Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Aug. 04, 2018 | Sep. 05, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | ABERCROMBIE & FITCH CO /DE/ | |
Entity Central Index Key | 1,018,840 | |
Current Fiscal Year End Date | --02-02 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Aug. 4, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Well-known Seasoned Issuer | Yes | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Common Stock, Shares Outstanding | 66,749,930 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2018 | Jul. 29, 2017 | Aug. 04, 2018 | Jul. 29, 2017 | |
Net sales | $ 842,414 | $ 779,321 | $ 1,573,313 | $ 1,440,420 |
Cost of sales, exclusive of depreciation and amortization | 335,519 | 318,426 | 624,073 | 580,600 |
Gross profit | 506,895 | 460,895 | 949,240 | 859,820 |
Stores and distribution expense | 374,552 | 369,295 | 735,707 | 729,224 |
Marketing, general and administrative expense | 123,883 | 109,353 | 248,780 | 219,246 |
Asset impairment | 8,671 | 6,135 | 9,727 | 6,865 |
Other operating income, net | (434) | (2,799) | (2,994) | (4,485) |
Operating income (loss) | 223 | (21,089) | (41,980) | (91,030) |
Interest expense, net | 3,023 | 4,089 | 6,041 | 8,209 |
Loss before income taxes | (2,800) | (25,178) | (48,021) | (99,239) |
Income tax expense (benefit) | 24 | (10,563) | (3,689) | (23,615) |
Net loss | (2,824) | (14,615) | (44,332) | (75,624) |
Less: Net income attributable to noncontrolling interests | 1,029 | 876 | 1,982 | 1,567 |
Net loss attributable to A&F | $ (3,853) | $ (15,491) | $ (46,314) | $ (77,191) |
Net loss per share attributable to A&F | ||||
Basic | $ (0.06) | $ (0.23) | $ (0.68) | $ (1.13) |
Diluted | $ (0.06) | $ (0.23) | $ (0.68) | $ (1.13) |
Weighted-average shares outstanding | ||||
Basic | 68,008 | 68,456 | 68,254 | 68,264 |
Diluted | 68,008 | 68,456 | 68,254 | 68,264 |
Dividends declared per share | $ 0.20 | $ 0.20 | $ 0.4 | $ 0.4 |
Other comprehensive (loss) income | ||||
Foreign currency translation, net of tax | $ (11,206) | $ 19,072 | $ (19,545) | $ 24,679 |
Derivative financial instruments, net of tax | 7,447 | (10,148) | 19,707 | (14,748) |
Other comprehensive (loss) income | (3,759) | 8,924 | 162 | 9,931 |
Comprehensive loss | (6,583) | (5,691) | (44,170) | (65,693) |
Less: Comprehensive income attributable to noncontrolling interests | 1,029 | 876 | 1,982 | 1,567 |
Comprehensive loss attributable to A&F | $ (7,612) | $ (6,567) | $ (46,152) | $ (67,260) |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Aug. 04, 2018 | Feb. 03, 2018 |
Current assets: | ||
Cash and equivalents | $ 581,166 | $ 675,558 |
Receivables | 91,719 | 79,724 |
Inventories | 454,913 | 424,393 |
Other current assets | 115,276 | 84,863 |
Total current assets | 1,243,074 | 1,264,538 |
Property and equipment, net | 691,933 | 738,182 |
Other assets | 325,842 | 322,972 |
Total assets | 2,260,849 | 2,325,692 |
Current liabilities: | ||
Accounts payable | 213,167 | 168,868 |
Accrued expenses | 311,930 | 308,601 |
Short-term portion of deferred lease credits | 19,449 | 19,751 |
Income taxes payable | 8,189 | 10,326 |
Short-term portion of borrowings, net | 0 | 0 |
Total current liabilities | 552,735 | 507,546 |
Long-term liabilities: | ||
Long-term portion of deferred lease credits | 75,963 | 75,648 |
Long-term portion of borrowings, net | 249,920 | 249,686 |
Leasehold financing obligations | 47,171 | 50,653 |
Other liabilities | 187,676 | 189,688 |
Total long-term liabilities | 560,730 | 565,675 |
Stockholders’ equity | ||
Class A Common Stock - $0.01 par value: 150,000 shares authorized and 103,300 shares issued at August 4, 2018 and February 3, 2018, respectively | 1,033 | 1,033 |
Paid-in capital | 401,483 | 406,351 |
Retained earnings | 2,337,100 | 2,420,552 |
Accumulated other comprehensive loss, net of tax | (94,892) | (95,054) |
Treasury stock, at average cost: 36,325 and 35,105 shares at August 4, 2018 and February 3, 2018, respectively | (1,507,414) | (1,490,503) |
Total Abercrombie & Fitch Co. stockholders’ equity | 1,137,310 | 1,242,379 |
Noncontrolling interests | 10,074 | 10,092 |
Total stockholders’ equity | 1,147,384 | 1,252,471 |
Total liabilities and stockholders’ equity | $ 2,260,849 | $ 2,325,692 |
Condensed Consolidated Balance4
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Aug. 04, 2018 | Feb. 03, 2018 |
Stockholders’ equity | ||
Treasury Stock, at Average Cost (in shares) | 36,325,000 | 35,105,000 |
Class A Common Stock | ||
Stockholders’ equity | ||
Class A Common Stock, par value | $ 0.01 | $ 0.01 |
Class A Common Stock, shares authorized | 150,000,000 | 150,000,000 |
Class A Common Stock, shares issued | 103,300,000 | 103,300,000 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Aug. 04, 2018 | Jul. 29, 2017 | |
Document Period End Date | Aug. 4, 2018 | |
Operating activities | ||
Net loss | $ (44,332) | $ (75,624) |
Adjustments to reconcile net loss to net cash provided by (used for) operating activities: | ||
Depreciation and amortization | 93,153 | 95,502 |
Asset impairment | 9,727 | 6,865 |
Loss on disposal | 1,644 | 3,824 |
Amortization of deferred lease credits | (10,609) | (10,412) |
Benefit from deferred income taxes | (17,049) | (19,121) |
Share-based compensation | 10,940 | 10,396 |
Changes in assets and liabilities | ||
Inventories | (40,934) | (67,964) |
Accounts payable and accrued expenses | 62,918 | 2,908 |
Lessor construction allowances | 6,107 | 5,478 |
Income taxes | (1,043) | (3,135) |
Long-term lease deposits | 1,452 | (530) |
Other assets | (20,319) | 9,960 |
Other liabilities | (1,129) | (6,193) |
Net cash provided by (used for) operating activities | 50,526 | (48,046) |
Investing activities | ||
Purchases of property and equipment | (54,115) | (61,777) |
Proceeds from sale of property and equipment | 0 | 203 |
Net cash used for investing activities | (54,115) | (61,574) |
Financing activities | ||
Purchase of treasury stock | (43,670) | 0 |
Dividends paid | (27,196) | (27,159) |
Other financing activities | (6,875) | (1,057) |
Net cash used for financing activities | (77,741) | (28,216) |
Effect of exchange rates on cash | (13,437) | 13,354 |
Net decrease in cash and equivalents, and restricted cash | (94,767) | (124,482) |
Cash and equivalents, and restricted cash, beginning of period | 581,166 | |
Cash and equivalents, and restricted cash, end of period | 603,188 | 443,150 |
Significant non-cash investing activities | ||
Change in accrual for construction in progress | 13,989 | (9,508) |
Supplemental information | ||
Cash paid for interest | 6,832 | 6,998 |
Cash paid for income taxes | 14,928 | 8,698 |
Cash received from income tax refunds | $ 8,173 | $ 5,808 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Aug. 04, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION Nature of Business Abercrombie & Fitch Co. (“A&F”), a company incorporated in Delaware in 1996, through its subsidiaries (collectively, A&F and its subsidiaries are referred to as “Abercrombie & Fitch” or the “Company”), is a global, multi-brand, specialty retailer, which primarily sells its products through its wholly-owned store and direct-to-consumer channels, as well as through various third-party wholesale, franchise and licensing arrangements. The Company offers a broad assortment of apparel, personal care products and accessories for men, women and kids under the Hollister, Abercrombie & Fitch and abercrombie kids brands. The Company has operations in North America, Europe, Asia and the Middle East. Principles of Consolidation The accompanying Condensed Consolidated Financial Statements include historical financial statements of, and transactions applicable to, the Company and reflect its assets, liabilities, results of operations and cash flows. The Company has interests in a United Arab Emirates business venture and in a Kuwait business venture with Majid al Futtaim Fashion L.L.C. (“MAF”), each of which meets the definition of a variable interest entity (“VIE”). The Company is deemed to be the primary beneficiary of these VIEs; therefore, the Company has consolidated the operating results, assets and liabilities of these VIEs, with MAF’s portion of net income presented as net income attributable to noncontrolling interests (“NCI”) on the Condensed Consolidated Statements of Operations and Comprehensive Loss and MAF’s portion of equity presented as NCI on the Condensed Consolidated Balance Sheets. Fiscal Year The Company’s fiscal year ends on the Saturday closest to January 31. All references herein to “Fiscal 2018 ” and “Fiscal 2017 ” represent the fifty-two week fiscal year ending on February 2, 2019 and the fifty-three week fiscal year ended on February 3, 2018 , respectively. Interim Financial Statements The Condensed Consolidated Financial Statements as of August 4, 2018 , and for the thirteen and twenty-six week periods ended August 4, 2018 and July 29, 2017 , are unaudited and are presented pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, the Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and notes thereto contained in A&F’s Annual Report on Form 10-K for Fiscal 2017 filed with the SEC on April 2, 2018 . The February 3, 2018 consolidated balance sheet data, included herein, were derived from audited consolidated financial statements, but do not include all disclosures required by accounting principles generally accepted in the United States of America (“U.S. GAAP”). In the opinion of management, the accompanying Condensed Consolidated Financial Statements reflect all adjustments (which are of a normal recurring nature) necessary to state fairly, in all material respects, the financial position and results of operations and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for Fiscal 2018 . Recent Accounting Pronouncements The Company reviews recent accounting pronouncements on a quarterly basis and has excluded discussion of those not applicable to the Company and those not expected to have a material impact on the Company’s financial statements. The following table provides a brief description of recent accounting pronouncements the Company has adopted or that could affect the Company’s financial statements. Accounting Standards Update (ASU) Description Date of Adoption Effect on the Financial Statements or Other Significant Matters Standards adopted ASU 2014-09, Revenue from Contracts with Customers This update superseded the revenue recognition guidance in ASC 605, Revenue Recognition . The new guidance requires entities to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration which the entity expects to be entitled to in exchange for those goods or services. February 4, 2018 The Company adopted this guidance and all related amendments using the modified retrospective method, and applied the standard to contracts that were not complete as of the adoption date. Comparative period information has not been restated and continues to be reported under the accounting standards in effect for those periods. This guidance primarily impacts the classification and timing of the recognition of the Company’s gift card breakage and timing of direct-to-consumer revenue. Adoption of this guidance had an immaterial impact on net loss attributable to A&F in the Company’s Condensed Consolidated Statements of Operations and Comprehensive Loss. The cumulative effect of applying the new standard on the Condensed Consolidated Balance Sheets as of August 4, 2018 was recognized as an adjustment to the opening balance of retained earnings, increasing beginning retained earnings by $6.9 million, with corresponding reductions in accrued expenses, inventories, and other assets of $4.7 million, $6.4 million, and $2.2 million, respectively, and increases to receivables and other current assets of $6.4 million and $4.4 million, respectively. In accordance with the new guidance, expected gift card breakage is now recognized in net sales as gift cards are redeemed. Previously, gift card breakage was recognized as other operating income when the Company determined that the likelihood of redemption was remote. Under the new guidance, direct-to-consumer revenue is recognized when control is passed to the customer, typically upon shipment or pick-up of goods. Previously, direct-to-consumer revenue was recognized upon customer acceptance, which typically occurred upon the customer’s possession of the merchandise. The Company does not expect this guidance to have a material impact on store, direct-to-consumer, wholesale, franchise or license revenues on an ongoing basis. The Company’s revenue recognition accounting policies are discussed further in this Note 1 under “Revenue Recognition.” ASU 2016-18, Statement of Cash Flows This update amends the guidance in ASC 230, Statement of Cash Flows . The new guidance requires an entity to show the changes in total cash, cash equivalents and restricted cash in the statement of cash flows. Consequently, an entity is no longer required to present transfers between cash and equivalents and restricted cash. February 4, 2018 The Company adopted this guidance under the retrospective method. For the twenty-six weeks ended July 29, 2017, adoption of this guidance resulted in a $0.8 million decrease in net cash used for operating activities and increases of $20.4 million and $21.2 million to beginning and ending cash, cash equivalents and restricted cash, respectively. In addition, captions have been updated in the Condensed Consolidated Statements of Cash Flows to reflect the inclusion of restricted cash. Restricted cash is classified as other assets on the Condensed Consolidated Balance Sheets, as was the case at year-end. Standards not yet adopted ASU 2016-02, Leases This update supersedes the leasing guidance in ASC 840, Leases . The new guidance requires an entity to recognize lease assets and lease liabilities on the balance sheet and disclose key leasing information that depicts the lease rights and obligations of an entity. February 3, 2019 The Company expects that this guidance will result in a material