Gap to Open in Thailand

Announces June sales declines
Posted July 9, 2009

Gap Inc. (San Francisco) is partnering with Armin Systems Limited to bring Gap stores to Thailand, with the first locations expected to open in spring 2010. The stores will sell clothing for adults, kids and babies.

“We’re pleased to expand in Southeast Asia with such a well-respected partner,” says Ron Young, Gap Inc.’s senior vp, international strategic alliances. “Armin Systems Limited is an experienced retailer in Thailand with a deep understanding of the marketplace.”

Together with its franchise partners, Gap Inc. has opened 100 Gap and 34 Banana Republic franchise stores in 17 countries, including Bahrain, Greece, Indonesia, Jordan, Korea, Kuwait, Oman, Qatar, Malaysia, Mexico, Romania, Russia, Saudi Arabia, Philippines, Singapore, Turkey and the United Arab Emirates. The retailer also has plans to open Gap and Banana Republic franchise stores in Bulgaria, Croatia, Cyprus, Romania, Egypt and Israel.

This week, Gap announced net sales of $1.29 billion for the five-week period ended July 4, 2009, a 9 percent decrease compared with the same period last year. Comparable store sales for June 2009 dropped 10 percent compared with a 7 percent decrease in June 2008.

By brand, same-store sales declined 10 percent at Gap North America; 20 percent at Banana Republic North America; 7 percent at Old Navy North America; and five percent International. “June was a transitional month as all of our brands made progress clearing through summer merchandise,” says Sabrina Simmons, chief financial officer of Gap Inc. “We’re pleased that our total company merchandise margins were above last year.”

Year-to-date net sales were $5.45 billion, while the company’s year-to-date same-store sales declined 8 percent.