The US clothing group Gap Inc. presented mixed figures for the second quarter of the 2023/24 financial year on Thursday evening. Sales fell again significantly, but the result exceeded market expectations.
In the 13 weeks ended July 29, Group sales were $3.55 billion, down 8 percent from the prior-year quarter. All Group brands had to accept losses. Old Navy revenue shrank 6% to $1.96 billion, Banana Republic fell 11% to $480 million and Athleta fell 1% to $341 million.
Its core brand, Gap, had quarterly sales of $755 million, down 14 percent year-on-year. According to the group, the sale of the brand’s China business to Baozun Inc., the discontinuation of the Yeezy Gap line and negative currency effects contributed to the significant decline. Adjusted for these factors, the label’s revenues fell by four percent.
The austerity program is having an effect
Thanks to lower freight costs, fewer discounts and significant cost reductions, the group returned to profitability despite the decline in sales. Operating income was $106 million after posting an operating loss of $28 million in the same period last year. Net income was $117 million (€109 million). The apparel retailer ended the second quarter of last year with a loss of $49 million.
For the full first half of the year, consolidated revenue was $6.82 billion, down 7 percent from the same period last year. The bottom line was a net profit of $99 million after reporting a loss of $211 million in the first six months of last year.