L Brands, the parent company that owns Victoria’s Secret, recently announced a 1.8% decrease in net sales for the holiday season. Victoria’s Secret, specifically, experienced a significant drop of 9% in comparable sales during this period. This decline in sales can be attributed to the ongoing Covid-19 pandemic, which led to reduced foot traffic and a 23% decrease in in-store comps for Victoria’s Secret.

However, despite the decrease in sales at physical locations, Victoria’s Secret’s direct channel saw a substantial 24% increase in sales. This suggests that customers are turning to online shopping more frequently, which could be a positive outcome for the brand.

L Brands reported total net sales of $3.84 billion for the nine-week period ending on January 2, 2021, which is a decrease from the $3.91 billion reported the previous year. It’s worth noting that these figures do not include sales from locations that were temporarily closed due to the pandemic.

Although the decline in sales may seem concerning, L Brands’ CEO, Andrew Meslow, expressed satisfaction with the holiday results, as they surpassed initial expectations. Meslow highlighted the progress made at Victoria’s Secret, specifically mentioning improvements in the quarter-to-date merchandise margin rate. He attributed this progress to several factors, including an enhanced merchandise assortment, focused execution of retail fundamentals, and the implementation of a profit improvement plan.

On the other hand, Bath & Body Works, another brand under the L Brands portfolio, performed well during the holiday season. It reported a notable 17% increase in comparable sales, with a 5% rise in in-store comps and an impressive 64% growth in the direct channel. This demonstrates the brand’s ability to adapt to the changing consumer landscape and capitalize on online sales.

Looking ahead, L Brands expects to report earnings per share between $2.70 and $2.80 for the fourth quarter. The company is set to release its Q4 financial results on February 24, 2021.

Useful links:
L Brands Investor Relations
Victoria’s Secret Official Website