Abercrombie & Fitch (NYSE:ANF) stock has gotten crushed today, down by 21% as of 11 a.m. EDT, after the company announced that it had terminated its sale process.
In May, the company had said it had received "expressions of interest" and was in "preliminary discussions" about a potential sale of the company. Shares jumped 12% on the day of the announcement and closed out that month up 10%. Abercrombie & Fitch did not specify how many suitors there were beyond saying it was in talks with "several parties."
Today's announcement confirms that those talks have fallen through, with Executive Chairman of the Board Arthur Martinez saying in a statement:
After a comprehensive review of all relevant factors, with the assistance of our financial advisor, the A&F Board of Directors determined that the best path to enhance value for stockholders is the rigorous execution of our business plan.
We believe in the prospects for our business and the opportunities for our brands. We are generating solid comp store sales momentum at Hollister and continue to refine and implement strategies to position the Abercrombie brand for revitalized performance. Our strong management team and dedicated people, the investments we have made in marketing, omnichannel and other strategies to drive sales, together with our relentless focus on operational efficiencies, all contribute to our expectation for improved trends beginning in the second half of the year, compared to the prior year period.
We are committed to taking sound, aggressive action to deliver enhanced performance and long-term stockholder value.
The comments did little to reassure investors, as last quarter's results spoke for themselves, with overall comparable sales falling 3%. Abercrombie brand comps fell 10%, while Hollister brand comps -- the "solid" momentum that Martinez referenced above -- came in at just 3%. The company's guidance warned that comparable sales would "remain challenging" in the second quarter.