increase in the Company’s long-term assets and long-term liabilities on the Company’s Condensed Consolidated Balance Sheets, and is currently evaluating additional impacts that this guidance may have on its consolidated financial statements, including the potential for impairment of right-of-use assets. The Company did not elect to early adopt this guidance. ASU 2017-12, Derivatives and Hedging — Targeted Improvements to Accounting for Hedging Activities This update amends ASC 815, Derivatives and Hedging . The new guidance simplifies certain aspects of hedge accounting for both financial and commodity risks to more accurately present the economic effects of an entity’s risk management activities in its financial statements. Under the new standard, more hedging strategies will be eligible for hedge accounting, including hedges of the benchmark rate component of the contractual coupon cash flows of fixed-rate assets or liabilities and partial-term hedges of fixed-rate assets or liabilities. For cash flow and net investment hedges, the guidance requires a modified retrospective approach while the amended presentation and disclosure guidance requires a prospective approach. February 3, 2019 The Company is currently evaluating the impact that this guidance will have on its consolidated financial statements. The Company did not elect to early adopt this guidance. The Company’s significant accounting policies as of August 4, 2018 have not changed materially from those disclosed in Note 2, “ SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, ” of the Notes to Consolidated Financial Statements contained in “ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA” of A&F’s Annual Report on Form 10-K for Fiscal 2017 , with the exception of those discussed below: Revenue Recognition The Company recognizes revenue from product sales when control of the good is transferred to the customer, generally upon pick up at, or shipment from, a Company location. The Company provides shipping and handling services to customers in certain direct-to-consumer transactions. Revenue associated with the related shipping and handling obligations is deferred until the obligation is fulfilled, typically upon the customer’s receipt of the merchandise. The related shipping and handling costs are classified in stores and distribution expense on the Condensed Consolidated Statements of Operations and Comprehensive Loss. Revenue is recorded net of estimated returns, associate discounts, promotions and other similar customer incentives. The Company estimates reserves for sales returns based on historical experience among other factors. The sales return reserve is classified in accrued expenses on the Condensed Consolidated Balance Sheets. The Company accounts for gift cards sold to customers by recognizing an unearned revenue liability at the time of sale, which remains until income from gift cards not expected to be redeemed, referred to as gift card breakage, is recognized as revenue proportionally with gift card redemptions. Gift cards sold to customers do not expire or lose value over periods of inactivity and the Company is not required by law to escheat the value of unredeemed gift cards to the jurisdictions in which it operates. The Company also maintains loyalty programs, which primarily provides customers with the opportunity to earn points toward future merchandise discount rewards with qualifying purchases. The Company accounts for expected future reward redemptions by recognizing an unearned revenue liability as customers accumulate points, which remains until revenue is recognized at the earlier of redemption or expiration. Unearned revenue liabilities are primarily recorded when prepayments for future merchandise are received through gift card purchases or when loyalty rewards are earned by a customer in a sales transaction, and are classified in accrued expenses on the Condensed Consolidated Balance Sheets and are typically recognized as revenue within a 12-month period. Unearned revenue liabilities as of August 4, 2018 and the date of adoption, February 4, 2018, were approximately $37.5 million and $38.7 million , respectively. On the date of adoption, February 4, 2018, an adjustment related to the adoption of new revenue recognition standards decreased the beginning of period balance by $6.2 million. For the thirteen and twenty-six weeks ended August 4, 2018 , the Company recognized revenue of approximately $20.3 million and $41.3 million , respectively, related to previous deferrals of revenue resulting from the Company’s gift card and loyalty programs. The Company also recognizes revenue under wholesale arrangements, which is generally recognized upon shipment, when control passes to the wholesale partner. Revenue from the Company’s franchise and license arrangements, primarily royalties earned upon sale of merchandise, is generally recognized at the time merchandise is sold to the franchisees’ retail customers or to the licensees’ wholesale customers. All revenues are recognized in net sales in the Condensed Consolidated Statements of Operations and Comprehensive Loss. For a discussion of the disaggregation of revenue, refer to Note 10, “ SEGMENT REPORTING . ” The Company does not include tax amounts collected from customers on behalf of third parties, including sales and indirect taxes, in net sales. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 6 Months Ended |
Aug. 04, 2018 | |
Earnings Per Share [Abstract] | |
NET INCOME (LOSS) PER SHARE | NET LOSS PER SHARE Net loss per basic and diluted share attributable to A&F is computed based on the weighted-average number of outstanding shares of Class A Common Stock (“Common Stock”). Additional information pertaining to net loss per share attributable to A&F is as follows: Thirteen Weeks Ended Twenty-six Weeks Ended (in thousands) August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 Shares of Common Stock issued 103,300 103,300 103,300 103,300 Weighted-average treasury shares (35,292 ) (34,844 ) (35,046 ) (35,036 ) Weighted-average — basic shares 68,008 68,456 68,254 68,264 Dilutive effect of share-based compensation awards — — — — Weighted-average — diluted shares 68,008 68,456 68,254 68,264 Anti-dilutive shares (1) 3,466 5,154 4,033 5,460 (1) Reflects the total number of shares related to outstanding share-based compensation awards that have been excluded from the computation of net loss per diluted share because the impact would have been anti-dilutive. |
Fair Value
Fair Value | 6 Months Ended |
Aug. 04, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE | FAIR VALUE Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The inputs used to measure fair value are prioritized based on a three-level hierarchy. The three levels of inputs to measure fair value are as follows: • Level 1—inputs are unadjusted quoted prices for identical assets or liabilities that are available in active markets that the Company can access at the measurement date. • Level 2—inputs are other than quoted market prices included within Level 1 that are observable for assets or liabilities, directly or indirectly. • Level 3—inputs to the valuation methodology are unobservable. The lowest level of significant input determines the placement of the entire fair value measurement in the hierarchy. The three levels of the hierarchy and the distribution of the Company’s assets and liabilities that are measured at fair value on a recurring basis were as follows: Assets and Liabilities at Fair Value as of August 4, 2018 (in thousands) Level 1 Level 2 Level 3 Total Assets: Trust-owned life insurance policies (at cash surrender value) $ — $ 104,310 $ — $ 104,310 Money market funds 25,073 — — 25,073 Derivative financial instruments — 12,343 — 12,343 Total assets $ 25,073 $ 116,653 $ — $ 141,726 Liabilities: Derivative financial instruments $ — $ 28 $ — $ 28 Total liabilities $ — $ 28 $ — $ 28 Assets and Liabilities at Fair Value as of February 3, 2018 (in thousands) Level 1 Level 2 Level 3 Total Assets: Trust-owned life insurance policies (at cash surrender value) $ — $ 102,784 $ — $ 102,784 Money market funds 330,649 — — 330,649 Derivative financial instruments — 37 — 37 Total assets $ 330,649 $ 102,821 $ — $ 433,470 Liabilities: Derivative financial instruments $ — $ 9,147 $ — $ 9,147 Total liabilities $ — $ 9,147 $ — $ 9,147 The Level 2 assets and liabilities consist of trust-owned life insurance policies and derivative financial instruments, primarily foreign currency exchange forward contracts.The fair value of trust-owned life insurance policies is determined using the cash surrender value of the life insurance policies. The fair value of foreign currency exchange forward contracts is determined using quoted market prices of the same or similar instruments, adjusted for counterparty risk. Fair value of borrowings The Company’s borrowings under the Company’s credit facilities are carried at historical cost in the accompanying Condensed Consolidated Balance Sheets. The carrying amount and fair value of the Company’s gross borrowings under the term loan credit facility were as follows: (in thousands) August 4, 2018 February 3, 2018 Gross borrowings outstanding, carrying amount $ 253,250 $ 253,250 Gross borrowings outstanding, fair value $ 254,200 $ 253,250 No borrowings were outstanding under the Company’s senior secured revolving credit facility as of August 4, 2018 or February 3, 2018 . |
Property and Equipment, Net
Property and Equipment, Net | 6 Months Ended |
Aug. 04, 2018 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | PROPERTY AND EQUIPMENT, NET Property and equipment, net consisted of: (in thousands) August 4, 2018 February 3, 2018 Property and equipment, at cost $ 2,802,253 $ 2,821,709 Less: Accumulated depreciation and amortization (2,110,320 ) (2,083,527 ) Property and equipment, net $ 691,933 $ 738,182 The Company incurred store asset impairment charges of $8.7 million and $9.7 million for the thirteen and twenty-six weeks ended August 4, 2018 , respectively, and $6.1 million and $6.9 million for the thirteen and twenty-six weeks ended July 29, 2017 , respectively, primarily related to certain of the Company’s international Abercrombie & Fitch stores. The Company had $35.6 million and $38.7 million of construction project assets in property and equipment, net at August 4, 2018 and February 3, 2018 , respectively, related to the construction of buildings in certain lease arrangements where the Company is deemed to be the owner of the construction project. |
Income Taxes
Income Taxes | 6 Months Ended |
Aug. 04, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company’s quarterly tax provision and the estimate of the annual effective tax rate are subject to significant variation due to several factors. These include variability in the pre-tax jurisdictional mix of earnings, changes in how the Company does business including entering into new businesses or geographies, changes in foreign currency exchange rates, changes in law, regulations, interpretations and administrative practices, relative changes of expenses or losses for which tax benefits are not recognized and the impact of discrete items. The impact of these items on the effective tax rate will be greater at lower levels of pre-tax earnings. Tax Cuts and Jobs Act of 2017 On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Act”) was signed into law. The Act makes broad and significantly complex changes to the U.S. corporate income tax system by, among other things: reducing the U.S. federal corporate income tax rate from 35% to 21%; transitioning U.S. international taxation to a modified territorial tax system; and imposing a mandatory one-time deemed repatriation tax, payable over eight years, on accumulated undistributed foreign subsidiary earnings and profits as of December 31, 2017. The Company recognized provisional discrete net tax charges of $19.9 million related to the enactment of the Act in the fourth quarter of Fiscal 2017. Due to proposed regulatory guidance issued by the Internal Revenue Service during the second quarter of Fiscal 2018, the Company recognized a measurement period charge of $2.0 million during the thirteen weeks ended August 4, 2018 , adjusting the provisional tax amounts related to the mandatory one-time deemed repatriation tax on accumulated undistributed foreign earnings. As a result of the Company's initial analysis of the impact of the Act and the measurement period adjustment, the Company has incurred discrete net income tax charges in an aggregate amount of $21.9 million since the enactment of the Act, which consists of: • $23.7 million of provisional tax expense related to the mandatory one-time deemed repatriation tax on accumulated undistributed foreign subsidiary earnings and profits of approximately $385.8 million; • $3.8 million of provisional tax expense related to the remeasurement of the Company's ending deferred tax assets and liabilities at February 3, 2018, as a result of the U.S. federal corporate income tax rate reduction from 35% to 21%; and, • $5.6 million of tax benefit for the decrease in its federal deferred tax liability on unremitted foreign earnings. Given the significant changes resulting from and complexities associated with the Act, the estimated financial impacts related to the enactment of the Act are provisional and assessed as of August 22, 2018 . The ultimate outcome may differ from these provisional amounts and could impact the provision for income taxes in Fiscal 2018, possibly materially, due to, among other things, additional analysis, changes in interpretations and assumptions the Company has made, additional regulatory guidance that may be issued and actions the Company may take as a result of the Act. Provisional amounts are expected to be finalized after the Company’s Fiscal 2017 U.S. corporate income tax return is filed in the fourth quarter of Fiscal 2018, but no later than one year from the enactment of the Act. Other The Company incurred discrete non-cash income tax benefits of $0.2 million and charges of $7.9 million for the thirteen and twenty-six weeks ended August 4, 2018 , respectively, and charges of $0.7 million and $9.9 million for the thirteen and twenty-six weeks ended July 29, 2017 , respectively, related to the expiration of certain share-based compensation awards, recognized in income tax expense (benefit) due to changes in share-based compensation accounting standards adopted by the Company in the first quarter of Fiscal 2017. |
