This is a surprise. Apparently 90s style cargo pants are back in style. No, but seriously, it’s always noteworthy when The Gap (GPS) is beating expectations and raising their outlook.
SAN FRANCISCO–(BUSINESS WIRE)–Gap Inc. today reported net sales of $1.14 billion for the four-week period ended October 31, 2009, which is an increase of 5 per cent as compared with net sales of $1.08 billion for the same period ended November 1, 2008. The company’s comparable store sales for October 2009 also increased 4 per cent compared with a 16 per cent decrease for October 2008.
“We’re pleased that we grew sales in October while delivering merchandise margins significantly above last year,” said Sabrina Simmons, chief financial officer of Gap Inc. “For the third quarter, we expect to deliver diluted earnings per share about 20 per cent above last year.”
Comparable store sales for October 2009 were as follows:
- Gap North America: negative 6 per cent versus negative 14 per cent last year
- Banana Republic North America: positive 5 per cent versus negative 17 per cent last year
- Old Navy North America: positive 14 per cent versus negative 20 per cent last year
- International: negative 4 per cent versus negative 5 per cent last year
Third Quarter Guidance and Sales Results
The company expects diluted earnings per share for the third quarter of fiscal year 2009 to be $0.42 to $0.44 compared with $0.35 for the third quarter last year. This exceeds the current First Call estimate of $0.38.
Given the magnitude of the sales trend improvement, the company now expects operating expense for the third quarter of 2009 to be higher than its previous guidance range of flat to up about $20 million.
For the thirteen weeks ended October 31, 2009, total company net sales were $3.59 billion, which is an increase of 1 per cent as compared with net sales of $3.56 billion for the thirteen weeks ended November 1, 2008. The company’s third quarter comparable store sales were flat compared with a decrease of 12 per cent in the third quarter of the prior year.
Comparable store sales for the third quarter of fiscal year 2009 were as follows:
- Gap North America: negative 7 per cent for both current and last year
- Banana Republic North America: negative 6 per cent versus negative 11 per cent last year
- Old Navy North America: positive 10 per cent versus negative 18 per cent last year
- International: negative 6 per cent versus negative 1 per cent last year
For more detailed information regarding the company’s October 2009 sales, please call 1-800-GAP-NEWS to listen to Gap Inc.’s monthly sales recording. International callers may call 706-634-4421.