US: Gap earnings down and cautious on FY forecast
- Q4 earnings drop 12.5%
- Sales down 3.2%
- FY EPS to be hit by weak currency
Gap said it expects its EPS growth rate to be negatively impacted by weakening foreign currencies
Clothing giant Gap Inc saw earnings drop in its fourth-quarter and said it expects weakening foreign currencies to hit earnings for the full year.
Net income in the three months ended 1 February dropped 12.5% to US$307m from $351m a year earlier.
Sales were down 3.2% to $4.58bn, while comparable sales edged up 1% compared with a 5% increase in the fourth quarter of last year.
Both earnings and revenues were negatively impacted by the loss of a 53rd week in the 2013 figures and heavy discounting over the holiday period.
For the full year, Gap said it expects its EPS growth rate to be negatively impacted by around five percentage points, as a result of weakening foreign currencies. As a result, the company has forecast EPS to be in the range of $2.90 to $2.95
Nonetheless, Gap said it will open 30 additional namesake stores in China during fiscal 2014, in addition to debuting five Old Navy stores in the country.
RBC Capital Markets analyst Howard Tubin noted: "While a necessary evil this past holiday season, price promotions and discounts are not levers GPS management is happy about having to pull.
"CEO Murphy believes that "it all starts with the product" and offering compelling and differentiated assortments is the most effective way to drive the business. This is a sentiment with which we completely agree."
The Gap, Inc. - Strategy and SWOT Report, is a source of comprehensive company data and information. The report covers the company’s structure, operation, SWOT analysis, product and service offerings ...
The Gap Inc has demonstrated that it understands the direction of the apparel market, and is using its digital platforms in conjunction with its physical stores to drive growth. The company has benefi...
The Gap, Inc. - SWOT, Strategy and Corporate Finance Report, is a source of comprehensive company data and information. The report covers the company’s structure, operation, SWOT analysis, product and...
A group of European retail clothing brands is calling for the elimination of duties on apparel, along with more flexible rules of origin, as part of the free-trade agreement being negotiated between t...
Gap Inc’s sales performance in 2012 highlights a successful turnaround is well underway. Innovative marketing combined with an omni-channel focus places the company well to regain lost market share. G...
- Impact of the TPP on the US textile industry?
- JC Penney emphasises new merchandising strategy
- Crystal Group nurtures its caring culture
- Apparel industry not immune from Russia tensions
- US apparel import data shows China competitiveness
- Cambodia garment workers “dying on the job”
- Vietnam proposes 15% rise to regional minimum wage
- Cotton prices set to slip on China policy change
- Nike appointments to drive growth opportunities
- Avery Dennison forms JV with Ningbo Shenzhou
- Global Database of the Top 1000 Apparel Producers - Company Names, Financial Performance, Key Executives, and Contact Details
- Textile Wholesaling in the UK - Industry Market Research Report
- Survey of the European Fabric Fairs: Spring/Summer 2015
- Global market review of denim and jeanswear – forecasts to 2020
- Prospects for the Textile and Clothing Industry in Turkey