Victoria’s Secret & Co. Announces New Share Repurchase Authorization and Provides Fourth Quarter 2022 Sales and Earnings Update
January 11 2023 - 6:45AM
Victoria’s Secret & Co. (“Victoria’s Secret” or the “Company”)
(NYSE: VSCO) today announced that its Board of Directors
unanimously approved a new share repurchase program (“January 2023
Share Repurchase Program”) authorizing the repurchase of up to $250
million of the Company’s common stock. Shares repurchased under the
January 2023 Share Repurchase Program will be made in the open
market, subject to market conditions and other factors. The January
2023 Share Repurchase Program is eligible to begin upon exhaustion
of the current $250 million share repurchase program which is
scheduled to be completed by the end of January 2023. Shares
acquired through the January 2023 Share Repurchase Program will be
available to meet obligations under equity compensation plans and
for general corporate purposes. The January 2023 Share Repurchase
Program will continue until exhausted, but no later than the end of
fiscal year 2023.
Concurrent with the announcement of the January
2023 Share Repurchase Program, the Company is now forecasting
fourth quarter 2022 operating income to be in the range of $245
million to $265 million, or approximately 12% to 13% of sales,
compared to its previously communicated guidance range of $240
million to $290 million. The Company now expects net income for the
fourth quarter 2022 to be in the range of $2.05 to $2.25 per
diluted share, compared to its previously communicated guidance
range of $2.00 to $2.45 per diluted share. Consistent with this
level of profitability, the Company reaffirms the fourth quarter
2022 sales guidance provided on November 30, 2022 which forecasted
a net sales decline in the high-single digit range compared to last
year’s fourth quarter net sales of $2.175 billion. All updated and
reaffirmed fourth quarter 2022 guidance excludes the financial
impact of the recent acquisition of AdoreMe, Inc. (“Adore Me”), as
well as transaction costs and purchase accounting related to this
transaction.
CEO Martin Waters commented, “We are pleased to
report that we expect to deliver upon our sales and operating
targets despite a challenged economic environment for our
customers. We were particularly encouraged by our sales performance
during peak days and weekends. Despite some significant weather
challenges directly before Christmas, our sales to date have
trended above plan since benefitting from both regular price
merchandise selling and semi-annual sale performance. As expected,
the holiday season was highly promotional and we were appropriately
aggressive. Our fourth quarter margins are expected to remain
within our range of expectations, our expenses continue to be very
well managed, and our inventory levels are trending lower, or
favorable, to our original expectations. The teams have executed
well and focused on what we can control in this challenging
economic environment. We expect to finish fiscal 2022 with an
operating margin rate in the high-single digits demonstrating the
resilience of our model and tremendous efforts of our teams and I
could not be prouder of their efforts.”
Martin continued, “During our first 18 months as
a public company, we have grown our leading market share position
in the intimates category, begun the journey to reposition our
brand, and stabilized our business platform. Despite a challenging
economic backdrop, we have identified and executed against several
long-term growth drivers, including the acquisition of Adore Me and
technology-related synergies, the acceleration of our international
business, the successful launch of our store of the future program,
and the identification of new business development and distribution
opportunities. Our market leadership position coupled with these
longer-term growth initiatives, our financial stability, and cash
flow potential are key competitive advantages for Victoria’s Secret
& Co. We believe today’s new share repurchase authorization
reflects our confidence in the Company and is another step on our
journey to create long-term, sustainable value for our
shareholders.”
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, and Adore Me, a
technology-led, digital-first innovative intimates brand serving
women of all sizes and budgets at all phases of life. We are
committed to empowering our more than 30,000 associates across a
global footprint of approximately 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.
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 U.S. Private Securities Litigation
Reform Act of 1995) contained in this press release or made by us,
our management, or our spokespeople 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. Forward-looking
statements include, without limitation, statements regarding our
future operating results, the implementation and impact of our
strategic plans, and our ability to meet environmental, social, and
governance goals. Words such as “estimate,” “commit,” “target,”
“goal,” “project,” “plan,” “believe,” “seek,” “strive,” “expect,”
“anticipate,” “intend,” “potential” and any similar expressions may
identify forward-looking statements. Risks associated with the
following factors, among others, could affect our financial
performance and cause actual results to differ materially from
those expressed or implied in any forward-looking statements:
- the spin-off from Bath & Body
Works, Inc. (f/k/a L Brands, Inc.) may not be tax-free for U.S.
federal income tax purposes;
- we may not realize all of the
expected benefits of the spin-off;
- general economic conditions,
inflation, 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 novel coronavirus (COVID-19)
global pandemic has had and may continue to have an adverse effect
on our business and results of operations;
- difficulties arising from turnover
in company leadership or other key positions;
- our ability to attract, develop and
retain qualified associates and manage labor-related costs;
- our dependence on mall traffic and
the availability of suitable store locations on appropriate
terms;
- our ability to successfully operate
and expand internationally and related risks;
- our independent franchise, license,
wholesale, and joint venture partners;
- our direct channel business;
- our ability to protect our
reputation and the image of our brands;
- our ability to attract customers
with marketing, advertising and promotional programs;
- 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 brands, keep up
with fashion trends, develop new merchandise and launch new product
lines successfully;
- our ability to realize the
potential benefits and synergies sought with the acquisition of
AdoreMe, Inc.;
- our ability to source, distribute
and sell goods and materials on a global basis, including risks
related to:
- political instability,
environmental hazards or natural disasters;
- significant health hazards or
pandemics;
- legal and regulatory matters;
- delays or disruptions in shipping
and transportation and related pricing impacts; and
- disruption due to labor
disputes;
- our geographic concentration of
vendor and distribution facilities in central Ohio and Southeast
Asia;
- the ability of our vendors to
deliver products in a timely manner, meet quality standards and
comply with applicable laws and regulations;
- fluctuations in freight, product
input and energy costs, including those caused by inflation;
- our and our third-party service
providers’ ability to implement and maintain information technology
systems and to protect associated data and system
availability;
- our ability to maintain the
security of customer, associate, third-party and company
information;
- stock price volatility;
- shareholder activism matters;
- our ability to maintain our credit
rating;
- our ability to comply with
regulatory requirements; and
- legal, tax, trade and other
regulatory matters.
Except as may be required by law, we assume no
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 Annual Report on Form 10-K and Quarterly
Report on Form 10-Q filed with the Securities and Exchange
Commission on March 18, 2022 and December 2, 2022,
respectively.
For further information, please contact:
Victoria’s Secret & Co.: |
|
Investor
Relations: |
Media Relations: |
Kevin Wynk |
Brooke Wilson |
investorrelations@victoria.com |
communications@victoria.com |
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