Bath & Body Works, Inc. (NYSE: BBWI) today reported second
quarter 2023 results.
Gina Boswell, CEO of Bath & Body Works,
commented, “In the second quarter, we delivered net sales in line
with our expectations, and the early benefits of our cost
optimization and merchandise margin improvement initiatives helped
drive earnings which outperformed our expectations. Our team
remained agile in response to the dynamic macroeconomic
environment, with a focus on delivering innovation and building
capabilities to position our company for topline growth and margin
expansion. We are executing well against a diverse set of
opportunities within our key areas of focus, which will enable us
to better serve our customers, drive profitable growth and create
long-term value for our stakeholders.”
Second Quarter 2023 Results
The company reported net sales of $1.559 billion
for the second quarter ended July 29, 2023, a decrease of 3.6%
compared to net sales of $1.618 billion for the second quarter
ended July 30, 2022.
The company reported earnings per diluted share
of $0.43 for the second quarter of 2023, compared to $0.52 for the
same period of the prior year. Second quarter operating income was
$188 million compared to $242 million last year, and net income was
$99 million compared to $120 million last year.
Reported second quarter 2023 net income includes
a $9 million pre‐tax gain ($7 million after‐tax gain) associated
with the early extinguishment of debt, resulting from the open
market repurchase and retirement of $115 million principal amount
of the company’s senior notes during the second quarter.
Excluding the gain on the early extinguishment
of debt, adjusted second quarter 2023 earnings per diluted share
were $0.40 and adjusted net income was $92 million.
At the conclusion of this press release is a
reconciliation of reported‐to‐adjusted results.
2023 Outlook
The company has updated its full‐year forecast
to reflect better-than-expected bottom line results in the second
quarter, the impact of debt and share repurchases in the second
quarter and narrowed sales expectations for the fiscal year.
For fiscal 2023, the company expects net sales
to decline 1.5% to 3.5% compared to $7.560 billion in 2022. The
company now expects full-year 2023 earnings per diluted share to be
between $2.85 and $3.15, compared to $3.40 in 2022. The company
expects full-year 2023 adjusted earnings per diluted share to be
between $2.80 and $3.10. The company’s adjusted earnings per
diluted share forecast excludes the gain on the early
extinguishment of debt associated with the open market repurchase
and retirement of $199 million principal amount of the company’s
senior notes through the end of the second quarter.
Fiscal 2023 will include a 53rd week, with the
fourth quarter of fiscal 2023 consisting of 14 weeks. The company’s
full-year outlook includes the impact of the 53rd week, estimated
at 7 cents per diluted share.
The company expects third quarter net sales to
decline 2.5% to 4.0% compared to $1.604 billion in the third
quarter of 2022. Third quarter earnings per diluted share are
expected to be between $0.30 and $0.40, compared to $0.40 earnings
per diluted share in the third quarter of 2022.
The company’s third quarter and full-year
outlook exclude the impact of any future debt or share repurchase
activity.
Earnings Call and Additional Information
Bath & Body Works, Inc. will conduct its
second quarter earnings call at 9:00 a.m. Eastern on August 23. To
listen, call 1.888.946.7609 (international dial‐in number:
1.517.308.9411); conference ID 6362067. For an audio replay, call
1.888.282.0035 (international replay number: 1.203.369.3602);
conference ID 6362067 or log onto www.BBWInc.com.
ABOUT BATH & BODY WORKS
Home of America’s Favorite Fragrances®, Bath
& Body Works is a global leader in personal care and home
fragrance, including top-selling collections for fine fragrance
mist, body lotion and body cream, 3-wick candles, home fragrance
diffusers and liquid hand soap. Powered by agility and innovation,
the company’s predominantly U.S.-based supply chain enables the
company to deliver quality, on-trend luxuries at affordable prices.
Bath & Body Works serves and delights customers however and
wherever they want to shop, from welcoming, in-store experiences at
more than 1,820 company-operated Bath & Body Works locations in
the U.S. and Canada and more than 440 international franchised
locations to an online storefront at bathandbodyworks.com.
