Gap to shut shops and hive off Old Navy

02 March, 2019, 10:01 | Author: Mary Valdez
  • Gap Is Spinning Off the Stronger Old Navy Brand Into Its Own CompanyMore

Gap Inc. will separate Old Navy into its own publicly-traded company and create a new, now unnamed firm to house the remaining brands in its portfolio, including Gap and Banana Republic.

Gap announced yesterday it will break into two companies.

Old Navy has been the only bright spot for the company in the past few years, cushioning it from the weak performance of its namesake Gap and Banana Republic brands, where sales have also taken a hit from fewer additions of new designs.

The moves, which followed a comprehensive board review, came with Old Navy thriving and Gap and Banana Republic struggling.

Gap plans to restructure its brand speciality fleet and revitalize brand health, and that includes the closure of approximately 230 Gap specialty stores over the next two years.

Gap's shares were up more than 20 percent on the news in after-hours trading Thursday.

Art Peck, president and chief executive of Gap Inc, said: "Combined with the separation we announced today, we will be well positioned to leverage the power of our brands and the talented teams that lead them to accelerate the pace of change, improve execution and deliver profitable growth".

Canada begins process of extraditing Huawei exec to US
Nonetheless, he ordered Diab to be handed over, saying Canada's extradition law left him no choice. Ms Meng and Huawei face United States charges of conspiring to violate USA sanctions on Iran.

Michael Jackson Documentary From BBC Set For Late 2019
The Michael Jackson estate has vehemently denied the shocking accusations against the late star made in HBO film Leaving Neverland .

OnePlus, Qualcomm to start 5G trials in India
And it must be popular with consumers, including OnePlus device buyers, if it keeps coming up every time a new phone launches. At Mobile World Congress 2019 , it seems every company is releasing either a foldable phone or a 5G phone (or both).

Old Navy has been the strongest brand for the parent company, accounting for almost half of annual revenues.

Getting out from under the sinking ship that is Gap (GPS) is good news for Old Navy. It will have annual revenue of about US$9 billion, compared to Old Navy's US$8 billion, the company said.

Ironically, lack of same-store sales growth at Old Navy hurt fourth-quarter overall sales. Old Navy would have been too valuable for Gap to simply sell off.

"Recognizing that, we determined that pursuing a separation is the most compelling path forward for our brands - creating two separate companies with distinct financial profiles, tailored operating priorities and unique capital allocation strategies, both well positioned to achieve their strategic goals and create significant value for our customers, employees and shareholders". Old Navy posted sales that were unchanged from a year ago.

He sees the split allowing Gap to focus on strengthening its core brand.

"In no way shape or form I'll just say it again do I view Old Navy as sick in any way shape or form".

Plus, closing 230 stores signals that Gap "must have seen that there was too much waste in its business model".

Recommended:



Popular

Number Of Confirmed Measles Cases Rises Again In Rockland
Measles is a highly contagious disease and can cause pneumonia , encephalitis (swelling of the brain), and death. Cases of measles are surging to alarmingly high levels around the globe, a new report from UNICEF warns.

Colorado Rockies extend Nolan Arenado
Monday, the Rockies announced they had extended manager Bud Black's contract by three years, keeping him in Colorado until 2022. Ben Maller thinks this is a much bigger win for Arenado and all other free agents than it is for the Rockies .

Game Of Thrones Final Season Posters: Who's Taking The Iron Throne?
In a joint interview with Glamour magazine , Turner said: "People always think Maisie and I are a couple". Season 8, the conclusion of Game of Thrones , is nearly here.

YouTube suspends comments on videos with minors
It comes after persistent reports of paedophile comments being openly left within comments sections of videos featuring children. The NZ Transport Agency and Inland Revenue also pulled ads from YouTube today, the latter in response to questions from 1 News.

Trump rule cuts reproductive healthcare funds for Title X clinics
The Trump administration intends to limit the Title X program that provides birth control and other reproductive health services. But there is no question, she said, that "the underlying scope of [the Title X program] has changed" since 1991.

China haggle over hardest points in commerce warfare talks
The Shanghai Composite Index of Chinese equities plunged 25 percent past year , recouping about 12 percent in 2019. Fed Chairman Jerome Powell will testify on US monetary policy on Tuesday and Wednesday.

Emilia Clarke says 'Game of Thones' end will shock viewers
Stay tuned for plenty more coverage of " Game of Thrones " leading into the final season debuting in April. You've got to believe that they'll be pushed out prior to the show's April 14 release date, though.

Kyler Murray Measures At 5 Feet, 10⅛ Inches, 207 Lbs
Hand size: 9 1/2 inches. "The underclassmen number has grown incrementally on a yearly basis it seems", he said. Murray is often compared to Wilson because of the size and the background in baseball.

Ferrari F8 Tributo is an homage to the mighty V8
Ferrari has redesigned the S-Duct that we first saw on the 488 Pista to improve downforce 15 percent compared to the 488 GTB . Furthermore, the steering wheel rim is smaller to "enhance the level of tactility and make the auto feel even more agile".

Don’t place party before country, Congress asks Narendra Modi
New Delhi accuses Islamabad of using armed groups as proxies to drive unrest in Kashmir and carry out "terror" attacks in India. Several other senior officials also attended the meeting held at the prime minister's residence in Delhi.