Nov. 5, 2009 (Business Wire) -- Gap Inc. (NYSE:GPS) today reported net sales of $1.14 billion for the four-week period ended October 31, 2009, which is an increase of 5 percent as compared with net sales of $1.08 billion for the same period ended November 1, 2008. The company’s comparable store sales for October 2009 also increased 4 percent compared with a 16 percent decrease for October 2008.

“We’re pleased that we grew sales in October while delivering merchandise margins significantly above last year,” said Sabrina Simmons, chief financial officer of Gap Inc. “For the third quarter, we expect to deliver diluted earnings per share about 20 percent above last year.”

Comparable store sales for October 2009 were as follows:

• Gap North America: negative 6 percent versus negative 14 percent last year
• Banana Republic North America: positive 5 percent versus negative 17 percent last year
• Old Navy North America: positive 14 percent versus negative 20 percent last year
• International: negative 4 percent versus negative 5 percent last year

Third Quarter Guidance and Sales Results

The company expects diluted earnings per share for the third quarter of fiscal year 2009 to be $0.42 to $0.44 compared with $0.35 for the third quarter last year. This exceeds the current First Call estimate of $0.38.

Given the magnitude of the sales trend improvement, the company now expects operating expense for the third quarter of 2009 to be higher than its previous guidance range of flat to up about $20 million.

For the thirteen weeks ended October 31, 2009, total company net sales were $3.59 billion, which is an increase of 1 percent as compared with net sales of $3.56 billion for the thirteen weeks ended November 1, 2008. The company’s third quarter comparable store sales were flat compared with a decrease of 12 percent in the third quarter of the prior year.

Comparable store sales for the third quarter of fiscal year 2009 were as follows:

• Gap North America: negative 7 percent for both current and last year
• Banana Republic North America: negative 6 percent versus negative 11 percent last year
• Old Navy North America: positive 10 percent versus negative 18 percent last year
• International: negative 6 percent versus negative 1 percent last year

For more detailed information regarding the company’s October 2009 sales, please call 1-800-GAP-NEWS to listen to Gap Inc.’s monthly sales recording.