US clothing giant Gap posts better than expected second quarter results

Gains are attributed to lower-price Old Navy sales as share price rises to 75 cent

The US clothing retailer has reported better than expected results for the second quarter. Photograph: Bloomberg

Gap, the largest US clothing retailer, posted second-quarter profit that topped analysts' estimates as bargain-hunting shoppers snapped up discounted clothing at its Old Navy chain.

Net income rose 9.6 per cent to $332 million, or 75 cents a share, from $303 million, or 64 cents, year earlier, the San Francisco-based company said in a statement yesterday.

Excluding a gain from an asset sale, profit was 70 cents a share. Analysts had estimated 69 cents, on average.

Net sales rose 2.9 per cent to $3.98 billion in the period, which ended on August 2nd.

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Chief executive Glenn Murphy is working to maintain sales growth as the choppy economic recovery restrains shoppers' appetites for new fashions.

The chain’s lower-priced Old Navy brand led the company’s sales gains for the second straight quarter.

Company-wide same-store sales were little changed in the second quarter, compared to a 5 per cent increase last year.

Bloomberg