The Gap Inc.
) posted comps increase of 1% for Jan 2014, compared with an 8%
increase in the prior-year period. Brand-wise, the company
registered improved comps performance at Gap and Old Navy, while
Banana Republic reported negative comps.
Comps at Gap Global rose 1% compared with a 4% increase in the
prior-year period. Old Navy Global's comps improved 4% versus a
12% increase last year. However, comps at Banana Republic Global
dipped 10%, as against a 9% rise recorded last year.
Net sales for the 4 weeks ended Feb 1, 2014 came in at $899
million, down from $1.13 billion reported for the 5-week period
ended Feb 2, 2013.
Notably, the company's January, fourth quarter and fiscal 2013
comps results are compared with the 4-week, 13-week, and 52-week
periods ended February 2, 2013, respectively as fiscal 2012
included an additional 53rd week. Moreover, the company's
top-line results for the above mentioned periods were impacted by
the absence of the additional week in fiscal 2013.
Shares of this leading apparel retailer for men, women, children
and babies soared to a high of $41.49 (up 4.5%) in the afterhours
trading session yesterday, following the release of
better-than-expected comparable store sales results for January
and the fourth quarter as well as an encouraging fourth-quarter
guidance. However, the stock closed after market trade returned
to the regular trade closing price of $39.71.
While Gap managed to post better-than-expected comps in an
otherwise difficult month, comp results for most retailers were
below expectations. Comps of retailers including
The Buckle Inc.
The Cato Corporation
) were down 6.6%, 8% and 7.6%, respectively, impacted by winter
storms during January.
Coming back to Gap, the company reported fourth quarter comps
increase of 1% against a 5% rise reported in the year-ago
quarter. This marked the company's 8th positive comps growth in a
row. Net sales for the quarter totaled $4.58 billion, down 3.2%
from $4.73 billion in the fourth quarter of fiscal 2012.
Segment-wise, the quarter's comps were up 1% at Gap Global,
remained flat at Old Navy and were down 3% at Banana Republic
For fiscal 2013, the company reported a 2% rise in comps compared
to a 5% increase reported last year. Net sales for the year rose
3.2% to $16.15 billion from $15.65 billion reported in fiscal
Encouraged by the positive comps results, the company came up
with a favorable earnings per share forecast for the fourth
quarter and fiscal 2013. The company projects fourth-quarter
earnings per share to range from 65 - 66 cents, while earnings
per share for fiscal 2013 are expected to grow in the mid-to-high
teens range. Earnings growth guidance for fiscal 2013 compares
with 49% earnings growth registered in fiscal 2012. Currently,
the Zacks Consensus Estimate for the fourth quarter stands at 60
cents per share, way below the company's guidance range.
Gap currently carries a Zacks Rank #3 (Hold) and is scheduled to
release its fourth-quarter and fiscal 2013 financial results on
Feb 27, 2014.
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