8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 14, 2012

ABERCROMBIE & FITCH CO.

(Exact name of registrant as specified in its charter)

Delaware	1-12107	31-1469076
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
6301 Fitch Path, New Albany, Ohio		43054
(Address of principal executive offices)		(Zip Code)

(614) 283-6500

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

On August 15, 2012, Abercrombie & Fitch Co. (the “Registrant”) issued a press release (the “Release”) reporting the Registrant’s unaudited financial results for the thirteen weeks (quarterly period) and twenty-six weeks (year-to-date period) ended July 28, 2012. A copy of the Release is included as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

The Registrant also made available in conjunction with the Release additional unaudited quarterly financial information as of and for the quarterly periods and year-to-date periods in the fiscal years ending February 2, 2013 and the fiscal year ended January 28, 2012. Additional financial information was made available for the fiscal years ended January 29, 2011, January 30, 2010 and January 31, 2009. The additional financial information is furnished as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference.

The Registrant also made available in conjunction with the Release an investor presentation of results for the quarterly period ended July 28, 2012. The presentation, which is available under the “Investor Presentations” tab in the “Investors” section of the Registrant’s website, located at www.abercrombie.com, is furnished as Exhibit 99.3 to this Current Report on Form 8-K and is incorporated herein by reference.

The Registrant’s management conducted a conference call on August 15, 2012, at approximately 8:30 a.m., Eastern Time, to review the Registrant’s financial results for the thirteen-week period ended July 28, 2012. A copy of the transcript of the conference call is furnished as Exhibit 99.4 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 8.01. Other Events.

In the Release, the Registrant also announced that the Board of Directors of the Registrant had declared a quarterly cash dividend of $0.175 per share in respect of the Registrant’s Class A Common Stock. The dividend was declared on August 14, 2012 and is payable on September 11, 2012 to shareholders of record at the close of business on August 27, 2012. At the meeting of the Board of Directors of the Registrant held on August 14, 2012, the Board authorized the repurchase of an additional ten million shares of the Registrant’s Class A Common Stock. This authorization is in addition to the 12,918,968 shares of Class A Common Stock which remained available in the aggregate as of August 14, 2012 for repurchase under the November 20, 2007 and May 15, 2012 authorizations by the Registrant’s Board of Directors to repurchase shares of the Registrant’s Class A Common Stock.

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Item 9.01. Financial Statements and Exhibits.

(a) through (c) Not applicable

(d) Exhibits:

The following exhibits are included with this Current Report on Form 8-K:

Exhibit No.	Description
99.1	Press Release issued by Abercrombie & Fitch Co. on August 15, 2012
99.2	Additional Unaudited Quarterly and Year-To-Date Financial Information made available by Abercrombie & Fitch Co. in conjunction with Press Release on August 15, 2012
99.3	Investor presentation of results for the quarterly period ended July 28, 2012 made available by Abercrombie & Fitch Co. with the Press Release issued on August 15, 2012
99.4	Transcript of conference call held by management of Abercrombie & Fitch Co. on August 15, 2012

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

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SIGNATURE

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 hereunto duly authorized.

	ABERCROMBIE & FITCH CO.
Dated: August 17, 2012	By:	/s/ Jonathan E. Ramsden
		Jonathan E. Ramsden
		Executive Vice President and Chief Financial Officer

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INDEX TO EXHIBITS

Current Report on Form 8-K

Dated August 17, 2012

Abercrombie & Fitch Co.

Exhibit No.	Description
99.1	Press Release issued by Abercrombie & Fitch Co. on August 15, 2012
99.2	Additional Unaudited Quarterly and Year-to-Date Financial Information made available by Abercrombie & Fitch Co. in conjunction with Press Release on August 15, 2012
99.3	Investor presentation of results for the quarterly period ended July 28, 2012 made available by Abercrombie & Fitch Co. with the Press Release issued on August 15, 2012
99.4	Transcript of conference call held by management of Abercrombie & Fitch Co. on August 15, 2012

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EX-99.1

Exhibit 99.1

ABERCROMBIE & FITCH REPORTS SECOND QUARTER 2012 RESULTS

BOARD OF DIRECTORS DECLARES QUARTERLY DIVIDEND OF $0.175 AND INCREASES

SHARE REPURCHASE AUTHORIZATION BY TEN MILLION SHARES

New Albany, Ohio, August 15, 2012: Abercrombie & Fitch Co. (NYSE: ANF) today reported unaudited results which reflected net income of $15.5 million and net income per diluted share of $0.19 for the thirteen weeks ended July 28, 2012, compared to net income of $32.0 million and net income per diluted share of $0.35 for the thirteen weeks ended July 30, 2011.

Mike Jeffries, Chief Executive Officer and Chairman of the Board of Abercrombie & Fitch Co., said:

“The second quarter results we are reporting today are disappointing and below our expectations coming into the quarter. In particular, we saw a further deceleration in the trend in our international stores, while our U.S. chain stores also comped negatively for the quarter for the first time since 2009. Our direct to consumer business remained a bright spot, posting its tenth successive quarter with growth of 25% or better.

Our entire organization is completely focused on improving upon the trends we have seen. There are factors beyond our control but, as a team, we believe there are opportunities to do better. We continue to be confident in the global appeal of our iconic brands. This was once again affirmed by the tremendous reception our Hong Kong flagship received at its opening this past Saturday. We remain excited and optimistic about the opportunities ahead of us, and we will be disciplined and judicious in our use of our shareholders’ capital to pursue those opportunities.”

Second Quarter Summary

Net sales for the thirteen weeks ended July 28, 2012 increased 4% to $951.4 million from $916.8 million for the thirteen weeks ended July 30, 2011. Total U.S. sales, including direct-to-consumer sales, decreased 5% to $648.0 million. Total international sales, including direct-to-consumer sales, increased 31% to $303.4 million. Total Company direct-to-consumer sales, including shipping and handling, increased 25% to $127.7 million.

Total comparable store sales for the quarter decreased 10% relative to last year. By brand, comparable store sales decreased 11% for Abercrombie & Fitch, 10% for abercrombie kids, and 10% for Hollister Co. Total sales by brand were $362.5 million for Abercrombie & Fitch, $76.3 million for abercrombie kids and $485.6 million for Hollister Co.

The gross profit rate for the second quarter was 62.5%, 110 basis points lower than last year’s second quarter gross profit rate. The decrease in the gross profit rate was driven by an increase in average unit cost and the adverse effect of exchange rates, partially offset by an international mix benefit.

Stores and distribution expense, as a percentage of net sales, increased to 48.1% from 46.4% for the second quarter of last year. The increase in the stores and distribution rate was primarily the result of deleveraging on negative comparable store sales.

Marketing, general and administrative expense for the second quarter was $111.3 million, compared to $110.0 million during the same period last year. The increase in marketing, general and administrative expense was due to increases in marketing expense, IT expense, travel and other expenses, largely offset by a decrease in incentive compensation expense.

The effective tax rate for continuing operations for the thirteen weeks ended July 28, 2012 was 38.9% compared to 30.7% for the prior year comparable period. The increase in the rate was primarily the result of a reduced benefit related to international operations which are taxed at a lower rate.

Net income was $15.5 million and net income per diluted share was $0.19 for the thirteen weeks ended July 28, 2012, compared to net income of $32.0 million and net income per diluted share of $0.35 for the comparable period last year.

The Company ended the second quarter of fiscal 2012 with $312.2 million in cash and cash equivalents, $20.1 million in current marketable securities, and borrowings under the revolving credit agreement of $75.0 million.

The Company did not repurchase shares of its common stock during the quarter.

During the quarter the Company opened a combined Hollister Co. and Gilly Hicks store in London on Regent Street, seven international Hollister Co. chain stores and three international Gilly Hicks chain stores. Subsequent to quarter end, the Company has opened an Abercrombie & Fitch flagship store in Hong Kong.

2012 Outlook

Based on a lower sales trend than previously projected, the Company now expects full year diluted earnings per share of approximately $2.50 to $2.75. This projection assumes comparable store sales will decline 10% for the second half of the year. The Company continues to expect substantial recovery of the gross margin rate erosion seen in 2011 on a 2012 full year basis. In addition to lower sales, the reduction in projected earnings per share also reflects the impact of a stronger US dollar and the impact of an increase in the effective tax rate. The Company now expects the tax rate for the year as a whole to be in the high 30s.

The Company will provide a strategic update on its international expansion plans, capital allocation plans, and its initiatives to increase domestic store profitability, as well as additional information on productivity, profitability and return on investment related to the Company’s international operations during its earnings call at 8:30 AM today.

The strategic update will include:

• A reduction in the expected number of fiscal 2012 international Hollister Co. chain store openings to approximately 30 stores from a previous expectation of close to 40 stores.

• A pause in new flagship store commitments, other than a planned Shanghai location.

• A reduced run rate for future international chain store openings, with a focus on under-penetrated markets where cannibalization effects are expected to be minimal, and subject to continued approval on a store by store basis.

• An updated fiscal 2012 capital expenditure budget of approximately $360 million, and an anticipated fiscal 2013 capital expenditure budget of approximately $200 million.

• An update on the Company’s share repurchase plans.

Other Developments

On August 14, 2012, the Board of Directors declared a quarterly cash dividend of $0.175 per share on the Class A Common Stock of Abercrombie & Fitch Co. payable on September 11, 2012 to shareholders of record at the close of business on August 27, 2012.

Additionally, the Board of Directors increased the existing share repurchase authorization by ten million shares, bringing the shares available for purchase under its publicly announced share repurchase authorization to 22.9 million shares.

An investor presentation of first quarter results will be available in the “Investors” section of the Company’s website at www.abercrombie.com at approximately 8:00 AM, Eastern Time, today.

The Company will report third quarter sales and earnings results on Wednesday, November 14, 2012.

At the end of the second quarter, the Company operated a total of 1,055 stores. The Company operated 278 Abercrombie & Fitch stores, 154 abercrombie kids stores, 486 Hollister Co. stores and 18 Gilly Hicks stores in the United States. The Company operated 15 Abercrombie & Fitch stores, five abercrombie kids stores, 92 Hollister Co. stores and seven Gilly Hicks stores internationally. The Company operates e-commerce websites at www.abercrombie.com, www.abercrombiekids.com, www.hollisterco.com and www.gillyhicks.com.

Today at 8:30 AM, Eastern Time, the Company will conduct a conference call. Management will discuss the Company’s performance and its plans for the future and will accept questions from participants. To listen to the conference call, dial (888) 461-2031 and ask for the Abercrombie & Fitch Quarterly Call or go to www.abercrombie.com. The international call-in number is (719) 325-2255. This call will be recorded and made available by dialing the replay number (888) 203-1112 or the international number (719) 457-0820 followed by the conference ID number 1694108 or through wwww.abercrombie.com.

For further information, call:

ICR, Inc.

