Yahoo Finance L Brands Sustains Decent Comparable Sales Run in November
L Brands, Inc.’s LB sustained focus on cost containment, inventory management, merchandise, and speed-to-market initiatives has kept it afloat in a competitive environment. Further, the company’s Bath & Body Works segment continues to drive the comparable sales (comps) performance.
Comps for the four-week period ended Dec 1, 2018 rose 9%. Comps for the month under review fared better than the prior-year period’s decline of 1% and also showcased an improvement from growth of 4% and 5% registered in October and September, respectively.
Net sales during the month under review surged 26% to $1.596 billion from $1.267 billion reported in the prior-year period.
After recording flat comps in the month of October, Victoria’s Secret comps increased 2% in the month of November on account of growth witnessed in lingerie and beauty. This was partly offset by sluggishness in the Pink brand. Moreover, merchandise margin rate fell considerably in the month under review, primarily owing to higher promotional activity.
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Comps at Bath & Body Works surged 18% in the month of November, following an increase of 11% in the preceding month. Merchandise margin rate fell owing to calendar shift. Promotional activity was lower during the period.
L Brands’ operational efficiencies together with its new and innovative collections bode well. Furthermore, the company’s focus on tapping international markets is likely to provide long-term growth opportunities and generate increased sales volumes. We note that shares of this Zacks Rank #2 (Buy) stock have increased 13% against the industry’s decline of 17.7% in the past three months.
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