The company earned net income of $337 million, or 39 cents pershare for the fourth quarter, compared with $378 million, or 40centsper share for the same period last year. Fiscal year 2005earnings per share were $1.24, up from $1.21 for fiscal year 2004on net income that declined to $1.11 billion from $1.15billion.

"None of us is satisfied with our overall 2005 businessresults," Gap president and CEO Paul Pressler said Thursday ascompany officials discussed fourth quarter and full-year financialresults during a conference call with financial analysts. ByronPollitt, CFO, cited "uncertainty regarding the timing of theturnaround" and month-to-date traffic that is down 13% in Februaryas reasons that Gap expects total comparable store sales to remainnegative in the first half of fiscal year 2006 and turn modestlypositive in the second half of fiscal year.

Net sales of $4.8 billion for the fourth quarter ended Jan. 28decreased 2% compared to $4.9 billion for the same period lastyear, with comparable store sales dropping 6% for the period. Netsales of $16 billion for the 52 weeks ended Jan. 28 also decreased2% in comparison to $16.3 billion for the same period the previousyear, with comparable sales dropping 5% for the year.