Joe Teklits / Jean Fontana

joseph.teklits@icrinc.com

203-682-8258

SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

A&F cautions that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this Press Release or made by management of A&F involve risks and uncertainties and are subject to change based on various 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. Except as may be required by applicable law, we assume no obligation to publicly update or revise our forward-looking statements. The following factors, in addition to those included in the disclosure 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 the fiscal year ended January 28, 2012, in some cases have affected and in the future could affect the Company’s financial performance and could cause actual results for the 2012 fiscal year and beyond to differ materially from those expressed or implied in any of the forward-looking statements included in this Press Release or otherwise made by management: changes in economic and financial conditions, and the resulting impact on consumer confidence and consumer spending, could have a material adverse effect on our business, results of operations and liquidity; if we are unable to anticipate, identify and respond to changing fashion trends and consumer preferences in a timely manner, and manage our inventory commensurate with customer demand, our sales levels and profitability may decline; fluctuations in the cost, availability and quality of raw materials, labor and transportation, could cause manufacturing delays and increase our costs; equity-based compensation awarded under the employment agreement with our Chief Executive Officer could adversely impact our cash flows, financial position or results of operations and could have a dilutive effect on our outstanding Common Stock; our growth strategy relies significantly on international expansion, which adds complexity to our operations and may strain our resources and adversely impact current store performance; our international expansion plan is dependent on a number of factors, any of which could delay or prevent successful penetration into new markets or could adversely affect the profitability of our international operations; our direct-to-consumer sales are subject to numerous risks that could adversely impact sales; we have incurred, and may continue to incur, significant costs related to store closures; our development of a new brand concept such as Gilly Hicks could have a material adverse effect on our financial condition or results of operations; fluctuations in foreign currency exchange rates could adversely impact our financial condition and results of operations; our business could suffer if our information technology systems are disrupted or cease to operate effectively; comparable store sales may continue to fluctuate on a regular basis and impact the volatility of the price of our Common Stock; our market share may be negatively impacted by increasing competition and pricing pressures from companies with brands or merchandise competitive with ours; our stock price may be volatile and investors may not be able to resell shares of our Common Stock at or above the price paid to acquire the shares; our ability to attract customers to our stores depends, in part, on the success of the shopping malls in which most of our stores are located; our net sales fluctuate on a seasonal basis, causing our results of operations to be susceptible to changes in Back-to-School and Holiday shopping patterns; our inability to accurately plan for product demand and allocate merchandise effectively could have a material adverse effect on our results; our failure to protect our reputation could have a material adverse effect on our brands; we rely on the experience and skills of our senior executive officers, the loss of whom could have a material adverse effect on our business; interruption in the flow of merchandise from our key vendors and international manufacturers could disrupt our supply chain, which could result in lost sales and could increase our costs; we do not own or operate any manufacturing facilities and, therefore, depend upon independent third parties for the manufacture of all our merchandise; our reliance on two distribution centers domestically and two third-party distribution centers internationally makes us susceptible to disruptions or adverse conditions affecting our distribution centers; our reliance on third parties to deliver merchandise from our distribution centers to our stores and direct-to-consumer customers could result in disruptions to our business; we may be exposed to risks and costs associated with credit card fraud and identity theft that would cause us to incur unexpected expenses and loss of revenues; modifications and/or upgrades to our information technology systems may disrupt our operations; our facilities, systems and stores, as well as the facilities and systems of our vendors and manufacturers, are vulnerable to natural disasters, pandemic disease and other unexpected events, any of which could result in an interruption to our business and adversely affect our operating results; our litigation exposure could have a material adverse effect on our financial condition and results of operations; our inability or failure to adequately protect our trademarks could have a negative impact on our brand image and limit our ability to penetrate new markets; fluctuations in our tax obligations and effective tax rate may result in volatility in our operating results; the effects of war or acts of terrorism could have a material adverse effect on our operating results and financial condition; our inability to obtain commercial insurance at acceptable prices or our failure to adequately reserve for self-insured exposures might increase our expenses and adversely impact our financial results; operating results and cash flows at the store level may cause us to incur impairment charges; we are subject to customs, advertising, consumer protection, privacy, zoning and occupancy and labor and employment laws that could require us to modify our current business practices, incur increased costs or harm our reputation if we do not comply; changes in the regulatory or compliance landscape could adversely affect our business and results of operations; our unsecured Amended and Restated Credit Agreement (the “Amended and Restated Credit Agreement”) and our Term Loan Agreement include financial and other covenants that impose restrictions on our financial and business operations; our operations may be affected by regulatory changes related to climate change and greenhouse gas emissions; and compliance with changing regulations and standards for accounting, corporate governance and public disclosure could adversely affect our business, results of operations and reported financial results.

Abercrombie & Fitch Co.

Consolidated Statements of Income

Thirteen Weeks Ended July 28, 2012 and July 30, 2011

(in thousands, except per share data)

	(Unaudited)					(Unaudited)
	2012		% of Net Sales			2011		% of Net Sales
Net Sales	$	951,407		100.0	%	$	916,763		100.0	%
Cost of Goods Sold		357,000		37.5	%		333,721		36.4	%
Gross Profit		594,407		62.5	%		583,042		63.6	%
Total Stores and Distribution Expense		458,085		48.1	%		425,325		46.4	%
Total Marketing, General and Administrative Expense		111,293		11.7	%		109,999		12.0	%
Other Operating (Income) Expense, Net		(1,933)		-0.2	%		544		0.1	%
Operating Income		26,962		2.8	%		47,174		5.1	%
Interest Expense, Net		1,546		0.2	%		985		0.1	%
Income Before Taxes		25,416		2.7	%		46,189		5.0	%
Tax Expense		9,897		1.0	%		14,158		1.5	%
Net Income		15,519		1.6	%		32,031		3.5	%
Net Income Per Share
Basic	$	0.19				$	0.37
Diluted	$	0.19				$	0.35
Weighted-Average Shares Outstanding:
Basic		82,555					87,267
Diluted		83,441					90,353

Abercrombie & Fitch Co.

Consolidated Statements of Income

Twenty-Six Weeks Ended July 28, 2012 and July 30, 2011

(in thousands, except per share data)

	(Unaudited)						(Unaudited)
	2012			% of Net Sales			2011			% of Net Sales
Net Sales	$	1,872,625			100.0	%	$	1,753,437			100.0	%
Cost of Goods Sold		701,859			37.5	%		626,734			35.7	%
Gross Profit		1,170,766			62.5	%		1,126,703			64.3	%
Total Stores and Distribution Expense		913,817			48.8	%		824,426			47.0	%
Total Marketing, General and Administrative Expense		228,182			12.2	%		217,650			12.4	%
Other Operating Income, Net		(4,519	)		-0.2	%		(1,292	)		-0.1	%
Operating Income		33,286			1.8	%		85,919			4.9	%
Interest Expense, Net		2,636			0.1	%		1,935			0.1	%
Income from Continuing Operation Before Taxes		30,650			1.6	%		83,984			4.8	%
Tax Expense from Continuing Operations		12,146			0.6	%		27,608			1.6	%
Net Income from Continuing Operations		18,504			1.0	%		56,376			3.2	%
Net Income from Discontinued Operations (net of taxes)		—			0.0	%		796			0.0	%
Net Income	$	18,504			1.0	%	$	57,172			3.3	%
Net Income Per Share from Continuing Operations:
Basic	$	0.22					$	0.65
Diluted	$	0.22					$	0.62
Net Income Per Share from Discontinued Operations:
Basic	$	—					$	0.01
Diluted	$	—					$	0.01
Net Income Per Share:
Basic	$	0.22					$	0.66
Diluted	$	0.22					$	0.63
Weighted-Average Shares Outstanding:
Basic		83,574						87,274
Diluted		84,813						90,397

Abercrombie & Fitch Co.

Consolidated Balance Sheets

(in thousands)

	(Unaudited) July 28, 2012		January 28, 2012		(Unaudited) July 30, 2011
ASSETS
Current Assets
Cash and Equivalents	$	312,153	$	583,495	$	539,613
Marketable Securities		20,110		84,650		—
Receivables		95,267		89,350		91,550
Inventories		621,740		569,818		516,128
Deferred Income Taxes		86,186		77,120		47,884
Other Current Assets		91,205		84,342		96,967
Total Current Assets		1,226,661		1,488,775		1,292,142
Property and Equipment, Net		1,280,239		1,197,271		1,196,585
Non-Current Marketable Securities		—		14,858		101,923
Other Assets		362,338		347,249		330,084
TOTAL ASSETS	$	2,869,238	$	3,048,153	$	2,920,734
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities
Accounts Payable and Outstanding Checks	$	186,447	$	211,368	$	221,004
Accrued Expenses		350,075		369,073		295,335
Deferred Lease Credits		39,996		41,047		42,244
Borrowings		75,000		—		—
Income Taxes Payable		36,062		77,918		16,951
Total Current Liabilities		687,580		699,406		575,534
Long-Term Liabilities
Deferred Lease Credits		176,875		183,022		194,586
Leasehold Financing Obligations		62,827		57,851		26,288
Other Liabilities		246,120		245,418		237,456
Total Long-Term Liabilities		485,822		486,291		458,330
Total Shareholders’ Equity		1,695,836		1,862,456		1,886,870
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	2,869,238	$	3,048,153	$	2,920,734

Abercrombie & Fitch Co.

U.S. Store Count

(Unaudited)

Thirteen Week Period Ended July 28, 2012

Store Activity	Abercrombie & Fitch			abercrombie		Hollister			Gilly Hicks		Total
April 28, 2012		279			154		491			18		942
New		—			—		—			—		—
Closed		(1	)		—		(5	)		—		(6	)
July 28, 2012		278			154		486			18		936

Abercrombie & Fitch Co.

International Store Count

(Unaudited)

Thirteen Week Period Ended July 28, 2012

Store Activity	Abercrombie & Fitch		abercrombie		Hollister		Gilly Hicks		Total
April 28, 2012		15		5		84		3		107
New		—		—		8		4		12
Closed		—		—		—		—		—
July 28, 2012		15		5		92		7		119

Abercrombie & Fitch Co.

U.S. Store Count

(Unaudited)

Twenty-Six Week Period Ended July 28, 2012

Store Activity	Abercrombie & Fitch			abercrombie		Hollister			Gilly Hicks		Total
January 28, 2012		280			154		494			18		946
New		1			—		—			—		1
Closed		(3	)		—		(8	)		—		(11	)
July 28, 2012		278			154		486			18		936

Abercrombie & Fitch Co.

International Store Count

(Unaudited)

Twenty-Six Week Period Ended July 28, 2012

Store Activity	Abercrombie & Fitch		abercrombie		Hollister		Gilly Hicks		Total
January 28, 2012		14		5		77		3		99
New		1		—		15		4		20
Closed		—		—		—		—		—
July 28, 2012		15		5		92		7		119

EX-99.2

Exhibit 99.2

Abercrombie & Fitch Co.

