Baby boom division won’t go forth

Beleaguered Gap Inc. is riveting its attention on its largest chains as it prepares to shutter its Forth & Towne stores, a division launched just 18 months ago to attract baby boomers.

The San Francisco-based parent of about 3,100 Gap, Old Navy and Banana Republic stores said Monday that the new chain wasn’t “demonstrating enough potential to deliver an acceptable long-term return on investment.” Forth & Towne operates 19 stores nationwide, including four in the Southland.

“Given the company’s financial performance, we are putting our focus and our resources on restoring our overall business momentum,” spokesman Greg Rossiter said.

The news disappointed Jennifer Geller, a Westlake Village resident who recently bought four tops at Forth & Towne. “It’s really a shame,” said the accountant, who’s fed up with stores where everything “looks like a size 0.”

“Everything is geared for tiny little girls now,” said Geller, 46. “If you’re older, you want something cute, you don’t want something matronly. But it’s hard to find stores now.”

The demise of Forth & Towne is just one of many changes underway at Gap, which has been mired in a slump. Sales at stores open a year or more either have been flat or have fallen in 30 of the last 32 months

The retailer ousted Chief Executive Paul Presser in January. While it searches for a new leader, Chairman Bob Fisher is serving as interim CEO. In a statement on Monday, Fisher called Forth & Towne “a great test of a promising concept and an illustration of the innovative risks you need to take in our business.” However, he said Gap “made the tough decision to close the brand and focus our efforts on stabilizing the existing businesses.”

And not a moment too soon, as far as analysts are concerned. “I think this is a very positive development for Gap,” said Todd Slater, an analyst with Lazard Capital Markets who called Forth & Towne “a distraction.” “I think it shows an ability to grasp reality, to refocus the company’s sights.”

The Fisher family, who founded the company and own the largest chunk of Gap’s shares, are “sending a signal that there are no sacred cows,” Slater added.

Some analysts wish Gap would be more aggressive about righting itself. Slater and analyst Christine Chen, with Needham & Co., believe the retailer could benefit from closing more Gap stores. “I think the quick fix for Gap is to close several hundred stores and to attract top-tier retail talent,” Slater said.

The company should do what it needs to “move the needle,” said Chen, who owns Gap shares. Gap stock dropped 16 cents to $19.65.

The Forth & Towne stores are expected to close by the end of June. Southern California stores are at Westfield Century City in Los Angeles, the Oaks shopping center in Thousand Oaks, Westfield Topanga in Canoga Park and Otay Ranch Town Center in Chula Vista.

In all, the closures will affect about 550 employees and incur a pretax expense of about $40 million that primarily will be recognized over the first and second quarters of this year, said the retailer, which releases its fourth-quarter earnings Wednesday. Gap said it would try to redeploy employees to its other stores.

Analyst Slater said in a note to clients Monday that Forth & Towne never gained much traction and “suffered from fit, style and image problems.”

Geller would disagree. And now she’s looking at the upside. “I’m thinking I should go back this weekend,” she said. “Maybe they’ll be having a sale.”

leslie.earnest@latimes.com