-nine weeks ended October 31, 2020 and November 2, 2019 follows:

(in thousands)	October 31, 2020		November 2, 2019
Service-based restricted stock units:
Total grant date fair value of awards granted	$	19,541	$	16,175
Total grant date fair value of awards vested	$	13,769	$	13,087
Performance-based restricted stock units:
Total grant date fair value of awards granted	$	—	$	5,379
Total grant date fair value of awards vested	$	4,635	$	—
Market-based restricted stock units:
Total grant date fair value of awards granted	$	8,443	$	4,176
Total grant date fair value of awards vested	$	4,132	$	511

The weighted-average assumptions used for market-based restricted stock units in the Monte Carlo simulation during the thirty-nine weeks ended October 31, 2020 and November 2, 2019, respectively, were as follows:

	October 31, 2020			November 2, 2019
Grant date market price	$	12.31		$	25.34
Fair value	$	16.24		$	36.24
Assumptions:
Price volatility	67		%	57		%
Expected term (years)	2.4			2.9
Risk-free interest rate	0.2		%	2.2		%
Dividend yield	—		%	3.2		%
Average volatility of peer companies	66.0		%	40.0		%
Average correlation coefficient of peer companies	0.4967			0.2407

XML

Derivative Instruments (Tables)

9 Months Ended

Oct. 31, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Location and Amounts of Derivative Fair Values on the Condensed Consolidated Balance Sheets

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 Sheet as of February 1, 2020 were as follows:

(in thousands)	Location	October 31, 2020		February 1, 2020		Location	October 31, 2020		February 1, 2020
Derivatives designated as cash flow hedging instruments	Other current assets	$	461	$	1,869	Accrued expenses	$	367	$	1,377
Derivatives not designated as hedging instruments	Other current assets	—		100		Accrued expenses	—		83
Total		$	461	$	1,969		$	367	$	1,460

Location and Amounts of Derivative Gains and Losses on the Condensed Consolidated Statements of Operations and Comprehensive Loss

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 31, 2020 and November 2, 2019 follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Gain (loss) recognized in AOCL (1)	$	93	$	(1,136)	$	12,328	$	5,918
Gain reclassified from AOCL into cost of sales, exclusive of depreciation and amortization (2)	$	5,327	$	2,541	$	11,104	$	6,845

(1)Amount represents the change in fair value of derivative contracts.

(2)Amount represents gain 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 Income (Loss) 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 31, 2020 and November 2, 2019 follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
(Loss) gain recognized in other operating (income) loss, net	$	—	$	(1,023)	$	742	$	157

XML

Accumulated Other Comprehensive Loss (Tables)

9 Months Ended

Oct. 31, 2020

Equity [Abstract]

Schedule of Accumulated Other Comprehensive Loss

For the thirteen and thirty-nine weeks ended October 31, 2020, the activity in AOCL was as follows:

	Thirteen Weeks Ended October 31, 2020
(in thousands)	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivative Financial Instruments		Total
Beginning balance at August 1, 2020	$	(106,632)	$	7,539	$	(99,093)
Other comprehensive income before reclassifications	2,142		93		2,235
Reclassified gain from accumulated other comprehensive loss (1)	—		(5,327)		(5,327)
Other comprehensive income (loss) after reclassifications (2)	2,142		(5,234)		(3,092)
Ending balance at October 31, 2020	$	(104,490)	$	2,305	$	(102,185)
	Thirty-nine Weeks Ended October 31, 2020
(in thousands)	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivative Financial Instruments		Total
Beginning balance at February 1, 2020	$	(109,967)	$	1,081	$	(108,886)
Other comprehensive income before reclassifications	5,477		12,328		17,805
Reclassified gain from accumulated other comprehensive loss (1)	—		(11,104)		(11,104)
Other comprehensive income after reclassifications (2)	5,477		1,224		6,701
Ending balance at October 31, 2020	$	(104,490)	$	2,305	$	(102,185)

(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 Income (Loss).

(2)    No tax effect was recognized during the thirteen and thirty-nine weeks ended October 31, 2020 due to the U.S. being a loss jurisdiction.

