Just two short years after arriving in Australia, Abercrombie & Fitch are packing up shop and heading home.
The American retailer has announced it will be closing its two stores in Melbourne and Sydney, following disappointing sales, poor consumer engagement, and competition from the surge of international fast-fashion brands like Forever 21 and H&M into Australia.
The retailer’s net sales for the fourth quarter decreased 14% to $US1.12 billion, driven by a 10% comparable sales decline.
Net sales were also 6% lower in the US and 17% in international markets.
The Australian market “was even more challenging than expected,” Abercrombie executive chairman Arthur Martinez said.
Abercrombie saw the warning signs and decided to call it quits during the quarter, attending to its leases to ensure it could close the stores by the end of fiscal 2015.
The struggling business also made the decision to sell its infamous corporate jet, which Abercrombie was forced to write down the value of by $US11 million.
The jet made headlines in 2012 when it was revealed that the company had a 47-page rule book governing the attire and behaviour of those on board. Read more about that here.
The teen retailer will now turn its focus to the Asian market. It plans to open 15 stores in China, Japan and the Middle East this year, along with 15 stores and outlet stores in the US – but it also plans to close about 60 stores.
Abercrombie shares have lost more than half their value since August, dropping 15% on Wednesday in the US to $US20.27.