Quarterly Financial Information

(Unaudited)

(in thousands, except per share data and store data)

										Fiscal 2011															Fiscal 2012
	2008			2009			2010			Q1			Q2			Q3			Q4			YTD			Q1			Q2			YTD
Net Sales	$	3,484,058		$	2,928,626		$	3,468,777		$	836,674		$	916,763		$	1,075,856		$	1,328,766		$	4,158,058		$	921,218		$	951,407		$	1,872,625
Cost of Goods Sold		1,152,963			1,045,028			1,256,596			293,013			333,721			429,334			583,120			1,639,188			344,859			357,000			701,859
Gross Profit		2,331,095			1,883,598			2,212,181			543,661			583,042			646,522			745,646			2,518,870			576,359			594,407			1,170,766
Total Stores and Distribution Expense		1,436,363			1,425,950			1,589,501			399,101			425,325			461,683			602,140			1,888,248			455,732			458,085			913,817
Total Marketing, General and Administrative Expense		405,248			353,269			400,804			107,651			109,999			107,844			111,627			437,120			116,889			111,293			228,182
Other Operating (Income) Expense, Net		(8,778	)		(13,533	)		(10,056	)		(1,836	)		544			(2,855	)		7,619			3,472			(2,584	)		(1,933	)		(4,519	)
Operating Income		498,262			117,912			231,932			38,745			47,174			79,850			24,260			190,030			6,322			26,962			33,286
Interest (Income) Expense, Net		(11,382	)		(1,598	)		3,362			950			985			533			1,108			3,577			1,089			1,546			2,636
Income from Continuing Operations Before Taxes		509,644			119,510			228,570			37,795			46,189			79,317			23,152			186,453			5,233			25,416			30,650
Tax Expense for Continuing Operations		201,475			40,557			78,287			13,450			14,158			28,412			3,572			59,591			2,248			9,897			12,146
Net Income from Continuing Operations		308,169			78,953			150,283			24,345			32,031			50,905			19,580			126,862			2,985			15,519			18,504
Net Income (Loss) from Discontinued Operations (Net of Taxes)		(35,914	)		(78,699	)		—			796			—			—			—			796			—			—			—
Net Income	$	272,255		$	254		$	150,283		$	25,141		$	32,031		$	50,905		$	19,580		$	127,658		$	2,985		$	15,519		$	18,504
Net Income Per Share from Continuing Operations:
Basic	$	3.55		$	0.90		$	1.71		$	0.28		$	0.37		$	0.59		$	0.23		$	1.46		$	0.04		$	0.19		$	0.22
Diluted	$	3.45		$	0.89		$	1.67		$	0.27		$	0.35		$	0.57		$	0.22		$	1.42		$	0.03		$	0.19		$	0.22
Net (Loss) Income Per Share from Discontinued Operations:
Basic	$	(0.41	)	$	(0.90	)	$	—		$	0.01		$	—		$	—		$	—		$	0.01		$	—		$	—		$	—
Diluted	$	(0.40	)	$	(0.89	)	$	—		$	0.01		$	—		$	—		$	—		$	0.01		$	—		$	—		$	—
Net Income Per Share:
Basic	$	3.14		$	—		$	1.71		$	0.29		$	0.37		$	0.59		$	0.23		$	1.47		$	0.04		$	0.19		$	0.22
Diluted	$	3.05		$	—		$	1.67		$	0.28		$	0.35		$	0.57		$	0.22		$	1.43		$	0.03		$	0.19		$	0.22
Weighted-Average Shares Outstanding:
Basic		86,816			87,874			88,061			87,282			87,267			86,962			85,881			86,848			84,593			82,555			83,574
Diluted		89,291			88,609			89,851			90,441			90,353			89,707			87,648			89,537			86,184			83,441			84,813
Comparable Store Sales		-13	%		-23	%		7	%		10	%		9	%		7	%		0	%		5	%		-5	%		-10	%		-8	%
Actual Shares Outstanding		87,055			87,985			87,246			87,377			86,966			87,158			85,638			85,638			82,542			82,567			82,567
Number of Stores — End of Period		1,097			1,096			1,069			1,071			1,073			1,092			1,045			1,045			1,049			1,055			1,055
Gross Square Feet — End of Period		7,760			7,848			7,756			7,738			7,801			7,967			7,778			7,778			7,840			7,900			7,900

EX-99.3

Exhibit 99.3

Exhibit 99.3 EST. 1892 Abercrombie & Fitch NEW YORK INVESTOR PRESENTATION 2012 SECOND QUARTER

SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 A&F cautions that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this presentation or made by management or spokespeople of A&F involve risks and uncertainties and are subject to change based on various important factors, many of which may be beyond the Company’s control. Wo rds such as “estimate,” “project,” “plan,” “believe,” “expect,” “anticipate,” “intend,” and similar expressions may identify forward-looking statements. Except as may be required by applicable law, we assume no obligation to publicly update or revise our forward-looking statements. The factors included in the disclosure 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 the fiscal year ended January 28, 2012, in some cases have affected and in the future could affect the Company’s financial performance and could cause actual results for the 2012 fiscal year and beyond to differ materially from those expressed or implied in any of the forward-looking statements included in this presentation or otherwise made by management. OTHER INFORMATION All dollar and share amounts are in thousands unless otherwise stated. Sub-totals and totals may not foot due to rounding.

Q2 UNAUDITED P&L SUMMARY 2012 % OF NET SALES 2011 % OF NET SALES NET SALES $951,407 100.0% $916,763 100.0% COST OF GOODS SOLD 357,000 37.5% 333,721 36.4% GROSS PROFIT 594,407 62.5% 583,042 63.6% OPERATING EXPENSE 569,378 59.8% 535,324 58.4% OTHER OPERATING (INCOME)/EXPENSE, NET (1,933) -0.2% 544 0.1% OPERATING INCOME 26,962 2.8% 47,174 5.1% INTEREST EXPENSE, NET 1,546 0.2% 985 0.1% INCOME BEFORE TAXES 25,416 2.7% 46,189 5.0% TAX EXPENSE 9,897 1.0% 14,158 1.5% NET INCOME $15,519 1.6% $32,031 3.5% NET INCOME PER SHARE BASIC $0.19 $0.37 DILUTED $0.19 $0.35

SALES ANALYSIS VERSUS PRIOR YEAR Q2 YEAR TO DATE TOTAL SALES + 4% TOTAL SALES + 7% TOTAL U.S. SALES—5% TOTAL U.S. SALES—3% TOTAL INTERNATIONAL SALES + 31% TOTAL INTERNATIONAL SALES + 36% DTC SALES + 25% DTC SALES + 33% COMPARABLE STORE SALES COMPARABLE STORE SALES TOTAL COMPANY—10% TOTAL COMPANY—8% ABERCROMBIE & FITCH—11% ABERCROMBIE & FITCH—8% abercrombie kids—10% abercrombie kids—11% HOLLISTER—10% HOLLISTER—8% SALES MIX SALES MIX

SALES GROWTH CONTRIBUTION GROWTH SECOND QUARTER CONTRIBUTION % 2011 NET SALES $916,763 FOREIGN EXCHANGE IMPACT (1) (15,000) -1.6% COMPARABLE STORES (75,942) -8.3% DTC 25,639 2.8% NON-COMPARABLE STORES, NET (2) 99,946 10.9% 2012 NET SALES $951,407 3.8% (1) Represents the impact of converting prior year sales at current year rates (2) New stores, net of closures; plus net effect of third party sell-off revenue

OPERATING EXPENSE SECOND QUARTER 2012 % OF NET SALES 2011 % OF NET SALES BPS (3) STORE OCCUPANCY (1) $185,311 19.5% $173,556 18.9% 60 ALL OTHER (2) 272,774 28.7% 251,769 27.5% 120 STORES & DISTRIBUTION 458,085 48.1% 425,325 46.4% 170 MARKETING, ADMINISTRATIVE GENERAL & 111,293 11.7% 109,999 12.0% (30) TOTAL $569,378 59.8% $535,324 58.4% 140 (1) Includes rent, other landlord charges, utilities, depreciation and other occupancy expense (2) Includes selling payroll, store management and support, other store expense, DTC, and distribution center costs (3) Rounded based on reported percentages

Q2 ANALYSIS 2012 2011 OPERATING OPERATING SALES INCOME SALES INCOME U.S. STORES (1) $560,508 $82,661 $613,085 $110,482 14.7% 18.0% INTERNATIONAL STORES (1) 254,764 75,141 197,962 76,139 29.5% 38.5% DIRECT TO CONSUMER 127,677 55,567 102,088 46,454 43.5% 45.5% MARKETING, GENERAL AND (109,999) ADMINISTRATIVE EXPENSES—(111,293)—STORE PRE-OPENING COSTS (2)—(15,370)—(15,553) ALL OTHER, NET (3) 8,458 (59,744) 3,628 (60,349) TOTAL $951,407 $26,962 $916,763 $47,174 (1)Operating Income for U.S. Stores and International Stores is reported on an aggregate four-wall basis, and excludes store pre-opening costs and is adjusted for period-end markdown reserves. (2) Store Pre-Opening Costs include pre-opening rent, payroll, travel and other expenses. (3) All Other includes Store Management & Support, DC (including DC markdowns) and Other Expenses, net of Other Income. Also includes third party sell-off revenue.

SHARE REPURCHASES FY 2012 FY 2011 SHARES AVERAGE SHARES AVERAGE COST COST REPURCHASED COST REPURCHASED COST FIRST QUARTER 3,300.0 $161,215 $48.85 428.8 $25,469 $59.40 SECOND QUARTER—— 950.1 $64,399 $67.78 THIRD QUARTER 150.0 $8,835 $58.90 FOURTH QUARTER 2,017.3 $97,903 $48.53 TOTAL 3,300.0 $161,215 $48.85 3,546.2 $196,606 $55.44 SHARES AUTHORIZED FOR FUTURE REPURCHASE* 22,919 *Includes increase of ten million shares authorized by the Board of Directors on August 14, 2012

INTERNATIONAL HOLLISTER STORE COUNT—CUMULATIVE YEAR END Q2 END HOLLISTER 2007 2008 2009 2010 2011 2012 CANADA 3 6 6 9 12 12 UK 3 10 19 26 28 GERMANY 1 4 11 17 ITALY 1 3 5 7 SPAIN 3 8 10 IRELAND 1 1 HONG KONG 1 1 SWEDEN 2 2 FRANCE 4 5 BELGIUM 2 2 AUSTRIA 3 4 CHINA 2 3 TOTAL 3 9 18 38 77 92

Q2 INTERNATIONAL STORE OPENINGS BRAND CENTER CITY DATE HOLLISTER REGENT STREET LONDON, UK 5/12/12 HOLLISTER BREUNINGERLAND LUDWISBURG, GERMANY 5/19/12 HOLLISTER VIVATSGASSE BONN, GERMANY 5/19/12 HOLLISTER EUROPA PASSAGE HAMBURG, GERMANY 6/23/12 HOLLISTER VALECENTER MARCON, ITALY 6/23/12 HOLLISTER BONAIRE VALENCIA, SPAIN 7/14/12 HOLLISTER PLUS CITY LINZ, AUSTRIA 7/21/12 HOLLISTER STIFTSTRASSE STUTTGART, GERMANY 7/28/12 GILLY HICKS REGENT STREET LONDON, UK 5/12/12 GILLY HICKS BENTALL KINGSTON, UK 5/12/12 GILLY HICKS STRATFORD LONDON, UK 5/12/12 GILLY HICKS BLUEWATER LONDON, UK 5/12/12