For the thirteen and thirty-nine weeks ended November 2, 2019, the activity in AOCL was as follows:

	Thirteen Weeks Ended November 2, 2019
(in thousands)	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivative Financial Instruments		Total
Beginning balance at August 3, 2019	$	(111,461)	$	5,515	$	(105,946)
Other comprehensive (loss) income before reclassifications	1,355		(1,136)		219
Reclassified gain from accumulated other comprehensive loss (1)	—		(2,541)		(2,541)
Tax effect	—		23		23
Other comprehensive income (loss) after reclassifications	1,355		(3,654)		(2,299)
Ending balance at November 2, 2019	$	(110,106)	$	1,861	$	(108,245)
	Thirty-nine Weeks Ended November 2, 2019
(in thousands)	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivative Financial Instruments		Total
Beginning balance at February 2, 2019	$	(104,887)	$	2,435	$	(102,452)
Other comprehensive (loss) income before reclassifications	(5,219)		5,918		699
Reclassified gain from accumulated other comprehensive loss (1)	—		(6,845)		(6,845)
Tax effect	—		353		353
Other comprehensive (loss) income after reclassifications	(5,219)		(574)		(5,793)
Ending balance at November 2, 2019	$	(110,106)	$	1,861	$	(108,245)

(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 Income (Loss).

XML

Segment Reporting (Tables)

9 Months Ended

Oct. 31, 2020

Segment Reporting [Abstract]

Revenue from External Customers by Operating Segment [Table Text Block]

for the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 were as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Hollister	$	476,665	$	514,772	$	1,178,925	$	1,447,975
Abercrombie	342,988		348,700		824,415		990,547
Total	$	819,653	$	863,472	$	2,003,340	$	2,438,522

Revenue from External Customers by Geographic Areas [Table Text Block]

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
U.S.	$	557,814	$	583,593	$	1,339,347	$	1,596,723
EMEA	190,214		191,977		474,165		566,563
APAC	43,618		55,910		117,768		188,836
Other	28,007		31,992		72,060		86,400
International	$	261,839	$	279,879	$	663,993	$	841,799
Total	$	819,653	$	863,472	$	2,003,340	$	2,438,522

XML

Flagship Store Exit (Benefits) Charges (Tables)

9 Months Ended

Oct. 31, 2020

Restructuring Cost and Reserve [Line Items]

Flagship Store Exit Charges [Table Text Block]

etails of the (benefits) charges incurred during the thirteen and thirty-nine weeks ended October 31, 2020 and November 2, 2019 related to this initiative follow:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
(in thousands)	October 31, 2020		November 2, 2019		October 31, 2020		November 2, 2019
Operating lease cost	(1,729)		—		(6,959)		46,716
Gain on lease assignment	(5,237)		—		(5,237)		—
Asset disposals and other store-closure costs (1)	(405)		—		(3,610)		(1,687)
Employee severance and other employee transition costs	(692)		285		3,316		1,994
Total flagship store exit (benefits) charges	$	(8,063)	$	285	$	(12,490)	$	47,023

(1)    Amounts represent costs incurred or benefits associated with returning the store to its original condition, including updated estimates to previously established accruals for asset retirement obligations and costs to remove inventory and store assets.

XML

Summary of Significant Accounting Policies Condensed Consolidated Statements of Cash Flows reconciliation (Details) - USD ($) $ in Thousands	Oct. 31, 2020	Feb. 01, 2020	Nov. 02, 2019	Feb. 02, 2019
Condensed Statements of Cash Flows reconciliation [Abstract]
Cash and equivalents	$ 812,881	$ 671,267	$ 410,775	$ 723,135
Restricted Cash and Cash Equivalents	14,633	18,696	18,698	22,694
Restricted Cash and Cash Equivalents, Current	4,294	2,301	2,550	0
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents	$ 831,808	$ 692,264	$ 432,023	$ 745,829

XML

Summary of Significant Accounting Policies Recent Accounting Pronouncements (Details)	9 Months Ended
	Oct. 31, 2020
Recent Accounting Pronouncements [Abstract]
Maximum Length Of Time Inventory Sales Hedged	12 months

XML

Impact of COVID-19 (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 31, 2020	Nov. 02, 2019	Oct. 31, 2020	Nov. 02, 2019	Feb. 01, 2020
Impact of COVID-19 [Abstract]
Liquidity	$ 1,158,000		$ 1,158,000		$ 913,800
Inventory Write-down	14,800
Government Payroll Subsidies in response to COVID-19 Benefit	2,800		14,700
Asset Impairment Charges		$ 12,610	57,340	$ 18,216
Asset impairment, exclusive of flagship store exit charges	$ 6,329	$ 12,610	57,340	14,987
Income Tax Expense Benefit Continuing Operations Discrete Items			77,400
Proceeds from Short-term Debt			210,000	0
Withdrawal from Rabbi Trust Assets			50,000	0
Proceeds from Notes Payable			$ 350,000	$ 0

XML

Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 31, 2020	Nov. 02, 2019	Oct. 31, 2020	Nov. 02, 2019	Feb. 01, 2020	Feb. 02, 2019
Revenue Recognition [Abstract]
Revenue recognized from Gift Card Program	$ 11,717	$ 12,653	$ 32,792	$ 40,729
Revenue recognized from Customer Loyalty Program Liability	9,686	9,249	23,377	23,795
Gift Card Liability, Current	22,910	19,855	22,910	19,855	$ 28,844	$ 26,062
Customer Loyalty Program Liability, Current	$ 19,640	$ 21,396	$ 19,640	$ 21,396	$ 23,051	$ 19,904

