Bulletin: The Gap Inc.'s Fourth-Quarter Performance Results Were In Line With Expectations; No Ratings Impact

NEW YORK (Standard&Poor's) Feb. 27, 2015--Standard&Poor's Rating Services noted today that The Gap Inc. reported its 2014 fourth-quarter and annual earnings results, which were in line with our expectations. Overall, the recent earnings release has no impact on the ratings and the outlook. The company reported a 2% revenue growth in fiscal 2014, reflecting modest store expansions and flat same-store sales, as good performance from its Old Navy brand offset weaknesses from its Gap brand. We believe specialty apparel industry will remain relatively soft in 2015, given the heightened industry competition (especially from fast fashion and off-pricing retailers), sustained highly promotional environment in the U.S., and continuing cautious consumer spending on small-ticket purchases. However, we expect

...NEW YORK (Standard & Poor's) Feb. 27, 2015--Standard & Poor's Rating Services noted today that The Gap Inc. reported its 2014 fourth-quarter and annual earnings results, which were in line with our expectations. Overall, the recent earnings release has no impact on the ratings and the outlook. The company reported a 2% revenue growth in fiscal 2014, reflecting modest store expansions and flat same-store sales, as good performance from its Old Navy brand offset weaknesses from its Gap brand. We believe specialty apparel industry will remain relatively soft in 2015, given the heightened industry competition (especially from fast fashion and off-pricing retailers), sustained highly promotional environment in the U.S., and continuing cautious consumer spending on small-ticket purchases. However, we expect the company's continuing global expansion, ongoing enhancement on its omnichannel operation, key operating initiatives and new merchandise strategy led by its new management team, will partly...

Bulletin