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Victoria's Secret owner L Brands posts upbeat Q4 earnings

By Prachi Singh

Feb 25, 2021

Management

L Brands, Inc. reported earnings per share of 3.03 dollars for the fourth quarter compared to a loss per share of 70 cents for the same quarter last year. The company said, operating income for the quarter was 1.273 billion dollars compared to 81.7 million dollars last year, and net income was 860.3 million dollars compared to a net loss of 192.3 million dollars last year.

Commenting on the trading results, Andrew Meslow, Chief Executive Officer of L Brands, stated in a statement: “We experienced consistent strength at Bath & Body Works along with continued significant improvement in performance at Victoria’s Secret. As a result of the collective initiatives underway, the company is well positioned to continue driving value for our shareholders.”

L Brands posts increase in comparable Q4 sales

On an adjusted basis, fourth quarter earnings per share increased 61 percent to 3.03 dollars compared to adjusted 1.88 dollars last year, operating income increased 58 percent to 1.273 billion dollars and net income was 860.3 million dollars compared to adjusted 523.7 million dollars last year.

Bath & Body Works fourth quarter operating income increased 250 million dollars or 38 percent to 913.7 million dollars, while Victoria’s Secret adjusted operating income increased 209.8 million dollars or 108 percent to 403.4 million dollars.

The company reported net sales of 4.818 billion dollars compared to 4.707 billion dollars for the fourth quarter ended February 1, 2020. Comparable sales increased 10 percent, consisting of a 22 percent increase at Bath & Body Works and a 3 percent decrease at Victoria’s Secret. Fourth quarter sales in the direct channel increased 74 percent at Bath & Body Works and 33 percent at Victoria’s Secret.

L Brands posts full-year earnings of 3 dollars per share

For the full year, L Brands reported earnings per share of 3 dollars compared to a loss per share of 1.33 dollars. Full-year operating income was 1.580 billion dollars compared to 258.4 million dollars last year and net income was 844.5 million dollars compared to a net loss of 366.4 million dollars last year.

The company added that adjusted full-year earnings per share increased 51 percent to 3.46 dollars compared to 2.29 dollars last year; adjusted operating income increased 47 percent to 1.808 billion dollars compared to 1.231 billion dollars last year; and adjusted net income was 974.5 million dollars compared to 637.3 million dollars last year.

Net sales for the year were 11.847 billion dollars compared to 12.914 billion dollars for the year ended February 1, 2020. Comparable sales increased 21 percent, consisting of a 45 percent increase at Bath & Body Works and a 1 percent increase at Victoria’s Secret. Full year sales in the direct channel increased 109 percent at Bath & Body Works and 31 percent at Victoria’s Secret.

The company is forecasting first quarter earnings per share between 35 cents and 45 cents, which represents substantial growth compared to last year when stores were closed for the majority of the quarter.

Picture:L Brands resources