Gap Inc.'s new store concept catering to the over-35-year-old female — announced last September — will be called Forth & Towne. It will be launched this fall with four stores in the Chicago area and one in New York, company officials said Thursday at its annual investors' meeting.
Forth & Towne — Gap's first new chain in a decade — aims to appeal to boomer women, who grew up with Gap, but with whom the store "lost touch," said Paul Pressler, president and chief executive at a meeting in San Francisco, which was broadcast on the Web.
With the over-35 group accounting for 39 percent of women's total apparel expenditures, this market represents a "sizable opportunity" for Gap, whose sales have been wavering, although profits have improved, boosted in part by cost-cutting.
Pressler told investors that the company — which operates stores under its namesake brand, Old Navy and Banana Republic — will unveil more details about the clothing this summer. But he said that the new store will offer a broad range of sizes, with a focus on fit, and assortments that serve a variety of occasions. The clothing will be priced between Gap and Banana Republic, he said.
Pressler told investors that this group has been shopping more at department stores, though they didn't necessarily prefer that channel.
The test stores will range in size from 8,000 square feet to 10,000 square feet. Pressler noted that the company created an address with the name "Forth" and wanted to evoke a sense of place with the word "Towne." Fitting rooms will be at the center of the store, with "neighborhoods" of merchandise around them, he said.
Gap also backed its 2005 profit outlook and issued guidance for 2006 as the apparel retailer outlined its growth plans. The company said it expects to grow earnings per share in 2006 by 12 percent, and reiterated 2005 profit guidance of $1.41 to $1.45 per share. Analysts surveyed by Thomson Financial project the retailer to report earnings of $1.42 per share for 2005, and $1.60 per share next year.
Gap reaffirmed its plans to double its annual dividend this year to 18 cents, and said it expects to boost dividends at a rate higher than its growth in net income.
The retailer aims to add at least 50 additional stores in the United Kingdom, France and Japan through 2007, and begin exploring the Chinese market in 2006.
The company said it hired Stephen Sunnucks as president of Europe for Gap Inc. International, a new position. Sunnucks, 47, spent four years as chief executive of New Look, a fashion retailer with 700 stores in the United Kingdom, Ireland and France.
Gap said it will also open 200 new Old Navy stores through 2007, and extend its Banana Republic brand through jewelry, handbags, personal care products and petites.
