Gap October comparable sales down 1 percent

Net sales at Gap for the four-week period ended October 29, 2016 were 1.20 billion dollars or flat when compared with the same period ended October 31, 2015. The company said, comparable sales for the month were down 1 percent versus a 3 percent decrease last year, owing to the fire on its Fishkill, New York distribution centre campus. The incident negatively impacted Gap’s October comparable sales by approximately 3 percentage points. For the third quarter, the company’s net sales were 3.80 billion dollars compared with 3.86 billion dollars for the third quarter of last year.

“As we close out the quarter, we are pleased to see a continued positive customer response to our Old Navy product collections,” said Sabrina Simmons, chief financial officer, Gap.

October comparable sales at global brands

Comparable sales at Gap Global: negative 7 percent, including an estimated negative impact from the Fishkill distribution centre fire of approximately 5 percentage points, versus negative 4 percent last year. Banana Republic Global reported negative 4 percent comparable sales, including an estimated negative impact of fire of approximately 4 percentage points, versus negative 15 percent last year and Old Navy Global was positive 3 percent, versus positive 2 percent last year.

The company noted that October merchandise margin rates actualized significantly higher than previously expected, which more than offset the estimated earnings impact from lost sales and increased logistics costs during the month that resulted from the Fishkill distribution centre fire.

Comparable sales for the third quarter were down 3 percent, including an estimated negative impact from the Fishkill distribution centre fire of approximately 2 percentage points, versus a 2 percent decrease last year. Gap Global was negative 8 percent, versus negative 4 percent last year, Banana Republic Global was negative 8 percent, versus negative 12 percent last year and Old Navy Global comparable sales were positive 3 percent, versus positive 4 percent last year.

Issues third quarter earnings guidance

On a reported basis, the company expects its diluted earnings per share for the third quarter to be in the range of 0.50 dollar to 0.51 dollar. Excluding the 0.09 dollar negative impact associated with its previously announced store closure and streamlining measures, which includes the impact from a higher tax rate, the company expects its adjusted diluted earnings per share to be in the range of 0.59 dollar to 0.60 dollar.

Picture:Gap