Bath & Body Works Reports Mixed Q3 2023 Results

Bath & Body Works Reports Mixed Q3 2023 Results

THE WHAT? Bath & Body Works, Inc. has released its financial results for the third quarter of 2023, revealing various achievements and challenges. CEO Gina Boswell highlighted the company’s performance, emphasising strong merchandise margin improvement and the benefits of cost optimisation initiatives. However, the company reported a slight decrease in net sales compared to the previous year.

THE DETAILS  For the third quarter ended October 28, 2023, Bath & Body Works reported net sales of $1.562 billion, a 2.6% decrease from the $1.604 billion in the same period last year. Notably, the company’s earnings per diluted share increased to $0.52, up from $0.40 in the previous year. This improvement was partly due to a $12 million pre-tax gain from the early extinguishment of debt. Excluding this gain, the adjusted earnings per diluted share were $0.48, and the adjusted net income was $110 million.

THE WHY?  In response to these results, Bath & Body Works has adjusted its outlook for the full fiscal year 2023. The company now expects a slight decline in net sales, estimating a decrease of 2.5% to 4% from 2022’s $7.560 billion. The full-year earnings per diluted share are anticipated to be between $2.99 and $3.19, with the adjusted figure, excluding the gain from debt extinguishment, ranging from $2.90 to $3.10. This revised forecast considers the better-than-expected third-quarter results, the impact of debt and share repurchases, and moderated sales expectations for the year. For the fourth quarter, the company anticipates a decrease in net sales by 1% to 5% and earnings per diluted share between $1.70 and $1.90, factoring in the effects of an additional 53rd week in the fiscal year.