“For personal reasons”
“Murphy and Peck have worked side-by-side for the better part of a decade as Gap Inc. dramatically improved its financial performance while expanding globally”, the San Francisco-based company wrote in a press release. Glenn Murphy will leave “for personal reasons”.
Murphy had previously explained the September results as “more difficult than anticipated”. There was a 1 % net sales growth, up to 1.48 billion dollars (1.2 billion euro), but the like-for-like turnover remained level. Gap’s drop (-3 %) offset the growth of its fellow chains Banana Republic (+2 %) and Old Navy (+1 %).
Gap realized a 7.75 billion dollar turnover in the first part of its broken fiscal year (until August), a 2 % increase compared to the same period last year. Its net profit dropped 6.9 % to 592 million dollars in the same period.
Foreign expansion
Peck (58), who has been responsible for innovation, growth and e-commerce, will take Murphy’s place. As CEO for North America (which represents 75 % of the yearly turnover), he has also been focused on expanding the reach for its new brands (Piperlime, Athleta, Intermix).
The American fashion group is active in 90 countries, with 3,200 own stores, 400 franchise stores and own web shops. Lately, it has focused on foreign expansion to lower its dependence on its home market. It had announced in August that it wanted to open 40 stores in India and an additional 30 stores in China (where the group only had 80 stores at the end of 2013).
Murphy’s departure did not go down well at the stock exchange as shares dropped 8.6 % immediately. That is not remarkable as the company’s value has tripled since Murphy took control in 2007. Analysts are sure that Peck will continue his predecessor’s strategy for the most part.
