Renovated strength for Gap

Thursday, 06 January 2011

Breaking the ice around the globe, main quoted apparel companies have been presenting either quarterly reports or forecasts for the new year. Yesterday it was time for Gap to update its last month's outcome while FashionUnited Top 100 Index closed down to 1,236.65.

Apparel retailers Gap Inc. Thursday reported a decline in December comparable-store sales of 3%. Gap also reaffirmed its full-year earnings guidance of $1.77 to $1.82 per share, while for the month, reported a 3% decline in comparable-store sales compared with a 2% increase in the prior year.

The California-based company, said its net sales for the five-week period ended January 1, 2011 remained flat at $2 billion. For the month of December, Old Navy North America division, whose target market largely consists of fashion oriented, yet price conscious teens to adults, recorded a 2% decline in comparable store sales, over a 7% increase in the previous year. At the Banana Republic North America division, comparable store sales increased 1%, compared to a decline of 3% last year.

Gap North America comparable store sales recorded a decline of 8%, in comparison with an increase of 1% last year. International posted a decline of 4%, compared to a decrease of 1% in the preceding year. For the year-to-date period, net sales were $13.82 billion, up 3% compared with net sales of $13.40 billion in the same period last year. Year-to-date comparable store sales increased 1%, compared with a 4% decrease last year. Sabrina Simmons, chief financial officer of Gap Inc. said, "After a strong start to the holiday season in November, sales and traffic trends for our brands were less consistent in December."

On other hand, teen retailer Zumiez Inc posted December same-store sales that missed market estimates for the first time in 8 months. Zumiez, which sells clothing and equipment for skaters, snowboarders and other action sports, reported a 9.2 percent rise in December same-store sales. Analysts were looking for a 11.5 percent rise, according to Thomson Reuters data.

Finally, G-III Apparel was one of Thursday's notable stocks on the rise, up 2.2% to $36.28. The S&P was trading at that time 0.5% higher to 1,276 and the Dow Jones Industrial Average was trading 0.4% higher to 11,735.

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