Revenue during the quarter dropped 6.88 percent to $1,036.36 million from $1,112.93 million in the previous year period. Gross margin for the quarter contracted 143 basis points over the previous year period to 59.34 percent. Total expenses were 94.09 percent of quarterly revenues, up from 89.21 percent for the same period last year. That has resulted in a contraction of 488 basis points in operating margin to 5.91 percent.

Operating income for the quarter was $61.26 million, compared with $120.08 million in the previous year period.

Fran Horowitz, chief executive officer, said: "Results for the quarter reflect a still challenging and competitive retail environment, however we continue to make progress on our strategic priorities. Hollister, our largest brand, achieved positive comp sales and the Abercrombie brand renewal continues, although it is a work in progress. International markets improved measurably from last quarter, for both Abercrombie and Hollister brands, and the direct-to-consumer business continued to deliver positive comparable sales in both the U.S. and international markets. However, the competitive environment resulted in more promotional activity and a lower gross margin rate than planned."

Debt comes down
Abercrombie & Fitch Company has recorded a decline in total debt over the last one year. It stood at $262.99 million as on Jan. 28, 2017, down 8.12 percent or $23.24 million from $286.24 million on Jan. 30, 2016. Abercrombie & Fitch Company has recorded a decline in long-term debt over the last one year. It stood at $262.99 million as on Jan. 28, 2017, down 8.12 percent or $23.24 million from $286.24 million on Jan. 30, 2016. Total debt was 11.46 percent of total assets as on Jan. 28, 2017, compared with 11.76 percent on Jan. 30, 2016. Debt to equity ratio was at 0.21 as on Jan. 28, 2017, down from 0.22 as on Jan. 30, 2016. Interest coverage ratio deteriorated to 12.74 for the quarter from 26.95 for the same period last year.