The Gap Inc. reported that June net sales increased 2 percent to $1.57 billion for the five-week period ending July 2, versus last year’s $1.54 billion for the five-week period ending July 4.
Gap’s comparable sales for June were also up 2 percent, which was an improvement over last year’s decline of 1 percent and much better than the Thomson Reuters estimate for a decline of 3.2 percent.
Banana Republic reported June comparable sales declined 4 percent versus last year’s positive 1 percent and a big surprise over Thomson’s estimate for a drop of 10.1 percent. Old Navy also rang up a big surprise as it delivered a positive 5 percent versus last year’s positive 1 percent and easily topped the estimate for a decline of 3.3 percent.
Gap Global turned in a decline of 1 percent versus last year’s negative 5 percent and slightly beat the estimate for a decline of 1.7 percent.
“We are pleased to see better performance across the portfolio this month, partly driven by an improvement in June traffic trends, particularly at Old Navy,” said Sabrina Simmons, chief financial officer at Gap Inc.
Investor relations senior vice president Jack Calandra pointed out that Sunday and Monday of the Memorial Day weekend fell into June sales and provided a strong start to the month. He also said the company saw an improvement in traffic trends, especially at Old Navy, which helped sales increase for the month.
Gap stock was rising 4 percent in after-hours trading to $22.50. In the last month the stock has risen by 10.75 percent.
The company will report second-quarter earnings on Aug. 18 and the FactSet estimate is for sales of $3.7 billion and earnings of 46 cents a share.
Among the remaining retailers that report June comparable sales, only L Brands Inc. and Zumiez Inc. managed to deliver surprises. L Brands reported that June net sales increased 7 percent to $1.296 billion for the five weeks ending July 2. Comparable sales for the same period increased 6 percent. This easily beat the Thomson Reuters estimate for an increase of 2.1 percent.
Zumiez comparable sales declined by 4.5 percent, which was worse than last year’s decline of 3.3 percent for the same time period. However, it was better than the Thomson estimate for a decline of 6 percent.