Vitoria's Secret Parent Company Raised Its Annual Profit Target.

After achieving better than expected earnings in the first quarter, Victoria 's Secret

parent company

Inc. (NYSE:LB) raised its annual profit target, stimulating its share price to rise 8% after the session.

According to the world clothing and shoe net, the group announced quarterly sales data at the beginning of the month. The group disclosed further net profit of 94 million 50 thousand US dollars on Wednesday, 17, although it was 38.2% lower than the 152 million 300 thousand US dollars in the same period last year. The adjusted EPS also dropped from 0.59 US dollars to 0.33 US dollars, but it was far ahead of the expected US $0.30 and the market expectation of US $0.29.

In the first quarter of April 29th, net sales of L Brands Inc. fell 6.8% to 2 billion 436 million 500 thousand US dollars, basically reaching US $2 billion 440 million in the market forecast.

Same store sales plunged 9%, including 6 percentage points of Victoria 's Secret Vitoria's secret exit from swimwear and clothing business.

Same store sales plunged 14%, Bath & Body Works rose slightly by 2%.

In February, it was the worst month. In March, the market saw hope, and in April it regressed.

In the three secret businesses of Victoria s Secret Vitoria, the sale of underwear sold in the same store of the same store declined. Although sales benefited from the popularity of sports bra and ultra-thin bra, the growth of 14%-16% and the successful intake of younger customers, but the lower retail prices of these two categories resulted in a decline in sales. The group said that from the fall of new products, it began to focus on the traditional bra, so as to achieve the balance of product mix.

In addition, Pink sales in the same store with an increase of 11%-13% are moving towards annual sales of $3 billion, while beauty business has recorded a decline of high digits.

Jefferies Group LLC analyst Jack Forrest Randal Konik reported earlier this month that more and more evidence shows that the secret monopoly of Victoria 's Secret Vitoria is collapsing day by day. Not only the core bra category has been shrinking, but also the growth of Pink series is slowing down, which means that the loss of market share is accelerating.

L Brands Inc. chairman, chief executive and major shareholder Leslie H. Wexner decided last year to end the secret year of Victoria s Secret Vitoria selling swimwear and clothing business of about 500 million dollars, but these products are actually loved by many loyal customers.

The management of Target Corp. NYSE:TGT (NYSE:TGT), Taghit department store and American Eagle Outfitters Inc. NYSE:AEO (NYSE:AEO) and other retailers in this week's quarterly press conference revealed that their swimsuit business has benefited from the strategic retreat of Victoria s Secret Vitoria.

Victoria 's Secret Vitoria's first secret flagship store in China

Driven by China's proprietary business, the net sales increased by 8.5% to 103 million 300 thousand U.S. dollars annually. The group opened a secret flagship store in Shanghai and Chengdu in February this year, China's first two Victoria 's Secret Secret, but it also recorded a $600 thousand operating loss as a result of China's massive investment in manpower, infrastructure and real estate.

In its performance commentary, the group expressed satisfaction with the initial performance of China's VSFA (all product stores), and said that VSBA (beauty and accessories stores) achieved "very healthy same store sales growth". Meanwhile, Tmall international flagship store, which was launched last year, is also making progress. The store will complete the pfer to Tmall's domestic platform this summer and launch the next day delivery service.

The gross profit margin of the group dropped by 320 basis points to 37.1% in the first quarter as a result of the rise in the purchase and occupancy expenses, and the gross profit margin of the group dropped by 12% in the first quarter.

In the short term, L Brands Inc. expects the same store sales in the May and the two quarter will continue to record the highest and middle declines in the May and the second quarter, which will continue to decline more than this year. Victoria's s Secret's secret business restructuring will have 10 percentage points and 6 percentage points negative for this month and this quarter, but the impact of the three quarter and the four quarter will be narrowed to 2%-3% and 1% respectively.

The two quarter EPS is expected to be 0.40-0.45 dollars, slightly lower than the market expectations of $0.46, but reflects the same store sales and gross profit margins continued to improve, compared to the same period last year was $0.70.

Excluding the impact of business restructuring, the same store sales all year round are expected to decline to a low single digit growth rate. EPS is expected to rise from the previous 3.05-3.35 US dollar to 3.10-3.40 US dollars, with a market forecast of US $3.21.

The annual capital expenditure budget is within the expected range, which is about 850 million yuan, including the investment of more than 100 new stores in the international market. China will also set up 4 new product stores this year. Among them, the flagship store of Macao Venice has opened in April, and Hongkong store is also expected to enter Tongluowan next year.

As for the North American market, the secrets of Victoria 's Secret Vitoria and Bath & Body Works will add 2 and 21 new stores respectively.

L Brands Inc. (NYSE:LB) rose 0.23% on Wednesday to $48.40, which has fallen by 26.5% since 2017.

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