On Feb. 23, Gap (NYSE:GPS) released Q4 2005 earnings for the period ended Jan. 29, 2006.

  • Revenues dropped 1.6%, with same-store sales decreasing 6%.
  • Net profit fell 10.8% year over year, with EPS dropping 2.5%.
  • Margins took a steep drop across the board.

(Figures in millions, except per-share data)

Income Statement Highlights

Avg. Est.

Q4 2005

Q4 2004

% Change

Sales

$4,800

$4,821

$4,898

(1.6)

Net Profit

--

$337

$378

(10.8)

EPS

$0.39

$0.39

$0.40

(2.5)



Get back to basics with a look at the income statement.

Margin Checkup

Q4 2005

Q4 2004

Change

Gross Margin

34.04%

36.81%

(2.77)

Op. Margin

10.58%

12.66%

(2.08)

Net Margin

6.99%

7.72%

(0.73)



Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q4 2005

Q4 2004

% Change

Cash + ST Invest.

$2,987

$3,062

(2.4)

Inventory

$1,696

$1,814

(6.5)



Liabilities

Q4 2005

Q4 2004

% Change

Long-Term Debt

$513

$513

0.0

Accounts Pay.

$1,132

$1,240

(8.7)



Cash Flow Highlights

Q4 2005

Q4 2004

% Change

Cash From Ops.

$1,551

$1,597

(2.9)

Capital Expend.

$600

$419

43.2

Free Cash Flow

$951

$1,178

(19.3)



Find out why Fools always follow the money.

Related Companies:

  • Abercrombie & Fitch (NYSE:ANF)
  • Aeropostale (NYSE:ARO)
  • Ann Taylor (NYSE:ANN)
  • Chico's FAS (NYSE:CHS)

Related Foolishness:

Gap is aMotley Fool Inside Valueand aMotley Fool Stock Advisorrecommendation. Check out any of the Fool's investing newsletters with afree, 30-day guest pass.

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so checkFool.comfor more of our in-depth discussion of what the numbers mean.

At the time of publication,Seth Jaysonhad shares of Aeropostale, but no positions in any other company mentioned . Gap is also aMotley Fool Stock Advisorpick. Fool rules arehere.