Safe Harbor Statement Under the Private Securities
Litigation Reform Act of 1995
We caution that any forward-looking statements
(as such term is defined in the Private Securities Litigation
Reform Act of 1995) contained in this press release or made by our
company or our management involve risks and uncertainties and are
subject to change based on various factors, many of which are
beyond our control. Accordingly, our future performance and
financial results may differ materially from those expressed or
implied in any such forward-looking statements. Words such as
“estimate,” “project,” “plan,” “believe,” “expect,” “anticipate,”
“intend,” “planned,” “potential,” “target,” “goal” and any similar
expressions may identify forward-looking statements. Risks
associated with the following factors, among others, in some cases
have affected and in the future could affect our financial
performance and actual results and could cause
actual results to differ materially from those expressed or implied
in any forward-looking statements included in this press release or
otherwise made by our company or our management:
- general economic conditions,
inflation and deflation, consumer confidence, consumer spending
patterns and market disruptions including pandemics or significant
health hazards, severe weather conditions, natural disasters,
terrorist activities, financial crises, political crises or other
major events, or the prospect of these events;
- the seasonality of our
business;
- the anticipated benefits from the
Victoria’s Secret & Co. spin-off may not be realized;
- the spin-off of Victoria’s Secret
& Co. may not be tax-free for U.S. federal income tax
purposes;
- our dependence on Victoria’s Secret
& Co. for information technology services and the transition of
such services to our own information technology systems or to those
of third-party technology service providers;
- our ability to attract, develop and
retain qualified associates and manage labor-related costs;
- difficulties arising from turnover
in company leadership or other key positions;
- the dependence on store traffic and
the availability of suitable store locations on appropriate
terms;
- our continued growth in part
through new store openings and existing store remodels and
expansions;
- our ability to successfully operate
and expand internationally and related risks;
- our independent franchise, license
and wholesale partners;
- our direct channel business;
- our ability to protect our
reputation and our brand image;
- our ability to successfully
complete environmental, social and governance initiatives, and
associated costs thereof;
- our ability to successfully achieve
expected annual cost savings in connection with our profit
optimization efforts to reduce expenses and improve operating
efficiency in the business;
- our ability to attract customers
with marketing, advertising and promotional programs;
- our ability to maintain, enforce
and protect our trade names, trademarks and patents;
- the highly competitive nature of
the retail industry and the segments in which we operate;
- consumer acceptance of our products
and our ability to manage the life cycle of our brand, develop new
merchandise and launch new product lines successfully;
- our ability to source, distribute
and sell goods and materials on a global basis, including risks
related to:
- political instability, wars and
other armed conflicts, environmental hazards or natural
disasters;
- significant health hazards or
pandemics, such as the COVID-19 pandemic, which could result in
closed factories and/or stores, reduced workforces, scarcity of raw
materials, and scrutiny or embargoing of goods produced in impacted
areas;
- duties, taxes and other
charges;
- legal and regulatory matters;
- volatility in currency exchange
rates;
- local business practices and
political issues;
- delays or disruptions in shipping
and transportation and related pricing impacts;
- disruption due to labor disputes;
and
- changing expectations regarding
product safety due to new legislation;
- our geographic concentration of
vendor and distribution facilities in central Ohio;
- our reliance on a limited number of
suppliers to support a substantial portion of our inventory
purchasing needs;
- the ability of our vendors to
deliver products in a timely manner, meet quality standards and
comply with applicable laws and regulations;
- fluctuations in foreign currency
exchange rates;
- fluctuations in product input
costs;
- fluctuations in energy costs;
- our ability to adequately protect
our assets from loss and theft;
- increases in the costs of mailing,
paper, printing or other order fulfillment logistics;
- claims arising from our
self-insurance;
- our and our third-party service
providers’, including Victoria’s Secret & Co. during the term
of the Transition Services Agreement between us and Victoria’s
Secret & Co., ability to implement and maintain information
technology systems and to protect associated data;
- our ability to maintain the
security of customer, associate, third-party and company
information;
- stock price volatility;
- our ability to pay dividends and
make share repurchases under share repurchase authorizations;
- shareholder activism matters;
- our ability to maintain our credit
ratings;
- our ability to service, repurchase
or refinance our debt and maintain compliance with our restrictive
covenants;
- our ability to comply with laws,
regulations and technology platform rules or other obligations
related to data privacy and security;
- our ability to comply with
regulatory requirements;
- legal and compliance matters;
and
- tax, trade and other regulatory
matters.
