Feb 25, 2010
Gap beats Street by a penny, gives upbeat forecast
Feb 25, 2010
SAN FRANCISCO (Reuters) - Gap Inc (GPS.N) posted a 45 percent rise in net income during its holiday quarter, helped by fewer discounts and improved sales in all its divisions, and gave a 2010 profit forecast that beat Wall Street's estimates.
The apparel retailer, operator of Gap, Banana Republic and Old Navy stores, said on Thursday 25 February that net income in its fourth quarter ended January 30 was $352 million, or 51 cents per share, from $243 million, or 34 cents per share, a year earlier.
Analysts, on average, had been expecting earnings of 50 cents per share, according to Thomson Reuters I/B/E/S.
Revenue rose 4 percent to $4.24 billion -- just above the $4.23 billion expected by Wall Street -- on a same-store sales gain of 2 percent from a decline of 14 percent a year earlier.
Gap's operating margin in the quarter was 13.9 percent compared with 9.8 percent in the year-ago period. Gap called that its highest fourth-quarter margin in more than a decade.
After a years-long sales slump, Gap has recently managed to turn around its sales through better merchandising, fashion and marketing, while beefing up its profit margins. It recently logged a 5 percent increase in overall January same-store sales, with gains in all its units.
Looking ahead, the company said it expects fiscal 2010 earnings per share to range between $1.70 to $1.75, above the $1.69 expected by Wall Street.
The company's shares closed at $20.39, up less than 1 percent.
(Reporting by Alexandria Sage; editing by Andre Grenon)
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