Gap (GPS)

Cash and Debt

The company ended the third quarter with $1.7 billion in cash and investments, and $188 million in long-term debt. For the first three quarters of fiscal year 2007, free cash flow was an inflow of $484 million, compared with an inflow of $214 million last year. This increase was primarily driven by lower inventory levels and a change in vendor payment terms.

The company now expects to generate about $900 million in free cash flow for fiscal year 2007, driven by its upward revision in earnings, continued disciplined inventory management and change in vendor payment terms. Please see the reconciliation of free cash flow, a non-GAAP financial measure, to the GAAP financial measure in the table at the end of this release.

Cash and Debt

The company ended the second quarter with $2.7 billion in cash and investments. This represents $2.2 billion more in cash and investments than debt. For the year-to-date period, free cash flow was an inflow of $347 million. The company now expects to generate at least $500 million in free cash flow for fiscal year 2007. The company expects to repay $326 million of debt in September of 2007. Please see the reconciliation of free cash flow, a non-GAAP financial measure, to the GAAP financial measure in the table at the end of this release.

Cash and Debt

The company ended the first quarter with $2.8 billion in cash and investments. This represents $2.3 billion more in cash and investments than debt. For the first quarter, free cash flow was an inflow of $159 million. The company reaffirmed that for the full year it expects to generate about $500 million in free cash flow. The company expects to repay about $325 million of debt in fiscal year 2007. Please see the reconciliation of free cash flow, a non-GAAP financial measure, to the GAAP financial measure in the table at the end of this release.

Cash and Debt

The company announced that it ended the third quarter with $2.4 billion in cash and short-term investments. This represents $1.9 billion more in cash and investments than total debt. For the 39 weeks ended October 28, 2006, free cash flow was an inflow of $214 million, compared with an outflow of $120 million last year. The increase was driven primarily by reductions in working capital. The company still expects to generate at least $800 million in free cash flow in fiscal 2006. Please see the reconciliation of free cash flow, a non-GAAP financial measure, to the GAAP financial measure in the table at the end of this release.

Cash and Debt

The company announced that it ended the second quarter with $2.8 billion in cash and short-term investments. This represents $2.3 billion more in cash and investments than funded debt. For the 26 weeks ended July 29, 2006, free cash flow was an inflow of $300 million, compared with an inflow of $21 million last year. The increase was driven primarily by an improvement in working capital. The company now expects to generate at least $800 million in free cash flow in fiscal 2006. Please see the reconciliation of free cash flow to the GAAP financial measure in the table at the end of this release.

Cash and Debt

The company ended the quarter with $2.9 billion in cash and short-term investments. This represents $2.4 billion more in cash and investments than funded debt. For the first quarter, free cash flow was an inflow of $225 million, compared with an inflow of $113 million last year. The company reiterated that it expects to generate at least $900 million in free cash flow in fiscal 2006. Please see the reconciliation of free cash flow to the GAAP financial measure in the table at the end of this release.

Cash and Debt

After repurchasing 98.5 million shares for $2 billion during the year, the company ended the fourth quarter with $3.0 billion in cash and short-term investments. Fiscal year 2005 free cash flow, defined as net cash provided by operating activities less purchase of property and equipment, was an inflow of $951 million. The company expects to generate at least $900 million in free cash flow for fiscal year 2006. Please see the reconciliation of free cash flow, a non-GAAP financial measure, to a GAAP financial measure in the table at the end of this release.

Cash and Debt

The company ended the third quarter with $2.3 billion in cash and investments, of which $75 million was restricted. This represents $1.8 billion more in cash and investments than funded debt. For the 39 weeks ended October 29, 2005, free cash flow was an outflow of $120 million, compared with an inflow of $156 million last year. The company now expects to generate $800 million to $900 million in free cash flow, down from its previous guidance of at least $1 billion in fiscal 2005. Please see the reconciliation of free cash flow to the GAAP financial measure in the table at the end of this release.

Cash and Debt

The company announced that it ended the second quarter with $2.6 billion in cash and short-term and long-term investments, of which $97 million was restricted. This represents $2.1 billion more in cash and investments than funded debt. For the 26 weeks ended July 30, 2005, free cash flow was an inflow of $21 million, compared with an inflow of $88 million last year. The company still expects to generate at least $1 billion in free cash flow in fiscal 2005. Please see the reconciliation of free cash flow to the GAAP financial measure in the table at the end of this release.

Cash and Debt

The company announced that it ended the quarter with $3.7 billion in cash and short-term and long-term investments, of which $1.0 billion were restricted. This represents $3.2 billion more in cash and investments than funded debt. For the first quarter, free cash flow was an inflow of $113 million, compared with an inflow of $130 million last year. The company expects to generate at least $1 billion in free cash flow in fiscal 2005. Please see the reconciliation of free cash flow to the GAAP financial measure in the table at the end of this release.

On April 5, 2005, Moody’s Investors Service upgraded the company’s credit rating to investment grade with a Baa3 rating.

The company has fully completed the conversion of its $1.38 billion convertible bond into about 86 million shares, leaving just $513 million of debt on the balance sheet.

Cash and Debt

The company expects at least $1 billion in free cash flow in each fiscal year of 2005, 2006 and 2007. Please see the reconciliation of free cash flow to a GAAP financial measure in the table at the end of this release. In addition, the company expects to substantially reduce restricted cash in 2005.

The company expects annual gross interest expense to be about $50 million in 2006.

Cash and Debt

After repurchasing about 48 million shares for $1 billion, the company ended the fourth quarter with $2.2 billion more in cash and short-term investments than debt. Fiscal year 2004 free cash flow, defined as net cash provided by operating activities less purchase of property and equipment, was an inflow of $1.2 billion. The company expects at least $1 billion in free cash flow for fiscal 2005. Please see the reconciliation of free cash flow to a GAAP financial measure in the table at the end of this release.

During fiscal year 2004, the company retired a total of $871 million in debt, of which $596 million was retired early. Full year earnings reflect $105 million in losses on early retirement of debt due to premiums paid and $36 million in pretax interest savings.

Standard and Poor’s recently raised the company’s credit rating to investment grade, BBB-. Moody’s currently has the company’s credit rating one notch below investment grade and is reviewing the company for a possible upgrade.

The company expects to call its convertible bond in late March 2005.