Gap, Nordstrom Post 1st-Quarter Profits
Gap Inc. said Thursday that its first-quarter earnings rose 16%, boosted by sales at new stores, but Kmart Corp. and Lands’ End Inc.’s profit fell, as cool and rainy weather last month damped demand for spring dresses and other clothes.
Two other retailers, upscale department store chain Nordstrom Inc. and Victoria’s Secret parent Intimate Brands Inc., reported profit gains after the close of trading on the New York Stock Exchange.
* Net income at San Francisco-based Gap, the largest U.S. retailer, rose to $235.5 million, or 27 cents a share, in the quarter ended April 29. Sales rose 20% to $2.73 billion. The company warned last week that first-quarter profit would be 1 cent to 2 cents below the 28-cent average estimate of analysts polled by First Call because of lower-than-expected April sales.
Same-store sales--sales at stores open at least a year--fell at U.S. Gap stores and at the Old Navy chain, which has been the company’s fastest-growing brand in recent years. Sales rose at Gap stores in Japan, Britain and other countries, and at the upscale Banana Republic chain.
* Kmart, based in Troy, Mich., said net income in the period ended April 26 fell to $22 million, or 5 cents a share, from $56 million, or 11 cents, a year earlier. A decline in same-store sales in March and April meant the company, which recently spent $1.1 billion to renovate its stores, couldn’t offset increases in operating expenses. Total sales rose 1.4% to $8.2 billion.
* Lands’ End’s net income in the quarter ended April 28 fell to $292,000, or a penny a share, from profit from operations of $5.7 million, or 18 cents, a year ago. The Dodgeville, Wis.-based company was expected to earn 16 cents. Excluding last year’s sales from the discontinued Willis & Geiger catalog, sales fell 4.6%.
* Seattle-based Nordstrom, which was hurt last year when it missed popular women’s fashion trends, said profit rose 4% to $32.8 million, or 25 cents a share. The results matched the average estimate of analysts. Same-store sales rose 5.3%.
* Intimate Brands, the biggest U.S. retailer of lingerie and bath products, said net income rose 29% to $67.9 million, or 27 cents a share. That topped the average 26-cent estimate in a First Call survey of analysts. Same-store sales rose 11%.
