Sales of Gap Inc. fell in July by 4%, or more than expected because of weak demand in the eponymous brand and Banana Republic, stated MarketWatch.
During the four weeks to July 30, the clothing trader marked a 14% decrease in sales in Banana Republic and 4% in the eponymous brand.
Surveyed by Thomson Reuters analysts had expected an overall decrease of 0.3%, including a 3.9% decline in Banana Republic and 1.4% in Gap. Sales in Old Navy were unchanged in July compared to the expected by analysts increase of 1.6%.
For the last quarter, Gap expects smooth earnings per share of 58 cents to 59 cents, which is above forecast by analysts of 48 cents per share.
During the quarter, sales were down by 2% and the preliminary net sales revenue amount to 3.85 bln dollars. Analysts predicted 3.78 billion dollars.
In May Gap warned about weak sales and that it will take steps to optimize its business, including to evaluate the operations of the Banana Republic and Old Navy outside of North America.
To cope with the decline in sales, CEO of Gap, Arthur “Art” Peck hired new directors and promised a rapid change in product assortment. The company narrowed its presence, closing a dozen locations.
The shares, which have lost 27% of their value over the past 12 months, depreciated by 4.8% to 24.40 dollars in the post-session.