Borrowings
Borrowings | 6 Months Ended |
Aug. 04, 2018 | |
Debt Disclosure [Abstract] | |
Borrowings | BORROWINGS Asset-Based Revolving Credit Facility On August 7, 2014, A&F, through its subsidiary Abercrombie & Fitch Management Co. (“A&F Management”) as the lead borrower (with A&F and certain other subsidiaries as borrowers or guarantors), entered into an asset-based revolving credit agreement. On October 19, 2017, the Company, through A&F Management, entered into the Second Amendment to Credit Agreement (the “ABL Second Amendment”), amending and extending the maturity date of the asset-based revolving credit agreement. As amended, the asset-based revolving credit agreement continues to provide for a senior secured revolving credit facility of up to $400 million (the “Amended ABL Facility”). The Amended ABL Facility will mature on October 19, 2022. The provisions of the credit agreement for the Amended ABL Facility have not changed from those contained in “ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA” of A&F’s Annual Report on Form 10-K for Fiscal 2017 . As of August 4, 2018, no borrowings were outstanding under the Amended ABL Facility. As of August 4, 2018, the Company had availability under the Amended ABL Facility of $328.1 million. Term Loan Facility A&F, through its subsidiary A&F Management as the borrower (with A&F and certain other subsidiaries as guarantors), also entered into a term loan credit agreement on August 7, 2014, which, as amended, provides for a term loan facility of $300 million (the “Term Loan Facility” and, together with the Amended ABL Facility, the “Credit Facilities”). On June 22, 2018, the Company, through A&F Management, entered into the Term Loan Second Amendment , which served to reprice the Term Loan Facility. As permitted under the credit agreement applicable to the Term Loan Facility, among other things, the Term Loan Second Amendment provided for the issuance by A&F Management of refinancing term loans in an aggregate principal amount of $253.3 million in exchange for the term loans then outstanding under the Term Loan Facility, which resulted in the reduction of the applicable margins for term loans by 0.25% . Under the Term Loan Second Amendment, at the Company's option, borrowings under the Term Loan Facility will now bear interest at either (a) an adjusted LIBO rate no lower than 1.00% plus a margin of 3.50% per annum, reduced from a margin of 3.75% per annum, or (b) an alternate base rate plus a margin of 2.50% per annum, reduced from a margin of 2.75% per annum. Deferred financing fees associated with the repricing transaction were not significant. All other material provisions under the credit agreement applicable to the Term Loan Facility remained unchanged. As of August 4, 2018 , the interest rate on borrowings under the Term Loan Facility was 5.59% . The Company’s Term Loan Facility debt is presented in the Condensed Consolidated Balance Sheets, net of the unamortized discount and fees. Net borrowings as of August 4, 2018 and February 3, 2018 were as follows: (in thousands) August 4, 2018 February 3, 2018 Borrowings, gross at carrying amount $ 253,250 $ 253,250 Unamortized discount (1,014 ) (1,184 ) Unamortized fees (2,316 ) (2,380 ) Borrowings, net 249,920 249,686 Less: short-term portion of borrowings, net — — Long-term portion of borrowings, net $ 249,920 249,686 Representations, Warranties and Covenants The Credit Facilities contain various representations, warranties and restrictive covenants that, among other things and subject to specified exceptions, restrict the ability of A&F and its subsidiaries to incur indebtedness (including guarantees), grant liens, make investments, pay dividends or distributions with respect to capital stock, make prepayments on other indebtedness, engage in mergers, dispose of certain assets or change the nature of their business. In addition, excess availability equal to the greater of 10% of the loan cap or $30 million must be maintained under the Amended ABL Facility. The Credit Facilities do not otherwise contain financial maintenance covenants. Both Credit Facilities contain certain affirmative covenants, including reporting requirements such as delivery of financial statements, certificates and notices of certain events, maintaining insurance and providing additional guarantees and collateral in certain circumstances. The Company was in compliance with the covenants under the Credit Facilities as of August 4, 2018 . |
Share-Based Compensation
Share-Based Compensation | 6 Months Ended |
Aug. 04, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION Financial Statement Impact The Company recognized share-based compensation expense of $6.2 million and $10.9 million for the thirteen and twenty-six weeks ended August 4, 2018 , respectively, and $5.5 million and $10.4 million for the thirteen and twenty-six weeks ended July 29, 2017 , respectively. The Company recognized tax benefits associated with share-based compensation expense of $1.3 million and $2.2 million for the thirteen and twenty-six weeks ended August 4, 2018 , respectively, and $2.1 million and $4.0 million for the thirteen and twenty-six weeks ended July 29, 2017 , respectively. Restricted Stock Units The following table summarizes activity for restricted stock units for the twenty-six weeks ended August 4, 2018 : Service-based Restricted Stock Units Performance-based Restricted Stock Units Market-based Restricted Stock Units Number of Underlying Shares (1) Weighted- Average Grant Date Fair Value Number of Underlying Shares Weighted- Average Grant Date Fair Value Number of Underlying Shares Weighted- Average Grant Date Fair Value Unvested at February 3, 2018 2,520,160 $ 15.35 690,174 $ 11.82 383,980 $ 16.50 Granted 736,915 21.93 197,979 21.77 142,014 33.69 Adjustments for performance achievement — — (43,999 ) 20.10 (36,817 ) 19.04 Vested (844,382 ) 17.30 — — (7,185 ) 19.04 Forfeited (121,568 ) 14.88 (12,998 ) 12.17 (12,999 ) 17.28 Unvested at August 4, 2018 2,291,125 $ 16.78 831,156 $ 13.74 468,993 $ 21.45 (1) Includes 496,981 unvested restricted stock units as of August 4, 2018 , subject to vesting requirements related to the achievement of certain performance metrics, such as operating income and net income, for the fiscal year immediately preceding the vesting date. Holders of these restricted stock units have the opportunity to earn back one or more installments of the award if the cumulative performance requirements are met in a subsequent year. Unvested shares related to restricted stock units with performance-based and market-based vesting conditions can achieve up to 200% of their target vesting amount and are reflected at 100% of their target vesting amount in the table above. Fair value of both service-based and performance-based restricted stock units is calculated using the market price of the underlying Common Stock on the date of grant reduced for anticipated dividend payments on unvested shares. In determining fair value, the Company does not take into account performance-based vesting requirements. Performance-based vesting requirements are taken into account in determining the number of awards expected to vest. For market-based restricted stock units, fair value is calculated using a Monte Carlo simulation with the number of shares that ultimately vest dependent on the Company’s total stockholder return measured against the total stockholder return of a select group of peer companies over a three-year period. For awards with performance-based or market-based vesting requirements, the number of shares that ultimately vest can vary from 0% to 200% of target depending on the level of achievement of performance criteria. Service-based restricted stock units are expensed on a straight-line basis over the total award’s requisite service period. Performance-based restricted stock units subject to graded vesting are expensed on an accelerated attribution basis. Performance share award expense is primarily recognized in the performance period of the award’s requisite service period. Market-based restricted stock units without graded vesting features are expensed on a straight-line basis over the award’s requisite service period. Compensation expense for stock options and stock appreciation rights is recognized on a straight-line basis over the award’s requisite service period. The Company adjusts share-based compensation expense on a quarterly basis for actual forfeitures. Unrecognized compensation expense presented excludes the effect of potential forfeitures, and will be adjusted for actual forfeitures as they occur. As of August 4, 2018 , there was $31.5 million , $9.1 million and $6.3 million of total unrecognized compensation cost, related to service-based, performance-based and market-based restricted stock units, respectively. The unrecognized compensation cost is expected to be recognized over a weighted-average period of 16 months , 13 months and 14 months for service-based, performance-based and market-based restricted stock units, respectively. The actual tax benefit realized for tax deductions related to the issuance of shares associated with restricted stock unit vesting was $1.5 million and $4.9 million for the thirteen and twenty-six weeks ended August 4, 2018 , respectively, and $0.5 million and $2.5 million for the thirteen and twenty-six weeks ended July 29, 2017 , respectively. Additional information pertaining to restricted stock units for the twenty-six weeks ended August 4, 2018 and July 29, 2017 follows: (in thousands) August 4, 2018 July 29, 2017 Service-based restricted stock units: Total grant date fair value of awards granted $ 16,161 $ 15,948 Total grant date fair value of awards vested 14,608 16,806 Performance-based restricted stock units: Total grant date fair value of awards granted $ 4,310 $ 4,774 Total grant date fair value of awards vested — — Market-based restricted stock units: Total grant date fair value of awards granted $ 4,784 $ 2,793 Total grant date fair value of awards vested 137 — The weighted-average assumptions used for market-based restricted stock units in the Monte Carlo simulation during the twenty-six weeks ended August 4, 2018 and July 29, 2017 were as follows: August 4, 2018 July 29, 2017 Grant date market price $ 23.59 $ 11.43 Fair value $ 33.69 $ 11.79 Assumptions: Price volatility 54 % 47 % Expected term (years) 2.9 2.9 Risk-free interest rate 2.4 % 1.5 % Dividend yield 3.4 % 7.0 % Average volatility of peer companies 37.4 % 35.2 % Average correlation coefficient of peer companies 0.2709 0.2664 Stock Appreciation Rights The following table summarizes stock appreciation rights activity for the twenty-six weeks ended August 4, 2018 : Number of Underlying Shares Weighted-Average Exercise Price Aggregate Intrinsic Value Weighted-Average Remaining Contractual Life Outstanding at February 3, 2018 3,010,720 $ 49.35 Granted — — Exercised (50,190 ) 22.21 Forfeited or expired (1,614,371 ) 54.67 Outstanding at August 4, 2018 1,346,159 $ 44.13 $ 867,381 3.4 Stock appreciation rights exercisable at August 4, 2018 1,248,775 $ 45.80 $ 612,390 3.1 Stock appreciation rights expected to become exercisable in the future as of August 4, 2018 92,143 $ 22.68 $ 239,589 6.7 As of August 4, 2018 , there was $0.5 million of total unrecognized compensation cost related to stock appreciation rights. The unrecognized compensation cost is expected to be recognized over a weighted-average period of 5 months . The grant date fair value of stock appreciation rights that were exercised during the twenty-six weeks ended August 4, 2018 and July 29, 2017 was $1.2 million and $2.2 million , respectively. Stock Options The following table summarizes stock option activity for the twenty-six weeks ended August 4, 2018 : Number of Underlying Shares Weighted-Average Exercise Price Aggregate Intrinsic Value Weighted-Average Remaining Contractual Life Outstanding at February 3, 2018 87,200 $ 78.20 Granted — — Exercised — — Forfeited or expired (87,200 ) 78.20 Outstanding at August 4, 2018 — $ — $ — — Stock options exercisable at August 4, 2018 — $ — $ — — As of August 4, 2018 , there was no unrecognized compensation cost related to stock options. |
Derivative Instruments
Derivative Instruments | 6 Months Ended |
