The management continues to expect MG&A expense to be approximately $105 million for the fourth quarter 2007.

Key questions and answers from the third quarter fiscal 2007 earnings call conducted by Abercrombie & Fitch Co on November 21, 2007.

Randy Konik (Bear Stearns): You got leverage in the quarter on 1% comp. Can you comment on what comp you need for the fourth quarter? Given your cost structure, your infrastructure, do you see that point of leverage changing in the future?

Mike Kramer: Yes there was this phenomenal quarter in terms of leverage and quite frankly even with the reported results and the leverage that you saw there of 15.2% increase year-over-year of net income on a sales growth of 12.8%. If you back out some one time hits that we took roughly equating to about $5 million to $6 million, we grew our bottom line, which I am going to call it quality of earnings number of 20.2%. It was a spectacular quarter in terms of leverage. How is this going to translate into the fourth quarter, it''s going to be difficult because we are anniversarying the 53rd week which allows for some significant leverage which talks to the 6 cents that we talked about earlier. However, what I will tell you is for the year 2007, I am shooting for operating margin expansion on flat comps. In terms of future after that, we do anticipate, our model is built for leverage, and I am not going to talk about the sales level in which that we are going to attain that leverage.

Randy Konik (Bear Stearns): When will we see the pre-opening expenses for the Japan flagship hit? Will it will hit on 2008 or will that more of a 2009 event?

Mike Kramer: Right now, the Ginza store it''s being constructed. It''s still on schedule for late 2009, most of our pre-opening expenses will be in late 2009.

Jeff Black (Lehman Brothers): How should we look at CapEx next year? How do we frame our thinking on the level of increase we might see, given the new concept in the investments internationally?

Mike Nuzzo: As far as CapEx, we will be disclosing our CapEx plans for 2008 on the fourth quarter call. But we''re going to continue with our new store expansion and that occupies any where from 200 million to 250 million in any given year depending on the number of stores. We will also continue to refresh stores and we have some catching up to do this year, and so, we likely will be spending an amount similar to what we’ve been spending in the past on refresh, although it might be lower because of the catch up work that we’ve done. We will continue to invest in the home office infrastructure; we talked about our IT investment. That will likely continue at a similar level next year. The real wild card is international expansion and specifically flagship construction which as you can imagine the CapEx there is much more substantial than an average store. That should help you to at least frame how to think about our CapEx into next year. We''ve talked about the fact that it''s likely not going to grow substantially, but again, the wild card is the number of flagships and international opportunities that we see in the next year.

Jeff Black (Lehman Brothers): On RUEHL, are we still talking being profitable by the end of this year and are we going to see that growth rate accelerate on a unit basis next year?

Mike Kramer: I have got good news and okay news with regards RUEHL. The good news is that, RUEHL reached profitability on a four-wall basis in the month of August. Obviously the month of August is a very high productive month for us because of back-to-school. But it does show how we''ve been able to move the P&L particularly the cost structure and getting us in line with profitability at roughly a range of 16 stores. Now, we''ve targeted a lot of our P&L to critical mass of 25 to 30 stores. This is extreme improvement in terms of the glide path.

Now, the okay news is that on the top-line basis it''s not performing as well as what we would like. If we continue similar to what we''ve seen in the last couple of months into Q4, we do not anticipate profitability in Q4. Now, it will be very close. The impact to our P&L from a negative pressure perspective will be nominal. The intent here was to get RUEHL to a place to where it wasn''t a negative impact on our P&L and we''ve achieved that. Now again, we are still very bullish on this brand.

Janet Kloppenburg (JJK Research): On RUEHL, can you discuss your strategies to bring a greater level of sales consistency and profitability to the business in 2008? [With the respect to Concept-5, could you talk about whether or not that will be additive, incremental, or neutral to earnings next year?

Mike Nuzzo: We have talked about achieving IMU parity in RUEHL with the other brands and we achieved that on a much smaller store base than what we had originally targeted. We also talked about lowering operating costs in the store and we''ve achieved that as well, especially in the area of payroll. We talked about developing a smaller footprint and we''ve done that and we feel obviously that''s going to help us in depreciation and rent expense for the go-forward stores. We launched a website. We are selling handbags and fragrance and we will expand that to total product in January. All of these items have positioned us not only for improvement in profitability in 2007 but will be a strong component of the business and the success of the business into 2008.