We are not under any obligation and do not
intend to make publicly available any update or other revisions to
any of the forward-looking statements contained in this press
release to reflect circumstances existing after the date of this
press release or to reflect the occurrence of future events even if
experience or future events make it clear that any expected results
expressed or implied by those forward-looking statements will not
be realized. Additional information regarding these and other
factors can be found in “Item 1A. Risk Factors” in our 2022 Annual
Report on Form 10-K, as filed with the Securities and Exchange
Commission, and our subsequent filings.
For further information, please contact:
Bath & Body Works, Inc.:Investor RelationsHeather
HollanderInvestorRelations@bbw.com
Media RelationsJamison PackCommunications@bbw.com
BATH & BODY WORKS, INC.
Second Quarter
2023
Total Sales (In millions):
|
Second Quarter |
|
Second Quarter |
|
% |
|
Year-to-Date |
|
Year-to-Date |
|
% |
|
2023 |
|
2022 |
|
Inc/(Dec) |
|
2023 |
|
2022 |
|
Inc/(Dec) |
Stores - U.S. and Canada |
$ |
1,144 |
|
$ |
1,161 |
|
(1 |
%) |
|
$ |
2,177 |
|
$ |
2,220 |
|
(2 |
%) |
Direct - U.S. and Canada |
|
329 |
|
|
367 |
|
(10 |
%) |
|
|
609 |
|
|
684 |
|
(11 |
%) |
International (a) |
|
86 |
|
|
90 |
|
(4 |
%) |
|
|
169 |
|
|
163 |
|
4 |
% |
Total Bath & Body
Works |
$ |
1,559 |
|
$ |
1,618 |
|
(4 |
%) |
|
$ |
2,955 |
|
$ |
3,067 |
|
(4 |
%) |
(a) Results include royalties associated
with franchised stores and wholesale sales.
Total Company-Operated Stores:
|
Stores |
|
|
|
|
|
Stores |
|
1/28/2023 |
|
Opened |
|
Closed |
|
7/29/2023 |
United States |
1,693 |
|
46 |
|
(25 |
) |
|
1,714 |
Canada |
109 |
|
— |
|
— |
|
|
109 |
Total Bath & Body
Works |
1,802 |
|
46 |
|
(25 |
) |
|
1,823 |
|
|
|
|
|
|
|
|
|
Total Partner-Operated Stores:
|
Stores |
|
|
|
|
|
Stores |
|
1/28/2023 |
|
Opened |
|
Closed |
|
7/29/2023 |
International |
401 |
|
23 |
|
(8 |
) |
|
416 |
International - Travel
Retail |
26 |
|
2 |
|
— |
|
|
28 |
Total
International |
427 |
|
25 |
|
(8 |
) |
|
444 |
|
|
|
|
|
|
|
|
|
BATH & BODY WORKS, INC. |
CONSOLIDATED STATEMENTS OF INCOME |
(Unaudited) |
(In millions, except per share amounts) |
|
|
|
|
|
|
|
|
|
Second Quarter |
|
Year-to-Date |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Net Sales |
$ |
1,559 |
|
|
$ |
1,618 |
|
|
$ |
2,955 |
|
|
$ |
3,067 |
|
Costs of Goods Sold, Buying
and Occupancy |
|
(937 |
) |
|
|
(958 |
) |
|
|
(1,737 |
) |
|
|
(1,739 |
) |
Gross Profit |
|
622 |
|
|
|
660 |
|
|
|
1,218 |
|
