Gap CEO Glenn Murphy To Retire In February; Art Peck Named Successor

(RTTNews) - Gap Inc. (GPS) said Wednesday that Art Peck, the president of its Growth, Innovation and Digital division, has been selected by the company's Board of Directors to succeed Glenn Murphy as the company's next chief executive officer, effective February 1, 2015.

Following seven successful years in his role, Murphy made the personal decision to retire from the company at the end of the fiscal year, allowing for a smooth and seamless leadership transition, the company said in a statement.

Peck has delivered significant results for Gap Inc. in a variety of brand, strategy and operational roles since joining the company in 2005. Among his various roles within the company, Peck led the North American division for Gap brand in 2011 and 2012, overseeing the product resurgence that successfully improved its business results.

Separately, Gap said its same-store sales were flat for September 2014.

Net sales for the five-week period ended October 4, 2014 were $1.48 billion, compared to $1.46 billion for the five-week period ended October 5, 2013.

Same-store sales fell 3% at the company's namesake stores, rose 2% at Banana Republic and grew 1% at the company's Old Navy stores.

"September proved to be more challenging than we expected," said Glenn Murphy, chairman and CEO, Gap Inc. "While Old Navy and Banana Republic are performing well, we are working aggressively to ensure our entire portfolio of brands delivers to its potential."

The company also said that it expects gross margins for the third quarter to be moderately below the prior year driven by underperformance at Gap brand. At the same time, the company expects third quarter operating expenses to be about 8% above the third quarter of fiscal year 2013.