February 28, 2019 / 4:41 AM / 7 months ago

L Brands issues weak Victoria's Secret sales; FY forecast below estimates

A customer passes by an L Brands Inc., Victoria's Secret retail store in Manhattan, New York, U.S., May 13, 2016. REUTERS/Brendan McDermid

(Reuters) - Fashion retailer L Brands on Wednesday forecast 2019 earnings below estimates and reported lower quarterly sales for its Victoria’s Secret business, sending its shares down 6 percent in after-hours trading.

Sales at Victoria’s Secret fell 5.14 percent to $2.53 billion while same-store sales declined 3 percent in the holiday quarter, as customers move to comfortable sports bras and bralettes.

The Victoria’s Secret owner also said it expects 2019 earnings per share to be between $2.20 and $2.60, falling short of analysts’ estimates of $2.71, according to IBES data from Refinitiv.

Same-store sales for L Brands on the whole rose 3 percent as its second-biggest division by revenue, Bath & Body Works, saw a same-store sales growth of 12 percent.

Net income fell to $540.1 million, or $1.94 per share, in the quarter ended Feb. 2, from $664.1 million or $2.33 a share, a year earlier.

Net sales for the quarter rose 0.60 percent to $4.85 billion.

Excluding expenses, the company earned $2.14 per share.

Analysts on average had expected the company to report quarterly adjusted earnings of $2.07 per share, on revenue of $4.88 billion, according to IBES data from Refinitiv.

(The story corrects to remove reference to profit in headline and lead; corrects net income figure in paragraph 5 to $540.1 mln from $5.4 mln and year-ago number to $664.1 mln from $6.4 mln)

Reporting by Ishita Chigilli Palli and Supriya Roy in Bengaluru; Editing by Shreejay Sinha

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