2012 GUIDANCE UPDATES FULL YEAR: COMP STORE SALES DOWN 10% FOR THE SECOND HALF OF THE YEAR APPROXIMATELY $250 MILLION IN SALES GROWTH CONTRIBUTION FROM 2011 OPENINGS APPROXIMATELY $200 MILLION IN SALES GROWTH CONTRIBUTION FROM 2012 OPENINGS SUBSTANTIAL RECOVERY OF 2011 GM RATE EROSION, DRIVEN BY AUC IMPROVEMENT IN SECOND HALF OF THE YEAR AND INTERNATIONAL MIX BENEFIT TAX RATE: HIGH 30s DILUTED EPS IN THE RANGE OF $2.50—$2.75 CAPITAL EXPENDITURES OF $360 MILLION THIRD QUARTER: GROSS MARGIN IMPROVEMENT MORE THAN OFFSET BY EXPENSE DELEVERAGING ON NEGATIVE COMP STORE SALES INCREASED MG&A VERSUS SECOND QUARTER, INCLUDING CRM AND CHINA MARKETING COSTS

Q2 STORE COUNT ACTIVITY ALL BRANDS* TOTAL U.S. CANADA EUROPE ASIA START OF Q2 2012 1,049 942 19 81 7 OPENINGS 12—- 12—CLOSINGS (6) (6)—— END OF Q2 2012 1,055 936 19 93 7 A&F START OF Q2 2012 294 279 4 8 3 OPENINGS———- CLOSINGS (1) (1)—— END OF Q2 2012 293 278 4 8 3 abercrombie kids START OF Q2 2012 159 154 3 2 -OPENINGS———-CLOSINGS———-END OF Q2 2012 159 154 3 2 -HOLLISTER CO. START OF Q2 2012 575 491 12 68 4 OPENINGS 8—- 8—CLOSINGS (5) (5)—— END OF Q2 2012 578 486 12 76 4 * End of Q2 2012 includes 25 Gilly Hicks stores, 18 in the U.S. and seven in Europe, four of which were opened during Q2.

STRATEGIC UPDATE CAPITAL ALLOCATION PHILOSOPHY INTERNATIONAL STORE PERFORMANCE STORE OPENING PLANS SHARE REPURCHASE PHILOSOPHY DOMESTIC STORE INITIATIVES

CAPITAL ALLOCATION PHILOSOPHY ALLOCATE AVAILABLE CAPITAL TO THOSE INVESTMENTS EXPECTED TO GENERATE THE GREATEST RISK-ADJUSTED RETURNS • HIGH RETURN • OPERATIONAL • SHARE REPURCHASES • DIVIDENDS

HOLLISTER EUROPE EXAMPLE APPROVED 75% 50% SALES $7.9 $5.9 $3.9 4-WALL CONTRIBUTION 2.7 1.7 0.8 4-WALL EBITDA 3.1 2.1 1.2 NON 4-WALL INCREMENTAL COST(1) 0.9 0.7 0.4 FULLY LOADED EBITDA $2.3 $1.5 $0.8 INITIAL NET CAPEX 3.2 3.2 3.2 OTHER INVESTMENTS(2) 0.4 0.4 0.4 TOTAL INVESTMENT $3.6 $3.6 $3.6 STORE-LEVEL ROI(3) 62% 41% 21% (1) Includes estimated DC, regional management, and an allocation of country specific costs (2) Other Investments consists of Pre-Opening Costs and store Working Capital (3) Store-Level ROI = Fully Loaded EBITDA divided by Total Investment

HOLLISTER EUROPE APPROXIMATELY 90% OF STORES ACHIEVING 4-WALL OPERATING MARGINS OF 30% OR GREATER ON AVERAGE, EXCEEDING APPROVED SALES VOLUME BY APPROXIMATELY 20%

A&F FLAGSHIP EXAMPLE: LONDON SALES $64.2 4-WALL CONTRIBUTION 30.5 4-WALL EBITDA 32.7 NON 4-WALL INCREMENTAL COST(1) 9.6 FULLY LOADED EBITDA $23.1 INITIAL NET CAPEX 24.8 OTHER INVESTMENTS(2) 3.3 TOTAL INVESTMENT $28.1 STORE-LEVEL ROI(3) 82% Sales and EBITDA are on Trailing Twelve Month basis as of 7/28/2012 (1) Includes estimated DC, regional management, an allocation of country specific costs, and net loss of inventory sell-off (2) Other Store-Level ROI Investments consists of Pre-Opening Costs and store Working Capital (3) Store-Level ROI = Fully Loaded EBITDA divided by Total Investment

A&F FLAGSHIPS—EUROPE COMBINED TRAILING TWELVE MONTH STORE-LEVEL ROI GREATER THAN 35% 25% OR HIGHER 4-WALL OPERATING MARGIN IN ALL BUT TWO STORES

A&F INTERNATIONAL OPENINGS CITY TIMING TYPE HONG KONG AUGUST 11, 2012 FLAGSHIP MUNICH Q3 2012 A&F and kids FLAGSHIP DUBLIN Q4 2012 TIER 1 / FLAGSHIP AMSTERDAM Q4 2012 TIER 1 / FLAGSHIP SEOUL 2013 TIER 1 / FLAGSHIP SHANGHAI FALL 2013 FLAGSHIP LONDON TBD kids FLAGSHIP

SHARE REPURCHASE PHILOSOPHY MINIMUM CASH BALANCE OF $350M EXCESS CASH RETURNED TO SHAREHOLDERS THROUGH DIVIDENDS AND SHARE REPURCHASES SUPPLEMENT WITH EXISTING CREDIT FACILITIES OR OTHER DEBT FINANCING AS APPROPRIATE EXECUTE REPURCHASES WHEN STOCK VALUATION IS ATTRACTIVE ON A LONG-TERM BASIS

USE OF CASH—LAST 6 QUARTERS NEW STORES $360.2 SHARE REPURCHASES $357.8 OTHER CAPEX(1) $155.3 DIVIDENDS $90.2 TOTAL $963.5 (1) Other Capex includes maintenance capex, IT, DTC, and DC investments

FREE CASH FLOW OPERATING CASH FLOW(1) $500.0 NORMALIZED CAPEX (200.0) NORMALIZED FREE CASH FLOW $300.0 (1) Estimated Operating Cash Flow for FY 2012

DOMESTIC STORE PROFITABILITY INITIATIVES MERCHANDISING INITIATIVES • CONSERVATIVE • SHORTER PRODUCT • INCREASE CHASE INVENTORY OPTIMIZATION • INVENTORY GROWTH • NEW MP&A SYSTEMS INSIGHT & INTELLIGENCE • MACRO, COMPETITOR, • PRIMARY AND SECONDARY

DOMESTIC STORE PROFITABILITY INITIATIVES CUSTOMER ENGAGEMENT • NEW CLUB PROGRAMS EXPENSE & AUC REDUCTION • INTERNATIONAL OPERATING • SIGNIFICANT FALL AUC • CENTRAL COSTS LEVERAGE STORE RATIONALIZATION • 135 STORES CLOSED • 180 EXPECTED CLOSURES • MODEST ANNUAL ACCRETION

EX-99.4

Exhibit 99.4

THOMSON REUTERS STREETEVENTS

EDITED TRANSCRIPT

ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

EVENT DATE/TIME: AUGUST 15, 2012 / 12:30PM GMT

OVERVIEW:

ANF reported 2Q12 net sales of $951m and diluted EPS of $0.19. Expects FY12 diluted EPS to be $2.50-2.75.

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AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

CORPORATE PARTICIPANTS

Brian Logan Abercrombie & Fitch Co. — VP, IR & Controller

Mike Jeffries Abercrombie & Fitch Co. — Chairman & CEO

Jonathan Ramsden Abercrombie & Fitch Co. — EVP & CFO

CONFERENCE CALL PARTICIPANTS

Dana Telsey Telsey Advisory Group — Analyst

Randy Konik Jefferies & Co. — Analyst

Steph Wissink Piper Jaffray — Analyst

Janet Kloppenburg JJK Research — Analyst

Adrienne Tennant Janney Capital Markets — Analyst

Maren Kasper Wells Fargo — Analyst

Lorraine Hutchinson Bank of America-Merrill Lynch — Analyst

Kimberly Greenberger Morgan Stanley — Analyst

David Glick Buckingham Research Group — Analyst

Robin Murchison SunTrust Robinson Humphrey — Analyst

Liz Dunn Macquarie Research — Analyst

Brian Tunick JPMorgan Chase — Analyst

Anna Andreeva FBR Capital Markets — Analyst

PRESENTATION

Operator

Good day, everyone. Welcome to the Abercrombie & Fitch second-quarter earnings results conference call. Today’s conference is being recorded. (Operator Instructions). At this time, I would like to turn the conference over to Mr. Brian Logan. Mr. Logan, please go ahead.

Brian Logan — Abercrombie & Fitch Co. — VP, IR & Controller

Good morning and welcome to our second-quarter earnings call. Earlier today, we released our second-quarter sales and earnings, income statement, balance sheet, store opening and closing summary and an updated financial history. Please feel free to reference these materials available on our website.

Also available on our website is an investor presentation, which we will be referring to in our comments during this call. This call is being recorded and the replay may be accessed through the Internet at Abercrombie.com under the Investors section.

Before we begin, I remind you that any forward-looking statements we may make today are subject to the Safe Harbor statement found in our SEC filings.

Today's earnings call is scheduled for one hour. Joining me today on the call are Mike Jeffries and Jonathan Ramsden. We will begin the call with a few remarks from Mike, followed by a review of the financial performance for the quarter from Jonathan and me, followed by an update on our strategic plans. After our prepared comments, we will be available to take your questions for as long as time permits. Now to Mike.

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2

AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

Good morning, everyone. Thank you for joining us today. The second-quarter results we are reporting today are disappointing and below our expectations coming into the quarter. In particular, we saw a further deceleration in the sales trend of our international stores while our US chain stores also comped negatively for the quarter for the first time since 2009. Our direct-to-consumer business remained a bright spot posting its 10th successive quarter with year-over-year sales growth of 25% or better.

As we have discussed in the past, we continue to believe that the macroeconomic environment is the primary driver of the negative comp sales we have seen in our international stores, particularly in Europe. The situation in Europe has continued to become more difficult since we first spoke of our concerns a year ago.

In addition, cannibalization has clearly been a factor as our brands have become more widely available in Europe. Within our down 26 comp for international stores for the quarter, we can specifically identify 5 percentage points of this trend as being attributable to store-on-store cannibalization. The overall effect is likely somewhat greater taking into account potential transfer to our rapidly growing direct-to-consumer business.

However, it is important to note that significant cannibalization effects are limited to only a portion of our international stores, principally flagships with large tourist components and local catchments where we have multiple stores. It is also important to note that even with the cannibalization we have seen, the great majority of these stores still meet our margin hurdle criteria.

Beyond the macroeconomic and cannibalization effects in Europe, we have also given back some share in the US and it is reasonable to assume that some of the factors that have affected our US business have also affected the trend in Europe.

