Irish arm of fashion retailer Gap slips into the red
Gap improved sales but 10% increase in the cost of sales led the company to a loss-making position
Gap’s newest store in Limerick
Gap’s Irish arm fell into a loss of €308,156 in the same year it opened a new outlet in Limerick.
Recently filed accounts for Gap Stores (Ireland) Limited show the clothes retailer’s profit before tax dropped from a €24,099 profit into a loss. Sales, however, increased almost 13 per cent to €12.7 million as a result of the opening of the Limerick outlet which adds to the company’s four other locations in the Republic. A 10 per cent increase in the cost of sales led the company to a loss-making position in the financial year ended on February 3rd, 2018.
Gap employed 109 people across the 12-month period, with wage and salary costs exceeding €1.6 million.
The Irish arm’s parent company, the US-based Gap Inc, said towards the end of November that it was considering closing hundreds of stores as sales at the brand slid. At that time the retailer said it had 775 Gap branded outlets globally. It also sells the Old Navy and Banana Republic brand of clothes.
“We are clearly not satisfied with the performance of Gap brand. We know this iconic brand is important to customers, and we are committed to taking the bold and necessary steps to ensure that it delivers value to shareholders,” Gap’s president and chief executive Art Peck, said on November 20th.
However, the directors of the Irish arm appeared less concerned, saying that “opportunities will continue to be sought to improve profitability and market share in the Irish casual apparel market”.
“The company will continue to improve its core business by creating the right product and store experience, retaining and developing the best talent in the industry, and examining the organisational structure to ensure that it effectively supports the business and meets customer needs.”