XML

Net Income (Loss) Per Share (Details) - shares shares in Thousands		3 Months Ended		9 Months Ended
		Oct. 31, 2020	Nov. 02, 2019	Oct. 31, 2020	Nov. 02, 2019
Weighted Average Shares Outstanding And Anti Dilutive Shares [Abstract]
Shares of Common Stock issued		103,300	103,300	103,300	103,300
Weighted-average treasury shares		(40,742)	(40,201)	(40,759)	(38,368)
Weighted-average — basic shares		62,558	63,099	62,541	64,932
Dilutive effect of share-based compensation awards		1,319	812	0	0
Weighted-average — diluted shares		63,877	63,911	62,541	64,932
Anti-dilutive shares (1)	[1]	1,828	2,912	1,988	1,572

[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.

XML

Fair Value (Assets and Liabilities at Fair Value) (Details) - USD ($) $ in Thousands	Oct. 31, 2020		Feb. 01, 2020
Fair Value, Recurring [Member]
Assets, Fair Value Disclosure [Abstract]
Cash and Cash Equivalents, Fair Value Disclosure	$ 111,867	[1]	$ 58,672
Derivative instruments (2)	461		1,969
Restricted Investments, Noncurrent	60,419		109,049
Restricted Cash Equivalents, Noncurrent	14,588	[2]	14,366
Total assets	187,335		184,056
Liabilities, Fair Value Disclosure [Abstract]
Derivative instruments (2)	367		1,460
Total liabilities	367		1,460
Level 1 | Fair Value, Recurring [Member]
Assets, Fair Value Disclosure [Abstract]
Cash and Cash Equivalents, Fair Value Disclosure	68,271	[1]	225
Derivative instruments (2)	0		0
Restricted Investments, Noncurrent	1		1
Restricted Cash Equivalents, Noncurrent	6,670	[2]	9,765
Total assets	74,942		9,991
Liabilities, Fair Value Disclosure [Abstract]
Derivative instruments (2)	0		0
Total liabilities	0		0
Level 2 | Fair Value, Recurring [Member]
Assets, Fair Value Disclosure [Abstract]
Cash and Cash Equivalents, Fair Value Disclosure	43,596	[1]	58,447
Derivative instruments (2)	461		1,969
Restricted Investments, Noncurrent	60,418		109,048
Restricted Cash Equivalents, Noncurrent	7,918	[2]	4,601
Total assets	112,393		174,065
Liabilities, Fair Value Disclosure [Abstract]
Derivative instruments (2)	367		1,460
Total liabilities	367		1,460
Level 3 | Fair Value, Recurring [Member]
Assets, Fair Value Disclosure [Abstract]
Cash and Cash Equivalents, Fair Value Disclosure	0	[1]	0
Derivative instruments (2)	0		0
Restricted Investments, Noncurrent	0		0
Restricted Cash Equivalents, Noncurrent	0	[2]	0
Total assets	0		0
Liabilities, Fair Value Disclosure [Abstract]
Derivative instruments (2)	0		0
Total liabilities	0		0
Term Loan Facility
Liabilities, Fair Value Disclosure [Abstract]
Gross borrowings outstanding, carrying amount			233,250
Gross borrowings outstanding, fair value			$ 233,979
Senior Notes [Member]
Liabilities, Fair Value Disclosure [Abstract]
Gross borrowings outstanding, carrying amount	350,000
Gross borrowings outstanding, fair value	$ 374,063

[1] Level 1 assets consist of investments in money market funds. Level 2 assets consist of time deposits.(2)    Level 2 assets and liabilities consist primarily of foreign currency exchange forward contracts.

[2] Level 1 assets consist of investments in U.S. treasury bills and money market funds. Level 2 assets consist of time deposits.

XML

Property and Equipment, Net (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 31, 2020	Nov. 02, 2019	Oct. 31, 2020	Nov. 02, 2019	Feb. 01, 2020
Property, Plant and Equipment [Line Items]
Store asset impairment	$ 2,350	$ 3,563	$ 12,943	$ 5,580
Property and equipment, at cost	2,741,167		2,741,167		$ 2,744,967
Less: Accumulated depreciation and amortization	(2,147,235)		(2,147,235)		(2,079,677)
Property and equipment, net	593,932		593,932		$ 665,290
Asset Impairment Charges		12,610	57,340	18,216
Asset impairment, exclusive of flagship store exit charges	$ 6,329	$ 12,610	$ 57,340	$ 14,987

