In yet another sign that the upscale consumer is spending, trendy-apparel retailer Abercrombie & Fitch (NYSE:ANF) reported first-quarter results that are drawing admiring glances from other retailers that aren't looking so fashionable.

A quick review of the numbers tells it all. Total revenues were up 33%, with comparable-store sales climbing 19%. Net income rose 38%, and earnings of $0.45 per share grew 50% compared with the same quarter a year ago, topping analyst estimates by $0.03.

To get a true apples-to-apples comparison, though, you need to back out the $8 million of expense in last year's first quarter for the settlement of three lawsuits. Doing that brings the increase in operating income to 25% -- not quite as impressive, but it still makes for an extremely solid quarter.

Many of the numbers elsewhere in the sector are up as well. Last week, American Eagle Outfitters (NASDAQ:AEOS) reported that year-over-year earnings doubled for the quarter. The week before that, Guess? (NYSE:GES) delivered earnings that stunned the analysts. But yesterday, an admission from Limited Brands (NYSE:LTD) of merchandising mistakes at its Express stores drove a whopping 76% earnings decline. The two other major competitors in the teen jean scene, Aeropostale (NYSE:ARO) and The Gap (NYSE:GPS) (a Motley Fool Stock Advisor recommendation), will report first-quarter earnings this Thursday.

Times haven't always been so rosy for Abercrombie. The company went through a nasty dry spell between 2000 and the second quarter of last year, during which it posted only a single quarter of positive comparable-store sales in a four-and-a-half-year stretch. But you have to give Abercrombie credit for growing the bottom line in each of those years. This is a company that knows how to make profits, even in tough times.

Several factors are driving the sales improvement. The company has been upscaling its merchandise, including the addition of a higher priced "brand within a brand" called Ezra Fitch. The line features cashmere sweaters, woven shirts, and denims priced well over $100. Abercrombie has also added additional staff to its stores. Labor expense rose 230 basis points year-over-year in the first quarter, a major increase that the company says is paying off in better customer service and merchandise presentation. It also hasn't hurt that the company is hitting the fashion mark with its preppy customer base.

Now that all signs are pointing in the right direction, the company is gearing up for faster growth. While the flagship Abercrombie & Fitch chain is near the company's stated 400-store limit in the United States, the company will open three locations in Canada later this year and has established subsidiaries in Europe and Japan for expected store openings in 2006 and 2007. Hollister brand stores, targeting the California surf lifestyle, will continue to grow at about 60 stores per year and is also set to debut later this year in Canada with three stores. During the fourth quarter last year, the company opened its first Ruehl stores, a sophisticated upscale brand inspired by the artsy, downtown Manhattan culture. Not my cup of cappuccino, but it takes all types. In addition to all the new stores, direct-to-consumer sales through catalogs and the Internet are showing strong double-digit growth.

So should you own Abercrombie? The time to get in was last fall, when the stock was trading in the $30s. At today's price, close to $60 per share, and with a trailing 12-month P/E close to 22, the stock is not cheap. I do like the direction the company is heading in, though. Sales growth for the past three quarters has been impressive, and the company definitely has proved that it knows how to make money. For the next four months, Abercrombie is going up against soft sales from last year, so you can expect continued growth. The real test will be in the fall, when it goes up against strong prior-year growth numbers. Then we'll know whether this is a sustained trend, or a turnaround in process. Stay tuned.

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Fool contributor Timothy M. Otte can't remember the last time anyone called him a preppy. He welcomes comments on his articles but doesn't own shares in any of the companies mentioned in this article.