18 slides from Gap, Inc. (the)'s earnings presentation, Mar 3, 2022
Slide 1: Gap Inc. Fiscal 2021 Fourth Quarter Earnings Results
Gap Inc. Fiscal 2021 Sonia Syngal CHIEF EXECUTIVE OFFICER Katrina O’Connell CHIEF FINANCIAL OFFICER FOURTH 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 lifestyle brands
We grow purpose-led, billion-dollar lifestyle brands
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 customer reach across every age, body and occasion thr
Slide 5: Financial Highlights
FY 2021 Financial Highlights • Fiscal 2021 sales reached $16.7B, growing 21% year-over-year and 2% versus 2019 • Expanded gross margin significantly through ROD leverage and higher product margins from AUR growth versus 2019 • Returned over $400M to shareholders through dividend program and share re
Slide 6: P&L Summary (Reported)
Q4 2021 P&L Summary (REPORTED) UNAUDITED Q4 Q4 Q4 2021 vs. Q4 Q4 2021 vs. ($ Millions) 2021 (1) 2020 (2) Q4 2020 2019 (3) Q4 2019 Net Sales $4,525 $4,424 +2% $4,674 (3%) Comparable Sales +3% +3% Gross Profit $1,523 $1,668 (9%) $1,674 (9%) % of Sales 33.7% 37.7% (400 bps) 35.8% (210 bps) Merchandise
Slide 7: P&L Summary (Adjusted)
Q4 2021 P&L Summary (ADJUSTED) UNAUDITED Q4 Q4 Q4 2021 vs. Q4 Q4 2021 vs. ($ Millions) 2021 2020 (2) Q4 2020 2019 (3) Q4 2019 Net Sales $4,525 $4,424 +2% $4,674 (3%) Comparable Sales +3% +3% Gross Profit $1,523 $1,668 (9%) $1,696 (1) (10%) % of Sales 33.7% 37.7% (400 bps) 36.3% (1) (260 bps) Merchan
Slide 8: Net Sales Growth
Q4 2021 Net Sales Growth vs. FY20 +2% (3%) +7% +22% +18% vs. FY19 (3%) +2% (13%) (11%) +52% vs. FY19 STORE CLOSURES/ STORE CLOSURES: STORE CLOSURES: ESTIMATED DIVESTITURES ~17 points ~10 points ~9 points IMPACT FROM: Note: Consistent with prior quarters in fiscal 2021, comparisons to the fourth quar
Slide 9: Comparable Sales
Q4 2021 Comparable Sales vs. FY20 +3% (6%) +10% +26% +12% vs. FY19 +3% (0%) +3% (2%) +42% NORTH AMERICA COMP VS. FY19: +12% Note: Consistent with prior quarters in fiscal 2021, comparisons to the fourth quarter of 2019 are also included.
Slide 10: P&L Summary (Reported)
FY 2021 P&L Summary (REPORTED) UNAUDITED FY FY FY 2021 vs. FY FY 2021 vs. ($ Millions) 2021 (1) 2020 FY 2020 2019 (2) FY 2019 Net Sales $16,670 $13,800 +21% $16,383 +2% Comparable Sales +6% +8% Gross Profit $6,637 $4,705 +41% $6,133 +8% % of Sales 39.8% 34.1% +570 bps 37.4% +240 bps Merchandise Marg
Slide 11: P&L Summary (Adjusted)
FY 2021 P&L Summary (ADJUSTED) UNAUDITED FY FY FY 2021 vs. FY FY 2021 vs. ($ Millions) 2021 2020 (2) FY 2020 2019 (3) FY 2019 Net Sales $16,670 $13,800 +21% $16,383 +2% Comparable Sales +6% +8% Adjusted Gross Profit $6,628 (1) $4,705 +41% $6,156 (1) +8% % of Sales 39.8% (1) 34.1% +570 bps 37.6% (1)
Slide 12: Net Sales Growth
FY 2021 Net Sales Growth vs. FY20 +21% +21% +20% +35% +27% vs. FY19 +2% +14% (12%) (18%) +48% vs. FY19 STORE CLOSURES/ STORE CLOSURES: STORE CLOSURES: ESTIMATED DIVESTITURES ~15 points ~10 points ~7 points IMPACT FROM: Note: Consistent with prior quarters in fiscal 2021, comparisons to fiscal 2019 a
Slide 13: Comparable Sales
FY 2021 Comparable Sales vs. FY20 +6% 0% +8% +24% +12% vs. FY19 +8% +12% +2% (9%) +39% NORTH AMERICA COMP VS. FY19: +12% Note: Consistent with prior quarters in fiscal 2021, comparisons to fiscal 2019 are also included.
Slide 14: We have Omni-Strength in North America
FY 2021 We have Omni-Strength in North America • Less than 20% of revenue generated from indoor malls • Over 90% of net sales generated in North America and partnering to amplify our reach internationally BRAND C HANNE L REGION ■ Old Navy 54% ■ U.S. 85% ■ Gap 24% ■ Online 39% ■ ■ Canada 8% ■ Banana
Slide 15: Rationalizing our North America Fleet
FY 2021 Rationalizing our North America Fleet • Completed over 70% of North America closures • On-track to close ~350 N.A. Gap and Banana Republic stores by end of FY23 NORTH AM ERIC A STORE C OUNT Banana Republic Gap 121 6 966 ~866 2019 2021 2023E
Slide 16: Improving Value by Turning Customers into Lifetime Loyalists
Q4 2021 Improving Value by Turning Customers into Lifetime Loyalists Spend 2X more annually 50+ 3X more likely to shop across MILLION channels members of our integrated loyalty program (1) 2X more likely to shop multiple brands (1) Includes credit card holders.
Slide 17: Commitment to Environmental, Social & Governance Performance
Q4 2021 Commitment to Environmental, Social & Governance Performance ENVIRONMENT SOCIAL GOVERNANCE 1.5M 10K+ 5 of 12 people have improved jobs provided to the next Directors access to drinking water generation of leaders through are women through USAID and Gap Inc. This Way ONward; more than Women +
Slide 18: Fiscal 2022 Outlook
Q4 2021 Fiscal 2022 Outlook AS OF MARCH 3, 2022 Reported Diluted Earnings per Share $1.95 to $2.15 Adjusted Diluted Earnings per Share (1) $1.85 to $2.05 Net Sales Growth Low single digits Reported Operating Margin 6.3% to 6.8% Adjusted Operating Margin (1) 6.0% to 6.5% Net Interest Expense About $7