On a GAAP basis second-quarter EPS totaled $0.75 which includes a one-time benefit from the sale of a building. Currency exchange rates had a negative impact of about 4% on earnings per share.
Same-store sales were flat in the second quarter, compared with a rise of 5% in the same period a year ago. By global division, Gap same-store sales were down 5% compared with a gain of 6% in the second quarter a year ago; Banana Republic same-store sales were flat compared with a drop of 1% a year ago; and Old Navy comparable-store sales rose 4% on top of a 6% rise a year ago.
Online sales rose 11% from $466 million in the year-ago quarter to $515 million.
At the end of last fiscal year, Gap forecast fiscal year 2014 EPS at $2.90 to $2.95, including a negative impact of 5% due to currency translation. The company raised that estimate by $0.05 at each end to account for the one-time gain of $0.05 per share in the second quarter from the building sale.
This earnings report was solid and won’t have much impact on the stock’s price one way or another. It was slightly better than expected, the outlook for the year has not changed, and the company is basically expecting more of the same. The CEO said, “We remain focused on our strategic initiatives, as we turn our focus toward delivering a strong second half.”
Shares are trading up about 0.3% in the after-hours market at $43.50 in a 52-week range of $36.13 to $44.59. The consensus target price for the shares was $44.80 before today’s report.
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