CEO Peck hears Gap’s sucking sound

By LISA FICKENSCHER

It hasn’t exactly been a good 15-month stretch for Gap Chief Executive Art Peck — in fact, it has sucked.

Over that span, cash has been sucked from the Gap’s balance sheet, more than $600 million in sales have been eliminated from its top line and tens of thousands of customers have likely fled from its Gap, Old Navy and Banana Republic stores — perhaps never to return.

With that kind of performance, perhaps it is not surprising that, since Peck took over as CEO of the 3,721-store chain on Feb. 1, 2015, Gap’s shares have cratered more than 50 percent — including nearly 12 per- cent on Tuesday, to $19.30, after the San Francisco-based company reported 24 hours earlier yet another lousy quarter.

Companywide same-store sales fell 5 percent in the three months ended May 2, with Banana Republic reporting an especially dreadful 11 percent decline. Sales at the flagship Gap stores fell 3 percent.

But perhaps the biggest problem facing Peck is the disaster at Old Navy. Long the bright spot in the corporate firmament, this stalwart saw same-store sales fall 6 percent in each of the last two quarters.

Equally as troubling for Peck and his reputation is the fact that he promised things would turn around for Gap this spring.

But that is unlikely to happen as fast- fashion retailers like H&M and Zara continue to steal Gap customers.

At the same time, Peck lowered Gap’s profit forecast range for the first quarter roughly 28 percent, to 31 cents to 32 cents.

Last year, Gap overhauled its design team, eliminating the role of creative director at Gap and Banana Republic — and created the companywide position of director of product design and development and named Wendi Goldman to the post.

Despite poor first fiscal-quarter results, Peck is optimistic.

“We are committed to better positioning the business [in the US],” he said.

It’s still not known whether Gap customers are listening.