Profits surge at college clothing brand
Sales at US fashion retailer Abercrombie & Fitch surged 40 per cent to US$961.6 million (£553.8 million) in fourth-quarter trading to January 28. Profits jumped 58 per cent to US$164.6 million (£94.8 million).

Like-for-like store sales were up 28 per cent for the quarter and 26 per cent for the year. Last month, same-store sales lifted 33 per cent, helped by gift-card redemptions and unseasonably warm temperatures.

For the year, Abercrombie made a US$333.3 million (£192 million) profit, up 54 per cent on 2004. Sales rose 37 per cent to US$2.8 billion (£1.61 billion).

However, the retailer warned that it expects sales to slow. Chief financial officer Mike Kramer said: 'Consequently, the company believes that, while it can sustain positive comparable store sales increases, the increases will not be at the level reported over the past 13 months.'

The retailer plans to spend about US$40 million (£23 million) this year to update some of its flagship stores and to expand the use of a video system at its Hollister outlets, which are aimed at high school students.

Abercrombie chief executive Mike Jeffries said he believes the Hollister brand has much more room to grow. 'At this point, we are only half way to Hollister's domestic store potential,' he said.