Aug. 04, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS | DERIVATIVE INSTRUMENTS The Company is exposed to risks associated with changes in foreign currency exchange rates and uses derivative instruments, primarily forward contracts, to manage the financial impacts of these exposures. The Company does not use forward contracts to engage in currency speculation and does not enter into derivative financial instruments for trading purposes. The Company uses derivative instruments, primarily foreign currency exchange forward contracts designated as cash flow hedges, to hedge the foreign currency exchange rate exposure associated with forecasted foreign currency denominated intercompany inventory sales to foreign subsidiaries and the related settlement of the foreign currency denominated intercompany receivables. Fluctuations in foreign currency exchange rates will either increase or decrease the Company’s intercompany equivalent cash flows and affect the Company’s U.S. Dollar earnings. Gains or losses on the foreign currency exchange forward contracts that are used to hedge these exposures are expected to partially offset this variability. Foreign currency exchange forward contracts represent agreements to exchange the currency of one country for the currency of another country at an agreed upon settlement date. These foreign currency exchange forward contracts typically have a maximum term of twelve months . The sale of the inventory to the Company’s customers will result in the reclassification of related derivative gains and losses that are reported in accumulated other comprehensive loss (“AOCL”). Under the current accounting guidance, substantially all of the unrealized gains or losses related to designated cash flow hedges as of August 4, 2018 would be recognized in cost of sales, exclusive of depreciation and amortization, over the next twelve months . Refer to Note 1, “ BASIS OF PRESENTATION , ” for further discussion of recent accounting pronouncements related to derivative instruments that could affect the Company's financial statements. The Company presents its derivative assets and derivative liabilities at their gross fair values on the Condensed Consolidated Balance Sheets. However, the Company’s derivative contracts allow net settlements under certain conditions. As of August 4, 2018 , the Company had outstanding the following foreign currency exchange forward contracts that were entered into to hedge either a portion, or all, of forecasted foreign currency denominated intercompany inventory sales, the resulting settlement of the foreign currency denominated intercompany accounts receivable, or both: (in thousands) Notional Amount (1) Euro $ 159,768 British pound $ 73,692 Canadian dollar $ 29,989 Japanese yen $ 15,960 (1) Amounts reported are the U.S. Dollar notional amounts outstanding as of August 4, 2018 . The Company also uses foreign currency exchange forward contracts to hedge certain foreign-currency-denominated net monetary assets/liabilities. Examples of monetary assets/liabilities include cash balances, receivables and payables. Fluctuations in foreign currency exchange rates result in transaction gains or losses being recorded in earnings, as U.S. GAAP requires that monetary assets/liabilities be remeasured at the spot exchange rate at quarter-end or upon settlement. The Company has chosen not to apply hedge accounting to these instruments because there are no differences in the timing of gain or loss recognition on the hedging instruments and the hedged items. As of August 4, 2018 , the Company had outstanding the following foreign currency exchange forward contracts that were entered into to hedge foreign-currency-denominated net monetary assets/liabilities: (in thousands) Notional Amount (1) Euro $ 8,818 Japanese yen $ 3,294 (1) Amounts reported are the U.S. Dollar notional amounts outstanding as of August 4, 2018 . The location and amounts of derivative fair values on the Condensed Consolidated Balance Sheets as of August 4, 2018 and February 3, 2018 were as follows: (in thousands) Location August 4, February 3, Location August 4, February 3, Derivatives designated as hedging instruments: Foreign currency exchange forward contracts $ 12,198 $ 37 $ 28 $ 9,108 Derivatives not designated as hedging instruments: Foreign currency exchange forward contracts $ 145 $ — $ — $ 39 Total Other current assets $ 12,343 $ 37 Accrued expenses $ 28 $ 9,147 Refer to Note 3, “ FAIR VALUE , ” for further discussion of the determination of the fair value of derivative instruments. The location and amounts of derivative gains and losses for the thirteen and twenty-six weeks ended August 4, 2018 and July 29, 2017 on the Condensed Consolidated Statements of Operations and Comprehensive Loss were as follows: (in thousands) Thirteen Weeks Ended Twenty-six Weeks Ended Derivatives not designated as hedging instruments: Location August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 Foreign currency exchange forward contracts gain (loss) Other operating income, net $ 1,894 $ (523 ) $ 4,595 $ (551 ) Effective Portion Ineffective Portion and Amount Excluded from Effectiveness Testing Amount of Gain (Loss) Recognized in AOCL on Derivative Contracts (1) Location of Gain (Loss) Reclassified from AOCL into Earnings Amount of Gain (Loss) Reclassified from AOCL into Earnings (2) Location of Gain Recognized in Earnings on Derivative Contracts Amount of Gain (Loss) Recognized in Earnings on Derivative Contracts (3) Thirteen Weeks Ended (in thousands) August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 Derivatives in cash flow hedging relationships: Foreign currency exchange forward contracts $ 8,058 $ (11,029 ) Cost of sales, exclusive of depreciation and amortization $ (150 ) $ 545 Other operating income, net $ 1,686 $ 634 Twenty-six Weeks Ended (in thousands) August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 Derivatives in cash flow hedging relationships: Foreign currency exchange forward contracts $ 16,665 $ (12,402 ) Cost of sales, exclusive of depreciation and amortization $ (5,222 ) $ 4,081 Other operating income, net $ 3,055 $ 1,161 (1) The amount represents the change in fair value of derivative contracts due to changes in spot rates. (2) The amount represents the reclassification from AOCL into earnings when the hedged item affects earnings, which is when merchandise is sold to the Company’s customers. (3) The amount represents the change in fair value of derivative contracts due to changes in the difference between the spot price and forward price that is excluded from the assessment of hedge effectiveness and, therefore, recognized in earnings. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 6 Months Ended |
Aug. 04, 2018 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | ACCUMULATED OTHER COMPREHENSIVE LOSS The activity in accumulated other comprehensive loss for the thirteen and twenty-six weeks ended August 4, 2018 was as follows: Thirteen Weeks Ended August 4, 2018 (in thousands) Foreign Currency Translation Adjustment Unrealized Gain (Loss) on Derivative Financial Instruments Total Beginning balance at May 5, 2018 $ (93,286 ) $ 2,153 $ (91,133 ) Other comprehensive (loss) income before reclassifications (11,206 ) 8,058 (3,148 ) Reclassified from accumulated other comprehensive loss (1) — 150 150 Tax effect — (761 ) (761 ) Other comprehensive (loss) income (11,206 ) 7,447 (3,759 ) Ending balance at August 4, 2018 $ (104,492 ) $ 9,600 $ (94,892 ) Twenty-six Weeks Ended August 4, 2018 (in thousands) Foreign Currency Translation Adjustment Unrealized Gain (Loss) on Derivative Financial Instruments Total Beginning balance at February 3, 2018 $ (84,947 ) $ (10,107 ) $ (95,054 ) Other comprehensive (loss) income before reclassifications (19,545 ) 16,665 (2,880 ) Reclassified from accumulated other comprehensive loss (1) — 5,222 5,222 Tax effect — (2,180 ) (2,180 ) Other comprehensive (loss) income (19,545 ) 19,707 162 Ending balance at August 4, 2018 $ (104,492 ) $ 9,600 $ (94,892 ) (1) Amount represents losses reclassified from accumulated other comprehensive loss to cost of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statement of Operations and Comprehensive Loss. The activity in accumulated other comprehensive loss for the thirteen and twenty-six weeks ended July 29, 2017 was as follows: Thirteen Weeks Ended July 29, 2017 (in thousands) Foreign Currency Translation Adjustment Unrealized Gain (Loss) on Derivative Financial Instruments Total Beginning balance at April 29, 2017 $ (120,520 ) $ 225 $ (120,295 ) Other comprehensive (loss) income before reclassifications 19,072 (11,029 ) 8,043 Reclassified from accumulated other comprehensive loss (2) — (545 ) (545 ) Tax effect — 1,426 1,426 Other comprehensive (loss) income 19,072 (10,148 ) 8,924 Ending balance at July 29, 2017 $ (101,448 ) $ (9,923 ) $ (111,371 ) Twenty-six Weeks Ended July 29, 2017 (in thousands) Foreign Currency Translation Adjustment Unrealized Gain (Loss) on Derivative Financial Instruments Total Beginning balance at January 28, 2017 $ (126,127 ) $ 4,825 $ (121,302 ) Other comprehensive income before reclassifications 24,679 (12,402 ) 12,277 Reclassified from accumulated other comprehensive loss (2) — (4,081 ) (4,081 ) Tax effect — 1,735 1,735 Other comprehensive income 24,679 (14,748 ) 9,931 Ending balance at July 29, 2017 $ (101,448 ) $ (9,923 ) $ (111,371 ) (2) Amount represents gains reclassified from accumulated other comprehensive loss to cost of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statement of Operations and Comprehensive Loss. |
Segment Reporting
Segment Reporting | 6 Months Ended |
Aug. 04, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | SEGMENT REPORTING The Company’s two operating segments are brand-based: Hollister and Abercrombie, the latter of which includes the Company’s Abercrombie & Fitch and abercrombie kids brands. These operating segments have similar economic characteristics, classes of consumers, products, and production and distribution methods, operate in the same regulatory environments, and have been aggregated into one reportable segment. Amounts shown below include net sales from wholesale, franchise and licensing operations, which are not a significant component of total revenue, and are aggregated within their respective areas. The following table provides the Company’s net sales by operating segment for the thirteen and twenty-six weeks ended August 4, 2018 and July 29, 2017 . Thirteen Weeks Ended Twenty-six Weeks Ended (in thousands) August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 Hollister $ 500,836 $ 446,639 $ 924,464 $ 821,315 Abercrombie 341,578 332,682 648,849 619,105 Total $ 842,414 $ 779,321 $ 1,573,313 $ 1,440,420 The following table provides the Company’s net sales by geographic area for the thirteen and twenty-six weeks ended August 4, 2018 and July 29, 2017 . Thirteen Weeks Ended Twenty-six Weeks Ended (in thousands) August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 United States $ 531,446 $ 470,280 $ 980,572 $ 879,347 Europe 192,354 195,895 362,014 350,880 Other 118,614 113,146 230,727 210,193 Total $ 842,414 $ 779,321 $ 1,573,313 $ 1,440,420 |
Contingencies
Contingencies | 6 Months Ended |
Aug. 04, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | CONTINGENCIES The Company is a defendant in lawsuits and other adversary proceedings arising in the ordinary course of business. Legal costs incurred in connection with the resolution of claims and lawsuits are generally expensed as incurred, and the Company establishes estimated liabilities for the outcome of litigation where losses are deemed probable and reasonably estimable. The Company’s assessment of the current exposure could change in the event of the discovery of additional facts. As of August 4, 2018 , the Company had accrued charges for legal contingencies, including the certain legal matters detailed below, of approximately $23 million , which are classified within accrued expenses on the accompanying Condensed Consolidated Balance Sheet. The estimated liability represents what the Company believes to be reasonable estimates of the loss exposures related to its legal matters. Actual liabilities may differ from the amounts recorded, due to uncertainties regarding final settlement agreement negotiations, actual claims rate experience, court approvals and the terms of any approval by the courts, and there can be no assurance that final resolution of legal matters will not have a material adverse effect on the Company’s financial condition, results of operations or cash flows. The Company may be subject to estimated incremental losses of as much as approximately $20 million . There are certain claims and legal proceedings pending against the Company for which accruals have not been established. Certain Legal Matters The Company is a defendant in two separate class action lawsuits filed by former associates of the Company who are represented by the same counsel. The first lawsuit, filed in 2013, alleges failure to indemnify business expenses and a series of derivative claims for compelled patronization, inaccurate wage statements, waiting time penalties, minimum wage violations and unfair competition under California state law on behalf of all non-exempt hourly associates at Abercrombie & Fitch, abercrombie kids, Hollister and Gilly Hicks stores in California. Four subclasses of associates were certified, and the matter was before a U.S. District Court of California. The second lawsuit, filed in 2015, alleges that associates were required to purchase uniforms without reimbursement in violation of federal law, and laws of the states of New York, Florida and Massachusetts, as well as derivative putative state law claims and seeks to pursue such claims on a class and collective basis. On December 12, 2017, a U.S. District Court of California granted the parties’ stipulation to transfer the first lawsuit pending and combine it with the second lawsuit then pending before a U.S. District Court of Ohio. Both matters were mediated and the parties signed a $25.0 million claims-made settlement agreement which, subject to final approval by a U.S. District Court of Ohio, is intended to result in a full and final settlement of all claims in both lawsuits on a class-wide basis. On February 16, 2018, a U.S. District Court of Ohio granted preliminary approval of the proposed settlement and ordered that notice of the proposed settlement be given to the absent members of the settlement class. The ultimate settlement amount is dependent upon the actual claims made by members of the class and is also subject to final approval by the U.S. District Court of Ohio and could be subject to appeal by class members. A final approval hearing is set to occur in the third quarter of Fiscal 2018. In addition to the matters discussed above, the Company is a defendant in certain other class action lawsuits filed by former associates of the Company. These lawsuits, currently assigned to the same judge in a U.S. District Court of California, allege non-exempt hourly associates of the Company were not properly compensated, in violation of federal and California law, for call-in practices requiring associates to engage in certain pre-shift activities in order to determine whether they should report to work and the Company’s alleged failure to pay reporting time pay and all wages earned at termination. In addition, these lawsuits include derivative claims alleging inaccurate wage statements and unfair competition under California state law on behalf of non-exempt hourly associates. One of these lawsuits was mediated and the parties involved have signed a $9.6 million settlement agreement, and on August 13, 2018, a U.S. District Court of California granted preliminary approval of the proposed settlement. The ultimate settlement is subject to final approval by the U.S. District Court of California and could be subject to appeal from class members, objection from class members or revocation of the settlement agreement under certain circumstances. A final approval hearing is set to occur in the fourth quarter of Fiscal 2018. There can be no absolute assurance that settlements will be finalized or approved or of the ultimate outcomes of the litigations. |
