Gap reported a 12.5% decline in fourth-quarter profit, with its results impacted by heavy discounting during the holidays. The retailer also issued a profit outlook for the full year that is below analysts' expectations, and said it will open 30 additional U.S. stores during fiscal year 2014.
Gap reported net income of $307 million for the three-month period ended Feb. 1, better than the Street expected, down from $351 million in the year-ago period.
Revenue totaled $4.58 billion, down from $4.73 billion. The company noted that fiscal year 2013 had 52 weeks compared with 53 weeks in fiscal year 2012. Same-store sales were up 1%.
Net income for the 52 weeks ended February 1, 2014 was $1.28 billion, compared with net income of $1.14 billion for the year-ago period.
“We are pleased to deliver another year of profitable growth for our shareholders,” said Glenn Murphy, chairman and CEO of Gap Inc. “Engaging customers across our multi-channel portfolio of brands positions us well on our path to winning in the global marketplace.”
Net sales increased $497 million to $16.15 billion for the 2013 fiscal year compared with net sales of $15.65 billion for the 2012 fiscal year. Same-store sales were up 2%.
In fiscal year 2014, the company expects to open about 185 company-operated stores, with a focus on China, Old Navy Japan, Athleta and global outlet stores. The company expects that it will close about 70 company-operated stores, net of repositions.