14 slides from Gap, Inc. (the)'s earnings presentation, May 27, 2021
Slide 1: Gap Inc. Fiscal 2021 First Quarter Earnings Results
Gap Inc. Fiscal 2021 Sonia Syngal CHIEF EXECUTIVE OFFICER Katrina O’Connell CHIEF FINANCIAL OFFICER FIRST QUARTER EARNINGS RESULTS
Slide 2: Forward Looking Statements / Non-GAAP Financial Measures
Forward Looking Statements / Non-GAAP Financial Measures FORWARD LOOKING STATEMENTS This conference call and webcast contain forward-looking statements within the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. All statements other than those that are purely histori
Slide 3: We grow purpose-led, billion-dollar brands that shape people’s way of life
We grow purpose-led, billion-dollar brands that shape people’s way of life.
Slide 4: Power Plan 2023
Power Plan 2023 Power of our Brands Grow purpose-led, billion-dollar lifestyle brands Power of our Platform Leverage our omni capabilities and scaled operations and extend our engineered approach to cost and growth Power of our Portfolio Extend our customer reach across every age, body and occasion
Slide 5: Financial Highlights
Q1 2021 Financial Highlights • Net sales up 89% versus 2020 and up 8% versus 2019 • Net sales growth in the quarter reflects a negative 7 percentage point impact from COVID-related and strategic store closures • Online sales grew 61% versus 2020 and 82% versus 2019 • Comparable sales up 28% versus 2
Slide 6: P&L Summary
Q1 2021 P&L Summary REPORTED Q1 Q1 Q1 2021 vs. Q1 Q1 2021 vs. ($ Millions) 2021 2020 Q1 2020 2019 (1) Q1 2019 Net Sales $3,991 $2,107 +89% $3,706 +8% Gross Profit $1,630 $268 +508% $1,344 +21% % of Sales 40.8% 12.7% +2810 bps 36.3% +450 bps Merchandise Margin B/(W) LY +1390 bps (1370 bps) (120 bps)
Slide 7: P&L Summary (Adjusted)
Q1 2021 P&L Summary ADJUSTED Q1 Q1 Q1 2021 vs. Q1 Q1 2021 vs. ($ Millions) 2021 2020 Q1 2020 2019 (2) Q1 2019 Net Sales $3,991 $2,107 +89% $3,706 +8% Gross Profit $1,630 $268 +508% $1,344 +21% % of Sales 40.8% 12.7% +2810 bps 36.3% +450 bps Merchandise Margin B/(W) LY +1390 bps (1370 bps) (120 bps)
Slide 8: Net Sales Growth
Q1 2021 Net Sales Growth vs. FY20 +89% +120% +69% +35% +69% vs. FY19 +8% +27% (16%) (29%) +56% Note: Due to the significant impact of COVID-related store closures last year, comparisons for the first quarter of 2019 are also included.
Slide 9: Comparable Sales
Q1 2021 Comparable Sales vs. FY20 +28% +35% +29% (4%) +27% vs. FY19 +13% +25% (1%) (22%) +46% North America Comp vs. FY19 +9% Note: Due to the significant impact of COVID-related store closures last year, comparisons for the first quarter of 2019 are also included.
Slide 10: Revenue Breakdown
Q1 2021 Revenue Breakdown • Higher-margin Old Navy and Athleta are 66% of company sales and on a path to 70% by 2023 • Highly-attractive online, strip, and street locations are ~80% of company sales BRAND C HANNE L REGION ■ Old Navy 57% ■ Online 40% ■ U.S. 86% ■ Gap 22% ■ Strip 34% (1) ■ Canada 7% ■
Slide 11: Rationalizing Our Store Fleet
Q1 2021 Rationalizing Our Store Fleet • On-track to close 350 N.A. Gap and Banana Republic stores by end of FY23 • ~75% of North America closures complete by end of FY21 NORTH AMERICA STORE COUNT Banana Republic Gap 121 6 ~947 ~866 2019 2021E 2023E
Slide 12: We have omni-strength in North America and are partnering to amplify our reach
We have omni-strength in North America and are partnering to amplify our reach. 62 >60% 5.4 MILLION INCREASE MILLION active customers in new online customers enrolled into globally as of the customers acquired our multi-tender loyalty end of Q1 2021(1) vs. last year (2) program in Q1 2021 (1) Refers
Slide 13: Commitment to Environmental, Social & Governance Performance
Commitment to Environmental, Social & Governance Performance ENVIRONMENTAL SOCIAL GOVERNANCE 11.2B Ranked 100% 6 of 13 liters of water in HRC’s Corporate Directors saved in manufacturing Equality Index are women since 2017 for the 15th year in a row 65% 92% Annual Global diversion rate of of supplie
Slide 14: Fiscal 2021 Outlook
Q1 2021 Fiscal 2021 Outlook AS OF MARCH 4, 2021 AS OF MAY 27, 2021 Reported Diluted Earnings per Share $1.20 - $1.35 $1.55 - $1.70 Adjusted Diluted Earnings per Share (1) -- $1.60 - $1.75 Net Sales Growth (2) Mid to high-teens Low-to-mid twenties Operating Margin About 5% About 6% Net Interest Expen