Gap Inc. (GPS) posted strong January comparable-store sales growth of 8% (comps) that surpassed analyst expectations and improved sharply from a decline of 4% in the comparable prior-year period, as the company witnessed continued improvement in sales across all its North American brands.
Comps at Gap North America increased 8% against a 5% decline recorded in the prior-year period. Banana Republic North America’s same-store sales soared 8% versus a 6% increase in January last year. Results at its Old Navy North America segment reflected a whopping 12% rise in comps compared with a 6% fall in the comparable prior-year period.
However, comps at the International business inched up 1% for the month compared with a 10% decline recorded in the prior-year period.
Net sales for the five-weeks ended Feb 2, 2013 summed to $1.13 billion compared with the year-ago period (four weeks ended Jan 28, 2012) sales of $833 million.
Further, the company indicated that the sales results for January, the fourth quarter and fiscal 2012 include an additional 53rd week, while all comps results exclude the additional week.
This Zacks Rank #2 (Buy) stock’s performance for the fourth quarter of fiscal 2012 also remained strong with comps increasing 5% compared to a 4% decline in the year-ago period. The comps improvement was driven by a 4% gain at Gap North America, 3% increase in Banana Republic North America and an 8% rise in Old Navy North America, offset by a 2% dip in International comps. Total sales for the fourth quarter grew 10.5% to $4.73 billion.
In fiscal 2012, the company’s net sales climbed 7.6% to $15.65 billion compared with $14.55 billion in the year-ago period. Improvements in net sales were primarily driven by 5% growth in the company’s comps.
Gap is scheduled to release its fourth quarter and fiscal 2012 results on Feb 28, 2013. The company expects to report fourth quarter earnings of 70 cents – 71 cents. Further, the company projects year-end inventory per store a little ahead of its previous guidance as in-transit inventory grew resulting from the arrival of early Easter holiday in 2013.
Concurrently, 3 other retailers – Ross Stores Inc. (ROST), Macy’s Inc. (M) and Nordstrom Inc. (JWN) – reported same-store sales for the month of January. Comps growth at Ross Stores, Macy’s and Nordstrom were 4%, 11.7% and 11.4%, respectively.
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