Victoria's Secret, Bath & Body Permanently Closing Stores Nationwide
May 23 2020
On a call with analysts, Victoria's Secret CEO Stuart Burgdoerfer said, "What we see is a somewhat smaller but substantially more profitable business with a much better foundation, and then obviously a return to growth which is what all of us are looking for". It's another blow to the beleaguered retailer just weeks after its half-billion dollar plan to go private was scrapped. L Brands is also set to close 51 stores of its other brand, Bath & Body Works.
Victoria's Secret is slimming down - and Wall Street likes the new look.
About 250 Victoria's Secret stores will close in the USA and Canada, and 51 Bath & Body Works locations will also close.
Victoria's Secret in its earnings statement said it had furloughed most store associates as of April 5 and reduced top management salaries by 20 percent. L Brands previously had an agreement with private equity firm Sycamore Partners to take the retailer private, but the firm chose to pull out of the agreement in early May citing temporary store closures sparked by the coronavirus pandemic.
The retailer, a mall staple which sells lingerie, womenswear and beauty products with 1,070 stores in North America, suffered a 46% loss in sales in the first quarter of 2020 as stores closed due to the coronoavrius pandemic and demand took a significant dip as people sheltered in place.
L Brands also announced that 51 Bath & Body Works stores in the US and Canada will close this year.
Shares of Columbus, Ohio-based L Brands recently changed hands at $13.61, up 11.4 percent.
During the first quarter that ended May 2, L Brands sales dropped 37%.