Gap shares fall after apparel retailer’s sales miss estimates, hurt by Covid-related store closures

A person walks previous a store on January 12, 2021 in New York City.

Angela Weiss | AFP | Getty Images

Gap Inc. on Thursday reported fourth-quarter sales that got here up in need of estimates as the continued coronavirus pandemic compelled short-term store closures in Europe, components of Asia and Canada.

The apparel retailer swung to a revenue, because of its efforts to promote extra merchandise at full sticker worth.

For the quarter ended Jan. 30, Gap reported internet revenue of $234 million, or 61 cents per share, in contrast with a lack of $184 million, or 49 cents per share, a 12 months earlier.

Earnings within the newest interval included a tax acquire of roughly 45 cents per share and an impairment cost of roughly 12 cents per share associated to Gap’s Intermix enterprise. Analysts had been calling for earnings of 18 cents per share, in line with a survey by Refinitiv. It wasn’t instantly clear if analysts had factored within the influence of this stuff.

Net sales fell about 5% to $4.42 billion from $4.67 billion a 12 months earlier. That was in need of analysts’ estimates for $4.66 billion.

Same-store sales for Gap’s athletic apparel model Athleta grew 26% 12 months over 12 months, and so they have been up 7% at Old Navy. Gap’s namesake model, nonetheless, booked a 6% same-store-sales decline, and Banana Republic mentioned that key metric fell 22%.

Gap mentioned its general on-line sales have been up 49%, representing 46% of internet sales in the course of the quarter.

For fiscal 2021, the corporate is looking for internet sales to be up a mid- to high-teens proportion in contrast with 2020. That’s assuming Covid-related impacts proceed within the first half of 2021, and the retailer returns to a extra normalized, pre-pandemic stage of sales within the second half of the 12 months, the corporate mentioned.

Analysts had been calling for year-over-year income progress of 14.1%, in line with Refinitiv.

Gap shares are up about 75% over the previous 12 months. The firm has a market cap of $9.46 billion.

Find the complete press launch from Gap right here.

This story is growing. Please verify again for updates.

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