L Brands, Inc. (LB - Free Report) came out with its comparable sales (comps) results for January, wherein the metric for the four-week period ended Feb 2, 2019, declined 1%. Looking at the monthly trend, the company’s comps performance appears to have lost momentum, lately. We note that comps rose 9% in November, followed by flat comps in December.
The company’s net sales decreased 25% to $780.1 million during the month under review from $1.04 billion reported in the prior-year period. Net sales had also dipped 1.6% in the preceding month.
Moving on, Victoria’s Secret has been witnessing dismal comps performance for quite some time now. For the month of January, the brand saw its comps decline 1%, against 4% growth in the prior-year period. This decline can be attributed to soft performance in Lingerie and Pink brands. Also, Victoria’s Secret merchandise margin rate fell significantly, due to higher promotional activities to boost traffic.
This specialty retailer of women's intimate and other apparel, beauty, and personal care products has been reeling under consumers’ changing preferences that continue to impact its Victoria’s Secret lingerie brand. Although the brand has been making efforts to get back on track through increased promotions in the past year, it failed to make a mark during the recent holiday season. Per sources, the company intends to close some of its Victoria’s Secret brand stores to focus on its core categories.
Meanwhile, comps remained flat in Bath & Body Works compared with growth of 13% registered in the year-ago period. Management informed that lean inventory levels resulted in less promotional activities for the month under review. Merchandise margin rate for the brand increased on the back of less promotional activities, partly negated by expenses related to supply-chain issues.
For the 13-week period ended Feb 2, comps rose 3% year over year, while net sales inched up 0.6% to $4.9 billion. Comps declined 3% year over year at Victoria’s Secret, while the metric improved 12% at Bath & Body Works.
Meanwhile, shares of this Zacks Rank #3 (Hold) company have lost 28.7% in the past three months, underperforming the industry’s decline of 14.6%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Apart from L Brands; Costco (COST - Free Report) , Zumiez (ZUMZ - Free Report) and Buckle (BKE - Free Report) reported sales results for January. Costco and Zumiez registered comps growth of 5.2%, and 3.5%, respectively. However, comps for Buckle declined 2.2%.
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