May 20, 2016 12:42 AM EDT

Gap To Close 75 Old Navy And Banana Republic Stores

Gap will be shutting down 75 Old Navy and Banana Republic stores. This comes after the retailer's disappointing sales for the first quarter.

Fortune reported that Gap Inc. has said on Thursday that it will be closing 75 Old Navy and Banana Republic stores around the world. This may be part of the apparel retailer's efforts to recover from falling sales over the past five quarters.

The company revealed in a statement that the store closures will include 53 Old Navy outlets in Japan. Last week, Gap already issued a warning about store closures after a dismal report about its first-quarter sales for its top three brands.

Gap also announced that it was not reaffirming the adjusted profit forecast of $2.20 to $2.25 per share for the year. The recent additional decline of Old Navy poses a greater challenge for the retailer.

Its net income dropped 46.9 percent to $127 million, equivalent to about 32 cents per share, for the first quarter which ended last Apr. 30. Its net sales also declined by 6 percent at $3.44 billion.

According to Washington Post, Gap will also close a "select number" of Banana Republic outlets, mostly in international locations. The company admitted that it is trying to focus on places which have the most growth potential.

"I'm obviously disappointed that we're going to be discontinuing operations," Gap chief executive Art Peck said on a conference call to investors. "But I view it as a sign of a good company that you acknowledge when a business isn't going to deliver."

The company added on Thursday that it will also streamline its operating model to cater to customer demands. It is expected to save about $275 million a year.

Banana Republic has around 679 stores all over the world while Old Navy has more than a thousand. Peck has confirmed that the company's plans for Old Navy stores will be focused on Mexico and China.

LA Times noted that investors aren't happy about the company's decline. Other retailers such as Nordstrom, Macy's and Kohl's also face the same problems currently.

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