Gap Inc. Prepares To Open Its First Stores in Africa
Company continues global expansion with franchise stores in Egypt and Morocco
SAN FRANCISCO - As part of its global expansion strategy, Gap Inc. (NYSE: GPS) today announced plans to open its first Gap store in Egypt this July and its first Gap and Banana Republic stores in Morocco this October. These store openings will mark the company’s first entry into Africa and will house Gap, GapKids and babyGap collections and Banana Republic’s accessible luxury clothes and accessories for men and women.
Last year, Gap Inc. first made its products available to African consumers in Egypt, Morocco, and South Africa through the company’s international online shipping provider. “We are thrilled to be taking another important step in our franchise business and global expansion strategy by bringing our store experience to consumers in Africa for the first time,” said Stephen Sunnucks, president of International, Gap Inc. “The rapidly growing consumer base in North Africa provides an ideal environment to introduce both Gap and Banana Republic to the continent.”
Gap Inc. is focused on growing its share of the $1.4 trillion global apparel market. Over the last five years, Gap Inc. has grown its franchise store base to more than 180 and expanded from 2 to 25 countries throughout Asia, Europe, Latin America, the Middle East and Australia. With today’s announcement, the company now has franchise agreements in place to bring its brands to 29 countries, including Chile and Serbia in fiscal year 2011. The company expects to double its franchise stores to 400 by fiscal year 2014 (More about Gap Inc.’s global runway may be downloaded here).
As part of an existing franchise agreement with The Fawaz Al Hokair Group, Gap will open its first Egyptian store in the Mall of Arabia in the capital city of Cairo: Africa’s largest city and renowned for centuries as the center of learning, culture, and commerce. Two additional Gap stores will open at Cairo’s City Stars Mall and Sun City Mall this October.
Egypt is the fourth country to be managed under Gap Inc.’s franchise agreement with The Fawaz Al Hokair Group, one of Saudi Arabia’s leading retail and commercial firms. The group also manages the company’s franchise locations for Gap brand in Jordan, Kazakhstan and Saudi Arabia.
Entering Egypt marks an important milestone for the company. The country’s rapidly growing consumer base of approximately 83 million people, the largest population in the Arab world, and position as a gateway to the rest of Africa offer significant opportunity to bring Gap brand to the market.
The company has signed a new franchise agreement with the Aksal Group to open its first Gap and Banana Republic stores in Casablanca, Morocco. Both stores will be located in the city’s new Morocco Mall and will open at the same time as the mall’s grand opening this October. Morocco will be the first country to be managed by the Aksal Group for Gap Inc.
With 14 million visitors per year, Casablanca is the premier shopping destination in North Africa. Morocco’s booming retail market and increasing urban population provide Gap Inc. with a terrific opportunity to introduce Gap and Banana Republic stores to the country.
This press release contains forward-looking statements within the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. All statements other than those that are purely historical are forward-looking statements. Words such as “expect,” “anticipate,” “believe,” “estimate,” “intend,” “plan,” “project,” and similar expressions also identify forward-looking statements. Forward-looking statements include statements regarding the following:
* Expected franchise store openings, including Serbia, Chile, Egypt and Morocco;
* Global expansion strategies, including franchise growth and the number of future franchise stores;
* Gaining a larger share of the global apparel market.
Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause the company’s actual results to differ materially from those in the forward-looking statements. These factors include, without limitation, the following:
* The risk that changes in general economic conditions or consumer spending patterns will have a negative impact on the company’s strategies;
* The highly competitive nature of the company’s business internationally;
* The risk that the company will be unsuccessful in gauging fashion trends and changing consumer preferences;
* The risk that the company’s efforts to expand internationally may not be successful and could impair the value of its brands;
* The risk that the company’s franchisees will be unable to successfully open, operate, and grow the company’s franchised stores;
* The risk that the company will be unsuccessful in identifying, negotiating, and securing new store locations effectively;
* The risk that the company will be unsuccessful in implementing its strategic, operating and people initiatives;
* The risk that updates or changes to the company’s information technology (“IT”) systems may disrupt its operations;
* The risk that acts or omissions by the company’s third-party vendors, including a failure to comply with the company’s code of vendor conduct, could have a negative impact on its reputation or operations;
* The risk that the company will not be successful in defending various proceedings, lawsuits, disputes, claims, and audits; and
* The risk that changes in the regulatory or administrative landscape could adversely affect the company’s financial condition, strategies, and results of operations.
Additional information regarding factors that could cause results to differ can be found in the Company’s Annual Report on Form 10-K for the fiscal year ended January 29, 2011, as well as its most recent Quarterly Report on Form 10-Q.
These forward-looking statements are based on information as of June 28, 2011. The company assumes no obligation to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized.
About Gap Inc.
Gap Inc. is a leading global specialty retailer offering clothing, accessories, and personal care products for men, women, children, and babies under the Gap, Banana Republic, Old Navy, Piperlime, and Athleta brands. Fiscal year 2010 net sales were $14.7 billion. Gap Inc. products are available for purchase in over 90 countries worldwide through about 3,100 company-operated stores, about 180 franchise stores, and e-commerce sites. For more information, please visit www.gapinc.com.
Gap was founded in 1969, in San Francisco, California by Doris and Don Fisher. Their goal? To make it easier for customers to find a great fitting pair of jeans and an easy-to-shop store experience. This philosophy lives on at Gap. We offer modern, cool clothing and accessories that help customers express their own individual sense of style.
Today, the brand continues its history of providing authentic style, celebrating creativity and making a difference. We recently introduced 1969 Premium Jeans. Building on 40 years of denim experience, Gap reinvented the premium denim category by delivering superior fit, finishes and detail.
Gap is committed to delivering quality items that people expect from our brand — including denim, khaki and knits in great styles and colors.
Banana Republic History
Banana Republic was founded in 1978, as a travel and safari company. The name as well as the original store aesthetic was intended to reflect this spirit of travel. When Gap Inc. acquired the company in 1983, the company retained the brand name.
Banana Republic has since established itself as a widely recognized and respected global apparel brand known for its affordable luxury offering with subtle ties to its original product and purpose.
Today Banana Republic offers modern, soulful, effortless style to men and women around the world through a range of great versatile wardrobe solutions - covetable, uncomplicated style that works from day to night. Characterized by elevated design, luxurious fabrications and approachable prices, the collections include apparel, handbags, jewelry, fragrance and eyewear.
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