NEW YORK (AP) — Gap Inc. on Monday raised its profit guidance for its recently concluded fiscal year based on its fourth-quarter sales and reduced taxes, despite a soft month of January.
The retailer said it expects to report net income of $2.86 to $2.87 per share for the year ended Jan. 31, up from its previous estimate of $2.73 to $2.78 per share. Analysts expected a profit of $2.74 per share on average, according to FactSet.
The San Francisco company said its total fourth-quarter sales grew 3 percent to $4.71 billion. Sales at locations open at least a year rose 2 percent in the quarter. Those sales are considered an important measurement of retailer performance because they exclude results from stores that opened or closed within the last year.
But the company said its net sales slipped 1 percent to $888 million in January, while sales at stores open at least a year fell 3 percent for the month.
Analysts expected a 1 percent January decrease in sales at stores open at least a year, according to Thomson Reuters.
Gap said its revenue fell in January as sales for its namesake brand slumped, but its Banana Republic and Old Navy brands reported improved results. An extension of tax benefits also underpinned its results.
The company said it expects to report a profit of 73 to 74 cents per share in the fourth quarter, while analysts had expected 68 cents per share on average.
Shares of Gap fell 30 cents to $40.80 in aftermarket trading. The stock has slipped 2.4 percent in 2015.