Basis of Presentation Nature of
Basis of Presentation Nature of Business (Policies) | 6 Months Ended |
Aug. 04, 2018 | |
Basis of Presentation [Abstract] | |
Nature of Business [Text Block] | Nature of Business Abercrombie & Fitch Co. (“A&F”), a company incorporated in Delaware in 1996, through its subsidiaries (collectively, A&F and its subsidiaries are referred to as “Abercrombie & Fitch” or the “Company”), is a global, multi-brand, specialty retailer, which primarily sells its products through its wholly-owned store and direct-to-consumer channels, as well as through various third-party wholesale, franchise and licensing arrangements. The Company offers a broad assortment of apparel, personal care products and accessories for men, women and kids under the Hollister, Abercrombie & Fitch and abercrombie kids brands. The Company has operations in North America, Europe, Asia and the Middle East. |
Basis of Presentation Principle
Basis of Presentation Principles of Consolidation (Policies) | 6 Months Ended |
Aug. 04, 2018 | |
Basis of Presentation [Abstract] | |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation The accompanying Condensed Consolidated Financial Statements include historical financial statements of, and transactions applicable to, the Company and reflect its assets, liabilities, results of operations and cash flows. The Company has interests in a United Arab Emirates business venture and in a Kuwait business venture with Majid al Futtaim Fashion L.L.C. (“MAF”), each of which meets the definition of a variable interest entity (“VIE”). The Company is deemed to be the primary beneficiary of these VIEs; therefore, the Company has consolidated the operating results, assets and liabilities of these VIEs, with MAF’s portion of net income presented as net income attributable to noncontrolling interests (“NCI”) on the Condensed Consolidated Statements of Operations and Comprehensive Loss and MAF’s portion of equity presented as NCI on the Condensed Consolidated Balance Sheets. |
Basis of Presentation Fiscal Ye
Basis of Presentation Fiscal Years (Policies) | 6 Months Ended |
Aug. 04, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Fiscal Period, Policy [Policy Text Block] | Fiscal Year The Company’s fiscal year ends on the Saturday closest to January 31. All references herein to “Fiscal 2018 ” and “Fiscal 2017 ” represent the fifty-two week fiscal year ending on February 2, 2019 and the fifty-three week fiscal year ended on February 3, 2018 , respectively. |
Basis of Presentation Revenue R
Basis of Presentation Revenue Recognition (Policies) | 6 Months Ended |
Aug. 04, 2018 | |
Revenue Recognition [Abstract] | |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition The Company recognizes revenue from product sales when control of the good is transferred to the customer, generally upon pick up at, or shipment from, a Company location. The Company provides shipping and handling services to customers in certain direct-to-consumer transactions. Revenue associated with the related shipping and handling obligations is deferred until the obligation is fulfilled, typically upon the customer’s receipt of the merchandise. The related shipping and handling costs are classified in stores and distribution expense on the Condensed Consolidated Statements of Operations and Comprehensive Loss. Revenue is recorded net of estimated returns, associate discounts, promotions and other similar customer incentives. The Company estimates reserves for sales returns based on historical experience among other factors. The sales return reserve is classified in accrued expenses on the Condensed Consolidated Balance Sheets. The Company accounts for gift cards sold to customers by recognizing an unearned revenue liability at the time of sale, which remains until income from gift cards not expected to be redeemed, referred to as gift card breakage, is recognized as revenue proportionally with gift card redemptions. Gift cards sold to customers do not expire or lose value over periods of inactivity and the Company is not required by law to escheat the value of unredeemed gift cards to the jurisdictions in which it operates. The Company also maintains loyalty programs, which primarily provides customers with the opportunity to earn points toward future merchandise discount rewards with qualifying purchases. The Company accounts for expected future reward redemptions by recognizing an unearned revenue liability as customers accumulate points, which remains until revenue is recognized at the earlier of redemption or expiration. Unearned revenue liabilities are primarily recorded when prepayments for future merchandise are received through gift card purchases or when loyalty rewards are earned by a customer in a sales transaction, and are classified in accrued expenses on the Condensed Consolidated Balance Sheets and are typically recognized as revenue within a 12-month period. Unearned revenue liabilities as of August 4, 2018 and the date of adoption, February 4, 2018, were approximately $37.5 million and $38.7 million , respectively. On the date of adoption, February 4, 2018, an adjustment related to the adoption of new revenue recognition standards decreased the beginning of period balance by $6.2 million. For the thirteen and twenty-six weeks ended August 4, 2018 , the Company recognized revenue of approximately $20.3 million and $41.3 million , respectively, related to previous deferrals of revenue resulting from the Company’s gift card and loyalty programs. The Company also recognizes revenue under wholesale arrangements, which is generally recognized upon shipment, when control passes to the wholesale partner. Revenue from the Company’s franchise and license arrangements, primarily royalties earned upon sale of merchandise, is generally recognized at the time merchandise is sold to the franchisees’ retail customers or to the licensees’ wholesale customers. All revenues are recognized in net sales in the Condensed Consolidated Statements of Operations and Comprehensive Loss. For a discussion of the disaggregation of revenue, refer to Note 10, “ SEGMENT REPORTING . ” The Company does not include tax amounts collected from customers on behalf of third parties, including sales and indirect taxes, in net sales. |
Contingencies (Policies)
Contingencies (Policies) | 6 Months Ended |
Aug. 04, 2018 | |
Loss Contingencies [Line Items] | |
Contingent Liability Reserve Estimate, Policy [Policy Text Block] | As of August 4, 2018 , the Company had accrued charges for legal contingencies, including the certain legal matters detailed below, of approximately $23 million , which are classified within accrued expenses on the accompanying Condensed Consolidated Balance Sheet. The estimated liability represents what the Company believes to be reasonable estimates of the loss exposures related to its legal matters. Actual liabilities may differ from the amounts recorded, due to uncertainties regarding final settlement agreement negotiations, actual claims rate experience, court approvals and the terms of any approval by the courts, and there can be no assurance that final resolution of legal matters will not have a material adverse effect on the Company’s financial condition, results of operations or cash flows. |
Basis of Presentation Recent Ac
Basis of Presentation Recent Accounting Pronouncements (Tables) | 6 Months Ended |
Aug. 04, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | Recent Accounting Pronouncements The Company reviews recent accounting pronouncements on a quarterly basis and has excluded discussion of those not applicable to the Company and those not expected to have a material impact on the Company’s financial statements. The following table provides a brief description of recent accounting pronouncements the Company has adopted or that could affect the Company’s financial statements. Accounting Standards Update (ASU) Description Date of Adoption Effect on the Financial Statements or Other Significant Matters Standards adopted ASU 2014-09, Revenue from Contracts with Customers This update superseded the revenue recognition guidance in ASC 605, Revenue Recognition . The new guidance requires entities to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration which the entity expects to be entitled to in exchange for those goods or services. February 4, 2018 The Company adopted this guidance and all related amendments using the modified retrospective method, and applied the standard to contracts that were not complete as of the adoption date. Comparative period information has not been restated and continues to be reported under the accounting standards in effect for those periods. This guidance primarily impacts the classification and timing of the recognition of the Company’s gift card breakage and timing of direct-to-consumer revenue. Adoption of this guidance had an immaterial impact on net loss attributable to A&F in the Company’s Condensed Consolidated Statements of Operations and Comprehensive Loss. The cumulative effect of applying the new standard on the Condensed Consolidated Balance Sheets as of August 4, 2018 was recognized as an adjustment to the opening balance of retained earnings, increasing beginning retained earnings by $6.9 million, with corresponding reductions in accrued expenses, inventories, and other assets of $4.7 million, $6.4 million, and $2.2 million, respectively, and increases to receivables and other current assets of $6.4 million and $4.4 million, respectively. In accordance with the new guidance, expected gift card breakage is now recognized in net sales as gift cards are redeemed. Previously, gift card breakage was recognized as other operating income when the Company determined that the likelihood of redemption was remote. Under the new guidance, direct-to-consumer revenue is recognized when control is passed to the customer, typically upon shipment or pick-up of goods. Previously, direct-to-consumer revenue was recognized upon customer acceptance, which typically occurred upon the customer’s possession of the merchandise. The Company does not expect this guidance to have a material impact on store, direct-to-consumer, wholesale, franchise or license revenues on an ongoing basis. The Company’s revenue recognition accounting policies are discussed further in this Note 1 under “Revenue Recognition.” ASU 2016-18, Statement of Cash Flows This update amends the guidance in ASC 230, Statement of Cash Flows . The new guidance requires an entity to show the changes in total cash, cash equivalents and restricted cash in the statement of cash flows. Consequently, an entity is no longer required to present transfers between cash and equivalents and restricted cash. February 4, 2018 The Company adopted this guidance under the retrospective method. For the twenty-six weeks ended July 29, 2017, adoption of this guidance resulted in a $0.8 million decrease in net cash used for operating activities and increases of $20.4 million and $21.2 million to beginning and ending cash, cash equivalents and restricted cash, respectively. In addition, captions have been updated in the Condensed Consolidated Statements of Cash Flows to reflect the inclusion of restricted cash. Restricted cash is classified as other assets on the Condensed Consolidated Balance Sheets, as was the case at year-end. Standards not yet adopted ASU 2016-02, Leases This update supersedes the leasing guidance in ASC 840, Leases . The new guidance requires an entity to recognize lease assets and lease liabilities on the balance sheet and disclose key leasing information that depicts the lease rights and obligations of an entity. February 3, 2019 The Company expects that this guidance will result in a material increase in the Company’s long-term assets and long-term liabilities on the Company’s Condensed Consolidated Balance Sheets, and is currently evaluating additional impacts that this guidance may have on its consolidated financial statements, including the potential for impairment of right-of-use assets. The Company did not elect to early adopt this guidance. ASU 2017-12, Derivatives and Hedging — Targeted Improvements to Accounting for Hedging Activities This update amends ASC 815, Derivatives and Hedging . The new guidance simplifies certain aspects of hedge accounting for both financial and commodity risks to more accurately present the economic effects of an entity’s risk management activities in its financial statements. Under the new standard, more hedging strategies will be eligible for hedge accounting, including hedges of the benchmark rate component of the contractual coupon cash flows of fixed-rate assets or liabilities and partial-term hedges of fixed-rate assets or liabilities. For cash flow and net investment hedges, the guidance requires a modified retrospective approach while the amended presentation and disclosure guidance requires a prospective approach. February 3, 2019 The Company is currently evaluating the impact that this guidance will have on its consolidated financial statements. The Company did not elect to early adopt this guidance. |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Table) | 6 Months Ended |
