L Brands reports Q2 sales decline 8%

L Brands (Victoria’s Secret) earnings per share for the second quarter ended July 29, 2017, were 0.48 dollar compared to 0.87 dollar for the quarter ended July 30, 2016. Second quarter operating income was 300.9 million dollars against 408.2 million dollars last year, and net income was 138.9 million dollars compared to 252.4 million dollars last year.

The company said, reported results above include a pre-tax gain of 108.3 million dollars or 0.24 dollar per share in 2016, related to a cash distribution from Easton Town Center; and a pre-tax charge of 35.8 million dollars or 0.08 dollar per share related to the early extinguishment of the company’s July 2017 notes. Excluding the significant items above, adjusted second quarter earnings per share decreased 31 percent to 0.48 dollar compared to 0.70 dollar last year, and adjusted net income was 138.9 million dollars compared to 204.7 million dollars last year.

The company reported net sales of 2.755 billion dollars for the second quarter compared to sales of 2.890 billion dollars for the second quarter ended July 30, 2016. The company reported a comparable sales decrease of 8 percent and said that the exit of the swim and apparel categories had a negative impact of about 6 percentage points and 9 percentage points to total company and Victoria’s Secret comparable sales, respectively.

Since the second quarter comparable sales decline of 8 percent was below the company’s expectations, L Brands said, accordingly, the company’s guidance for the remainder of the year reflects a more conservative sales forecast than its previous guidance. The company updated its guidance for 2017 full-year earnings per share to 3 to 3.20 dollars from 3.10 to 3.40 dollars previously, and issued guidance for third quarter earnings per share between 0.25 dollar and 0.30 dollar.

L Brands – Victoria’s Secret

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