REYNOLDSBURG, Ohio, Aug. 24, 2022 (GLOBE NEWSWIRE) Victoria’s Secret & Co. (“Victoria’s Secret” or the “Company”) (NYSE: VSCO) today reported 2022 financial results for the second quarter ended July 30, 2022.

Chief Executive Officer Martin Waters commented, “As we celebrate our first year as an independent, publicly-traded company, I would like to express my deepest appreciation for the hard work and dedication of our team of associates and partners around the world. 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.”

Martin continued, “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.”

Second Quarter Results
The Company reported net income of $70 million, or $0.83 per diluted share for the second quarter of 2022. This result compares to net income of $151 million, or $1.71 per share for the second quarter of 2021.

Second quarter 2022 reported results include a pre-tax charge of $29 million, principally severance, related to the previously announced restructuring actions to reorganize, streamline and improve our leadership structure. Excluding this special item, adjusted net income was $92 million, or $1.09 per diluted share, which was near the midpoint of the previously communicated guidance of $0.95 to $1.25 per diluted share.

Second quarter 2022 reported operating income was $98 million. Excluding the pre-tax charge mentioned above, adjusted operating income was $127 million, which was in the range of our previously communicated guidance of $125 million to $155 million and compared to $203 million in the second quarter of 2021.

The Company reported net sales of $1.521 billion for the second quarter of 2022, a decrease of 6% compared to net sales of $1.614 billion in the prior year second quarter. This result was below our previously communicated guidance as customer traffic trends decelerated across the retail environment throughout the quarter. Total comparable sales for the second quarter of 2022 decreased 8% compared to the second quarter of 2021.

At the conclusion of this press release, we have included a reconciliation of reported to adjusted results.

Capital Allocation
On March 2, 2022, the Company announced a share repurchase program providing for the repurchase of up to $250 million of the Company’s common stock during the year. During the second quarter, the Company invested $62 million to repurchase 1.7 million shares under this program. Year to date, the Company has invested $171 million to repurchase 3.9 million shares under this program. The Company continues to expect to complete the share repurchase program by the end of fiscal year 2022.

Full Year 2022 Outlook
The Company is forecasting full year 2022 net sales to decrease in the mid to high single digit range compared to last year’s full year net sales of $6.785 billion. At this forecasted level of sales, adjusted operating income is expected to be in the range of $525 million to $575 million, or approximately 8% to 9% of sales.

Third Quarter 2022 Outlook
The Company is forecasting third quarter 2022 net sales to decrease in the high single digit range compared to last year’s third quarter net sales of $1.441 billion. Operating income is expected to be in the range of $10 million to $40 million compared to $108 million in the third quarter of 2021. Earnings are estimated to be in the range of $0.00 to $0.25 per diluted share compared to earnings of $0.81 per share last year.

About Victoria’s Secret & Co.

Victoria’s Secret & Co. (NYSE: VSCO) is a Fortune 500 specialty retailer of modern, fashion-inspired collections including signature bras, panties, lingerie, casual sleepwear, athleisure and swim, as well as award-winning prestige fragrances and body care. VS&Co is comprised of market leading brands, Victoria’s Secret and Victoria’s Secret PINK, that share a common purpose of inspiring and uplifting our customers in every stage of their lives. We are committed to empowering our more than 30,000 associates across a global footprint of nearly 1,350 retail stores in approximately 70 countries. We provide our customers with products and experiences that make them feel good inside and out while driving positive change through the power of our products, platform and advocacy.

Total Sales (Millions):

¹ – Results include consolidated joint venture sales in China, royalties associated with franchised stores and wholesale sales.

Comparable Sales Increase (Decrease):

NOTE: Stores are excluded from the comparable sales calculation when they have been closed for four consecutive days or more. Therefore, comparable sales results exclude periods of time that stores were closed for four consecutive days or more as a result of the COVID-19 pandemic.  Please refer to our filings with the Securities and Exchange Commission for further discussion regarding our comparable sales calculation.
¹ – Results include company-operated stores in the U.S. and Canada, consolidated joint venture stores in China and direct sales.
² – Results include company-operated stores in the U.S. and Canada and consolidated joint venture stores in China.

Total Stores:

¹ – Includes eight partner-operated stores.