Gap Inc. weathered the promotional climate well in the second quarter, logging gains in profits and sales even as its gross margin declined.
The company also said that it had signed a franchise agreement with Arvind Lifestyle Brand Ltd., a subsidiary of Arvind Ltd., to open stores in India. The first stores will open in the nation’s largest cities, Mumbai and Delhi, by summer 2015 and about 40 Gap stores are planned under the arrangement.
In the three months ended Aug. 2, Gap, the largest U.S.-based apparel specialty chain, recorded net income of $332 million, or 75 cents a diluted share, 9.6 percent higher than the $303 million, or 64 cents, recorded in the comparable 2013 period. Excluding a gain of 5 cents a share for the sale of a building owned but no longer occupied by the firm, adjusted EPS was 70 cents, 1 cent higher than analysts, on average, expected.
Sales in the quarter were up 2.9 percent to $3.98 billion from $3.87 billion a year ago with comparable sales, including those of e-commerce operations, flat versus a 5 percent advance in last year’s quarter.
Gross profit was flat and gross margin retreated to 39.4 percent of sales from 40.5 percent in the year-ago period.
“Building on last year’s strong performance, we are pleased to have grown our sales 3 percent and delivered solid improvement in earnings per share,” said Glenn Murphy, chairman and chief executive officer of the San Francisco-based firm. “We remain focused on our strategic initiatives as we turn our focus toward delivering a strong second half.”
Online sales expanded 11 percent to $515 million, the company said, with the growth rate down from 27 percent in the second quarter of last year.
Gap raised its guidance for full-year profit to a range of $2.95 to $3 a share to reflect the gain on the asset sale.
Year-to-date net income fell 6.9 percent to $592 million, or $1.32 a diluted share, from $636 million, or $1.35, in the first half of 2013. Revenues are up 2.1 percent to $7.76 billion from $7.6 billion.
My character, Dinah Madani, is just the coolest, [most] badass woman imaginable," says @amberroserevah. The actress stars in @marvel's newest series on @netflix, @thepunisher. To prepare for her role, Revah sat down with Homeland agents to get a real sense of with Dinah's day-to-day life is really like. Read our full interview on WWD.com. #wwdeye (📷: @jilliansollazzo)
A scene from the 91st annual @macys Thanksgiving Day Parade. The parade, which boasts 50 million TV viewers and 3.5 million on-site spectators, is considered one of the largest and most watched parades in the world. (📷: Jason Szenes/EPA-REX)
The circus came to @bloomingdales 59th Street on Tuesday night and lit up Lexington Avenue with acrobatic dancers, death-defying knife throwing, sword swallowing and aerial acts with no net. The 45 minutes of theatrics built up to unveiling the holiday windows depicting @swarovski crystal-encrusted circus pieces and scenes from “The Greatest Showman” – songs from the soundtrack included. See the rest of the photos on WWD.com #wwdfashion (📷: Joshua Scott)
The psychedelic fashion that pervaded the ’60s is back with an exhibit at the @museumofcityny. “Mode New York: Fashion Takes a Trip” chronicles the changing styles from 1960 through 1973 and features designers such as @ysl, @oscardelarenta and more. The exhibition, which is on display through April 1, is organized into four periods: First Lady Fasion, Youthquake, New Bohemia and New Nonchalance. Pictured here is model Pat Bardonella during the Garvey Day Parade in 1968. (📷: @kwamebphoto) #wwdeye #wwdfashion
“People should be a lot more honest in expressing both the dark and light of themselves. We need to give each other the space to do that because it’s the only way we can grow and evolve,” says @noelwells of her new film “Mr. Roosevelt,” which is largely based on her own struggles. Unexpectedly leaving @nbcsnl in 2014 after just one season, Wells felt set back in her self-esteem and career trajectory. She quickly refocused her energy to more personal projects, which led to the completion of “Mr. Roosevelt.” Read the rest of WWD’s interview with the “Master of None” actress on WWD.com #wwdeye (📷: @jilliansollazzo)
@barbrastreisand is giving fans a chance to see her perform up close in a new concert series, which makes its debut on @Netflix today. From behind-the-scenes takes to her concert performance in Miami last December, the two-hour streaming special captures Streisand in her element. Pictured here is the singer/actress photographed for WWD in 1963. (📷: Palmieri Tony) #wwdeye #wwdarchive
@chanel and @pharrell dropped what’s being dubbed as the world’s most exclusive sneakers yesterday. The Adidas Originals NMD Hu, which Williams designed in collaboration with Chanel and @adidasoriginals, has a waiting list of over 120K people who pre-registered online at chanelatcolette.fr –– and only 500 pairs are on sale. The singer predicted the resale value of the shoes could reach $40K. Read the full interview on WWD.com. Link in bio. #wwdfashion (📷: Dominique Maître)
@imanshumpert is diving deeper into his creative endeavors and relaunching his clothing line, Post 90s, and is helping to raise money for the hurricane victims in St. Maarten with a jersey he’s designed with his brother. The Cleveland Cavaliers player talked to WWD about kneeling during the national anthem, working with fashion brands and how he wants to be more than an @nba player. Read the interview on WWD.com #wwdfashion (📷: George Chinese)