Many of you observed the lack of newness in our stores through May and June and the stepped-up promotional activity that was necessary as we began clearing through our spring inventory overhang. As we look back on the quarter and in fact, all the way back to last Christmas, it is clear that the significant slowing in the European business that began in the fall of last year, coupled with a difficult fourth quarter in the US, has continued to have repercussions. Most notably, it has put us in a position of playing defense to work down our inventory levels rather than being on offense and chasing into trends in which we believe.

Through long experience with this Company, I know that we are much better when we are playing offense than when we are playing defense. Having said that, our inventory position has improved considerably at the end of the second quarter and we are expecting further significant inventory level improvement in the third quarter, as Jonathan will speak to in a moment.

In addition, we are working to keep our committed inventories leaner going forward so that we have more room to chase and react. We will come back to that in a moment.

Beyond all these factors, one question we continue to ask ourselves as a team, and I know many of you have the same question, is how much of the trend is self-inflicted. The answer is not wholly clear. However, our entire organization is completely focused on improving the trends we have seen. There are factors beyond our control, but, as a team, we believe there are opportunities to do better. We will talk in a few minutes about the various initiatives we have in place to improve productivity and profitability in our US stores and to help stabilize trends internationally.

In that context, I would like to make a few more comments on our international business. During the quarter, we opened a combined Hollister and Gilly Hicks store in London on Regent Street, seven international Hollister chain stores and three international Gilly Hicks chain stores. We are pleased with the brand awareness and excitement that these openings have created.

Our four-wall operating income from international stores was down slightly to a year ago with contributions from new stores being more than offset by declines in existing stores, most notably flagships. This brings us to one of the paradoxes of our business today, best illustrated by the performance of our A&F flagship store in London. The store was our first international flagship and quickly became a shopping destination for Europeans. The store's performance, however, has been significantly affected as we opened other A&F stores throughout Europe and probably by the growing penetration of Hollister in Europe.

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3

AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Even with the impact of cannibalization, the store has had approximately $64 million of sales over the past 12 months and has generated a four-wall EBITDA of approximately $33 million. By the way, these numbers for London are all included on a slide, which Jonathan will discuss later, as part of our strategic update presentation. Despite the fact that sales volume is well below the store's peak from a couple of years ago and contribution is down even more, the store still achieved a four-wall margin of approximately 50% over the past 12 months, well above our target rate.

Taking into account an initial investment of nearly $30 million in CapEx and other investments, the store's contribution translates into an annual store-level ROI of approximately 80% after factoring in incremental non-four-wall costs, and clearly the cumulative return is much greater than that.

The picture is similar for Milan and some of our earliest Hollister stores, which, despite significant declines in volume and profitability, continue to deliver very strong results and returns on an absolute basis.

As we discussed on our last earnings call, when we look at the current trends in Europe, there are four key questions we ask ourselves. First, are our stores continuing to stand out from the mall in terms of excitement and energy and in terms of traffic and productivity? Second, are the new store volumes consistent with the volumes at which we approved the deals? Third, are we achieving our annualized target 30% four-wall margins at the current trend and after cannibalization? Last, is our international direct-to-consumer business continuing to grow at a healthy rate? We continue to believe the answer to all of these questions is yes.

In addition, we have long said that if we achieve our operating hurdles, return on investment metrics are also very strong. However, given the declines we have seen and the impact of cannibalization, we believe that it is appropriate to add a further question. Specifically whether the return on invested capital we have generated from our international expansion is superior to any alternative deployment of capital over that period. We are very confident that is the case as Jonathan will review in more detail in a few minutes.

However, given a period of declining returns, we believe it is appropriate to review our future plans in that light and make sure that we remain highly disciplined in only committing to new stores or other capital projects where we are confident that, based on conservative assumptions, the answer to all five questions will remain yes.

Overall, setting aside our future store opening plans, we are very focused on improving the performance of our existing stores. We remain very cautious about the macroeconomic environment, but we are hopeful that, with our comp sales for the past few weeks running a little above our second-quarter trend, we are beginning to see at least a stabilization in the trend. With that, I will hand over to Jonathan, but will come back to make some additional comments in a few minutes.

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Thanks, Mike and good morning, everyone. I will start with a short summary of our results for the quarter and outlook for the full year and then Brian will go into some additional details. For the quarter, the Company's net sales increased 4% to $951 million, total US sales, including DTC, were down 5%. International sales, including DTC, were up 31% and total DTC sales, including shipping and handling, were up 25%. Comp store sales were down 10% to last year. Comp sales were down 5% in US stores and were down 26% in international stores.

On a weighted average basis the dollar strengthened approximately 3% versus the prior quarter and approximately 7% versus last year. Foreign currency changes for the quarter affected sales growth adversely by approximately 160 basis points versus a year ago. Gross margin erosion for the quarter of 110 basis points was modestly greater than anticipated reflecting the lower sales trend.

Overall, expenses for the second quarter came in significantly below projection. The main drivers of the expense reduction were lower contingent rent, lower incentive compensation, reductions in travel, marketing and other home office expenses.

Operating income for the quarter was $27 million versus $47.2 million a year ago. Operating margin fell 230 basis points with expense deleverage of 120 basis points adding to the operating margin erosion. The tax rate for the quarter was 38.9% and diluted earnings per share for the quarter were $0.19 versus $0.35 for the prior-year quarter.

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4

AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Turning to the balance sheet, we ended the quarter with total inventory at cost up 20% versus a year ago. Based on our current sales plan, we expect inventory at cost to be approximately flat year over year at the end of Q3 and down at the end of Q4. We ended the quarter with $312 million in cash and cash equivalents and $20 million of current marketable securities.

During the quarter, we drew down $75 million from our revolving credit facility to provide us with additional liquidity through the trough point in our cash cycle. We have $274 million remaining available under our revolving credit facility and $300 million under our term loan facility.

During the second quarter, we liquidated $18 million of our auction-rate securities. We did not repurchase any shares during the quarter. In order to maintain our cash cushion, any such repurchases would have entailed further drawing down on credit facilities, which we were not comfortable doing in the absence of clear stabilization in trends.

At our Board meeting yesterday, the Board approved an additional 10 million shares to our share repurchase authorization, bringing our total outstanding authorization to 22.9 million shares. We will come back to this in a moment.

With regard to our expectations for the fiscal year, based on the second-quarter trend, we are now planning for down 10 comps for the full year with US and international trends consistent with Q2. Overall, based on the lower sales trend, we are now projecting diluted earnings per share for the year of $2.50 to $2.75. Consistent with past practice, our guidance does not assume any further share buybacks. With that, I will hand over to Brian to add some more details on our operating results for the quarter and outlook for the year.

Brian Logan — Abercrombie & Fitch Co. — VP, IR & Controller

Thanks, Jonathan. As reported, comp store sales were down 10% for the quarter. US comp store sales were down 5% versus down 1% in Q1 with chain stores performing slightly better, although comping negative for the quarter for the first time since 2009. International comp store sales were down 26% versus down 22% in Q1 with Hollister European stores performing somewhat better.

By brand, comp store sales were down 11% for Abercrombie & Fitch, 10% for abercrombie kids and 10% for Hollister. Within the brands, male and female performed comparably.

The gross profit rate for the second quarter was 62.5%, 110 basis points lower than last year's second-quarter gross profit rate. The decrease in rate was driven by an increase in average unit cost and the adverse effects of exchange rates, partially offset by an international mix benefit. A summary of our second-quarter operating expense can be found on the slide on page 5 of the investor presentation.

Stores and distribution expense for the quarter was $458 million, or 48.1% as a percentage of net sales. Store occupancy costs were approximately $185 million and all other stores and distribution costs represented 28.7% of net sales, 120 basis points above the percentage of net sales they represented last year. The increase in the stores and distribution expense rate was primarily the result of deleveraging on negative comp store sales.

Stores and distribution expense for the quarter included approximately $700,000 of accelerated depreciation from our DC consolidation, lower than previously anticipated due to an extension in the expected service life of our second DC.

MG&A for the quarter was $111 million versus $110 million last year. The increase in MG&A a for the quarter was due to an increase in marketing, IT, travel and other expenses, largely offset by a decrease in incentive compensation expense.

The tax rate for the quarter was 38.9% compared to 30.7% for the prior year. The increase in rate was primarily the result of a reduced benefit related to international operations, which are taxed at a lower rate. As Jonathan mentioned, we ended the quarter with total inventory at cost up 20% versus the second quarter last year.

Spring season inventory continues to be up disproportionately, which is reflected in the higher markdown reserve at the end of the quarter when compared to last year. During the quarter, we opened a combined Hollister and Gilly Hicks store in London on Regent Street, seven international Hollister chain stores and three international Gilly Hicks chain stores. Details of international stores opening for the quarter are included on the slide on page 9 of the investor presentation.

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AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

In the US, we closed six stores during the quarter. At the end of the quarter, we operated 293 Abercrombie & Fitch stores, 159 abercrombie kids stores, 578 Hollister stores and 25 Gilly Hicks stores.

With regard to our expectations for the fiscal year, in addition to the down 10 comps for the fall season, we anticipate for the full year that stores opened in 2011 will contribute approximately $250 million to sales growth while stores opened in 2012 are expected to contribute approximately $200 million.

Excluding charges, we anticipate a substantial recovery of our 2011 gross margin rate erosion to be largely offset by expense deleverage. The gross margin rate recovery is expected to be primarily the result of lower average unit costs due to the abatement of cotton prices.

During the fall season, US chain AURs are expected to be flat to slightly down to last year while international AURs are expected to be down to last year. In addition, as a reminder, our fourth-quarter gross margin rate for last year was estimated to be adversely impacted by about 200 basis points as a result of markdowns on higher carryover inventory. We expect the fiscal year tax rate to be in the high 30%s and capital expenditures to be approximately $360 million.

With regard to third quarter, we expect gross margin rate improvement to be more than offset by expense deleveraging on negative comp store sales. For the third quarter, we expect an increase in expense versus second quarter due to higher marketing expenses related to the introduction of our new CRM programs and brand awareness initiatives in China, including those around the Hong Kong flagship opening.

We will report third-quarter sales and earnings results on Wednesday, November 14. With that, I will turn the call back to Jonathan.

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Thanks, Brian. As we indicated in our pre-release two weeks ago, we want to spend some time this morning to give an update on various aspects of our forward-looking plans. In connection with that, I would like to refer you to the Strategic Update section of our investor presentation.

First of all, as Mike alluded to a few minutes ago, we are confident that the return on investment from our international rollout to date has been superior to any alternative use of capital over that period, including stock buybacks. Going forward, our philosophy remains to be disciplined in allocating capital to where it will derive the greatest return on a risk-adjusted basis.

Turning to the performance of our international operations to date, as we have stated in the past, we think it is helpful to break out the business between Hollister Europe, A&F flagships and other investments. Starting with Hollister Europe, as we have discussed in the past, we believe that Hollister international store openings represent a low risk, high return use of capital. To illustrate how we think about this, the slide on page 14 shows the anticipated sales contribution, EBITDA and operating income for a recent Hollister store we opened or we approved rather in France. We referenced this example in some recent conference presentations and think it is a good example of a fairly average European Hollister store.

