Old Navy helps Gap sail through retail gloom

Analysts typically had expected an income of 29 cents per share and revenue of $3.39 billion, based on Thomson I/B/E/S.

Old Navy, the business’s greatest brand by revenue, is a vibrant place, posting its fifth consecutive year of sales development in 2016.

Gap’s results come among a gloomy retail atmosphere with shops for example Macy’s Corporation (M.N) and J.C. Penney Co Corporation (JCP.N) and apparel retailers including Rob Lauren Corp (RL.N) and American Bald eagle Outfitters Corporation (AEO.N) reporting disappointing results.

“The end result was delivered inside a tough marketplace is an achievement,” GlobalData Retail Md Neil Saunders stated.

The business’s shares were up 4.five percent at $24.24 in after-market buying and selling on Thursday.

Peck also continued to be bullish around the company’s ‘Athleisure’ brand, Athleta, calling it an “exceptional artist”.

Gap continues to be searching to duplicate its success using the Old Navy at its Blueberry Republic and namesake brands.

“Outdoors of the powerhouse of growth, the business’s other brands fared much less well…This imbalance implies that Gap is firing on only one cylinder,” he stated.

The company reported a 6 % stop by same-store sales last year.

Comparable sales at Blueberry Republic fell 4 %, in contrast to an 11 percent drop last year. Analysts had expected a decline 4.2 percent, based on Consensus Metrix.

Gap on Thursday backed its 2017 comparable sales forecast of flat to up slightly.

Gap Corporation (Gps navigation.N) reported an unexpected increase in quarterly same-store sales, bucking the popularity of dismal leads to the U.S. retail industry, as the organization taken advantage of the robust performance at its Old Navy brand.

“Old Navy includes a very significant transmission of millennial customers which are involved in that brand,” Leader Art Peck stated with an earnings call with analysts.

However, Saunders elevated concerns concerning the company’s reliance on Old Navy.

(Reporting by Arunima Banerjee in Bengaluru Editing by Anil D’Silva and Sriraj Kalluvila)

Revenue was flat at $3.44 billion. The organization stated the strong dollar impacted the quarter’s revenue by about $11 million.

Comparable sales in the low-cost Old Navy brand leaped 8 percent within the first quarter ended April 29, handily beating the two.2 percent rise believed by Consensus Metrix.

“Our brands performed more than the key Easter time selling season, particularly at Old Navy, which has a tendency to realize outsized impacts over key holiday period,” Chief Financial Officer Teri List-Stoll stated throughout the call.

Internet earnings rose to $143 million, or 36 cents per share, within the quarter from $127 million, or 32 cents per share, last year.

The business’s same-store sales rose 2 percent within the latest quarter. Analysts typically had expected b .2 percent fall, based on Consensus Metrix.

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