Gap's Slow September

It seems many investors have had a lot of optimism about the dawn of a new day at Gap (NYSE: GPS  ) , but judging by its September same-store sales, that day hasn't arrived yet.

Gap's same-store sales fell 7% in September, compared to its 3% decrease this time last year, with weakness in every one of its segments. Gap North America's comps dropped like a rock, down 10%, Old Navy North America comps fell 8%, and the international segment decreased 2%. Banana Republic, which was the only concept up against positive comps last year, experienced a 2% drop in same-store sales. Overall, analysts had been expecting results as low as a decrease of 6.8%.

Furthermore, Gap's September sales decreased 3% to $1.43 billion. In the company's press release, Executive Vice President of Finance Sabrina Simmons said that merchandise margins matched last year's and that the company is comfortable with its inventory levels, which it's managing "tightly" as the holiday season approaches.

This isn't as heartening as last month, when Gap's August comps slipped 1%, which was better than the 2% decrease analysts had expected. And of course, back in July, Gap actually managed a modest increase in overall sales.

Meanwhile, Gap's revolving door continues to revolve. The company announced that it has named as president of Banana Republic Jack Calhoun, who counts among his previous gigs a brand management position with Procter & Gamble (NYSE: PG  ) . He's been at Gap for four years and has served as interim president of the Banana Republic concept for the last eight months. Later in the press release comes word that Gap veteran Deborah Lloyd, Banana Republic's head of design, is leaving the company later this month -- turns out she's leaving to head up Liz Claiborne's (NYSE: LIZ  ) Kate Spade brand. That's certainly unfortunate, since Banana Republic has been the concept that has done relatively well as the others have struggled.

Gap's shares have edged up 4.4% over the course of the last six months, but I continue to think it hasn't yet proven enough to warrant optimism about its long-hoped-for turnaround.

For related Foolishness, see the following articles:

• Last quarter, Gap was pinching pennies.
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