L Brands to Restructure Victoria's Secret, Cut About 200 Jobs -- Update

By Joshua Jamerson 

L Brands Inc. said it would restructure its Victoria's Secret business in an attempt to streamline operations and focus more on its core merchandise, as the retailer reported better-than-expected growth Thursday across its established stores in March.

The restructuring comes two months after Sharen Turney resigned as Victoria's Secret chief executive.

L Brands said it plans to reorganize Victoria's Secret into three units: Victoria's Secret Lingerie, PINK and Victoria's Secret Beauty. Leaders at each unit will report directly to Chairman and Chief Executive Leslie Wexner.

Victoria's Secret will cut about 200 home office associates in New York and in Columbus, Ohio, where the company is based. The company also will eliminate certain merchandise categories and focus resources on core merchandise, where L Brands sees the most potential for growth.

Mr. Wexner said the moves are an effort in "narrowing our focus and simplifying our operating model," adding that the company is "taking care to support" those who would lose jobs.

Victoria's Secret same-store sales grew 2% in March as a decline in the beauty segment was offset by growth in PINK and lingerie. The company also said the shift of the Easter holiday into March this year from April last year hurt results.

Analysts, on average, expected 1.4% growth in March, according to Consensus Metrix.

Company wide, same-store sales rose 3% at L Brands, also the parent of Bath & Body Works and La Senza. Analysts, on average, had expected 1.52%.

L Brands said total company sales increased 4.7% to $1.03 billion in March.

Shares, down 11% in the past three months, were inactive premarket.

Write to Joshua Jamerson at [e-mail]

(END) Dow Jones Newswires

April 07, 2016 09:21 ET (13:21 GMT)

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