Aug. 04, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Weighted Average Number of Shares | Thirteen Weeks Ended Twenty-six Weeks Ended (in thousands) August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 Shares of Common Stock issued 103,300 103,300 103,300 103,300 Weighted-average treasury shares (35,292 ) (34,844 ) (35,046 ) (35,036 ) Weighted-average — basic shares 68,008 68,456 68,254 68,264 Dilutive effect of share-based compensation awards — — — — Weighted-average — diluted shares 68,008 68,456 68,254 68,264 Anti-dilutive shares (1) 3,466 5,154 4,033 5,460 (1) Reflects the total number of shares related to outstanding share-based compensation awards that have been excluded from the computation of net loss per diluted share because the impact would have been anti-dilutive. |
Fair Value (Tables)
Fair Value (Tables) | 6 Months Ended |
Aug. 04, 2018 | |
Fair Value Disclosures [Abstract] | |
Company's Assets and Liabilities Measured at Fair Value | The three levels of the hierarchy and the distribution of the Company’s assets and liabilities that are measured at fair value on a recurring basis were as follows: Assets and Liabilities at Fair Value as of August 4, 2018 (in thousands) Level 1 Level 2 Level 3 Total Assets: Trust-owned life insurance policies (at cash surrender value) $ — $ 104,310 $ — $ 104,310 Money market funds 25,073 — — 25,073 Derivative financial instruments — 12,343 — 12,343 Total assets $ 25,073 $ 116,653 $ — $ 141,726 Liabilities: Derivative financial instruments $ — $ 28 $ — $ 28 Total liabilities $ — $ 28 $ — $ 28 Assets and Liabilities at Fair Value as of February 3, 2018 (in thousands) Level 1 Level 2 Level 3 Total Assets: Trust-owned life insurance policies (at cash surrender value) $ — $ 102,784 $ — $ 102,784 Money market funds 330,649 — — 330,649 Derivative financial instruments — 37 — 37 Total assets $ 330,649 $ 102,821 $ — $ 433,470 Liabilities: Derivative financial instruments $ — $ 9,147 $ — $ 9,147 Total liabilities $ — $ 9,147 $ — $ 9,147 |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis, Valuation Techniques [Table Text Block] | The carrying amount and fair value of the Company’s gross borrowings under the term loan credit facility were as follows: (in thousands) August 4, 2018 February 3, 2018 Gross borrowings outstanding, carrying amount $ 253,250 $ 253,250 Gross borrowings outstanding, fair value $ 254,200 $ 253,250 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 6 Months Ended |
Aug. 04, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | Property and equipment, net consisted of: (in thousands) August 4, 2018 February 3, 2018 Property and equipment, at cost $ 2,802,253 $ 2,821,709 Less: Accumulated depreciation and amortization (2,110,320 ) (2,083,527 ) Property and equipment, net $ 691,933 $ 738,182 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 6 Months Ended |
Aug. 04, 2018 | |
Schedule of Restricted Stock Unit Activity | The following table summarizes activity for restricted stock units for the twenty-six weeks ended August 4, 2018 : Service-based Restricted Stock Units Performance-based Restricted Stock Units Market-based Restricted Stock Units Number of Underlying Shares (1) Weighted- Average Grant Date Fair Value Number of Underlying Shares Weighted- Average Grant Date Fair Value Number of Underlying Shares Weighted- Average Grant Date Fair Value Unvested at February 3, 2018 2,520,160 $ 15.35 690,174 $ 11.82 383,980 $ 16.50 Granted 736,915 21.93 197,979 21.77 142,014 33.69 Adjustments for performance achievement — — (43,999 ) 20.10 (36,817 ) 19.04 Vested (844,382 ) 17.30 — — (7,185 ) 19.04 Forfeited (121,568 ) 14.88 (12,998 ) 12.17 (12,999 ) 17.28 Unvested at August 4, 2018 2,291,125 $ 16.78 831,156 $ 13.74 468,993 $ 21.45 (1) Includes 496,981 unvested restricted stock units as of August 4, 2018 , subject to vesting requirements related to the achievement of certain performance metrics, such as operating income and net income, for the fiscal year immediately preceding the vesting date. Holders of these restricted stock units have the opportunity to earn back one or more installments of the award if the cumulative performance requirements are met in a subsequent year. Unvested shares related to restricted stock units with performance-based and market-based vesting conditions can achieve up to 200% of their target vesting amount and are reflected at 100% of their target vesting amount in the table above. |
Schedule of Stock Appreciation Rights Activity | Stock Appreciation Rights The following table summarizes stock appreciation rights activity for the twenty-six weeks ended August 4, 2018 : Number of Underlying Shares Weighted-Average Exercise Price Aggregate Intrinsic Value Weighted-Average Remaining Contractual Life Outstanding at February 3, 2018 3,010,720 $ 49.35 Granted — — Exercised (50,190 ) 22.21 Forfeited or expired (1,614,371 ) 54.67 Outstanding at August 4, 2018 1,346,159 $ 44.13 $ 867,381 3.4 Stock appreciation rights exercisable at August 4, 2018 1,248,775 $ 45.80 $ 612,390 3.1 Stock appreciation rights expected to become exercisable in the future as of August 4, 2018 92,143 $ 22.68 $ 239,589 6.7 As of August 4, 2018 , there was $0.5 million of total unrecognized compensation cost related to stock appreciation rights. The unrecognized compensation cost is expected to be recognized over a weighted-average period of 5 months . The grant date fair value of stock appreciation rights that were exercised during the twenty-six weeks ended August 4, 2018 and July 29, 2017 was $1.2 million and $2.2 million , respectively. |
Schedule of Stock Option Activity | Stock Options The following table summarizes stock option activity for the twenty-six weeks ended August 4, 2018 : Number of Underlying Shares Weighted-Average Exercise Price Aggregate Intrinsic Value Weighted-Average Remaining Contractual Life Outstanding at February 3, 2018 87,200 $ 78.20 Granted — — Exercised — — Forfeited or expired (87,200 ) 78.20 Outstanding at August 4, 2018 — $ — $ — — Stock options exercisable at August 4, 2018 — $ — $ — — As of August 4, 2018 , there was no unrecognized compensation cost related to stock options. |
Market-based restricted stock units [Member] | |
Schedule of Weighted-Average Estimated Fair Value and Assumptions of Restricted Stock Units with Market Vesting Conditions | The weighted-average assumptions used for market-based restricted stock units in the Monte Carlo simulation during the twenty-six weeks ended August 4, 2018 and July 29, 2017 were as follows: August 4, 2018 July 29, 2017 Grant date market price $ 23.59 $ 11.43 Fair value $ 33.69 $ 11.79 Assumptions: Price volatility 54 % 47 % Expected term (years) 2.9 2.9 Risk-free interest rate 2.4 % 1.5 % Dividend yield 3.4 % 7.0 % Average volatility of peer companies 37.4 % 35.2 % Average correlation coefficient of peer companies 0.2709 0.2664 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 6 Months Ended |
Aug. 04, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Outstanding Foreign Exchange Forward Contracts | As of August 4, 2018 , the Company had outstanding the following foreign currency exchange forward contracts that were entered into to hedge either a portion, or all, of forecasted foreign currency denominated intercompany inventory sales, the resulting settlement of the foreign currency denominated intercompany accounts receivable, or both: (in thousands) Notional Amount (1) Euro $ 159,768 British pound $ 73,692 Canadian dollar $ 29,989 Japanese yen $ 15,960 (1) Amounts reported are the U.S. Dollar notional amounts outstanding as of August 4, 2018 . The Company also uses foreign currency exchange forward contracts to hedge certain foreign-currency-denominated net monetary assets/liabilities. Examples of monetary assets/liabilities include cash balances, receivables and payables. Fluctuations in foreign currency exchange rates result in transaction gains or losses being recorded in earnings, as U.S. GAAP requires that monetary assets/liabilities be remeasured at the spot exchange rate at quarter-end or upon settlement. The Company has chosen not to apply hedge accounting to these instruments because there are no differences in the timing of gain or loss recognition on the hedging instruments and the hedged items. As of August 4, 2018 , the Company had outstanding the following foreign currency exchange forward contracts that were entered into to hedge foreign-currency-denominated net monetary assets/liabilities: (in thousands) Notional Amount (1) Euro $ 8,818 Japanese yen $ 3,294 (1) Amounts reported are the U.S. Dollar notional amounts outstanding as of August 4, 2018 . |
Location and Amounts of Derivative Fair Values on the Condensed Consolidated Balance Sheets | The location and amounts of derivative fair values on the Condensed Consolidated Balance Sheets as of August 4, 2018 and February 3, 2018 were as follows: (in thousands) Location August 4, February 3, Location August 4, February 3, Derivatives designated as hedging instruments: Foreign currency exchange forward contracts $ 12,198 $ 37 $ 28 $ 9,108 Derivatives not designated as hedging instruments: Foreign currency exchange forward contracts $ 145 $ — $ — $ 39 Total Other current assets $ 12,343 $ 37 Accrued expenses $ 28 $ 9,147 |
Location and Amounts of Derivative Gains and Losses on the Condensed Consolidated Statements of Operations and Comprehensive Loss | The location and amounts of derivative gains and losses for the thirteen and twenty-six weeks ended August 4, 2018 and July 29, 2017 on the Condensed Consolidated Statements of Operations and Comprehensive Loss were as follows: (in thousands) Thirteen Weeks Ended Twenty-six Weeks Ended Derivatives not designated as hedging instruments: Location August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 Foreign currency exchange forward contracts gain (loss) Other operating income, net $ 1,894 $ (523 ) $ 4,595 $ (551 ) Effective Portion Ineffective Portion and Amount Excluded from Effectiveness Testing Amount of Gain (Loss) Recognized in AOCL on Derivative Contracts (1) Location of Gain (Loss) Reclassified from AOCL into Earnings Amount of Gain (Loss) Reclassified from AOCL into Earnings (2) Location of Gain Recognized in Earnings on Derivative Contracts Amount of Gain (Loss) Recognized in Earnings on Derivative Contracts (3) Thirteen Weeks Ended (in thousands) August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 Derivatives in cash flow hedging relationships: Foreign currency exchange forward contracts $ 8,058 $ (11,029 ) Cost of sales, exclusive of depreciation and amortization $ (150 ) $ 545 Other operating income, net $ 1,686 $ 634 Twenty-six Weeks Ended (in thousands) August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 Derivatives in cash flow hedging relationships: Foreign currency exchange forward contracts $ 16,665 $ (12,402 ) Cost of sales, exclusive of depreciation and amortization $ (5,222 ) $ 4,081 Other operating income, net $ 3,055 $ 1,161 (1) The amount represents the change in fair value of derivative contracts due to changes in spot rates. (2) The amount represents the reclassification from AOCL into earnings when the hedged item affects earnings, which is when merchandise is sold to the Company’s customers. (3) The amount represents the change in fair value of derivative contracts due to changes in the difference between the spot price and forward price that is excluded from the assessment of hedge effectiveness and, therefore, recognized in earnings. |
Accumulated Other Comprehensi28
Accumulated Other Comprehensive Loss (Tables) | 6 Months Ended |
Aug. 04, 2018 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Loss | The activity in accumulated other comprehensive loss for the thirteen and twenty-six weeks ended August 4, 2018 was as follows: Thirteen Weeks Ended August 4, 2018 (in thousands) Foreign Currency Translation Adjustment Unrealized Gain (Loss) on Derivative Financial Instruments Total Beginning balance at May 5, 2018 $ (93,286 ) $ 2,153 $ (91,133 ) Other comprehensive (loss) income before reclassifications (11,206 ) 8,058 (3,148 ) Reclassified from accumulated other comprehensive loss (1) — 150 150 Tax effect — (761 ) (761 ) Other comprehensive (loss) income (11,206 ) 7,447 (3,759 ) Ending balance at August 4, 2018 $ (104,492 ) $ 9,600 $ (94,892 ) Twenty-six Weeks Ended August 4, 2018 (in thousands) Foreign Currency Translation Adjustment Unrealized Gain (Loss) on Derivative Financial Instruments Total Beginning balance at February 3, 2018 $ (84,947 ) $ (10,107 ) $ (95,054 ) Other comprehensive (loss) income before reclassifications (19,545 ) 16,665 (2,880 ) Reclassified from accumulated other comprehensive loss (1) — 5,222 5,222 Tax effect — (2,180 ) (2,180 ) Other comprehensive (loss) income (19,545 ) 19,707 162 Ending balance at August 4, 2018 $ (104,492 ) $ 9,600 $ (94,892 ) (1) Amount represents losses reclassified from accumulated other comprehensive loss to cost of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statement of Operations and Comprehensive Loss. The activity in accumulated other comprehensive loss for the thirteen and twenty-six weeks ended July 29, 2017 was as follows: Thirteen Weeks Ended July 29, 2017 (in thousands) Foreign Currency Translation Adjustment Unrealized Gain (Loss) on Derivative Financial Instruments Total Beginning balance at April 29, 2017 $ (120,520 ) $ 225 $ (120,295 ) Other comprehensive (loss) income before reclassifications 19,072 (11,029 ) 8,043 Reclassified from accumulated other comprehensive loss (2) — (545 ) (545 ) Tax effect — 1,426 1,426 Other comprehensive (loss) income 19,072 (10,148 ) 8,924 Ending balance at July 29, 2017 $ (101,448 ) $ (9,923 ) $ (111,371 ) Twenty-six Weeks Ended July 29, 2017 (in thousands) Foreign Currency Translation Adjustment Unrealized Gain (Loss) on Derivative Financial Instruments Total Beginning balance at January 28, 2017 $ (126,127 ) $ 4,825 $ (121,302 ) Other comprehensive income before reclassifications 24,679 (12,402 ) 12,277 Reclassified from accumulated other comprehensive loss (2) — (4,081 ) (4,081 ) Tax effect — 1,735 1,735 Other comprehensive income 24,679 (14,748 ) 9,931 Ending balance at July 29, 2017 $ (101,448 ) $ (9,923 ) $ (111,371 ) (2) Amount represents gains reclassified from accumulated other comprehensive loss to cost of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statement of Operations and Comprehensive Loss. |
