As part of this restructuring, Old Navy will close stores in Japan and focus on growth in North America and China. The brand saw a 6 percent global same-store sales decline in the quarter. Gap emphasized that Japan remains an important market for the company's portfolio and that 200 Gap and Banana Republic stores will remain in the country.
The retailer also said it would be shut some Banana Republic locations, bringing the total expected store closure count to 75 by the end of fiscal 2016. For the first quarter, Banana Republic global saw an 11 percent decline in comparable-store sales.
"By taking every opportunity to exploit our strategic advantages, our brands will be able to more fully harness the power of the enterprise to better serve their customers across channels and geographies," Art Peck, CEO of Gap, said in a statement.
Gap also said that it will not reaffirm its earnings outlook for the current fiscal year, but noted that the current "First Call consensus earnings per share estimate of $1.92 falls within a reasonable range of potential outcomes, excluding restructuring impacts from its store closure and streamlining measures."
The company, however, added that "trends in the apparel retail environment would need to improve from the first quarter of fiscal year 2016 in order to achieve this estimate."
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