XML

Leases (Details) - USD ($) $ in Thousands		3 Months Ended				9 Months Ended
		Oct. 31, 2020		Nov. 02, 2019		Oct. 31, 2020		Nov. 02, 2019
Leases [Abstract]
Single lease cost	[1]	$ 83,743		$ 104,726		$ 264,932		$ 318,270
Variable lease cost		14,428	[2]	25,990	[2]	61,763	[2]	129,073
Operating lease right-of-use asset impairment	[3],[4]	3,979		9,047		44,397		12,636
Operating lease cost		102,150		$ 139,763		371,092		459,979
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability						(41,305)		293,281
Cash paid for operating lease liabilities						224,827		$ 311,275
LesseeOperatingLeaseLeasesNotYetCommencedLiability		3,300				3,300
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals		$ 29,000				$ 29,000

[1] Includes 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 rent abatements 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.

[3] (1)     Includes $3.2 million of operating lease right-of-use asset impairment related to flagship store exit charges for each of the thirteen and thirty-nine weeks ended November 2, 2019. Refer to Note 17, “FLAGSHIP STORE EXIT (BENEFITS) CHARGES.”

[4] Refer to Note 9, “ASSET IMPAIRMENT,” for details related to operating lease right-of-use asset impairment charges.

XML

Asset Impairment (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 31, 2020	Nov. 02, 2019	Oct. 31, 2020	Nov. 02, 2019	Feb. 01, 2020
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Operating Lease, Right-of-Use Asset	$ 955,781		$ 955,781		$ 1,230,954
Asset impairment, exclusive of flagship store exit charges	6,329	$ 12,610	57,340	$ 14,987
Fair Value, Recurring [Member]
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Store Assets, including property and equipment and operating lease right-of-use assets	102,200	36,800	102,200	36,800
Operating Lease, Right-of-Use Asset	$ 94,200	$ 32,300	$ 94,200	$ 32,300

XML

Rabbi Trust Assets (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 31, 2020	Nov. 02, 2019	Oct. 31, 2020	Nov. 02, 2019	Feb. 01, 2020
Defined Benefit Plan, Plan Assets, Category [Line Items]
Proceeds from Life Insurance Policy	$ 391	$ 805	$ 1,369	$ 2,394
Withdrawal from Rabbi Trust Assets			50,000	$ 0
Fair Value, Recurring [Member]
Defined Benefit Plan, Plan Assets, Category [Line Items]
Restricted Investments, Noncurrent	60,419		60,419		$ 109,049
Fair Value, Recurring [Member] | Level 2
Defined Benefit Plan, Plan Assets, Category [Line Items]
Restricted Investments, Noncurrent	60,418		60,418		109,048
Fair Value, Recurring [Member] | Level 1
Defined Benefit Plan, Plan Assets, Category [Line Items]
Restricted Investments, Noncurrent	$ 1		$ 1		$ 1

XML

Income Taxes (Details) $ in Thousands	9 Months Ended
	Oct. 31, 2020 USD ($)
Valuation Allowance [Line Items]
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount	$ (35,600)
Unrecognized Tax Benefits that Would Impact Effective Tax Rate	41,800
Income Tax Expense Benefit Continuing Operations Discrete Items	77,400
Pre-Tax Losses Without Tax Benefits Recognized	180,700
United States
Valuation Allowance [Line Items]
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount	(10,600)
GERMANY
Valuation Allowance [Line Items]
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount	(6,000)
SWITZERLAND
Valuation Allowance [Line Items]
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount	$ (78,900)

XML

Borrowings (Details) - USD ($) $ in Thousands	9 Months Ended
	Oct. 31, 2020	Nov. 02, 2019	Feb. 01, 2020
Long-Term Borrowings [Line Items]
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate	8.75%
Line of Credit Facility, Remaining Borrowing Capacity	$ 383,700
Long-term Debt, Excluding Current Maturities	343,559		$ 231,963
Schedule of Future Payments of the Term Loan Facility
ABL Facility, covenant terms, minimum remaining borrowing capacity	345,200
Letters of Credit Outstanding, Amount	(800)
Repayments of Short-term Debt	$ 210,000	$ 0
Senior Notes [Member]
Long-Term Borrowings [Line Items]
Maturity date	Jul. 15, 2025
Gross borrowings outstanding, carrying amount	$ 350,000
Unamortized discount	(6,441)
Unamortized Debt Issuance Expense Fees Paid to Lenders	0
Term Loan Facility
Long-Term Borrowings [Line Items]
Maximum borrowing capacity	300,000
Gross borrowings outstanding, carrying amount			233,250
Unamortized discount			(355)
Unamortized Debt Issuance Expense Fees Paid to Lenders			(932)
Borrowings, net			$ 231,963
ABL Facility
Long-Term Borrowings [Line Items]
Maximum borrowing capacity	$ 400,000
Maturity date	Oct. 19, 2022

