Victoria’s Secret sales down on comps, North America; earnings beat expectations
Victoria's Secret & Co. announced on Wednesday revenues for the third quarter fell 9% to $1.318 billion, on the back of a double-digit decline in comparable store sales, partially offset by growth in its international business.
Despite the sales dip, the Reynoldsburg, Ohio-based company said the quarterly sales result was in-line with its previously communicated guidance of down high-single digits, compared to the third quarter last year.
Likewise, comparable sales for the third quarter decreased 11%, compared to the third quarter of 2021.
International revenues totalled $163.5 million, up 43%, while North America revenues fell to $1.6 billion, from $1.3 billion last year.
The lingerie company reported net income of $24 million, or $0.29 per diluted share for the third quarter, which was above its high-end of its previously communicated guidance range of $0.00 to $0.25 per diluted share, compared to $75 million, or $0.81 per diluted share for the third quarter of 2021.
“After nearly a year and a half as an independent, publicly-traded company, we continue to make significant progress in our transformation and mission to celebrate and champion all women. We have created a solid financial platform with our new, more agile operating structure, and even in a very challenging macroeconomic environment, we were able to deliver third quarter operating income and earnings per diluted share results above our previous guidance. With our aligned focus on our customer and our strategic priorities, we are well positioned to continue to navigate and execute in a shifting consumer landscape," said Victoria's Secret chief executive officer Martin Waters.
“At our Investor Day in October, we discussed our strategic growth plan which outlines significant runway ahead guided by our three key principles: strengthen our core, ignite growth, and transform the foundation. Led by our two category-defining brands and merchandise leadership positions in intimates and beauty, we remain confident in our ability to deliver our long-term financial targets, reinvest in our business, and return value to our shareholders. Further evidence of our commitment to drive long-term value, we recently announced our agreement to acquire AdoreMe, Inc., a technology-led, digitally-native intimates brand … a move that strategically positions us for accelerated growth. We are excited for the opportunity to leverage Adore Me’s expertise and technology to improve our customer shopping experience and accelerate the modernization of our digital platform. This is just one example of how we are committed to executing on our strategic growth plan.”
Looking ahead, Victoria's Secret is forecasting full year 2022 net sales to decrease 6% to 7% compared to last year’s full year net sales of $6.785 billion.
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