Segment Reporting (Tables)
Segment Reporting (Tables) | 6 Months Ended |
Aug. 04, 2018 | |
Segment Reporting [Abstract] | |
Revenue from External Customers by Operating Segment [Table Text Block] | The following table provides the Company’s net sales by operating segment for the thirteen and twenty-six weeks ended August 4, 2018 and July 29, 2017 . Thirteen Weeks Ended Twenty-six Weeks Ended (in thousands) August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 Hollister $ 500,836 $ 446,639 $ 924,464 $ 821,315 Abercrombie 341,578 332,682 648,849 619,105 Total $ 842,414 $ 779,321 $ 1,573,313 $ 1,440,420 |
Revenue from External Customers by Geographic Areas [Table Text Block] | The following table provides the Company’s net sales by geographic area for the thirteen and twenty-six weeks ended August 4, 2018 and July 29, 2017 . Thirteen Weeks Ended Twenty-six Weeks Ended (in thousands) August 4, 2018 July 29, 2017 August 4, 2018 July 29, 2017 United States $ 531,446 $ 470,280 $ 980,572 $ 879,347 Europe 192,354 195,895 362,014 350,880 Other 118,614 113,146 230,727 210,193 Total $ 842,414 $ 779,321 $ 1,573,313 $ 1,440,420 |
Basis of Presentation Revenue30
Basis of Presentation Revenue Recognition (Details) - USD ($) $ in Millions | 6 Months Ended | |
Aug. 04, 2018 | Feb. 04, 2018 | |
Deferred Revenue Arrangement [Line Items] | ||
Unearned Revenue Liability | $ 38.7 | $ 37.5 |
Amounts included in unearned revenue liability at the beginning of the period | $ 20.3 |
Basis of Presentation Impact fr
Basis of Presentation Impact from Adoption of Revenue Accounting Standards (Details) $ in Millions | Feb. 04, 2018USD ($) |
Impact from Adoption of New Revenue Recognition [Abstract] | |
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 6.9 |
Effect on Accrued Expenses from New Accounting Principal in Period of Adoption | 4.7 |
Effect on Inventories from New Accounting Principal in Period of Adoption | 6.4 |
Effect on Other Assets from New Accounting Principal in Period of Adoption | 2.2 |
Effect on Receivables from New Accounting Principal in Period of Adoption | 6.4 |
Effect on Other Current Assets from New Accounting Principal in Period of Adoption | $ 4.4 |
Basis of Presentation Recent 32
Basis of Presentation Recent Accounting Pronouncements (Details) - USD ($) $ in Millions | Jul. 29, 2017 | Jan. 28, 2017 |
Recent Accounting Pronouncements [Abstract] | ||
Restricted Cash | $ 20.6 | $ 20.4 |
Net Income (Loss) Per Share (De
Net Income (Loss) Per Share (Details) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | |||
Aug. 04, 2018 | Jul. 29, 2017 | Aug. 04, 2018 | Jul. 29, 2017 | ||
Weighted Average Shares Outstanding And Anti Dilutive Shares [Abstract] | |||||
Shares of Common Stock issued | 103,300 | 103,300 | 103,300 | 103,300 | |
Weighted-average treasury shares | (35,292) | (34,844) | (35,046) | (35,036) | |
Weighted-average — basic shares | 68,008 | 68,456 | 68,254 | 68,264 | |
Dilutive effect of share-based compensation awards | 0 | 0 | 0 | 0 | |
Weighted-average — diluted shares | 68,008 | 68,456 | 68,254 | 68,264 | |
Anti-dilutive shares (1) | [1] | 3,466 | 5,154 | 4,033 | 5,460 |
[1] | Reflects the total number of shares related to outstanding share-based compensation awards that have been excluded from the computation of net loss per diluted share because the impact would have been anti-dilutive. |
Fair Value (Assets and Liabilit
Fair Value (Assets and Liabilities at Fair Value) (Details) - USD ($) | Aug. 04, 2018 | Feb. 03, 2018 |
Fair Value, Measurements, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Trust-owned life insurance policies (at cash surrender value) | $ 104,310,000 | $ 102,784,000 |
Money market funds | 25,073,000 | 330,649,000 |
Derivative financial instruments | 12,343,000 | 37,000 |
Total assets | 141,726,000 | 433,470,000 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Derivative financial instruments | 28,000 | 9,147,000 |
Total liabilities | 28,000 | 9,147,000 |
Level 1 | Fair Value, Measurements, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Trust-owned life insurance policies (at cash surrender value) | 0 | 0 |
Money market funds | 25,073,000 | 330,649,000 |
Derivative financial instruments | 0 | 0 |
Total assets | 25,073,000 | 330,649,000 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Derivative financial instruments | 0 | 0 |
Total liabilities | 0 | 0 |
Level 2 | Fair Value, Measurements, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Trust-owned life insurance policies (at cash surrender value) | 104,310,000 | 102,784,000 |
Money market funds | 0 | 0 |
Derivative financial instruments | 12,343,000 | 37,000 |
Total assets | 116,653,000 | 102,821,000 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Derivative financial instruments | 28,000 | 9,147,000 |
Total liabilities | 28,000 | 9,147,000 |
Level 3 | Fair Value, Measurements, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Trust-owned life insurance policies (at cash surrender value) | 0 | 0 |
Money market funds | 0 | 0 |
Derivative financial instruments | 0 | 0 |
Total assets | 0 | 0 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Derivative financial instruments | 0 | 0 |
Total liabilities | 0 | 0 |
Term Loan Facility | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Gross borrowings outstanding, carrying amount | 253,250,000 | 253,250,000 |
Gross borrowings outstanding, fair value | 254,200,000 | 253,250,000 |
ABL Facility | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Credit facility, amount outstanding | $ 0 | $ 0 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Aug. 04, 2018 | Jul. 29, 2017 | Aug. 04, 2018 | Jul. 29, 2017 | Feb. 03, 2018 | |
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, at cost | $ 2,802,253 | $ 2,802,253 | $ 2,821,709 | ||
Less: Accumulated depreciation and amortization | (2,110,320) | (2,110,320) | (2,083,527) | ||
Property and equipment, net | 691,933 | 691,933 | 738,182 | ||
Asset Impairment Charges | 8,671 | $ 6,135 | 9,727 | $ 6,865 | |
Construction Project Assets [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, net | $ 35,600 | $ 35,600 | $ 38,700 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Aug. 04, 2018 | Feb. 03, 2018 | Jul. 29, 2017 | Aug. 04, 2018 | Jul. 29, 2017 | |
Income Tax Disclosure [Abstract] | |||||
TaxCutsandJobsActof2017ProvisionalNetTaxExpense | $ 19,900 | ||||
Excess Tax Benefit from Share-based Compensation, Operating Activities | $ 200 | $ 700 | $ 7,900 | $ 9,900 |
Borrowings (Details)
Borrowings (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2018 | May 05, 2018 | Aug. 04, 2018 | Feb. 03, 2018 | |
Long-Term Borrowings [Line Items] | ||||
Interest rate on borrowings | 5.59% | 5.59% | ||
Unamortized discount | $ (1,014,000) | $ (1,014,000) | $ (1,184,000) | |
Unamortized fees paid to lenders | (2,316,000) | (2,316,000) | 2,380,000 | |
Borrowings, net | 249,920,000 | 249,920,000 | 249,686,000 | |
Short-term portion of borrowings, net | 0 | 0 | 0 | |
Long-term portion of borrowings, net | $ 249,920,000 | 249,920,000 | 249,686,000 | |
Base Rate Initial Applicable Margin ABL Facility [Domain] | ||||
Long-Term Borrowings [Line Items] | ||||
Basis spread on variable rate | 2.50% | 2.75% | ||
London Interbank Offered Rate (LIBOR) Term Loan Facility [Domain] | ||||
Long-Term Borrowings [Line Items] | ||||
Basis spread on variable rate | 3.50% | 3.75% | ||
Term Loan Facility | ||||
Long-Term Borrowings [Line Items] | ||||
Maximum borrowing capacity | $ 300,000,000 | 300,000,000 | ||
Gross borrowings outstanding, carrying amount | $ 253,250,000 | 253,250,000 | 253,250,000 | |
Schedule of Future Payments of the Term Loan Facility | ||||
Debt Instrument, Interest Rate Terms | 0.01 | |||
ABL Facility | ||||
Long-Term Borrowings [Line Items] | ||||
Maximum borrowing capacity | $ 400,000,000 | $ 400,000,000 | ||
ABL Facility, unused capacity, commitment fee percentage | 10.00% | |||
Credit facility, amount outstanding | 0 | $ 0 | $ 0 | |
Schedule of Future Payments of the Term Loan Facility | ||||
ABL Facility, covenant terms, minimum remaining borrowing capacity | $ 30,000,000 | $ 30,000,000 |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2018 | Jul. 29, 2017 | Aug. 04, 2018 | Jul. 29, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ 6,200 | $ 5,500 | $ 10,940 | $ 10,396 |
Tax benefit recognized related to share-based compensation expense | 1,300 | $ 2,100 | $ 2,200 | 4,000 |
Target percentage of equity awards earned | 100.00% | |||
Stock Appreciation Rights | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total unrecognized compensation cost, net of estimated forfeitures | 500 | $ 500 | ||
Unrecognized compensation cost, weighted-average period of recognition | 5 months | |||
Total grant date fair value of awards vested | $ 1,200 | 2,200 | ||
Service-based restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total unrecognized compensation cost, net of estimated forfeitures | 31,500 | $ 31,500 | ||
Unrecognized compensation cost, weighted-average period of recognition | 16 months | |||
Total grant date fair value of awards granted | $ 16,161 | 15,948 | ||
Total grant date fair value of awards vested | 14,608 | 16,806 | ||
Performance-based restricted stock units [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total unrecognized compensation cost, net of estimated forfeitures | 9,100 | $ 9,100 | ||
Unrecognized compensation cost, weighted-average period of recognition | 13 months | |||
Total grant date fair value of awards granted | $ 4,310 | 4,774 | ||
Total grant date fair value of awards vested | 0 | 0 | ||
Market-based restricted stock units [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total unrecognized compensation cost, net of estimated forfeitures | $ 6,300 | $ 6,300 | ||
Unrecognized compensation cost, weighted-average period of recognition | 14 months | |||
Total grant date fair value of awards granted | $ 4,784 | 2,793 | ||
Total grant date fair value of awards vested | $ 137 | $ 0 | ||
Minimum | Performance-based restricted stock units [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Target percentage of equity awards earned | 0.00% | |||
Minimum | Market-based restricted stock units [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Target percentage of equity awards earned | 0.00% | |||
Maximum | Performance-based restricted stock units [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Target percentage of equity awards earned | 200.00% | |||
Maximum | Market-based restricted stock units [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Target percentage of equity awards earned | 200.00% |
Share-Based Compensation (Restr
Share-Based Compensation (Restricted Stock Units Activity) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Aug. 04, 2018 | Jul. 29, 2017 | Aug. 04, 2018 | Jul. 29, 2017 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Employee Service Share-based Compensation, Tax Benefit from Exercise of Stock Options | $ 1.5 | $ 0.5 | $ 4.9 | $ 2.5 | |
Target percentage of equity awards earned | 100.00% | ||||
Service-based restricted stock units with $1.00 net income requirement [Member] | |||||
Restricted Stock Unit Activity, Number of Underlying Shares | |||||
Number of Underlying Shares, Ending Balance at August 4, 2018 | 496,981 | 496,981 | |||
Service-based restricted stock units | |||||
Restricted Stock Unit Activity, Number of Underlying Shares | |||||
Number of Underlying Shares, Beginning Balance at February 3, 2018 | 2,520,160 | ||||
Number of Underlying Shares, Granted | 736,915 | ||||
Number of Underlying Shares, Adjustments for performance achievement | 0 | ||||
Number of Underlying Shares, Vested | (844,382) | ||||
Number of Underlying Shares, Forfeited | (121,568) | ||||
Number of Underlying Shares, Ending Balance at August 4, 2018 | [1] | 2,291,125 | 2,291,125 | ||
Restricted Stock Unit Activity, Weighted-Average Grant Date Fair Value | |||||
Weighted-Average Grant Date Fair Value, Beginning Balance at February 3, 2018 | $ 15.35 | ||||
Weighted-Average Grant Date Fair Value, Granted | 21.93 | ||||
Weighted-Average Grant Date Fair Value, Adjustments for performance achievement | 0 | ||||
Weighted-Average Grant Date Fair Value, Vested | 17.30 | ||||
Weighted-Average Grant Date Fair Value, Forfeited | 14.88 | ||||
Weighted-Average Grant Date Fair Value, Ending Balance at August 4, 2018 | $ 16.78 | $ 16.78 | |||
Performance-based restricted stock units [Member] | |||||
Restricted Stock Unit Activity, Number of Underlying Shares | |||||
Number of Underlying Shares, Beginning Balance at February 3, 2018 | 690,174 | ||||
Number of Underlying Shares, Granted | 197,979 | ||||
Number of Underlying Shares, Adjustments for performance achievement | (43,999) | ||||
Number of Underlying Shares, Vested | 0 | ||||
Number of Underlying Shares, Forfeited | (12,998) | ||||
Number of Underlying Shares, Ending Balance at August 4, 2018 | 831,156 | 831,156 | |||
Restricted Stock Unit Activity, Weighted-Average Grant Date Fair Value | |||||
Weighted-Average Grant Date Fair Value, Beginning Balance at February 3, 2018 | $ 11.82 | ||||
Weighted-Average Grant Date Fair Value, Granted | 21.77 | ||||
Weighted-Average Grant Date Fair Value, Adjustments for performance achievement | 20.10 | ||||
Weighted-Average Grant Date Fair Value, Vested | 0 | ||||
Weighted-Average Grant Date Fair Value, Forfeited | 12.17 | ||||