XML

Borrowings Schedule of Short-term borrowings (Details) $ in Millions	Oct. 31, 2020 USD ($)
Short-term debt disclosure [Abstract]
Line of Credit Facility, Remaining Borrowing Capacity	$ 383.7

XML

Share-Based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 31, 2020	Nov. 02, 2019	Oct. 31, 2020	Nov. 02, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares Issued, Value, Share-based Payment Arrangement, after Forfeiture	$ (150)	$ (181)	$ (5,566)	$ (6,619)
Payment, Tax Withholding, Share-based Payment Arrangement	150	181	5,566	6,619
Share-based compensation expense	4,669	5,796	13,575	8,464
Tax benefit recognized related to share-based compensation expense	0	1,211	0	1,566
Share-based Payment Arrangement, Exercise of Option, Tax Benefit	0	6	0	1,175
Share-based Payment Arrangement, Cancellation of Option, Tax Charge	0	(447)	0	(611)
Share-based Payment Arrangement, Discrete Income Tax Benefit (Charge)	0	(441)	0	564
Stock Appreciation Rights
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total grant date fair value of awards vested				620
Service-based restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total unrecognized compensation cost, net of estimated forfeitures	27,879		$ 27,879
Unrecognized compensation cost, weighted-average period of recognition			1 year 3 months 18 days
Total grant date fair value of awards granted			$ 19,541	16,175
Total grant date fair value of awards vested			13,769	13,087
Performance-based restricted stock units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total unrecognized compensation cost, net of estimated forfeitures	0		$ 0
Unrecognized compensation cost, weighted-average period of recognition			0 years
Total grant date fair value of awards granted			$ 0	5,379
Total grant date fair value of awards vested			4,635	0
Market-based restricted stock units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total unrecognized compensation cost, net of estimated forfeitures	9,939		$ 9,939
Unrecognized compensation cost, weighted-average period of recognition			1 year 1 month 6 days
Total grant date fair value of awards granted			$ 8,443	4,176
Total grant date fair value of awards vested			4,132	511
Additional Paid-in Capital [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares Issued, Value, Share-based Payment Arrangement, after Forfeiture	(436)	(509)	(22,053)	(13,862)
Share-based compensation expense	$ 4,669	$ 5,796	$ 13,575	$ 8,464

