Gap, Inc. (the) · NYSE:GAP
Gap, Inc. (the) — Q4 2019 Earnings Presentation
12 slides from Gap, Inc. (the)'s earnings presentation, Mar 12, 2020
Slide 1: Gap Inc. Fiscal 2019 Fourth Quarter Earnings Results
GAP INC. FISCAL 2019 FOURTH QUARTER EARNINGS RESULTS Robert J. Fisher Teri List-Stoll INTERIM PRESIDENT EXECUTIVE VICE PRESIDENT & CHIEF EXECUTIVE OFFICER & CHIEF FINANCIAL OFFICER Sonia Syngal INCOMING PRESIDENT & CHIEF EXECUTIVE OFFICER
Slide 2: Disclosure Statement
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: Q4 Reported P&L Summary
Q4 REPORTED P&L SUMMARY IN MILLIONS Q4 2019 Q4 Q4 vs. 2019 2018 Q4 2018 Net Sales $4,674 $4,623 +1% Comp (1%) (1%) Gross Profit $1,674 $1,645 +2% % 35.8% 35.6% +20bps Merchandise Margin B/(W) LY +20bps (60bps) ROD % of Sales B/(W) LY +0bps (60bps) Operating Expenses $1,919 $1,273 +51% % 41.1% 27.5%
Slide 4: Q4 Adjusted P&L Summary
Q4 ADJUSTED P&L SUMMARY IN MILLIONS Q4 2019 Q4 Q4 vs. 2019 2018 Q4 2018 Net Sales $4,674 $4,623 +1% Comp (1%) (1%) Adjusted Gross Profit $1,696(1) $1,645 +3% % 36.3%(1) 35.6% +70bps Adj. Merchandise Margin B/(W) LY +30bps(1) (60bps) Adj. ROD % of Sales B/(W) LY +40bps(1) (60bps) Adjusted Operating E
Slide 5: FY 2019 Reported P&L Summary
FY 2019 REPORTED P&L SUMMARY IN MILLIONS FY 2019 FY FY vs. 2019 2018 FY 2018 Net Sales $16,383 $16,580 (1%) Comp (3%) 0% Gross Profit $6,133 $6,322 (3%) % 37.4% 38.1% (70bps) Merchandise Margin B/(W) LY (60bps) (60bps) ROD % of Sales B/(W) LY (10bps) +50bps Operating Expenses $5,559 $4,960 +12% % 33
Slide 6: FY 2019 Adjusted P&L Summary
FY 2019 ADJUSTED P&L SUMMARY IN MILLIONS FY 2019 FY FY vs. 2019 2018 FY 2018 Net Sales $16,383 $16,580 (1%) Comp (3%) 0% Adjusted Gross Profit $6,156(1) $6,322 (3%) % 37.6%(1) 38.1% (50bps) Adj. Merchandise Margin B/(W) LY (50bps)(1) (60bps) Adj. ROD % of Sales B/(W) LY +0bps(1) +50bps Adjusted Oper
Slide 7: 4Q 2019 & FY 2019 Net Sales and Comparable Sales
7 FY 2019 4Q 2019 & COMPARABLESALES NET SALES (1) Includesnetfor the salesnot Janie includedoes Jack for brand.Janie and BananaRepublicsalesJack. (2)Comp and Comp Sales Comp Sales Net Sales Net Sales $16.4 bn. bn. $16.4 $4.7 bn. bn. $4.7 (1%) (3%) Comp Sales Comp Sales Net Sales Net Sales $2.3 bn. b
Slide 8: Q4 Adjusted Operating Margin Bridge Contribution by Brand
Q4 ADJUSTED OPERATING MARGIN BRIDGE CONTRIBUTION BY BRAND ~(20 BPS) ~(50 BPS) 8.0% ~(50 BPS) ~(0 BPS) ~(90 BPS) 5.9% (1) (2) (1) (3) Q4 2018 Old Navy Banana Republic Gap Athleta Other Q4 2019 Adjusted Operating Margin Operating Margin (1) Includes Franchise. (2) Includes Franchise and Janie & Jack.
Slide 9: Adjusted Operating Margin Bridge Contribution by Brand
ADJUSTED OPERATING MARGIN BRIDGE CONTRIBUTION BY BRAND ~(130 BPS) 8.2% ~(40 BPS) ~10 BPS ~0 BPS ~(20 BPS) 6.4% (1) (2) (1) (3) 2018 Operating Old Navy Banana Republic Gap Athleta Other 2019 Adjusted Margin Operating Margin (1) Includes Franchise. (2) Includes Franchise and Janie & Jack. (3) Includes
Slide 10: Returning Capital to Shareholders
8% DIVIDEND HISTORY RETURNING Dividend Yield Indicated Annual Dividend ($) CAPITAL TO 6% SHAREHOLDERS 4% 0.97 0.97 0.92 0.92 0.92 2% 0.88 • $564M of cash distributed % Jan-15 Jan-16 Jan-17 Jan-18 Jan-19 Jan-20 to shareholders in 2019 (1) • 8.8% dividend yield SHARES REPURCHASED (MM) 30 • 10% CAGR in
Slide 11: Fiscal 2020 Outlook
FISCAL 2020 OUTLOOK AS OF MARCH 12, 2020 Reported Diluted Earnings per Share $1.23 - $1.35 Adjusted Diluted Earnings per Share $1.80 - $1.92 (1) Comp Sales Down low-single digits Net Sales Down low-single digits Net Company-Operated Store Closures About 90 Capital Expenditures About $600 million(2)
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