In addition to our expected or approved case, as reflected on the slide, we also show a downside scenario where the store achieves only 75% of its expected volume and a low-end scenario where the store only achieves 50% of its expected volume.

In terms of return on capital, we define store-level ROI as four-wall EBITDA, less estimated incremental non-four-wall costs such as DC, regional management and an allocation of country-specific costs divided by a total investment calculated as our original net CapEx plus other investments comprised primarily of preopening costs, lease deposits where applicable and store working capital.

Using this store-level ROI analysis, this example shows that the return on the approved scenario is 62%, the return is 41% in the downside scenario and is still above 20% in the low-end scenario, a scenario we regard as very unlikely. This particular store does not have any significant anticipated cannibalization effects, but we also factor those into the incremental EBITDA where they exist. In addition, our CapEx in France runs higher than our average across Europe.

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AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

On a trailing 12 month basis, approximately 90% of our Hollister European stores exceeded a 30% four-wall margin. In addition, on average, the stores are exceeding their approved sales volumes by approximately 20% with the result that the overall store-level ROI for Hollister Europe is well above the example we just reviewed.

It is also important to note that our downside risk on Hollister chain stores is also protected by lease exit clauses that exist in many of our leases. 90% of our Hollister European stores have lease exit clauses, either unconditional or based on sales.

Turning to A&F flagships, the slide on page 16 provides an illustration of the performance of our A&F London flagship over the past 12 months. As Mike stated, we believe that the London flagship is a good example to discuss as no other store has been more adversely affected by the macroeconomic and cannibalization trends.

Despite a material decline in London's volume over the past year, the store continues to operate well ahead of its original approved volume and well ahead of our 30% contribution margin hurdle rate. In addition, the store-level ROI has also remained strong and the store has generated cumulative returns, which are a multiple of our initial investment. Using a comparable measure, our overall store-level ROI on a trailing 12 month basis for our European A&F flagships exceeds 35% with all of our European flagships, other than Copenhagen and Dusseldorf, operating at four-wall margins above 25%.

As a last point on Europe, the returns referenced above do not include the benefit our increased store presence has had on our international DTC growth, which we believe is significant.

With regard to our other international operations, our store-level ROI for our Canadian operations is comparable to Europe. Although, at this point, we are not planning any further investment in Canada. With regard to Asia, our rollout is still at an early stage and we will continue to take a test-and-learn approach to new opportunities, limiting our invested capital until the opportunity is proven.

Turning to what this means for our future opening plans, the slide on page 18 shows the A&F international store plans we have today. We have added no new commitments since our prior update in May, although we continue to move forward on a Shanghai location that we would expect to open in the fall of 2013.

In addition, we have scaled back Dublin and Seoul from full flagships to smaller Tier 1 formats with meaningful reductions in the associated capital expenditures. We are not able to confirm an opening date for London kids at this time.

With regard to Shanghai, we do not expect this store to achieve our 30% four-wall margin hurdle rate. However, we believe that a Shanghai flagship is important in supporting our broader rollout in China, which, in addition to Hollister, may potentially include some A&F chain stores.

Beyond Shanghai, we are pausing all other flagship commitments, but will keep this under review as we go forward. We now anticipate around 30 Hollister openings this year in addition to the four international Gilly Hicks stores we have already opened.

For 2013, we are planning for approximately 20 international Hollister chain store openings. This includes close to 10 existing commitments. Overall, these openings will be focused on underpenetrated markets where we expect minimal cannibalization. They will include our first stores in Australia and likely in the Middle East.

On the latter point, we are finalizing an agreement to establish a joint venture with a Middle East-based partner that will provide us with operational support while enabling us to operate our stores consistently with our fully company-owned stores. As we have done in the past, we will continue to review all store openings on a case-by-case basis.

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AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

We now expect capital expenditures in 2012 to be around $360 million and 2013 capital expenditures to be around $200 million. Our modified store opening plans will also result in significantly lower preopening costs, which should now come in around $50 million this year and reduce to approximately $30 million next year.

Coming back to our capital allocation strategy, as reflected on slide 19, our share repurchase philosophy is as follows. After allocating capital to new stores and other internal projects such as DTC investments that provide superior returns, we would expect to return excess cash to shareholders through dividends and share repurchases. We define excess cash as being cash above a $350 million base requirement at all times. We believe this amount is appropriate to protect the Company from the short-term effects of external factors.

In addition to cash from operations, we will continue to review the appropriateness of adjusting our capital structure through the use of the term loan facility or other instruments over time. This evaluation takes into account the inherent leverage already in our business model, as well as our outlook on the business in general. Given business trends during the second quarter, we chose not to draw down on the term loan, but would expect to use this facility once we are confident that business trends have stabilized.

Last, we will execute buybacks when we believe the stock is attractively priced on a long-term basis. In the above context, the slide on page 20 of the presentation illustrates our capital allocation over the past six quarters and shows that, over that period, we have spent approximately $360 million on new store openings, approximately $358 million on stock buybacks, approximately $155 million on other CapEx projects, including maintenance-type projects and approximately $90 million on dividends.

Regarding our share buyback potential, the slide on page 21 shows a projected normalized free cash flow for 2012 of around $300 million with normalized lower run rate CapEx. Assuming that our underlying results improve going forward, the free cash flow generated should increase accordingly.

In addition, having been in a position where inventory has been a use of cash over the past 12 months, we expect inventory to be a source of cash over the next 12 months. Beyond that, we are committed to growing inventory at less than the rate of sales. Based on this, we anticipate that we will have substantial cash flow from operations over the next 18 months to support continued capital return to shareholders.

In addition, we have the term loan facility of $300 million to supplement that. Based on these projections, our Board yesterday authorized an additional 10 million share increase in our share repurchase authorization, bringing the total authorization to 22.9 million shares. With that, I will hand back to Mike.

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

Thanks, Jonathan. As I referenced a few moments ago, our entire organization is focused on improving the trend of our business and before closing, I want to review some of the initiatives we are pursuing to accomplish this. This is not an area of significant capital investment, but we believe there is significant potential to improve our overall returns to shareholders through gains in the productivity and profitability of our domestic fleet.

First, with regard to merchandising, we have a number of initiatives that will improve our ability to react and chase. These include implementing more conservative merchandise plans, a shortening of our product development calendar, and increasing the chase component of our open-to-buy. In addition, we are increasing local sourcing within the US and Central America to further shorten leadtimes and increase flexibility.

Second, in terms of inventory productivity, we are committed to growing inventory at a slower pace than the rate of sales growth. This will be supported by investments we have made in new merchandising, planning and allocation systems, which are now live for the spring season of 2013. Among other things, these new systems will greatly enhance the efficiencies in building plans and give us much better visibility on margin and inventory plans by selling channel. In addition, these systems will shift our focus to selling margin rather than IMU, which is a significant improvement given the evolution and complexity of our business today.

A third key area of focus is insight and intelligence, particularly with regard to our international operations. We are building a team to help us better understand macro, competitor and customer dynamics in our key markets. Ultimately, we believe this improved understanding will help us make better business decisions. This intelligence will include both primary and secondary research, as well as leveraging our associates to gather and synthesize intelligence they come across.

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AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Fourth, with regard to customer engagement, we are excited about the launch of our new club programs for A&F and Hollister. Yesterday marked the official launch date for our new A&F club program and for our new Hollister Club Cali in the US.

Our CRM programs are something that we have been working hard on for nearly two years. They will enable us to have a single view of the customer across channels to target both product and promotional messages to customers on a segmented or ultimately individualized basis and to engage with our customers in new ways and through unique content via mobile, social and cross channels. We believe that these programs will also allow us to gain insight into the behaviors of both new and returning customers. Prior to launch, we had 150,000 pre-registrations for the clubs and we expect this to grow significantly in the coming weeks and months and become a meaningful part of our model.

Fifth, with regard to expense and AUC, we will continue to focus on finding efficiencies and taking cost out of our model as we have done successfully over the past year and we will continue that process going forward.

Although the complexity of running our business has increased with our international expansion, our headcount at the home office remains lower than it was four years ago. This further reinforces the leverage benefit of our profitable international store openings. We have also analyzed and adapted our international operating model resulting in reductions in our selling payroll and other expenses such as repairs and maintenance. The progress we have made on AUC for the fall season is also a good example of how effective our teams can be when they are aligned around specific measurable goals.

Last, store closures will also remain an important part of our long-term plan to improve both the overall profitability and the brand profile of our US stores. We continue to expect closures primarily through natural lease expirations to be modestly accretive to EPS on a year-over-year basis.

We believe all of these efforts can be meaningful in terms of improving the trajectory of our domestic business and many of them will also benefit our international business and our DTC business. With regard to DTC, we remain pleased with the progress we are making, particularly internationally, where initiatives such as broadening the payment types we accept and accelerating our fulfillment capabilities are significantly improving conversion.

In closing, I want to reiterate our confidence in the global appeal of our iconic brands. This was once again affirmed with the strong response to our Hong Kong flagship on Saturday and this adds to our cautious optimism about the potential for our brands in Mainland China. Through its first five days, the store has done over $1 million in sales. We remain excited and optimistic about the opportunities ahead of us and we will be disciplined and judicious in our use of shareholders' capital to pursue these opportunities. Thank you and we will be happy to take your questions.

QUESTIONS AND ANSWERS

Operator

(Operator Instructions). Dana Telsey, Telsey Advisory Group.

Dana Telsey — Telsey Advisory Group — Analyst

Good morning, everyone. Mike, given the new world that we are in, how are you thinking about the merchandise assortment, basic versus fashion, pricing globally and you mentioned the changes in the supply chain, which should be very helpful? How do you see that and timing of that of adding to enhancing inventory, enhancing turn margins? Thank you.

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9

AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

I think we are thinking the same thoughts. Clearly, we have room for more fashion, more trend turning faster, which will clearly be facilitated by shortening the cycle. In terms of international pricing, I will turn that over to Jonathan.

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

I think we have said we are planning for international AURs to be down in the back half of the year, particularly in flagships and to a lesser degree in the Hollister chain stores on a year-over-year basis.

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

And I think, Dana, the most important part of trend and increasing our fashion component is, as I said in the overview, being on the offense. Chasing is key to improving that part of our business.

Dana Telsey — Telsey Advisory Group — Analyst

Thank you.

Operator

Randy Konik, Jefferies.

Randy Konik — Jefferies & Co. — Analyst

Hey, can you hear me?

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

Hi, Randy.

Randy Konik — Jefferies & Co. — Analyst

Hey, guys, how are you? So I guess obviously so I think what — this is what the market wants to hear is the word discipline and so forth around the capital allocation. So if I look at slide 21 in the packet, there is a quote that says normalized CapEx of $200 million and normalized free cash flow of $300 million. Is there some sort of line in the sand we can be thinking about or the shareholders or investors, potential investors can be thinking about in the sense that either you are going to hold the line at around $200 million in CapEx going forward over the next few years? Or ex that, would you be able — be committing to generating normalized free cash flow minimum or baseline of about $300 million per year assuming that if the operations get better the CapEx could go up a little bit? So just trying to get some clarity there.

