Gap offers muted outlook for annual profit

The Gap Inc.is an apparel retail company. That has resulted in sluggish traffic at the stores.

Gap has been in a cycle of discounting its goods to get shoppers to buy.

The company has been revamping its brands, but a promised turnaround this past spring failed to come to fruition.

“While I remain unsatisfied with the pace of improvement across the business, I am encouraged by the underlying signs of progress”, he said, citing healthier merchandise margins. Besides this, Gap is also introducing stain-resistant clothing, adding more stretch in its men’s lines, and testing smaller-sized Old Navy stores. It has Company-operated stores in the United States Canada the United Kingdom France Ireland Japan Italy China and Hong Kong.

Comparable sales for each of Gap’s three main brands were weak, but to be expected.

It’s Athleta division, a women’s and girl’s athleisure retailer, has the potential to be a big money maker for the company. It’s also working hard to improve fit – a problem that has long bedeviled the retailer. The company, which now operates 1,317 Ross Dress for Less locations and 184 DD’s Discounts, posted a profit of $282 million in the period, up from $259 million previous year. The consensus analysts are calling for $1.94 in EPS.

The shares fell less than 1 percent to $25.71 in late trading in NY. Following the release of the earnings report, the stock was initially down about 3% at $25.11 in early trading indications on Friday.

The company announced that its net income was $125 million equal to 31 cents a share for the quarter ending July 30, in comparison to $219 million equal to 52 cents a share for the same period one year ago.

Gap forecast a full-year adjusted profit of $1.87-$1.92 per share. Analysts polled by Thomson Reuters had a consensus earnings estimate of $0.59 per share for the quarter. The business’s quarterly revenue was down 1.2% compared to the same quarter a year ago. Revenue at stores opened at least a year fell 2 percent.

The company said that it had $0.60 in earnings per share (EPS) on $3.85 billion in revenue. Now the stock price is moving -23.14% off from the highest level of twelve months and +53.90% above from twelve months low. He left in 2015 to become CEO of Ralph Lauren Corp. and business stalled.

Old Navy Global: Flat, worse than a +3% gain past year. Old Navy struggled, too: same-store sales were flat versus last year’s 3 percent increase. Banana Republic Global posted 9% decline, versus 4% in the same quarter past year.

“Next really is to bring the voice of the brand back, and start telling the story”, Peck said.

San Francisco-based Gap has also been controlling inventories and shortening production times as it attempts to replicate the success of its Old Navy brand at its Gap and Banana Republic chains. The 52 week high shares of The Gap Inc. have reached is 33.8 whilst the 52 week low for the company’s shares is 17.