Just saw this in the news and thought you'd all enjoy.
Paul Pressler, Gap
How quickly has Gap (NYSE: GPS) CEO Paul Pressler fallen? His timing was superb. He latched on to the apparel retailer in 2003, just as the company was coming off three straight years of same-store sales declines. That year found the struggling operator of Gap, Old Navy, and Banana Republic posting positive comps of 7%, but that was just a third of the improvement that was necessary to get comps back to their 1999 level.
Still, the market gave Pressler the benefit of the doubt. Turnarounds take time, and he was just starting to lay his handprints on the company. Then came 2004, when comps clocked in flat. A year later, same-store sales resumed their troubling ways by sinking 5% lower. It's only getting worse with comps off by 7% through the end of November.
How many retailers do you know that have nailed just one year of positive comps on this side of the millennium? If one argues that there's more to retail than comps, Gap also lowered its profit guidance last month. The company now expects earnings per share to fall between 15% and 19% this year.
Yes, the company is going the wrong way, and Pressler has slipped on a Banana Republic peel. Salvation? It doesn't look good here. Even a positive step in comps early in 2007 will only be seen as the result of an easy lay-up off its sandbagged past. It's going to take dramatic improvements in comps and earnings to save Pressler now.
Couldn't happen to a nicer guy.