Gap To Close More Stores Than Planned

Retailer Gap stated it plans to close about 150 stores this year, 15 more than previously planned, and open about 125. Store openings will focus on Gap's US Old Navy chain, with closures to include more of the core Gap stores.

At the start of this month, Swedish retailer H&M formerly took possession of the 10 former Gap stores in Germany, in a deal agreed earlier this year. Sales in the Gap International business continue to be a problem, with a 10 per cent decline across the quarter to the end of July. The company currently has 3,095 stores in total.

In the US, Gap said its summer clearance sales generated weaker than expected interest from consumers. The retailer is currently featuring Sex and the City actress Sarah Jessica Parker in a high-profile ad campaign.

Gap chief financial officer Byron Pollitt stated: "Following a strong start in May, business in June and July was challenging with traffic trends softening and monthly results disappointing. Our strategic decision to reduce overall promotional and markdown activity partially contributed to the deterioration of traffic during the quarter."