XML

Share-Based Compensation (Restricted Stock Units Activity) (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended		9 Months Ended
		Oct. 31, 2020	Nov. 02, 2019	Oct. 31, 2020	Nov. 02, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Payment Arrangement, Exercise of Option, Tax Benefit		$ 0	$ 6	$ 0	$ 1,175
Restricted Stock Unit Activity, Number of Underlying Shares
Number of Underlying Shares, Beginning Balance at February 1, 2020				796,725
Number of Underlying Shares, Granted				0
Number of Underlying Shares, Forfeited				(382,225)
Number of Underlying Shares, Ending Balance at August 1, 2020		414,500		414,500
Restricted Stock Unit Activity, Weighted-Average Grant Date Fair Value
Weighted-Average Grant Date Fair Value, Beginning Balance at February 1, 2020				$ 40.06
Weighted-Average Grant Date Fair Value, Granted				0
Weighted-Average Grant Date Fair Value, Forfeited				47.87
Weighted-Average Grant Date Fair Value, Ending Balance at August 1, 2020		$ 32.86		$ 32.86
Service-based restricted stock units with $1.00 net income requirement [Member]
Restricted Stock Unit Activity, Number of Underlying Shares
Number of Underlying Shares, Ending Balance at August 1, 2020		66,624		66,624
Service-based restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount		$ 27,879		$ 27,879
Restricted Stock Unit Activity, Number of Underlying Shares
Number of Underlying Shares, Beginning Balance at February 1, 2020				1,676,831
Number of Underlying Shares, Granted				2,280,194
Number of Underlying Shares, Adjustments for performance achievement				0
Number of Underlying Shares, Vested				(790,429)
Number of Underlying Shares, Forfeited				(107,795)
Number of Underlying Shares, Ending Balance at August 1, 2020	[1]	3,058,801		3,058,801
Restricted Stock Unit Activity, Weighted-Average Grant Date Fair Value
Weighted-Average Grant Date Fair Value, Beginning Balance at February 1, 2020				$ 18.68
Weighted-Average Grant Date Fair Value, Granted				8.57
Weighted-Average Grant Date Fair Value, Adjustments for performance achievement				0
Weighted-Average Grant Date Fair Value, Vested				17.42
Weighted-Average Grant Date Fair Value, Forfeited				13.83
Weighted-Average Grant Date Fair Value, Ending Balance at August 1, 2020		$ 11.63		$ 11.63
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition				1 year 3 months 18 days
Performance-based restricted stock units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount		$ 0		$ 0
Restricted Stock Unit Activity, Number of Underlying Shares
Number of Underlying Shares, Beginning Balance at February 1, 2020				747,056
Number of Underlying Shares, Granted				0
Number of Underlying Shares, Adjustments for performance achievement				38,381
Number of Underlying Shares, Vested				(481,304)
Number of Underlying Shares, Forfeited				(6,917)
Number of Underlying Shares, Ending Balance at August 1, 2020		297,216		297,216
Restricted Stock Unit Activity, Weighted-Average Grant Date Fair Value
Weighted-Average Grant Date Fair Value, Beginning Balance at February 1, 2020				$ 15.11
Weighted-Average Grant Date Fair Value, Granted				0
Weighted-Average Grant Date Fair Value, Adjustments for performance achievement				11.37
Weighted-Average Grant Date Fair Value, Vested				9.63
Weighted-Average Grant Date Fair Value, Forfeited				22.80
Weighted-Average Grant Date Fair Value, Ending Balance at August 1, 2020		$ 22.43		$ 22.43
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition				0 years
Market-based restricted stock units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount		$ 9,939		$ 9,939
Restricted Stock Unit Activity, Number of Underlying Shares
Number of Underlying Shares, Beginning Balance at February 1, 2020				421,784
Number of Underlying Shares, Granted				519,905
Number of Underlying Shares, Adjustments for performance achievement				134,122
Number of Underlying Shares, Vested				(350,447)
Number of Underlying Shares, Forfeited				(3,485)
Number of Underlying Shares, Ending Balance at August 1, 2020		721,879		721,879
Restricted Stock Unit Activity, Weighted-Average Grant Date Fair Value
Weighted-Average Grant Date Fair Value, Beginning Balance at February 1, 2020				$ 23.05
Weighted-Average Grant Date Fair Value, Granted				16.24	$ 36.24
Weighted-Average Grant Date Fair Value, Adjustments for performance achievement				11.79
Weighted-Average Grant Date Fair Value, Vested				11.79
Weighted-Average Grant Date Fair Value, Forfeited				35.61
Weighted-Average Grant Date Fair Value, Ending Balance at August 1, 2020		$ 21.46		$ 21.46
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition				1 year 1 month 6 days

[1] (1)    Includes 66,624 unvested restricted stock units as of October 31, 2020, subject to vesting requirements related to the achievement of certain performance metrics, such as operating income and net income, for the fiscal year immediately preceding the vesting date. Holders of these restricted stock units have the opportunity to earn back one or more installments of the award if the cumulative performance requirements are met in a subsequent year. (2)    Unvested shares related to restricted stock units with performance-based and market-based vesting conditions are reflected at 100% of their target vesting amount in the table above. Certain unvested shares related to restricted stock units with performance-based vesting conditions can be achieved at up to 200% of their target vesting amount.

XML

Share-Based Compensation (Restricted Stock Units Assumptions) (Details) - $ / shares	9 Months Ended
	Oct. 31, 2020	Nov. 02, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Document Period End Date	Oct. 31, 2020
Fair value (in dollars per share)	$ 0
City Area Code	(614)
Market-based restricted stock units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant date market price (in dollars per share)	$ 12.31	$ 25.34
Fair value (in dollars per share)	$ 16.24	$ 36.24
Price volatility	67.00%	57.00%
Expected term (years)	2 years 4 months 24 days	2 years 10 months 24 days
Risk-free interest rate	0.20%	2.20%
Dividend yield	0.00%	3.20%
Average volatility of peer companies	66.00%	40.00%
Average correlation coefficient of peer companies	0.4967	0.2407

