NEW YORK (CNN/Money) - Clothing retailer Gap Inc. on Thursday posted a big jump in first-quarter profit and sales, citing the company's improved product mix and renewed marketing initiatives.

The No. 1 apparel retailer logged net income of $202 million, or 22 cents per share, compared with $37 million, or 4 cents per share a year ago.

Wall Street had forecast a profit of 21 cents a share.

San Francisco-based Gap (GPS: Research, Estimates) said net sales for the first-quarter rose 16 percent to $3.4 billion, while sales at stores open at least a year -- a retail measure known as same-store sales -- rose 12 percent. That compares with a same-store sales decline of 17 percent in the prior year.

However, the company also reiterated its guidance for 2003 of an expected 2 percent decline in square footage for the full fiscal year.

Two years ago, the No. 1 apparel retailer was a high-flying name in retail whose khakis, denims and T-shirts epitomized "casual dressing." As soon as Gap (GPS: up $0.55 to $17.20, Research, Estimates) moved away from its signature style in favor of trendier clothes, the bubble burst. Sales disintegrated, Gap lost its loyal customers and the stock price plummeted.

That's the old story. Here's how the latest chapter reads: Gap's sales at stores open at least a year-- a retail measure known as same-store sales -- are up for the seventh consecutive month; the stock price has rebounded 98 percent from last year's lows, and store traffic continues to improve.

Gap shares rose 10 cents to $17.30 in after-hours trading.