Mike Kramer: RUEHL conversation ties nicely to your question with regards to the Concept-5. Strategically we have always positioned a portion of our cost structure to develop new growth initiatives and we have a few of them and that''s what allows us to be able to flip levers to be able to control our cost structure, because it allows for discretionary expenses. RUEHL, obviously for the last three years, has been a negative pressure to our P&L to the tune of $30 million loss and last year around $21 million to $22 million loss. With our improvement that we have seen in RUEHL, it accounts for some room year-over-year in terms of negative pressure, in terms of other growth initiatives and Concept-5 will fit that bill for us. Concept-5 year one will be a negative pressure to our P&L, it will be a loss year one. We are not going to talk about the amount, but suffice it to say we are not going to let it impact our efforts to expand our operating margin.

Kimberly Greenberger (Citigroup): Is there an opportunity potentially to get a little more aggressive with your store openings internationally? Obviously real estate selection is critical to success and no one would recommend reckless expansion, but one store every couple of years seems like a very conservative approach. Can you comment on that?

Mike Nuzzo: We are refocusing our efforts in international market in terms of more of a proportion of our efforts in terms of capital, investment and growth script footage expansion. Yes, opening one store each year seems somewhat very conservative, but keep in mind that until we reach the level of confidence we were trying to be conservative. We''ve definitely reached that level of confidence. Over the last three to six months, we have definitely reached that level. Our Fifth Avenue store is annualizing to over $100 million in sales. Of which more than 50% is international business. We have also highlighted the same trend in a lot of our high tourist locations throughout the United States, obviously the success that we have seen in Canada, the success that we have seen in London, is from a total dollar perspective. All this combined with the direct consumer, the list that we have seen when we put brick and mortar give us the confidence to focus more efforts in terms of our international expansion. Lead times are very long. We have been focusing for probably the last four months in terms of nailing down some sites, so in the next three to six months you''re going to see us talking more candidly about some of the sites that we''ve locked and loaded with regards to international expansion. We believe not only Abercrombie & Fitch, but Hollister as well as Abercrombie Kids are going to be a huge growth vehicle for us internationally. Our international business is highly accretive to us, so this is huge growth, low risk, highly accretive.

Jeff Klinefelter (Piper Jaffray): In terms of your growth, you’ve talked in the past about the differences in expansion of Hollister versus Abercrombie, the differences between the various European markets, mall versus non-mall. There might be an opportunity to go more mall based across Europe, which may be a little faster growth. Are there some differences between these concepts in that respect?

Mike Kramer: The international opportunity or the strategy if you will for our brands, A&F and Hollister are completely different. Abercrombie & Fitch, which is perceived as even more iconic and aspiration of globally than even here domestically, which is almost scary. It affords for us to take a look at this more in terms of flagship-oriented high profile oriented locations throughout Europe, Japan and Asia. Again, it''s going to be higher volume, lower number of units and to maintain that aspirational nature with regards to that brand. Hollister has not reached yet the iconic status, but it''s well on its way, because of the price point positioning we believe that this will be a much more of a mall based, just like you are seeing here domestically. A mall based even in Europe will be able to accelerate our growth much faster than we do with Abercrombie & Fitch high profile flagship strategy.

Brian Tunick (JP Morgan): Can you talk about the weakness at Hollister, particularly in the juniors business and what is some of the plans to reinvigorate the Hollister comp?

Mike Nuzzo: The weakness in the Hollister business was in bottoms in particularly Betty''s denim. We talked about the lack of a strong fashion drive in Denim. Hollister was weaker in that area, but looking at the other aspects of Hollister, we are very excited. We were up 2% in transactions per store per week in the quarter. We opened new stores that are on par in terms of productivity with our existing store base. We are doing product expansions. We talked about the Sessions program. We''ve got a big fragrance line that''s out in the store. Our international internet business in Hollister is up over a 100% in the quarter. We are absolutely thrilled about where we are with Hollister today and especially with the expansion opportunities that we have both domestically and internationally.

Dana Cohen (Banc of America): The other line was up versus the prior year. What was that driving it?