Gap Projects Disappointing Results as Sales Slide at Banana Republic -- Update
10 November 2015 - 9:27AM
Dow Jones News
By Lauren Pollock
Gap Inc. forecast weaker-than-expected results for its recently
completed quarter as the retailer's sales continued declining in
October, particularly at Banana Republic.
Shares declined 5.4% after hours.
Gap, which has more than 3,700 stores under brands that include
Old Navy, Banana Republic and its namesake division, has been
trying to revamp, following a series of fashion mis-hits. Its
shares have come under pressure as sales in recent months
disappointed and the head of its top-performing Old Navy division
departed to take over Ralph Lauren Corp.
For the quarter ended Nov. 1, Gap projected earnings, excluding
one-time items, of 62 cents to 63 cents a share, short of the 66
cents a share projected by analysts polled by Thomson Reuters.
Sales slid 3% to $3.86 billion but were flat on a
constant-currency basis and missed the $3.93 billion expected on
Wall Street.
Gap said it also expects year-over-year inventory dollars per
store at the end of the quarter to be slightly lower than it
previously guided.
As for October, sales, excluding newly opened and closed
locations, declined 3%, on top of a 3% fall last year. Analysts at
Retail Metrics had guided for a 0.4% decline.
Banana Republic logged a 15% sales drop, while the Gap brand saw
sales fall 4% and Old Navy notched a 2% increase.
Gap is due to report its quarterly results Nov. 19.
Write to Lauren Pollock at lauren.pollock@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
November 09, 2015 17:12 ET (22:12 GMT)
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