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Gap lifts its fiscal 2008 earnings forecast

Apparel retailer Gap Inc. raised its fiscal 2008 earnings forecast Thursday, crediting January cost control efforts.
/ Source: The Associated Press

Apparel retailer Gap Inc. raised its fiscal 2008 earnings forecast Thursday, crediting January cost control efforts.

The apparel retailer now expects profit in a range of $1.32 to $1.33 per share. Its prior outlook was for net income of $1.27 to $1.30 per share.

Analysts polled by Thomson Reuters predict earnings of $1.29 per share. Analysts' estimates typically exclude one-time items.

Gap also said its annual sales fell 8 percent to $14.53 billion from $15.76 billion a year earlier. The results missed Wall Street's estimate of $14.62 billion.

January same-store sales slid 23 percent, with softer results across its Banana Republic, Old Navy and namesake businesses.

Analysts expected a same-store sales decline of 15.4 percent.

Same-store sales, or sales at stores open at least a year, are a key indicator of retailer performance since they measure growth at existing stores rather than newly opened ones.

Gap runs more than 3,100 stores in the U.S., United Kingdom, Canada, France, Japan and Ireland. The company had fiscal 2008 sales of $14.5 billion. It will report February sales results on March 5 and fourth-quarter earnings results on Feb. 26.

Gap shares rose 35 cents to $11 in premarket trading.