Limited Brands 2Q Profit Rises 29%; Raises Full-Year EPS View

   DOW JONES NEWSWIRES 
 

Limited Brands Inc. (LTD) fiscal second-quarter earnings increased 29% on continued improvement in both sales and margin, as the specialty retailer raised its full-year profit guidance.

Shares in the parent of Victoria's Secret and Bath & Body Works were up 3.4% at $35.50 after hours. Through the close, the stock had risen 12% so far this year, while the wider market was negative. Shares hit their highest level ever in May.

Limited raised its full-year earnings outlook to $2.35 to $2.50 a share, up from May's outlook of $2.25 to $2.45 a share. Limited also predicted fiscal third-quarter earnings of 17 cents to 22 cents a share, the top end just touching the 22-cent consensus estimate of analysts polled by Thomson Reuters.

The company has reported quarterly profit growth for two years straight now, lately supported by a strategy to increase regular-priced selling by reining in promotions and clearances while trimming inventory.

"Our focus on managing inventory and expenses conservatively and staying agile yielded more full-priced selling," Chairman and Chief Executive Leslie H. Wexner said Wednesday of the latest results.

For the quarter ended July 30, the company posted a profit of $231.2 million, or 73 cents a share, from $178.7 million, or 54 cents a share, a year earlier. Excluding gains related to Express stock sales and other one-time items, earnings rose to 48 cents a share from 36 cents.

Earlier this month, Limited raised its adjusted earnings outlook for the quarter to 44 cents to 46 cents a share.

At the same time, it reported revenue rose 9.6% to $2.46 billion, better than analysts' consensus estimate at the time, with same-store sales rising 12%.

In the latest period, gross margin rose to 36.7% from 34.7%.

-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291; [e-mail]