|
|
1,328 |
|
General, Administrative and
Store Operating Expenses |
|
(434 |
) |
|
|
(418 |
) |
|
|
(849 |
) |
|
|
(806 |
) |
Operating Income |
|
188 |
|
|
|
242 |
|
|
|
369 |
|
|
|
522 |
|
Interest Expense |
|
(86 |
) |
|
|
(86 |
) |
|
|
(175 |
) |
|
|
(175 |
) |
Other Income |
|
25 |
|
|
|
2 |
|
|
|
45 |
|
|
|
3 |
|
Income Before Income
Taxes |
|
127 |
|
|
|
158 |
|
|
|
239 |
|
|
|
350 |
|
Provision for Income
Taxes |
|
28 |
|
|
|
38 |
|
|
|
59 |
|
|
|
75 |
|
Net Income |
$ |
99 |
|
|
$ |
120 |
|
|
$ |
180 |
|
|
$ |
275 |
|
|
|
|
|
|
|
|
|
Net Income per Diluted
Share |
$ |
0.43 |
|
|
$ |
0.52 |
|
|
$ |
0.78 |
|
|
$ |
1.16 |
|
|
|
|
|
|
|
|
|
Weighted Average Diluted
Shares Outstanding |
|
229 |
|
|
|
231 |
|
|
|
230 |
|
|
|
237 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BATH & BODY WORKS, INC. |
CONSOLIDATED CONDENSED BALANCE SHEETS |
(Unaudited) |
(In millions) |
|
|
July 29,2023 |
|
July 30,2022 |
ASSETS |
|
|
|
Current Assets: |
|
|
|
Cash and Cash Equivalents |
$ |
790 |
|
|
$ |
452 |
|
Accounts Receivable, Net |
|
153 |
|
|
|
184 |
|
Inventories |
|
818 |
|
|
|
971 |
|
Other |
|
132 |
|
|
|
147 |
|
Total Current Assets |
|
1,893 |
|
|
|
1,754 |
|
Property and Equipment, Net |
|
1,236 |
|
|
|
1,071 |
|
Operating Lease Assets |
|
1,080 |
|
|
|
1,087 |
|
Goodwill |
|
628 |
|
|
|
628 |
|
Trade Name |
|
165 |
|
|
|
165 |
|
Deferred Income Taxes |
|
38 |
|
|
|
45 |
|
Other Assets |
|
155 |
|
|
|
151 |
|
Total Assets |
$ |
5,195 |
|
|
$ |
4,901 |
|
LIABILITIES AND EQUITY (DEFICIT) |
|
|
|
Current Liabilities: |
|
|
|
Accounts Payable |
$ |
508 |
|
|
$ |
587 |
|
Accrued Expenses and Other |
|
518 |
|
|
|
512 |
|
Current Operating Lease Liabilities |
|
187 |
|
|
|
158 |
|
Income Taxes |
|
— |
|
|
|
1 |
|
Total Current Liabilities |
|
1,213 |
|
|
|
1,258 |
|
Deferred Income Taxes |
|
168 |
|
|
|
157 |
|
Long-term Debt |
|
4,668 |
|
|
|
4,858 |
|
Long-term Operating Lease
Liabilities |
|
1,036 |
|
|
|
1,050 |
|
Other Long-term Liabilities |
|
264 |
|
|
|
240 |
|
Total Equity (Deficit) |
|
(2,154 |
) |
|
|
(2,662 |
) |
Total Liabilities and Equity
(Deficit) |
$ |
5,195 |
|
|
$ |
4,901 |
|
|
|
|
|
|
|
|
|
BATH & BODY WORKS, INC. |
CONSOLIDATED STATEMENTS OF CASH FLOWS |
(Unaudited) |
(In millions) |
|
|
Year-to-Date |
|
|
2023 |
|
|
|
2022 |
|
Operating
Activities: |
|
|
|
Net Income |
$ |
180 |
|
|
$ |
275 |
|
Adjustments to Reconcile Net
Income to Net Cash Provided by Operating Activities: |
|
|
|
Depreciation of Long-lived Assets |
|
129 |
|
|
|
106 |
|
Share-based Compensation Expense |
|
18 |
|
