US clothing giant Gap posts better than expected second quarter results

Gap, the largest US clothing retailer, posted second-quarter profit that topped analysts' estimates as bargain-hunting shoppers snapped up discounted clothing at its Old Navy chain.

Net income rose 9.6 per cent to $332 million, or 75 cents a share, from $303 million, or 64 cents, year earlier, the San Francisco-based company said in a statement yesterday.

Excluding a gain from an asset sale, profit was 70 cents a share. Analysts had estimated 69 cents, on average.

Net sales rose 2.9 per cent to $3.98 billion in the period, which ended on August 2nd.

Chief executive Glenn Murphy is working to maintain sales growth as the choppy economic recovery restrains shoppers' appetites for new fashions.

The chain’s lower-priced Old Navy brand led the company’s sales gains for the second straight quarter.

Company-wide same-store sales were little changed in the second quarter, compared to a 5 per cent increase last year.

Bloomberg