THE WHAT? Victoria’s Secret & Co has reported its results for the second quarter ended July 30, 2022. Net sales dropped 6 percent compared to the prior-year period hitting US$1.521 billion, below guidance, but operating income and earnings remained on target.
THE DETAILS Indeed, second quarter reported operating income was US$127 million, excluding a pre-tax charge related to the restructuring actions, within guidance of US$125 million to US$155 million but down from last year’s Q2 income of US$203 million.
Net income was also down at US$70 million versus the prior year’s US$151 million. The company is expecting full year 2022 sales to decrease in the mid to high single digit range and operating income to be in the range of US$525 million to US$575 million.
THE WHY? Chief Executive Officer Martin Waters commented, “As a company, we undertook and committed to not simply an evolution, but a revolution of our strategy. We aspired to and are proud to be a different company today, with a new leadership team and a mission to welcome, celebrate, and champion all women. We have made much progress, but recognize this transformation is a journey, and our work continues to become the Victoria’s Secret our customers and associates deserve – where everyone feels seen, respected, and valued.
“We continue to be the market leader in our category and our brand transformation continues to be well received by our customers. Even in a very difficult macroeconomic environment, thanks to our team’s relentless focus on execution, we were able to deliver second quarter adjusted operating income and adjusted earnings per diluted share results within our guidance range. We expect customers will continue to be challenged by inflationary and other financial pressures for the balance of 2022, and we have adjusted our inventory position and cost structure accordingly while allowing for continued investment in growth initiatives. We are confident in our ability to navigate and execute in a shifting consumer landscape with our new, optimized leadership structure which allows for greater agility and focus on the customer and growth initiatives.”