Old Navy Buoys Gap In Second Quarter

August 22, 2014

Although same-store sales at Gap were flat in the second quarter, the company reported a better-than-expected quarterly profit, buoyed by strong sales at Old Navy, and raised its full-year profit forecast as a result.

Net profit rose to $332 million in the quarter from $303 million a year ago.

Revenue increased 3% to $3.98 billion.  Online net sales increased 11% to $515 million, on top of last year's 27% increase.  The company noted it continues to advance its successful omnichannel platform with the expansion of its reserve in store service to all U.S. Gap stores.  The company also launched its order-in-store pilot, with plans to roll out the service to select U.S. Gap, Banana Republic, Old Navy and Athleta stores later this year.

Gap also plans to expand its reach to India through 40 franchise-operated stores.  The retailer is partnering with Arvind Lifestyle Brand Limited, a subsidiary of Arvind Limited, which is one of India's largest textile companies.

"India is an emerging, vibrant market and an important next step in our global expansion strategy," said Steve Sunnucks, global president of Gap.

Source: Retailing Today

Gap Posts Positive Comps In July

August 8, 2014

Gap posted positive comps in July for the four-week period ended August 2, buoyed by sales at Banana Republic; but preliminary second quarter results show that comparable store sales were flat compared to the same period last year.

Net sales in July increased 5% to $1.17 billion compared with net sales of $1.12 billion for the four-week period ended August 3.  For the second quarter, Gap Inc.'s net sales increased 3% to $3.98 billion compared with $3.87 billion for the second quarter last year.

"We're pleased to close out the first half of the year with a positive comp in July and look forward to the new product and marketing campaigns our brands will launch this fall," chairman and CEO Glenn Murphy said.

Comparable sales for July were up 2% versus a 1% increase last year.  Broken down by global brand, comparable sales for Gap decreased 2%, compared to a 7% increase last year; comparable sales at Banana Republic increased 6%, compared to a 1% decrease last year; and comparable sales at Old Navy increased 3%, compared to a 5% decrease last year.

For the second quarter so far, comparable sales are flat versus a 5% increase last year.  Broken down by global brand, comparable sales for Gap decreased 5%, compared to a 6% increase last year; comparable sales at Banana Republic stayed flat versus a 1% decrease last year; and comparable sales at Old Navy increased 4%, compared to a 6% increase last year.

Gap will release its complete second quarter earnings results August 21 and August sales results September 4.

Source: Retailing Today

Old Navy Drives Gap's April Sales

May 9, 2014

Gap had a good April in terms of sales, and a large part of the reason is the company's Old Navy banner.

The company reported that April net sales increased 10% to $1.33 billion for the four-week period ended May 3, versus $1.21 billion last year.  Gap's comparable sales for April 2014 were up 9% versus a 7% increase last year.

For the first quarter so far, Gap's net sales have increased 1% to $3.77 billion versus $3.73 billion last year.  The company's comparable sales so far have decreased 1% versus a 2% increase last year.

"We are pleased with our execution overall in April, especially at Old Navy," said chairman and CEO Glenn Murphy.

For the month, comparable sales by global brand were as follows:

• Gap Global: up 3% versus an 8% increase last year
• Banana Republic Global: up 7% versus a 1% increase last year
• Old Navy Global: up 18% versus a 9% increase last year

The company expects diluted earnings per share for the first quarter to be in the range of $0.56 to $0.57.  It also expects gross margins for the quarter to decline less than the year-over-year decline in the fourth quarter of fiscal year 2013.  In addition, the company expects first quarter fiscal year 2014 operating expenses to be slightly above last year.

Gap will release its complete first quarter earnings results May 22, and will report May sales June 5.

Source: Retailing Today

Severe Weather Affects Gap's February Sales

March 7, 2014

Severe weather that persisted during the year's shortest month affected Gap's February sales results.

The company reported net sales for the four-week period ended March 1 of $929 million, compared with net sales of $966 million for the four-week period ended March 2, 2013.  Comparable-store sales for the month declined 7%, versus last year's 3% increase.

"While February was clearly a difficult month, we remain focused on executing our global priorities," said chairman and CEO Glenn Murphy.

Comparable sales by global brand for the month were as follows:

• Gap: down 10% versus last year's 2% increase
• Banana Republic: down 7% versus last year's 5% decrease
• Old Navy: down 6% versus last year's 6% increase

The company said that more than 450 stores had to close during February due to weather.

In line with its strategic priorities, the company is preparing to open its first Gap store in Taiwan.  The brand expects to end fiscal year 2014 with more than 100 Gap stores across the Greater China region.

Gap will report March sales April 10.

Source: Retailing Today