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The company has been revamping the Gap and Banana Republic brands, looking to

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replicate the success of the low-end Old Navy apparel. Comparable sales of its signature Gap brand rose 1 percent in December, compared with a two percent decline a year earlier. Old Navy brand sales rose 12 percent, compared with a 7 percent fall a year earlier. The company's comparable sales rose 4 percent in December, while analysts on average had expected a 0.7 percent decline. Continue Reading Below ADVERTISEMENT "If you look back in the past few months, September was down 10 percent, October was down seven and November was down three... they have actually been working towards improvement," Instinet analyst Simeon

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Siegel told Reuters. "This is the quarter where they pushed to positive," he said. Gap and other traditional apparel chains have been struggling with the growing popularity of online retailers and fast-fashion chains such as H&M, Forever 21 and Inditex's Zara, which are known for offering trendier clothes at cheaper prices. Gap, which is also shutting stores and reducing overhead costs, said it now expected full-year 2016 adjusted profit to be modestly above the higher end of the previously forecast range of $1.87-$1.92 per share. Department store chains Macy's and Kohl's both cut their 2016 profit forecasts on Wednesday, after their

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holiday season sales fell more than expected.

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