XML

Share-Based Compensation (Stock Appreciation Rights Activity) (Details) - USD ($)	9 Months Ended
	Oct. 31, 2020	Nov. 02, 2019
Stock Appreciation Rights Activity, Number of Underlying Shares
Number of Underlying Shares, Beginning Balance at February 1, 2020	796,725
Number of Underlying Shares, Granted	0
Number of Underlying Shares, Exercised	0
Number of Underlying Shares, Forfeited	(382,225)
Number of Underlying Shares, Ending Balance at August 1, 2020	414,500
Number of Underlying shares, Stock appreciation rights exercisable	414,500
Number of Underlying Shares, Stock appreciation rights expected to become exercisable	0
Stock Appreciation Rights, Weighted-Average Exercise Price
Weighted-Average Grant Date Fair Value, Beginning Balance at February 1, 2020	$ 40.06
Weighted-Average Exercise Price, Granted	0
Weighted-Average Exercise Price, Exercised	0
Weighted-Average Exercise Price, Forfeited or expired	47.87
Weighted-Average Grant Date Fair Value, Ending Balance at August 1, 2020	32.86
Weighted-Average Exercise Price, Stock appreciation rights exercisable	32.86
Weighted-Average Exercise Price, Stock appreciation rights expected to become exercisable	$ 0
Aggregate Intrinsic Value, Outstanding	$ 0
Aggregate Intrinsic Value, Stock appreciation rights exercisable	0
Aggregate Intrinsic Value, Stock appreciation rights expected to become exercisable	$ 0
Weighted-Average Remaining Contractual Life, Outstanding	3 years 2 months 12 days
Weighted-Average Remaining Contractual Life, Stock appreciation rights exercisable	3 years 2 months 12 days
Weighted Average Remaining Contractual Life, Stock appreciation rights expected to become exercisable	0 years
Stock Appreciation Rights
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value		$ 620,000

XML

Derivative Instruments (Outstanding Foreign Exchange Forward Contracts) (Details) $ in Thousands	Oct. 31, 2020 USD ($)
Euro Member Countries, Euro
Derivative [Line Items]
Notional Amount	$ 65,537
United Kingdom, Pounds
Derivative [Line Items]
Notional Amount	29,603
Canada, Dollars
Derivative [Line Items]
Notional Amount	$ 11,239

XML

Derivative Instruments (Derivative Fair Values on the Condensed Consolidated Balance Sheets) (Details) - USD ($) $ in Thousands	Oct. 31, 2020	Feb. 01, 2020
Derivative Instruments, Gain (Loss) [Line Items]
Foreign Currency Cash Flow Hedge Asset at Fair Value	$ 461	$ 1,869
Foreign Currency Cash Flow Hedge Liability at Fair Value	367	1,377
Foreign Currency Derivative Instruments Not Designated as Hedging Instruments, Asset at Fair Value	0	100
Foreign Currency Derivative Instruments Not Designated as Hedging Instruments, Liability at Fair Value	0	83
Fair Value, Recurring [Member]
The location and amounts of derivative fair values on the Condensed Consolidated Balance Sheets
Other current assets	461	1,969
Accrued expenses	367	1,460
Level 2 | Fair Value, Recurring [Member]
The location and amounts of derivative fair values on the Condensed Consolidated Balance Sheets
Other current assets	461	1,969
Accrued expenses	$ 367	$ 1,460

XML

Derivative Instruments (Derivative Gains (Losses) on the Condensed Consolidated Statement of Operations) (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Oct. 31, 2020	Nov. 02, 2019	Oct. 31, 2020	Nov. 02, 2019
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain (Loss) Recognized in AOCL on Derivative Contracts (Effective Portion)	[1]	$ 93	$ (1,136)	$ 12,328	$ 5,918
Amount of Gain (Loss) Reclassified from AOCL into Earnings (Effective Portion)	[2]	5,327	2,541	11,104	6,845
Gain/(Loss)		$ 0	$ (1,023)	$ 742	$ 157

[1] mount represents the change in fair value of derivative contracts.

[2] Amount represents gain 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.

XML

Derivative Instruments (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Oct. 31, 2020	Nov. 02, 2019	Oct. 31, 2020	Nov. 02, 2019	Feb. 01, 2020
Derivative Instruments, Gain (Loss) [Line Items]
Derivatives, Gain Deferred in AOCL				$ 12,600
Foreign Currency Cash Flow Hedge Asset at Fair Value		$ 461		461		$ 1,869
Foreign Currency Cash Flow Hedge Liability at Fair Value		367		367		1,377
Foreign Currency Derivative Instruments Not Designated as Hedging Instruments, Asset at Fair Value		0		0		100
Foreign Currency Derivative Instruments Not Designated as Hedging Instruments, Liability at Fair Value		0		0		83
Derivative Instruments, Gain (Loss) Reclassified from Accumulated AOCL into Income, Effective Portion, Net	[1]	5,327	$ 2,541	$ 11,104	$ 6,845
Length of time inventory sales hedged (in months)				12 months
Derivative Instruments, Gain (Loss) Recognized in AOCL, Effective Portion, Net	[2]	93	$ (1,136)	$ 12,328	$ 5,918
Euro Member Countries, Euro
Derivative Instruments, Gain (Loss) [Line Items]
Notional Amount		65,537		65,537
United Kingdom, Pounds
Derivative Instruments, Gain (Loss) [Line Items]
Notional Amount		29,603		29,603
Canada, Dollars
Derivative Instruments, Gain (Loss) [Line Items]
Notional Amount		11,239		11,239
Fair Value, Recurring [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Other current assets		461		461		1,969
Accrued expenses		367		367		1,460
Level 2 | Fair Value, Recurring [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Other current assets		461		461		1,969
Accrued expenses		$ 367		$ 367		$ 1,460

[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 Income (Loss) when the hedged item affects earnings, which is when merchandise is converted to cost of sales, exclusive of depreciation and amortization.