And then on the share buyback, you made a comment, Jonathan, about buying back when the stock is attractive. Obviously, it is pretty attractive down here, at least from our perspective. I guess the pause — was that due to the cash generation cycle in this point of the year and we could expect that to — the buyback spigot to turn back on in the back half of the year and into early part of next year? How should we be thinking about the timing of the buyback? Thanks.

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10

AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Sure. To take the first part first then, Randy, we are obviously hopeful that operating cash flow we are going to generate this year is going to be growing going forward. I mean frankly if it didn't grow then I think the likelihood that CapEx would grow would be very unlikely because that would suggest that the dynamics going on wouldn’t support accelerating again the store openings. So we are hopeful that the normalized free cash flow of $300 million will grow even if CapEx were to start growing again at some point, but we are going to remain very disciplined about that. We are going to look at it on the basis of store by store, is the return we can generate from any given store the best use of capital relative to buybacks or any other use as we commit to each of those stores. But we would certainly hope that normalized free cash flow should be growing going forward from what has obviously been a challenging year in 2012.

And then on the second piece, there are two principal gates we have to get through to do buybacks. The first one is valuation and the second one is liquidity. The comments we made in the script were that because we would have had to go into the term loan to be buying back shares during the quarter, we weren’t comfortable doing that given the trends in the business. And as we have just said in the script, once we feel that those trends have stabilized then we would expect to pull down on that facility and use it towards buybacks and we obviously can’t be more specific on timing around that, but it was really a liquidity-driven issue in the second quarter that prevented us from going forward.

Randy Konik — Jefferies & Co. — Analyst

So can you hear me? Can you hear me again?

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Yes, Randy.

Randy Konik — Jefferies & Co. — Analyst

Yes, I'm sorry. So I just want to make clear. So should the market be thinking about $300 million as a baseline of free cash flow for this Company and its ability to generate that number going forward, over not just the next 12 months, but if we are thinking about potential investors thinking about the next two, three, four, five years? Is that how we should be thinking about this business?

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

We are obviously not giving a forecast for the business, but we would be disappointed if we weren't able to generate more free cash flow than that beyond 2012. Does that answer the question?

Randy Konik — Jefferies & Co. — Analyst

Yes, thanks.

Operator

Steph Wissink, Piper Jaffray.

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11

AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Steph Wissink — Piper Jaffray — Analyst

Thanks, good morning, everyone. Just trying to follow up on Randy’s question regarding discipline, you added a tremendous amount of discipline around your store operating model. I am just curious how you think about the overall health of your store base in the US. More so, what is the right store base size for each of your core concepts? Thank you.

Jonathan Ramsden — Abercrombie & Fitch Co.— EVP & CFO

Hi, Steph. I think we have said, for Hollister, we don’t anticipate the store footprint contracting significantly. There are some stores that will probably close, which are not doing particularly well and there is no new news there. But most of the closures are oriented towards A&F and kids and getting the A&F and kids brands focused on those stronger performing stores. And as we have said many times in the past, if you look at the sort of upper tier of A&F and kids stores, the economics of those stores are frankly comparable to our international stores. So there is a segment of those stores that we would like to reposition the fleet towards. We have talked about another 180 closures between now and 2015. Again, most of that would be oriented towards A&F and kids as it has been for the 135 stores we closed in 2010 and 2011.

Steph Wissink — Piper Jaffray — Analyst

Thank you.

Operator

Janet Kloppenburg, JJK Research.

Janet Kloppenburg — JJK Research — Analyst

Good morning, everyone. Congratulations on an outstanding opening in Hong Kong. That is very exciting.

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

Thank you.

Janet Kloppenburg — JJK Research — Analyst

A couple of questions. At the end of the first quarter or maybe fiscal year ‘11, you had said that you expected to recapture a great portion or almost all of the gross margin that you lost in 2011 attributable to higher raw material costs. Can you just give us an update on that outlook right now?

Secondly, I know there will be increased M&A pressure, expense pressure in the quarter due to the CRM and China marketing costs. Should we expect that again in the fourth quarter?

And just lastly, Mike, how soon can your merchandising and sourcing — your shortened leadtime initiatives affect the merchandise in the stores? Thanks so much.

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

Jonathan, do you want to take the first part?

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12

AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Sure. In terms of gross margin rate, Janet, what we have said is that we anticipate a substantial recovery of the erosion we had last year. So well towards — well back towards the 2010 gross margin rate. And as Brian said in his comments, that is primarily driven by the average unit cost benefit with some international mix coming into play.

Janet Kloppenburg — JJK Research — Analyst

Okay, great, thank you.

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

On the marketing piece, there is a — there will be some ongoing costs of operating the CRM programs and there will be some ongoing Hong Kong and China marketing, but there is a disproportionate effect in this quarter, particularly around the Hong Kong opening where we did some fairly extensive marketing around that. And that expense, as well as some of the initial content creation for the club programs, is disproportionately impacting Q3, so it should certainly abate beyond Q3.

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

I am going to give you a long answer to work our way into your question. And I would like everyone to know that I think that we have to start by going back to this time last year. Our international business had been very strong through the first six months of the year and I think Hollister comped around 20% for the second quarter of last year and our US business was also strong.

Since that time, we have had obviously very significant reductions in sales volumes and we have had to make material changes to our merchandise plans in response to that. So we have been in the mode for most of that time in trying to get out of inventory receipts and work down inventory levels as opposed to chasing the business, which is what we have proven ourselves to be rather good at doing. And that is a tough place.

Did we miss business over the past two quarters because our assortment was too narrow and because we were late on some trends? I believe so. But what we have been working toward is what I have stated — to put ourselves in a position where we can back on the offensive. It is an important point that I keep making. And that means conservative merchandise plans, more open-to-buy, more chase.

And the answer to your question is that I think we will be there as we progress through Christmas in terms of what you see in the stores and certainly for the spring. In our financial plans though, we are not counting on any improvement in the trend from this, but we are hopeful that we will see some.

Janet Kloppenburg — JJK Research — Analyst

Great. Lots of luck.

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

Thanks, Janet.

Operator

Adrienne Tennant, Janney Capital Markets.

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13

AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Adrienne Tennant — Janney Capital Markets — Analyst

Good morning. My question is on the international lease structure. And I was wondering — it sounds like Hollister is quite similar to the US mall structure 10-year leases with kickouts. I was wondering on the flagships if you can help us. Are they longer leases? Are they — can you work with landlords in terms of adjusting them as we go? And is that different in Asia versus Europe? Thank you very much.

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

With regard to Hollister, by the way, it is probably worth noting that the structure of the leases in a number of countries in Europe actually gives us more flexibility than we have in the US. Somewhere like France or Belgium, there are kickouts that kick in after various periods of time pretty much automatically in the structure of the leases in those countries. So we do also have a couple of those kickout-type provisions in some of the smaller flagship stores. We don’t have them in the bigger flagship stores in Europe, but frankly the scenario in which we could see ever wanting to exercise a kickout in those flagship stores is so remote as to make it essentially kind of a moot question.

In Asia, it is still early days over there. The leases typically in China tend to be a little bit shorter than they are in Europe or the US. I think with regard to new flagships and lease flexibility, based on our current plans, as we've said, we are not anticipating at this point adding to the commitments we have out there other than Shanghai. So again, it is somewhat moot at this point.

But I think in terms of the general duration of the leases in somewhere like China, it is, in any case, shorter than the US and given the relatively small number of leases we have, we haven't really got into at this point the discussion about kickout provisions in those leases.

Adrienne Tennant — Janney Capital Markets — Analyst

Okay. And any update on Singapore?

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Yes, it is doing solidly.

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

Solid business, yes.

Adrienne Tennant — Janney Capital Markets — Analyst

Great. And Mike, I just wanted to say once again your eye for color is fantastic for the fall season.

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

Thank you. That’s very kind.

Operator

Evren Kopelman, Wells Fargo.

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AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Maren Kasper — Wells Fargo — Analyst

Hi, it's Maren Kasper in for Evren. So follow-on margins are still really strong in Europe, but the non-store expenses are what are weighing on the operating margin. Is that just a factor of scale or is there an opportunity to reduce some of those non-store expenses?

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Well, the non-store expenses are a combination of a few different things. If you look at the segment footnote or the segment chart in the investor presentation, you have got DC costs, which are largely a function of sales over time. There is a fixed component and we have always said that DC costs in Europe will progressively reduce as a percentage of sales as we have more volume going through those facilities.

Regional management is a function of store count for the most part. Typically, there is a span of control for the regional district managers. That isn’t really directly correlated with volumes, so there is a little bit of deleveraging of that effect when you have negative same-store sales. They are a couple of the bigger buckets, the bigger pieces that go into that. Then obviously we have preopening costs, which is outside of that. I think reading that other expense line quarter to quarter is a little challenging. I think it is more meaningful on a sort of full-year basis, but what we have generally said is we would expect that to remain, on a full-year basis, relatively flattish as a percentage of sales. We don't expect either significant leverage or deleverage on an ongoing basis.

Maren Kasper — Wells Fargo — Analyst

Okay, great. That’s helpful. And then secondly, when do you think you guys have potential to begin to leverage occupancy expenses again?

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

I mean that is really driven by comps frankly. If we are in a positive comp environment, obviously, you can leverage occupancy and if you are negative same-store sales, clearly it is going to be the opposite. We do have a percentage rent component to our occupancy cost, but most of our occupancy cost is made up of fixed rent and fixed depreciation. So it is clearly a function of the sales trend.

Operator

Okay, and we ask that you do limit yourself to one question once again. (Operator Instructions). Lorraine Hutchinson, Bank of America.

Lorraine Hutchinson — Bank of America-Merrill Lynch — Analyst

Thank you. Good morning. Just a quick follow-up. When you talk about comp trends stabilizing in order for you to draw down on the revolver, does that mean turn positive or just not getting worse?

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

I think it is a belief that, and we don't want to overparse this, but I think it is a belief that things aren't getting worse primarily and therefore that we have a comfort factor that the trend stabilization that we are looking at when we make that decision is one that we think is sustainable. And that entails obviously not just seeing a few weeks, but seeing sort of a longer period of stabilization or improvement.

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AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Lorraine Hutchinson — Bank of America-Merrill Lynch — Analyst

Okay. And then my question revolved around the cannibalization analysis that you did when you were originally rolling the stores out. Where do you think it went wrong in trying to predict the cannibalization? And do you feel like you have a good enough handle on it now to be opening 30 more Hollisters internationally over the next year or so?

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Well, first of all, I think the premise of the first part of the question that we went wrong is not one we would agree with. I think it is obviously hard to begin with to project those things. When we opened a store in Oberhausen, it was tough for us to know whether people were driving 100 miles or 50 miles to come to the store because the brand was so appealing. So it was tough to gauge and I think there was probably some opening surge in any case around those stores.

