China Clothing A&F Conciliation Shareholder Litigation Is Expected To Close 60 Stores

Forced to

The huge pressure of $140 million in litigation claims, Abercrombie & Fitch Co. promises to change corporate governance and add a chief ethics compliance officer to strengthen internal corruption and executive pay management.

Last Friday, Columbo District Court in Ohio handled the lawsuit against Abercrombie & Fitch Co. by the urban plantation police employee retirement fund. When 1, the two sides reached a settlement.

Mark Lebovitch, partner of Bernstein, Litowitz, Berger & Grossmann, the plaintiff agency, said that such a "mitigation" approach would be beneficial to both sides.

Previously, Abercrombie & Fitch Co. had encountered aggressive investors' "forcing the palace".

Beginning at the end of 2013, shareholders Engaged Capital LLC demanded that Abercrombie & Fitch Co. vigorously carry out rapid reform, and the two sides "fight" several rounds, and finally Abercrombie & Fitch Co.

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In April 2014, Abercrombie & Fitch Co. announced a reconciliation agreement with Engaged Capital LLC and reorganized the board.

The oppression of Abercrombie & Fitch Co. is mainly due to the self assertion and high salary of Mike Jeffries, a dissatisfied group's long-term CEO.

Since 1996, Mike Jeffries of the group has been criticized by the community and the pressure of shareholders because of many issues such as rhetoric, discrimination, strange shop regulations and leadership.

In January 2014, the group was forced to separate its duties as chairman and CEO. Mike Jeffries served as CEO only.

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In the 10 quarter, same store sales fell, and Mike Jeffries's CEO position was already at stake.

According to the no fashion Chinese network data, in the two quarter ended August 2nd, Abercrombie & Fitch Co. overall store sales decreased 7% compared with the same period last year, far less than analysts expected 4.1%, of which Abercrombie & Fitch brand fell slightly by 1%, Abercrombie Kids and Hollister Co. fell 6% and 10% respectively.

By region, the same store sales in the US and the international market decreased by 5% and 9% respectively.

A&F profit net profit rose 13.2% to 12 million 900 thousand U.S. dollars over the same period last year, 11 million 400 thousand US dollars in the same period last year, and the diluted earnings per share rose to US $0.17 from US $0.14 last year, adjusted earnings per share to US $0.19, far exceeding analysts' expected $0.11.

But net income fell by 5.8% to 891 million dollars a year, less than the analyst forecast of $909 million 800 thousand.

Mike Jeffries said at the analyst conference after the two quarter earnings conference that it will withdraw from the sale of logo clothing in the North American market from the spring of 2015, but will retain such products in the international market stores.

In addition, Abercrombie & Fitch Co. said that with the expiration of the lease, the group will close 60 stores.