- Prachi Singh |
Fourth quarter comparable sales at Gap were up 2 percent compared with a decline of 7 percent last year. On a reported basis, diluted earnings per share at Gap, were 0.55 dollar for the fourth quarter and 1.69 dollars for fiscal year 2016. The company’s adjusted diluted earnings per share were 0.51 dollar for the quarter and 2.02 dollars for fiscal year.
“We’re pleased to finish the year strong, with positive comp and sales growth during the critical holiday quarter,” said Art Peck, CEO of Gap in a press release, adding, “Going forward, we will maintain our focus on improving the quality and relevance of our products, increasing our responsiveness to trends and demand, and creating more synergy across channels to deliver the experiences our customers want and expect, however they choose to shop.”
Q4 net sales up 1 percent
Fourth quarter net sales increased 1 percent to 4.43 billion dollars and fiscal year 2016 net sales were 15.5 billion dollars. The translation of foreign currencies into US dollars, the company said, negatively impacted the company’s reported net sales for fiscal year by about 20 million dollars.
For fiscal 2016, the company’s comparable sales were down 2 percent compared with a decline of 4 percent last year. Comparable sales at Old Navy Global were positive 1 percent versus flat last year, at Gap Global: negative 3 percent versus negative 6 percent last year and Banana Republic Global: negative 7 percent versus negative 10 percent last year.
2017 comparable sales expected to grow slightly
For fiscal year 2017, the company expects diluted earnings per share to be in the range of 1.95 dollars to 2.05 dollars, which includes the estimated negative impact of approximately 0.09 dollar due to foreign currency fluctuations at current exchange rates. This impact equates to approximately 5 percentage points of earnings per share growth when compared with the company’s adjusted diluted earnings per share of 2.02 dollars for fiscal year 2016.
The company also noted that comparable sales for fiscal year are expected to be flat to up slightly. Net sales are expected to be slightly below this range driven by an expected negative impact from foreign currency fluctuations year-over-year.
It expects its reported diluted earnings per share for the first half to be down in the high single digits when compared with the adjusted diluted earnings per share for the first half of fiscal year 2016. During the year, the company expects to open about 40 company-operated stores, net of closures and repositions. In line with its strategy, the company expects store openings to be focused on Athleta and Old Navy locations, with closures weighted toward Gap brand.