USA: Gap Inc Announces June Sales Up 19 Per Cent

Gap Inc (NYSE:GPS) today reported sales of $1.17 billion for the five weeks ended July 1, 2000, an increase of 19 per cent over sales of $977 million for the comparable period ended July 3, 1999. The company's comparable store sales for June 2000 decreased 2 per cent compared to a 13 per cent increase in June 1999. The company's June comparable store sales by division were as follows: Gap Domestic had a positive low-single digit versus a positive low-single digit last year; Gap International had a flat comp versus positive mid-teens last year; Banana Republic had a positive low-single digit versus positive low-teens last year; and Old Navy had a negative high-single digit versus positive mid-thirties last year. Sales of $4.83 billion for the 22 weeks ended July 1, 2000, represent an increase of 20 per cent over sales of $4.04 billion for the same period in 1999. The company's year-to-date comparable store sales decreased 2 per cent compared to an 11 per cent increase a year ago. As of July 1, 2000, Gap Inc operated 3,224 stores compared to 2,630 at July 3, 1999, an increase of 23 per cent. As a result of the lower, quarter-to-date reported margins, the company believes that earnings for the second quarter will likely come in approximately three cents below the current consensus estimate of $0.26. Despite the second quarter business shortfall, the company does not anticipate changes to the third and fourth quarter range of analyst estimates.