CEO of Victoria’s Secret & Co Martin Waters commended the team on its results following a “volatile” fourth quarter in 2023.

Waters attributed the positive results in Q4 to disciplined inventory management and cost reductions related to its ‘transform the foundation’ initiative, which aims to modernise Victoria’s Secret’s supply chain operating model.

Q4 highlights

  • Net sales increase to $2.08bn from $2.02bn
  • Operating income increased to $258.4m from $243.4m
  • Net income rose to $183.5m from $172.1m.

FY highlights

  • Net sales fell to $6.2bn from $6.3bn
  • Operating income sank to $245.6m from $477.6m
  • Net income fell to $115.8m from $337.7m

With the long-term health of the business in mind, Waters said the company remains committed to its strategic priorities of accelerating its core, igniting growth and transforming the foundation.

“As we look into the new year, we recognise the broader intimates market in North America has been down for four consecutive quarters and we are planning the business appropriately conservative in the near-term.

“At the same time, we are focused on delivering on multiple initiatives to drive growth in our business, including our multi-tender loyalty program, new customer experience enhancements in our digital business, product improvements and launches to enhance the Victoria’s Secret brand and a reimagined merchandise strategy for PINK.

“At our Investor Day in October 2023, we discussed our focus on accelerating our core, and our initiatives designed to leverage our market leadership position and unlock our opportunity to convert our significant cultural influence into long-term financial growth. We believe our strategies will position the business to deliver the potential of our category-defining Victoria’s Secret and PINK brands, and I believe we have the right leadership team in place at the right time for our business to be successful. We remain confident in our brand repositioning efforts and are committed to delivering our long-term financial targets and returning value to our shareholders.”

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Full Year and Q1 2024 Outlook

Victoria’s Secret is forecasting 52-week fiscal year 2024 net sales to be about $6bn. That’s a low-single digits decline compared to 52-weeks from fiscal year 2023.

At this forecasted level of sales, adjusted operating income for fiscal year 2024 is expected to be about $250m to $275m.

Victoria’s Secret is also forecasting Q1 2024 net sales to decrease by mid-single digits compared to last year’s first quarter net sales of $1.407bn. At this forecasted level of sales, adjusted operating income for the first quarter of 2024 is expected to be in the range of $10m to $35m.