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Shoppers walk past a Victoria’s Secret store in Chicago in 2019.
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L Brands Inc. stock rose more than 5% in after-hours trading Wednesday after the retailer reported quarterly earnings head and shoulders above Wall Street expectations thanks to “significant improvement” for its Victoria’s Secret brand.
L Brands LB, -5.19% said it earned $330.6 million, or $1.17 a share, in the third quarter, contrasting with a loss of $252.0 million, or 91 cents a share, in the year-ago period.
Adjusted for one-time items, L Brands earned $1.13 a share, compared with 2 cents a share a year ago. Revenue rose to $3.06 billion, from $2.68 billion a year ago. Same-store sales rose 28% in the quarter, L Brands said.
Analysts polled by FactSet had expected the company to report adjusted earnings of 12 cents a share on sales of $2.68 billion.
“L Brands reported a record third quarter, driven by exceptional results and continued strength at Bath & Body Works, and a significant improvement in performance at Victoria’s Secret,” Chief Executive Andrew Meslow said in a statement.
The company heads into the holiday season with “well positioned” inventory and “encouraged” by early responses to its merchandise, Meslow said.
“However, we are cautious about our ability to exceed last year’s fourth-quarter sales and earnings results, given anticipated constraints on store traffic, online fulfillment and shipping capacity, as well as other uncertainties related to the COVID pandemic,” he said.
Shares of L Brands have gained 85% this year, compared with gains around 10% for the S&P 500 index. SPX, -1.15%