Weighted-Average Grant Date Fair Value, Ending Balance at August 4, 2018 | $ 13.74 | $ 13.74 | |||
Market-based restricted stock units [Member] | |||||
Restricted Stock Unit Activity, Number of Underlying Shares | |||||
Number of Underlying Shares, Beginning Balance at February 3, 2018 | 383,980 | ||||
Number of Underlying Shares, Granted | 142,014 | ||||
Number of Underlying Shares, Adjustments for performance achievement | (36,817) | ||||
Number of Underlying Shares, Vested | (7,185) | ||||
Number of Underlying Shares, Forfeited | (12,999) | ||||
Number of Underlying Shares, Ending Balance at August 4, 2018 | 468,993 | 468,993 | |||
Restricted Stock Unit Activity, Weighted-Average Grant Date Fair Value | |||||
Weighted-Average Grant Date Fair Value, Beginning Balance at February 3, 2018 | $ 16.50 | ||||
Weighted-Average Grant Date Fair Value, Granted | 33.69 | $ 11.79 | |||
Weighted-Average Grant Date Fair Value, Adjustments for performance achievement | 19.04 | ||||
Weighted-Average Grant Date Fair Value, Vested | 19.04 | ||||
Weighted-Average Grant Date Fair Value, Forfeited | 17.28 | ||||
Weighted-Average Grant Date Fair Value, Ending Balance at August 4, 2018 | $ 21.45 | $ 21.45 | |||
Minimum | Performance-based restricted stock units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Target percentage of equity awards earned | 0.00% | ||||
Minimum | Market-based restricted stock units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Target percentage of equity awards earned | 0.00% | ||||
Maximum | Performance-based restricted stock units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Target percentage of equity awards earned | 200.00% | ||||
Maximum | Market-based restricted stock units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Target percentage of equity awards earned | 200.00% | ||||
[1] | (1) Includes 496,981 unvested restricted stock units as of August 4, 2018, subject to vesting requirements related to the achievement of certain performance metrics, such as operating income and net income, for the fiscal year immediately preceding the vesting date. Holders of these restricted stock units have the opportunity to earn back one or more installments of the award if the cumulative performance requirements are met in a subsequent year. Unvested shares related to restricted stock units with performance-based and market-based vesting conditions can achieve up to 200% of their target vesting amount and are reflected at 100% of their target vesting amount in the table above. |
Share-Based Compensation (Res40
Share-Based Compensation (Restricted Stock Units Assumptions) (Details) | 6 Months Ended | |
Aug. 04, 2018$ / shares | Jul. 29, 2017$ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Target percentage of equity awards earned | 100.00% | |
Market-based restricted stock units [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Grant date market price (in dollars per share) | $ 23.59 | $ 11.43 |
Fair value (in dollars per share) | $ 33.69 | $ 11.79 |
Price volatility | 54.00% | 47.00% |
Expected term (years) | 2 years 10 months 24 days | 2 years 10 months 24 days |
Risk-free interest rate | 2.40% | 1.50% |
Dividend yield | 3.40% | 7.00% |
Average volatility of peer companies | 37.40% | 35.20% |
Average correlation coefficient of peer companies | 0.2709 | 0.2664 |
Derivative Instruments (Outstan
Derivative Instruments (Outstanding Foreign Exchange Forward Contracts) (Details) - Cash Flow Hedging - Forward Contracts $ in Thousands | Aug. 04, 2018USD ($) | |
Inter-company Inventory and Accounts Receivables | Euro Member Countries, Euro | ||
Derivative [Line Items] | ||
Notional Amount | $ 159,768 | [1] |
Inter-company Inventory and Accounts Receivables | United Kingdom, Pounds | ||
Derivative [Line Items] | ||
Notional Amount | 73,692 | [1] |
Inter-company Inventory and Accounts Receivables | Canada, Dollars | ||
Derivative [Line Items] | ||
Notional Amount | 29,989 | [1] |
Inter-company Inventory and Accounts Receivables | Japan, Yen | ||
Derivative [Line Items] | ||
Notional Amount | 15,960 | [1] |
Assets and Liabilities | Euro Member Countries, Euro | ||
Derivative [Line Items] | ||
Notional Amount | $ 8,818 | [2] |
[1] | Amounts reported are the U.S. Dollar notional amounts outstanding as of August 4, 2018. | |
[2] | Amounts reported are the U.S. Dollar notional amounts outstanding as of August 4, 2018. |
Derivative Instruments (Derivat
Derivative Instruments (Derivative Fair Values on the Condensed Consolidated Balance Sheets) (Details) - USD ($) $ in Thousands | Aug. 04, 2018 | Feb. 03, 2018 |
Foreign currency exchange forward contracts | Other current assets | Designated As Hedging Instrument | ||
The location and amounts of derivative fair values on the Condensed Consolidated Balance Sheets | ||
Other current assets | $ 12,198 | $ 37 |
Foreign currency exchange forward contracts | Other current assets | Not Designated as Hedging Instruments | ||
The location and amounts of derivative fair values on the Condensed Consolidated Balance Sheets | ||
Other current assets | 145 | 0 |
Foreign currency exchange forward contracts | Accrued expenses | Designated As Hedging Instrument | ||
The location and amounts of derivative fair values on the Condensed Consolidated Balance Sheets | ||
Accrued expenses | 28 | 9,108 |
Foreign currency exchange forward contracts | Accrued expenses | Not Designated as Hedging Instruments | ||
The location and amounts of derivative fair values on the Condensed Consolidated Balance Sheets | ||
Accrued expenses | 0 | 39 |
Fair Value, Measurements, Recurring | ||
The location and amounts of derivative fair values on the Condensed Consolidated Balance Sheets | ||
Other current assets | 12,343 | 37 |
Accrued expenses | 28 | 9,147 |
Level 2 | Fair Value, Measurements, Recurring | ||
The location and amounts of derivative fair values on the Condensed Consolidated Balance Sheets | ||
Other current assets | 12,343 | 37 |
Accrued expenses | $ 28 | $ 9,147 |
Derivative Instruments (Deriv43
Derivative Instruments (Derivative Gains (Losses) on the Condensed Consolidated Statement of Operations) (Details) - Foreign currency exchange forward contracts - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Aug. 04, 2018 | Jul. 29, 2017 | Aug. 04, 2018 | Jul. 29, 2017 | ||
Cash Flow Hedging | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Recognized in AOCL on Derivative Contracts (Effective Portion) | [1] | $ 8,058 | $ (11,029) | $ 16,665 | $ (12,402) |
Other operating income, net | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain/(Loss) | 1,894 | (523) | 4,595 | (551) | |
Other operating income, net | Cash Flow Hedging | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain Recognized in Earnings on Derivative Contracts (Ineffective Portion and Amount Excluded from Effectiveness Testing) | [2] | 1,686 | 634 | 3,055 | 1,161 |
Cost of sales, exclusive of depreciation and amortization | Cash Flow Hedging | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Reclassified from AOCL into Earnings (Effective Portion) | [3] | $ (150) | $ 545 | $ (5,222) | $ 4,081 |
[1] | The amount represents the change in fair value of derivative contracts due to changes in spot rates. | ||||
[2] | The amount represents the change in fair value of derivative contracts due to changes in the difference between the spot price and forward price that is excluded from the assessment of hedge effectiveness and, therefore, recognized in earnings. | ||||
[3] | The amount represents the reclassification from AOCL into earnings when the hedged item affects earnings, which is when merchandise is sold to the Company’s customers. |
Derivative Instruments (Details
Derivative Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Aug. 04, 2018 | Jul. 29, 2017 | Aug. 04, 2018 | Jul. 29, 2017 | Feb. 03, 2018 | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Length of time inventory sales hedged (in months) | 12 months | |||||
Period in which remaining unrealized gains or losses on intercompany inventory sales are recognized | 12 months | |||||
Foreign currency exchange forward contracts | Cash Flow Hedging | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Derivative Instruments, Gain (Loss) Recognized in AOCL, Effective Portion, Net | [1] | $ 8,058 | $ (11,029) | $ 16,665 | $ (12,402) | |
Foreign currency exchange forward contracts | Cost of sales, exclusive of depreciation and amortization | Cash Flow Hedging | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated AOCL into Income, Effective Portion, Net | [2] | (150) | 545 | (5,222) | 4,081 | |
Foreign currency exchange forward contracts | Other operating income, net | Cash Flow Hedging | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gain Recognized in Earnings, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net | [3] | 1,686 | $ 634 | 3,055 | $ 1,161 | |
Fair Value, Measurements, Recurring | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Other current assets | 12,343 | 12,343 | $ 37 | |||
Accrued expenses | 28 | 28 | 9,147 | |||
Level 2 | Fair Value, Measurements, Recurring | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Other current assets | 12,343 | 12,343 | 37 | |||
Accrued expenses | $ 28 | $ 28 | $ 9,147 | |||
[1] | The amount represents the change in fair value of derivative contracts due to changes in spot rates. | |||||
[2] | The amount represents the reclassification from AOCL into earnings when the hedged item affects earnings, which is when merchandise is sold to the Company’s customers. | |||||
[3] | The amount represents the change in fair value of derivative contracts due to changes in the difference between the spot price and forward price that is excluded from the assessment of hedge effectiveness and, therefore, recognized in earnings. |
Accumulated Other Comprehensi45
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||
Aug. 04, 2018 | Jul. 29, 2017 | Aug. 04, 2018 | Jul. 29, 2017 | |||||
Accumulated Other Comprehensive Loss [Roll Forward] | ||||||||
Beginning balance | $ (91,133) | $ (120,295) | $ (95,054) | $ (121,302) | ||||
Other comprehensive (loss) income before reclassifications | (3,148) | 8,043 | (2,880) | 12,277 | ||||
Reclassified from accumulated other comprehensive loss (1) | 150 | [1] | (545) | [2] | 5,222 | [1] | (4,081) | [2] |
Tax effect | (761) | 1,426 | (2,180) | 1,735 | ||||
Other comprehensive (loss) income | (3,759) | 8,924 | 162 | 9,931 | ||||
Ending balance at August 4, 2018 | (94,892) | (111,371) | (94,892) | (111,371) | ||||
Foreign Currency Translation Adjustment | ||||||||
Accumulated Other Comprehensive Loss [Roll Forward] | ||||||||
Beginning balance | (93,286) | (120,520) | (84,947) | (126,127) | ||||
Other comprehensive (loss) income before reclassifications | (11,206) | 19,072 | (19,545) | 24,679 | ||||
Reclassified from accumulated other comprehensive loss (1) | 0 | 0 | 0 | 0 | ||||
Tax effect | 0 | 0 | 0 | 0 | ||||
Other comprehensive (loss) income | (11,206) | 19,072 | (19,545) | 24,679 | ||||
Ending balance at August 4, 2018 | (104,492) | (101,448) | (104,492) | (101,448) | ||||
Unrealized Gain (Loss) on Derivative Financial Instruments | ||||||||
Accumulated Other Comprehensive Loss [Roll Forward] | ||||||||
Beginning balance | 2,153 | 225 | (10,107) | 4,825 | ||||
Other comprehensive (loss) income before reclassifications | 8,058 | (11,029) | 16,665 | (12,402) | ||||
Reclassified from accumulated other comprehensive loss (1) | 150 | (545) | 5,222 | (4,081) | ||||
Tax effect | (761) | 1,426 | (2,180) | 1,735 | ||||
Other comprehensive (loss) income | 7,447 | (10,148) | 19,707 | (14,748) | ||||
Ending balance at August 4, 2018 | $ 9,600 | $ (9,923) | $ 9,600 | $ (9,923) | ||||
[1] | Amount represents losses reclassified from accumulated other comprehensive loss to cost of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statement of Operations and Comprehensive Loss. | |||||||
[2] | Amount represents gains reclassified from accumulated other comprehensive loss to cost of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statement of Operations and Comprehensive Loss. |
Segment Reporting (Segment Repo
Segment Reporting (Segment Reporting Information, by Segment) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2018USD ($) | Jul. 29, 2017USD ($) | Aug. 04, 2018USD ($) | Jul. 29, 2017USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of Operating Segments | 2 | |||
Number of reportable segments | 1 | |||
Net Sales | $ 842,414 | $ 779,321 | $ 1,573,313 | $ 1,440,420 |
Segment Reporting (Net Sales by
Segment Reporting (Net Sales by Brand) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2018 | Jul. 29, 2017 | Aug. 04, 2018 | Jul. 29, 2017 | |
Schedule of Revenue by Brand [Line Items] | ||||
Net Sales | $ 842,414 | $ 779,321 | $ 1,573,313 | $ 1,440,420 |
Hollister | ||||
Schedule of Revenue by Brand [Line Items] | ||||
Net Sales | 500,836 | 446,639 | 924,464 | 821,315 |
Abercrombie | ||||
Schedule of Revenue by Brand [Line Items] | ||||
Net Sales | $ 341,578 | $ 332,682 | $ 648,849 | $ 619,105 |
Segment Reporting (Sales by Geo
Segment Reporting (Sales by Geographic Area) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2018 | Jul. 29, 2017 | Aug. 04, 2018 | Jul. 29, 2017 | |
Net Sales | $ 842,414 | $ 779,321 | $ 1,573,313 | $ 1,440,420 |
United States | ||||
Net Sales | 531,446 | 470,280 | 980,572 | 879,347 |
Europe | ||||
Net Sales | 192,354 | 195,895 | 362,014 | 350,880 |
Other | ||||
Net Sales | $ 118,614 | $ 113,146 | $ 230,727 | $ 210,193 |
Contingencies (Details)
Contingencies (Details) $ in Millions | 3 Months Ended |
Aug. 04, 2018USD ($) | |
Loss Contingencies [Line Items] | |
Proposed Litigation Settlement, Amount | $ 25 |
Loss Contingency, Potential Incremental Loss Portion Not Accrued | 20 |
Accrued legal contingencies | $ 23 |
Uncategorized Items - anf-20180
Label | Element | Value |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents | $ 567,632,000 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents | $ 697,955,000 |