(Filed Under wholesale Lingerie News). Victoria’s Secret and Pink comparable store sales in North America fell 6% in December following a 4% drop in December 2016.
But when the direct business for those brands is added in, the overall sales decline in December, 2017 was only 1%, indicating a significant jump in online business.
“Growth in the beauty and Pink business was more than offset by a decline in lingerie,” explained Amie Preston, chief investor relations officer, in remarks referring to the two brands. “The merchandise margin rate was down significantly, driven by an increase in promotional activity.”
Meanwhile, parent company L Brands, Inc., which also owns Bath & Body Works, La Senza and Henri Bendel, reported combined sales “of $2.516 billion for the five weeks ended December 30, 2017, an increase of 3 percent, compared to net sales of $2.438 billion for the five weeks ended December 31, 2016. Comparable sales increased 1 percent for the five weeks ended December 30, 2017.”
Looking at the first 11 months of its fiscal year, “The company reported net sales of $11.592 billion for the 48 weeks ended December 30, 2017, compared to net sales of $11.769 billion for the 48 weeks ended December 31, 2016. Comparable sales decreased 4 percent for the 48 weeks ended December 30, 2017. For the 48 weeks ended December 30, 2017, the exit of the swim and apparel categories had a negative impact of about 3 percentage points and 5 percentage points to total company and Victoria’s Secret comparable sales, respectively.”
“Before the effect of any significant one-time items, including the impact of tax reform legislation, the company expects to report fourth quarter earnings per share of about $2.00, compared to its previous guidance of $1.95 to $2.10.”
Through the first 11 months of the fiscal year, Victoria’s Secret and Pink North American comparable store sales are down 9%. Nevertheless, L Brands has slightly increased its net lingerie store counts on this continent. During the period between January 28, 2017 and December 30, 2017, in the U.S., L Brands opened five and closed nine Victoria’s Secret stores, dropping the total to 994; opened eight and closed one Pink store raising the total to 140; and opened one La Senza shop, raising the total to 5. In other words, a net gain of four stores in the U.S.
During the same period, in Canada, the company opened two Victoria’s Secret stores, raising the total to 39; closed two Pink stores dropping the total to seven; and opened one and closed two La Senza store, dropping the total to 121. In other words, a net one less stores there.
Outside of North America, L Brands expanded its intimates businesses more aggressively during the year. During the period between January 28, 2017 and December 30, 2017, in the U.K. and Ireland, the company opened three Victoria’s Secret stores, raising the total to 18; opened two Pink stores in the U.K., raising the total to five; opened two and closed three Victoria’s Secret Beauty and Accessories shops (all believed to be in China), dropping the total to 30; and opened its first five full service Victoria’s Secret stores, also in China.
Speaking about Victoria’s Secret and Pink, Preston stated, “January will begin with a continuation of our semi-annual sale. At the end of the month we will focus on Valentine’s Day.”
She added, referring to L Brands as a whole, “we expect comps for the total company in January to be up low single digits.” — NM
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