But more importantly, when we have gone back and looked at all the stores that have been cannibalized and looked at whether in hindsight we would still have opened them, there is probably one or maybe two that we might not have opened because they wouldn't have met our overall return. So it is not as if, in retrospect, it led us down a path that we wouldn't have gone down.

Going forward, we are able now based on the patterns we have seen in certain discrete catchments like in, for example, the Frankfurt area or obviously around London or even somewhere like Manchester where we have two stores pretty close together in the UK, we now have a pretty good read on that and then every store we approve today, we put in a specific assumption of the cannibalization of existing stores and looking at the incremental return that store generates both in terms of the four-wall margin, but also in terms of the overall store-level ROI that we talked about earlier.

So I think to some degree it is natural. When the brand first got to Europe, it was very hot. People were probably going out of their way to get to the store to find it or having their friend go there. Over time as it becomes more available than some of the existing stores that probably have had some cannibalization, there is no great surprise about that. But fundamentally, it doesn't I think change the economics of what we have been through.

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

And let me add to this. Our discipline is really strong. To look at Hong Kong where we just stated what the flagship is doing, we also have an immensely successful store in Festival Walk, is one of the highest volume Hollister stores in the fleet. We are not — we are going to open one more store in Hong Kong and that is this month in Causeway Bay, but that will be it in Hong Kong. So with the size of that business and the enthusiasm for our brands, we are very disciplined about calling it a day at this point.

Operator

Kimberly Greenberger, Morgan Stanley.

Kimberly Greenberger — Morgan Stanley — Analyst

Good morning. Mike, I’m wondering if you can just talk to us about the international pricing strategy. I know last year, you felt like you had potentially overreached on price a little bit and you have been taking pricing down early this year. Do you feel like you have found the right sort of level on pricing in international stores?

And then, Jonathan, I am wondering if you can just help us with US versus international comps by quarter last year. I would assume that the international comparisons get a little bit easier as we progress through the second half of the year. And if you just have the transaction metrics here for the second quarter that you just reported, that would be great. Thanks so much.

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AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

Let me comment on international pricing and the first flagship and then Hollister. What I believe I said was that we felt we might have stretched the flagship prices too high. We have reacted to that and lowered the mix in flagship stores. I can't really tell you, Kimberly, if what I was saying was correct. It is very difficult to track that flagship AUR to the business. I believe that the slowdown in those stores has been really macro-related primarily. They are tourist stores and some cannibalization. So we have lowered the retails slightly for go-forward in the flagship stores. I am really not sure that the result is going to be dramatic. The Hollister AURs are very comparable to last year.

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Kimberly, on the second part, just to take some of the pieces of that, I think we said on the US that the — and this is off the top of my head. These numbers may not be exactly right, but I think we have said high single digits for US stores through the first three quarters last year and then approximately flat I think in the fourth quarter of last year I think is what we had said.

With regard to Hollister Europe, we were up in the 20% plus range through the first six months of last year. That then moderated into the single digits in the third and fourth quarters of last year and then turned negative in 2012. The flagships trend declined a little earlier than Hollister. We started to see the first signs of that in the second quarter, although really predominantly in August, but it didn't really become clear until the third quarter and then the flagships were negative from the third quarter onwards in 2011. And then they have been more negative through the first half of 2012 than Hollister.

Kimberly Greenberger — Morgan Stanley — Analyst

And Jonathan, just on the transaction metrics in the second quarter?

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Are you asking for a recap, Kimberly, or some —?

Kimberly Greenberger — Morgan Stanley — Analyst

AUR —.

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

We certainly have a —.

Kimberly Greenberger — Morgan Stanley — Analyst

Is that in the presentation?

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

(multiple speakers) on AUR for the second quarter?

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AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Brian Logan — Abercrombie & Fitch Co. — VP, IR & Controller

Yes, for the second quarter, I think we only gave some information on go-forward for the AUR.

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Yes, we didn’t specifically call that out, but I think again — and Brian, correct me if I am wrong — I think it was roughly flattish to slightly down for the US chain stores in the second quarter.

Brian Logan — Abercrombie & Fitch Co. — VP, IR & Controller

That is correct.

Operator

David Glick, Buckingham Research Group.

David Glick — Buckingham Research Group — Analyst

Good morning. Jonathan, just a question about the tax rate. I mean clearly the international business is still very profitable, yet the corporate tax rate is back toward more historical levels before you had a more profitable international operation. Can you help us understand why that is the case and how we should think about the tax rate going forward?

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Sure, David. There is kind of a 30-second answer to that question and then there is like a two-hour one.

David Glick — Buckingham Research Group — Analyst

I will take the 30-second.

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

30-second. I mean essentially we have the underlying profitability, the economic profitability of the operation, which is obviously still very strong. Then what happens though is a portion of our central overhead for tax purposes gets pushed out to the international operations. So our home office cost here and that is primarily based on sales how that gets allocated for tax purposes. So as international has grown as a proportion of the sales, for tax purposes, more of our central overhead for tax purposes gets moved to international and that therefore reduces the taxable profits internationally. It doesn’t — so it’s somewhat of a different answer between the economic profits and the taxable profits, but that is the short 30-second version of it.

Operator

Robin Murchison, SunTrust.

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AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Robin Murchison — SunTrust Robinson Humphrey — Analyst

Hi, good morning. Thank you for the color and visibility. Question — what is the approximate number of stores needed to maintain critical mass in the kids division? And then as you look at — are you looking at any merchant design team changes relative to any or all of the brands? Thanks.

Jonathan Ramsden — Abercrombie & Fitch Co.— EVP & CFO

I guess on the first part, Robin, I mean that is something that we clearly feel we have critical mass with the storecount we have today from a buying standpoint and certainly within the plans that we made for store closures, we don’t anticipate that changing our position. So we are not going to take the overall store footprint to a level where we would start to lose leverage from an average unit cost standpoint.

Robin Murchison — SunTrust Robinson Humphrey — Analyst

Okay and the merchant design changes, any?

Mike Jeffries — Abercrombie & Fitch Co.— Chairman & CEO

None that we are discussing at this point. We are constantly evolving our staff. I think the most important point is we have arguably the strongest merchant and design teams in the business and we are very pleased with them. They continue to perform.

Operator

Liz Dunn, Macquarie Capital.

Liz Dunn — Macquarie Research — Analyst

Hi, thanks for taking my question. Just as follow-up to the stores question, a lot of higher-end brands sort of have kind of a 300 store opportunity in the United States that they talk about and some are above that, such as Coach. I am just curious as to your perspective on why the Abercrombie & Fitch brand doesn’t have that sort of potential scale and now we need to close stores in that brand.

And then also I appreciate your careful management of the brand aesthetic over the years and obviously that has led to some longevity for the brand, but how do you — do you think at all that that sometimes constrains your ability to chase emerging trends as quickly as your competitors? Thanks.

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

I guess on the first part, I mean I think obviously our demographic is somewhat different than someone like a Coach. We obviously can’t speak to anybody else’s storecount plans. We look at it based on the economic performance of those stores we are in today and the stores that are marginal or we think are declining relative to the chain. In many cases, they are in malls that — where the malls are declining. So we certainly wouldn’t want to keep open a store if it is not doing well today and the mall itself is declining. We are generally in malls only, which may also account for some of the difference with some of those other brands you are looking at. But I don’t think we can really talk about anything beyond how we look at it and the economics of the stores that we are focused on closing versus the ones we expect to keep open because of their performance.

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AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

To answer your question, Liz, about whether our aesthetic prevents us from chasing trend as fast as our competitors, I don’t think that is the case. I think we might — we have a point of view that we chase trend that is appropriate to our aesthetic, but there is plenty of trend out there that is appropriate to our aesthetic.

Operator

Brian Tunick, JPMorgan.

Brian Tunick — JPMorgan Chase — Analyst

Thanks, good morning, guys. I guess one question for Mike, if you could just elaborate on your comments about the improved trend you have seen over the past few weeks. Is that both in the US and in Europe? Obviously, there was some noise around the Olympics. And then maybe, Jonathan, some more color on the gross margin expectations for the back half. Just maybe help us feel more comfortable what you have baked in domestically again. When we see A&F doing all denim $39 last week, American Eagle is now priced under $30, how much have you assumed that it gets very competitive in the back half? We understand you get the cotton back, but I’m just trying to understand what you have assumed in your guidance for the full year on the gross margins really more domestically.

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

Okay, Brian. By the way, I missed you in Roosevelt Field a week ago.

Brian Tunick — JPMorgan Chase — Analyst

I will see you soon.

Mike Jeffries — Abercrombie & Fitch Co. — Chairman & CEO

Okay. The answer to your question is that comp sales improved for both US and international. However, it is too early to say this represents a decisive change in the trend. As we found during the second quarter, comp sales can be volatile. We will know — we think we will know more over the next several weeks, but, for now, we are not counting on an improved trend, but we remain hopeful.

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Brian, on the second part of the question, as Brian I think referenced in his comments, we are planning for AURs in US chain stores to be flat to slightly down for the balance of the year, which is a little more conservative than we had indicated back in May. Obviously, we are up against a very aggressive promotional period, particularly in the fourth quarter. So at this point, we think that is a reasonable assumption.

The other key drivers are obviously the average unit cost is the biggest help to gross margin year over year, that reserve effect that Brian alluded to earlier, which is also helping to some degree and then international mix where we also have lower AURs baked in year over year for the international stores.

Operator

Anna Andreeva, FBR.

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AUGUST 15, 2012 / 12:30PM, ANF — Q2 2012 Abercrombie & Fitch Co. Earnings Conference Call

Anna Andreeva — FBR Capital Markets — Analyst

Great. Thanks so much. Good morning, guys. I was hoping you could parse out some of the gross margin decline for the second quarter, down 100 basis points. It's actually a little better than what we would have thought given all the promotional activities. So what was AUC versus ForEx? And then looking into the third quarter, you mentioned bigger expense deleverage. So how should we think about stores and distribution expense? I think it was up about 8% in dollars year over year. In the second quarter, should we think about a similar type of increase in 3Q and similarly on?

Jonathan Ramsden — Abercrombie & Fitch Co. — EVP & CFO

Okay, thanks. I guess on AUC, Anna, it was flat to slightly up for the quarter. The turning point was sort of midway through the quarter. So in terms of what we actually sold, it still skewed a little bit up on a year-over-year basis. I don't know if we have pulled out the specific FX impact on gross margin. We haven't specifically broken that out.

I think one of the reasons it was probably better than you might have anticipated really goes back to that point that we have been focused on trying to work through the inventory, kept it on the floor a little longer and that probably has to some degree impacted the sales trend, but we did focus on trying to hold the gross margin rate as we worked through the season. Brian, do you want to comment on the other pieces? The question was about increased expense deleverage in Q3. Any additional detail we can give?

Brian Logan — Abercrombie & Fitch Co. — VP, IR & Controller

I think part of it is some of the incremental expenses that we are going to see around our CRM programs, which will be incremental in the third quarter, in addition to some of the marketing initiatives we had discussed as well primarily related to China.

Operator

That does conclude today's question-and-answer session and today's presentation. We thank everyone for their participation. You may now disconnect.

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