“NEW YORK (AP) — After years of struggle, Gap is back in style.
Gap Inc., which owns The Gap, Old Navy and Banana Republic clothing chains, on Thursday reported a 43 percent jump in its fiscal first-quarter net income, as the company continues to reap benefits from the turnaround plan that it began early last year.
The results are welcome news for customers and investors who had watched the one-time industry darling flounder over the past several years. Gap’s performance shows that efforts by the chain to attract customers with brightly colored fashions and lively ads are helping to boost sales.
“We are pleased with our strong start to the year, especially first-quarter sales,” Glenn Murphy, chairman and CEO of Gap, said in a statement. Murphy pointed to the improving mindset of the consumer, noting the improving housing market and job picture and the stock market’s gains.
“The consumer has been operating pretty much for the last five-plus years in a very challenging environment,” he said on a call with analysts. “This is the first quarter in a long time that the consumer, to us, felt like they were moving in a more positive direction.”
Gap executives did not mention the recent push by activists for clothing makers to form a global pact aimed at improving safety in Bangladesh clothing factories. Gap said last week that it couldn’t join the pact unless a provision was made that it felt would free it from unlimited legal liability. The San Francisco-based retailer also backed an outlook for the full year that remains below analyst expectations. Gap said that the weaker yen will impact its fourth quarter…..”
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