Gap, Inc. (the) · NYSE:GAP
Gap, Inc. (the) — Q1 2018 Earnings Presentation
10 slides from Gap, Inc. (the)'s earnings presentation, May 24, 2018
Slide 1: Gap Inc. Fiscal 2018 First Quarter Earnings Results
GAP INC. FISCAL 2018 FIRST QUARTER EARNINGS RESULTS ART PECK PRESIDENT & CHIEF EXECUTIVE OFFICER TERI LIST-STOLL EXECUTIVE VICE PRESIDENT & CHIEF FINANCIAL OFFICER
Slide 2: Disclosure Statement: Forward Looking Statements
DISCLOSURE STATEMENT 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 historical are forward-looking statements.
Slide 3: Q1 2018 Highlights: Gap Inc. Comp Sales
Q1 2018 HIGHLIGHTS: GAP INC. COMP SALES 7% 1 Year Comps 2 Year Comps 7% 5% 5% 3% 3% 3% 2% 2% 1% 1% 1% 0% -1% -2% -3% -4% -5% -6% Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 6 consecutive quarters of positive comparable sales 3
Slide 4: Q1 2018 Highlights: U.S. Stores Traffic Trends
Q1 2018 HIGHLIGHTS: U.S. STORES TRAFFIC TRENDS Q2’17 Q3’17 Q4’17 Q1’18 + + + _ : Beat to industry traffic : Miss to industry traffic + : Positive traffic 4
Slide 5: Q1 2018 Highlights: Online Sales Growth
Q1 2018 HIGHLIGHTS: ONLINE SALES GROWTH Gap Inc. Online Sales Growth Rate 30% 15% 0% Q1 2016 Q1 2018 Continued strength in online sales Note: Online sales includes both sales through our online channels as well as ship-from-store sales. Table above includes impacts from 53rd week in Q4’17, calendar
Slide 6: Q1 P&L Summary
Q1 P&L SUMMARY IN MILLIONS Q1 2018 Without Q1 2018 Without Q1 2018 Q1 2017 Adoption of ASC 606 Adoption of ASC 606 vs. Q1 2017 NET SALES $3,783 $3,642 $3,440 +6% COMP 1% 1% 2% GROSS PROFIT $1,427 $1,336 $1,303 +3% % 37.7% 36.7% 37.9% (120bps) MERCHANDISE MARGIN B/(W) LY (140bps) (180bps) +220bps ROD
Slide 7: ASC Adoption Impact on Q1 2018
ASC 606 ADOPTION IMPACT ON Q1 2018 IN MILLIONS 13 WEEKS ENDED MAY 5, 2018 BALANCES WITHOUT AS REPORTED ADJUSTMENTS ADOPTION of ASC 606 NET SALES $3,783 $(141) $3,642 COST OF GOODS SOLD AND OCCUPANCY EXPENSES 2,356 (50) 2,306 GROSS PROFIT 1,427 (91) 1,336 OPERATING EXPENSES 1,198 (92) 1,106 OPERATING
Slide 8: Q1 2018: Additional Metrics
Q1 2018: ADDITIONAL METRICS $1.4 billion $138 million Q1 2018 ending Q1 2018 capital cash, cash expenditures equivalents, and short-term investments $194 million +4% Q1 2018 Year-over-year distributions to inventory shareholders growth at the through share end of Q1 2018 repurchases and dividends
Slide 9: Fiscal 2018 Outlook as of May 24, 2018
FISCAL 2018 OUTLOOK AS OF MAY 24, 2018 Full Fiscal Year 2018 Reported Diluted Earnings per Share $2.55 - $2.70 Comp Sales Flat to up slightly Net Company-Operated Store Openings About 25 Capital Expenditures About $800 million Effective Tax Rate About 26% Share Repurchases About $400 million 9
Slide 10: Banana Republic
BANANA REPUBLIC aip @ATHLETA