Abercrombie & Fitch Shares Drop Sharply

NEW YORK (AP) — Shares of Abercrombie & Fitch Co. tumbled Thursday after the teen retailer posted a bigger-then-expected drop in same-store sales for May.

Its stock shed $3.56, or 11.3 percent, to $28.12 in midday trading.

Before the market opened, Abercrombie reported its same-store sales plunged 28 percent in May. The decline was about 4 percent steeper than Wall Street analysts expected, according to a poll by Thomson Reuters. In the year-ago period, Abercrombie saw its same-store sales dip 1 percent.

Same-store sales, or sales at stores open at least a year, is a key indicator of retailer performance.

The company said sales in men's graphic tees and knit tops and women's shorts and fleece were particularly weak.

Abercrombie's results for the month were far worse than those of most of its teen rivals. Overall, the teen retail sector was one of few bright spots among the May same-store sales results, with low-price stores doing the best. The Buckle Inc. and Aeropostale Inc. — both known for offering deals and trendy fashions — reported double-digit increases.

Abercrombie had resisted discounting its clothing and accessories to try to keep profits and margins intact. But the company said Thursday it has now started cutting prices.