L Brands Shares Tumble on Sales Weakness
06 May 2016 - 12:50AM
Dow Jones News
L Brands Inc. on Thursday posted sales growth below expectations
amid continued weakness at its Victoria's Secret business, which
the company said last month that it would restructure.
Shares tumbled 11% in morning trading to $71.10, a new 52-week
low.
For the first quarter, L Brands said sales rose 4.1% to $2.61
billion, below analysts' estimates for $2.67 billion, according to
Thomson Reuters. Same-store sales increased 1%, as a 1% decline at
Victoria's Secret dragged on a 5% increase at Bath & Body
Works.
The company said it expects to report adjusted first-quarter
earnings at the high end of its previous guidance for 50 to 55
cents a share. But that guidance, when issued, was well-below
consensus views for 64 cents a share.
In early April, L Brands said it would restructure its
Victoria's Secret business in an attempt to streamline operations,
end mailings of its catalog and focus more on its core merchandise.
The moves came shortly after Sharen Turney resigned as Victoria's
Secret chief executive.
The company has said it plans to reorganize Victoria's Secret
into three units: Victoria's Secret Lingerie, PINK and Victoria's
Secret Beauty.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
May 05, 2016 10:35 ET (14:35 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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