Earnings Up 24% at Victoria's Secret Parent L Brands

By Anne Steele And Tess Stynes 

L Brands Inc., the parent company of Victoria's Secret and Bath & Body Works, again raised its per-share earnings guidance for the year as it reported that profit rose 24% in the three months ended in October.

For the year ending in January, the company now expects per-share earnings of $3.69 to $3.79, compared with its recently increased estimate for per-share profit of $3.58 to $3.73.

However, for the holiday quarter, L Brands forecast per-share earnings of $1.85 to $1.95, below estimates of analysts polled by Thomson Reuters for per-share profit of $1.98.

The Ohio-based company has been a relative bright spot in a retail industry that has faced challenges from a highly promotional environment. For L Brands, well-managed inventories have helped the retailer avoid the markdowns that have plagued many peers.

For the quarter ended Oct. 31, the retailer's gross margin rose to 41.6% from 40.8%.

Overall, L Brands reported a profit of $164 million, up from $131.8 million a year earlier. Per-share earnings rose to 55 cents from 44 cents. The company earlier this month said it expected to make 51 cents to 53 cents a share, compared with its earlier view of 40 cents to 45 cents a share.

Revenue rose 7% to $2.48 billion. Analysts were looking for $2.49 billion.

Sales at stores open at least a year increased by 7%. At Victoria's Secret, which generates the bulk of the company's revenue, sales at established stores grew 7%, while sales at Bath & Body Works improved 6%.

Shares of the company rose 0.8% to $92.95 in after-hours trading.

Write to Anne Steele at [e-mail] and Tess Stynes at [e-mail]

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(END) Dow Jones Newswires

November 18, 2015 17:35 ET (22:35 GMT)

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