|
|
15 |
|
Gain on Extinguishment of Debt |
|
(16 |
) |
|
|
— |
|
Changes in Assets and
Liabilities: |
|
|
|
Accounts Receivable |
|
74 |
|
|
|
55 |
|
Inventories |
|
(109 |
) |
|
|
(261 |
) |
Accounts Payable, Accrued Expenses and Other |
|
(87 |
) |
|
|
16 |
|
Income Taxes Payable |
|
(107 |
) |
|
|
(69 |
) |
Other Assets and Liabilities |
|
(5 |
) |
|
|
(56 |
) |
Net Cash Provided by Operating
Activities |
$ |
77 |
|
|
$ |
81 |
|
|
|
|
|
Investing
Activities: |
|
|
|
Capital Expenditures |
$ |
(178 |
) |
|
$ |
(161 |
) |
Other Investing Activities |
|
2 |
|
|
|
(1 |
) |
Net Cash Used for Investing
Activities |
$ |
(176 |
) |
|
$ |
(162 |
) |
|
|
|
|
Financing
Activities: |
|
|
|
Payments for Long-term Debt |
$ |
(182 |
) |
|
$ |
— |
|
Repurchases of Common Stock |
|
(48 |
) |
|
|
(1,312 |
) |
Dividends Paid |
|
(92 |
) |
|
|
(94 |
) |
Tax Payments related to
Share-based Awards |
|
(9 |
) |
|
|
(31 |
) |
Other Financing Activities |
|
(12 |
) |
|
|
(9 |
) |
Net Cash Used for Financing
Activities |
$ |
(343 |
) |
|
$ |
(1,446 |
) |
|
|
|
|
Effects of Exchange Rate
Changes on Cash and Cash Equivalents |
$ |
— |
|
|
$ |
— |
|
Net Decrease in Cash and Cash
Equivalents |
|
(442 |
) |
|
|
(1,527 |
) |
Cash and Cash Equivalents,
Beginning of Year |
|
1,232 |
|
|
|
1,979 |
|
Cash and Cash Equivalents, End of
Period |
$ |
790 |
|
|
$ |
452 |
|
|
|
|
|
|
|
|
|
BATH & BODY WORKS, INC. |
ADJUSTED FINANCIAL INFORMATION |
(Unaudited) |
(In millions, except per share amounts) |
|
|
|
|
|
|
|
|
|
Second Quarter |
|
Year-to-Date |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
Reconciliation of Reported Net Income to Adjusted Net
Income |
Reported Net Income |
$ |
99 |
|
|
$ |
120 |
|
$ |
180 |
|
|
$ |
275 |
Gain on Extinguishment of
Debt |
|
(9 |
) |
|
|
— |
|
|
(16 |
) |
|
|
— |
Tax Effect of Gain on
Extinguishment of Debt |
|
2 |
|
|
|
— |
|
|
4 |
|
|
|
— |
Adjusted Net Income |
$ |
92 |
|
|
$ |
120 |
|
$ |
168 |
|
|
$ |
275 |
|
|
|
|
|
|
|
|
Reconciliation of Reported Earnings Per Diluted Share to
Adjusted Earnings Per Diluted Share |
Reported Earnings Per Diluted
Share |
$ |
0.43 |
|
|
$ |
0.52 |
|
$ |
0.78 |
|
|
$ |
1.16 |
Gain on Extinguishment of
Debt |
|
(0.04 |
) |
|
|
— |
|
|
(0.07 |
) |
|
|
— |
Tax Effect of Gain on
Extinguishment of Debt |
|
0.01 |
|
|
|
— |
|
|
0.02 |
|
|
|
— |
Adjusted Earnings Per Diluted
Share |
$ |
0.40 |
|
|
$ |
0.52 |
|
$ |
0.73 |
|
|
$ |
1.16 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See Notes to Reconciliation of GAAP Financial
Measures to Non-GAAP Financial Measures.