[2] mount represents the change in fair value of derivative contracts.

XML

Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands	3 Months Ended				9 Months Ended
	Oct. 31, 2020		Nov. 02, 2019		Oct. 31, 2020		Nov. 02, 2019
Accumulated Other Comprehensive Loss [Roll Forward]
Beginning balance	$ (99,093)		$ (105,946)		$ (108,886)		$ (102,452)
Other comprehensive income before reclassifications	2,235		219		17,805		699
Reclassified gain from accumulated other comprehensive loss (1)	(5,327)	[1]	(2,541)	[2]	(11,104)	[1]	(6,845)	[2]
Tax effect			23				353
Other comprehensive income after reclassifications (2)	(3,092)	[3]	(2,299)		6,701	[3]	(5,793)
Ending balance at October 31, 2020	(102,185)		(108,245)		(102,185)		(108,245)
Foreign Currency Translation Adjustment
Accumulated Other Comprehensive Loss [Roll Forward]
Beginning balance	(106,632)		(111,461)		(109,967)		(104,887)
Other comprehensive income before reclassifications	2,142		1,355		5,477		(5,219)
Reclassified gain from accumulated other comprehensive loss (1)	0		0		0		0
Tax effect			0				0
Other comprehensive income after reclassifications (2)	2,142	[3]	1,355		5,477	[3]	(5,219)
Ending balance at October 31, 2020	(104,490)		(110,106)		(104,490)		(110,106)
Unrealized Gain (Loss) on Derivative Financial Instruments
Accumulated Other Comprehensive Loss [Roll Forward]
Beginning balance	7,539		5,515		1,081		2,435
Other comprehensive income before reclassifications	93		(1,136)		12,328		5,918
Reclassified gain from accumulated other comprehensive loss (1)	(5,327)		(2,541)		(11,104)		(6,845)
Tax effect			23				353
Other comprehensive income after reclassifications (2)	(5,234)	[3]	(3,654)		1,224	[3]	(574)
Ending balance at October 31, 2020	$ 2,305		$ 1,861		$ 2,305		$ 1,861

[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 Income (Loss).

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

[3] No tax effect was recognized during the thirteen and thirty-nine weeks ended October 31, 2020 due to the U.S. being a loss jurisdiction.

XML

Segment Reporting (Segment Reporting Information, by Segment) (Details)	3 Months Ended	9 Months Ended
	Oct. 31, 2020	Oct. 31, 2020
Segment Reporting Information [Line Items]
Number of Operating Segments	2
Number of reportable segments		1

XML

Segment Reporting (Net Sales by Brand) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 31, 2020	Nov. 02, 2019	Oct. 31, 2020	Nov. 02, 2019
Schedule of Revenue by Brand [Line Items]
Net sales	$ 819,653	$ 863,472	$ 2,003,340	$ 2,438,522
Hollister
Schedule of Revenue by Brand [Line Items]
Net sales	476,665	514,772	1,178,925	1,447,975
Abercrombie
Schedule of Revenue by Brand [Line Items]
Net sales	$ 342,988	$ 348,700	$ 824,415	$ 990,547

XML

Segment Reporting (Sales by Geographic Area) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 31, 2020	Nov. 02, 2019	Oct. 31, 2020	Nov. 02, 2019
Net sales	$ 819,653	$ 863,472	$ 2,003,340	$ 2,438,522
United States
Net sales	557,814	583,593	1,339,347	1,596,723
EMEA [Member]
Net sales	190,214	191,977	474,165	566,563
Asia Pacific [Member]
Net sales	43,618	55,910	117,768	188,836
Other
Net sales	28,007	31,992	72,060	86,400
International [Member]
Net sales	$ 261,839	$ 279,879	$ 663,993	$ 841,799

XML

Flagship Store Exit (Benefits) Charges (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 31, 2020	Nov. 02, 2019	Oct. 31, 2020	Nov. 02, 2019
Flagship Store Exit Charges [Abstract]
Lease Cost from Flagship Store Exits	$ (1,729)	$ 0	$ (6,959)	$ 46,716
Gain (Loss) on Termination of Lease	(5,237)	0	(5,237)	0
Property, Plant and Equipment, Disposals	(405)	0	(3,610)	(1,687)
Severance Costs	(692)	285	3,316	1,994
Flagship store exit (benefits) charges	(8,063)	$ 285	(12,490)	$ 47,023
Maximum Annual Cash Payments	$ 15,000		$ 15,000