Specialty retailer Gap Inc. (GPS) Thursday posted flat comparable-store sales for the month of November, while another player Ross Stores Inc. (ROST) reported 8% growth in comparable store sales for the same month. Net sales increased 2% for the global specialty retailer GAP and 12% for off-price retail chain Ross Stores.
The Consumer Price Index for All Urban Consumers decreased 0.2% in October before seasonal adjustment, the Bureau of Labor Statistics of the U.S. Department of Labor reported. On a seasonally adjusted basis, consumer price index rose 0.3% in October. The index for all items, less food and energy, rose 0.5% in October, while sales at apparel stores declined 4%. U.S. gasoline prices averaged $2.629 per gallon during the week ended November 30, higher than the previous year.
Gap said comparable store sales for the month were flat compared to a decline of 10% in the prior-year period. Comparable store sales at Gap North America dropped 4%, versus an 11% decline a year earlier. Banana Republic North America reported a 4% drop in November same-store sales, compared to a decrease of 11% last year. In Old Navy North America, comparable-store sales were up 6%, compared to down 9% last year. Internationally, comparable store sales were down 5%, versus a 6% decrease last year.
Gap's net sales for the four-week period ended November 28, 2009 were $1.42 billion, an increase of 2%, compared to $1.39 billion reported in the corresponding period of the previous year.
Sabrina Simmons, chief financial officer of Gap Inc., said, "We're pleased that we continued to meet our objective of improving our sales trend and we did it with merchandise margins significantly above last year."
Year-to-date, comparable store sales dropped 5%, compared to a 11% decline in the previous year. Net sales for the year-to-date period totaled $11.38 billion, down 4% from the prior-year's net sales of $11.84 billion.
For the month of October, Gap reported comparable store sales growth of 4%, compared to a 16% decrease in the previous year. Total sales for October rose 5% to $1.14 billion from $1.08 billion for the four-week period ended November 1, 2008.
For the off-price retail chain Ross Stores, same-store sales for November 2009 increased 8%. Sales for the four weeks ended November 28, 2009 advanced 12% to $635 million from $568 million in the comparable period of the previous year.
For the ten months ended November 28, 2009, Ross Stores' sales totaled $5.839 billion, up 10% from the previous year's sales of $5.320 billion. Comparable store sales for the ten months period rose 5% on top of a 2% gain in the same period last year.
Michael Balmuth, Vice Chairman, President and Chief Executive Officer of Ross Stores, said, "November sales outperformed our expectations as business strengthened in the second half of the month. Shoes, Dresses and Home continued to be the strongest merchandise categories while the Southwest and Northwest were the top performing regions."
Looking ahead, Balmuth added, "While we are pleased with our healthy start to the holiday season, most of the pre-Christmas shopping period is still ahead of us. As a result, we believe it is prudent to maintain our current forecast for comparable store sales gains of 6%-7% in December and 4%-5% in January."
Based on the comps targets and ahead-of-plan sales in November, Ross Stores currently expects fourth-quarter earnings to be at the high end to slightly better than its previous forecast of $0.88 - $0.94. Analysts polled by Thomson Reuters expected the company to report earnings of $0.97 per share for the quarter.
GPS is currently trading at $21.59, down 14 or 0.64% on NYSE, while ROST is trading at $44.11, down 23 cents or 0.52% on NASDAQ.
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