BATH & BODY WORKS, INC. |
ADJUSTED FORECASTED FINANCIAL INFORMATION |
(Unaudited) |
|
|
|
|
|
Full-Year |
|
2023 |
Reconciliation of Forecasted Earnings Per Diluted Share to
Adjusted Forecasted Earnings Per Diluted Share |
Forecasted Earnings Per Diluted Share |
$ |
2.85 |
— |
$ |
3.15 |
Gain on Extinguishment of
Debt |
|
|
(0.07) |
|
|
Tax Effect of Gain on
Extinguishment of Debt |
|
|
0.02 |
|
|
Adjusted Forecasted Earnings
Per Diluted Share |
$ |
2.80 |
— |
$ |
3.10 |
|
|
|
|
|
|
The company’s forecast excludes the impact of any
future debt or share repurchase activity.
See Notes to Reconciliation of GAAP Financial
Measures to Non-GAAP Financial Measures.
BATH & BODY WORKS, INC.
NOTES TO RECONCILIATION OF GAAP FINANCIAL
MEASURES
TO NON-GAAP FINANCIAL
MEASURES
(Unaudited)
The “Adjusted Financial Information” provided in the attached
reflects the following non-GAAP financial measures:
Fiscal 2023
In the second quarter of 2023, adjusted results exclude a:
- $9 million pre-tax
gain ($7 million net of tax of $2 million), included in other
income, associated with the early extinguishment of outstanding
notes.
In the first quarter of 2023, adjusted results exclude a:
- $7 million pre-tax
gain ($5 million net of tax of $2 million), included in other
income, associated with the early extinguishment of outstanding
notes.
Forecasted full-year 2023 adjusted results exclude the
following:
- A $16 million
pre-tax gain ($12 million net of tax of $4 million), included in
other income year-to-date through the second quarter of 2023,
associated with the early extinguishment of outstanding notes.
- The impact of any
future debt or share repurchase activity.
Fiscal 2022
In the first and second quarters of 2022, there were no
adjustments to results.
The adjusted financial information should not be
construed as an alternative to the results determined in accordance
with generally accepted accounting principles. Further, the
company’s definitions of adjusted income information may differ
from similarly titled measures used by other companies. Management
believes that the presentation of adjusted financial information
provides additional information to investors to facilitate the
comparison of past and present operations. While it is not possible
to predict future results, management believes the adjusted
financial information is useful for the assessment of the
operations of the company because the adjusted items are not
indicative of the company’s ongoing operations due to their size
and nature. Additionally, management uses adjusted financial
information as key performance measures for the purpose of
evaluating performance internally. The adjusted financial
information should be read in conjunction with the company’s
historical financial statements and notes thereto contained in the
company’s Quarterly Reports on Form 10-Q and Annual Report on Form
10-K.
“Total international system-wide retail sales”
means the net sales of all Bath & Body Works stores and digital
channels located outside North America and owned and/or operated by
the company’s franchise, license and wholesale partners. While
total international system-wide retail sales are not recorded as
net sales by the company, management believes the information is
important in understanding the company’s financial performance
because these sales are the basis on which the company calculates
and records certain net sales for its International business and
are indicative of the financial health of the company’s franchise,
license and wholesale partners and the prospects for growth of the
company’s International business.
Bath & Body Works (NYSE:BBWI)
Gráfico Histórico do Ativo
De Abr 2024 até Mai 2024
Bath & Body Works (NYSE:BBWI)
Gráfico Histórico do Ativo
De Mai 2023 até Mai 2024