Gap boosts 2013 dividend; fourth-quarter tops Street
(Reuters) - Gap Inc's (GPS.N) fourth-quarter profit beat estimates, helped by higher comparable store sales in North America and the apparel retailer raised its dividend for this year by 20 percent to 60 cents.
The company's shares rose 2 percent in extended trading.
The company, which owns the Gap, Old Navy and Banana Republic brands, forecast a full-year profit largely below analysts' estimates, hurt by a weak Japanese yen.
Gap expects a per-share profit of between $2.52 and $2.60 for the year, compared to the average $2.59 per share analysts were looking for according to Thomson Reuters I/B/E/S.
After years of being accused of selling boring clothes, Gap has regained an edge in fashion, following a prolonged turnaround that included a change in its top management.
Operating margin is expected to grow to about 13 percent in 2013 from about 12 percent last year, Chief Executive Glenn Murphy said on a conference call.
QUARTER BEATS STREET
Gap, the third biggest clothes retailer in the world, posted net income of $351 million, or 73 cents per share, for the quarter ended February 2, compared with $218 million, or 44 cents per share, in the same quarter last year.
Gross margin for the quarter rose 4.8 percentage points to 37.6 percent.
Analysts on average had expected a profit of 71 cents per share.
Sales rose 10.5 percent to $4.73 billion, while same-store sales were up 5 percent.
During the fourth-quarter, sales at established North American stores rose 4 percent for its namesake brand and 3 percent for Banana Republic brand. Sales at Old Navy stores rose 8 percent, the company said.
Shares of the company, which have risen more than 40 percent in one year, closed at $32.92 on Thursday on the New York Stock Exchange.
(Reporting by Aditi Shrivastava and Phil Wahba; Editing by Sreejiraj Eluvangal)