US: L Brands books mixed Q4 results
- Earnings up to US$489.6m
- Sales slide 1%
- FY EPS guided at $3-3.20
L Brands, formerly known as Limited Brands, has booked a mixed fourth-quarter with an increase in earnings but a drop in revenues.
The retailer, which operates the Victoria's Secret and Bath & Body Works chains, reported earnings of US$489.6m in the three month period ended 2 February, compared to $519.2m last year.
The increase was due mainly to lower expenses and the absence of a goodwill impairment charge recorded last year.
Sales slid 1% to $3.818bn from $3.856bn in the prior year period. Comparable store sales, however, edged up 1%.
The company said it expects FY EPS to be between $3.00 and $3.20, including EPS of between $0.44 and $0.49 in the first quarter. Comparable store sales are guided to be flat to low-single digit.
FBR Capital Markets analyst Susan Anderson said guidance was "a bit light" versus consensus, but added: "We believe that this was likely expected given the environment (precedent has also been set by other retailers guiding conservatively)."
She added: "We expect a continuation of the promotional environment into 2014 but not significantly more promotional year-on-year. In addition, Limited Brands likely has some benefits at BBW [Bath & Body Works] with higher price points on products that could offset some promotional activity at the segment."
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