Limited Brands, Inc. (LTD)

October 06, 2011 12:00 am ET


Amie Preston - Vice President Investor Relations



Welcome to the Limited Brands' September Sales Call Replay. Please note this call will be available at 7:30 a.m. Eastern Time on the day of release. [Operator Instructions]

Amie Preston

Good morning, everyone. This is Amie Preston, Chief Investor Relations Officer, and this is Limited Brands' September sales report for the 5-week period ending October 1, 2011.

As a matter of formality, I need to remind you that any forward-looking statements I may make today are subject to the Safe Harbor statement found in our SEC filings.

Total Limited Brands sales for the 5 weeks ended October 1, 2011, were $818.6 million versus sales of $735.8 million for the 5 weeks ended October 2, 2010. Limited Brands' September comps were up 11%.

The September merchandise margin rate was down to last year. Inventories ended the month down 2% per square foot at cost and down 9% on a 2-year basis.

At Victoria's Secret stores, September comps were up 13%. Sales growth was driven by strength across the assortment. We began September featuring the Showstopper bra in Lingerie. The PINK back-to-school floor set and the relaunch of Beauty's Garden product as VS Fantasies. Mid-month featured the Unforgettable bra and was followed by an integrated launch of our Gorgeous lace bra with our new Gorgeous fragrance.

The merchandise margin rate of Victoria's Secret stores was down to last year, driven by expected cost pressures in PINK and strong response to planned promotions. Merchandise margin dollars increased over last year. October selling activity will begin with the continuation of our Gorgeous bra and fragrance launch and PINK's campus pants. Mid-month, we will transition into a new take on our Very Sexy collection as we continue to focus on newness and fresh innovative products with high emotional content.

At Victoria's Secret Direct, September sales were up 7%, driven by strength in PINK active dresses and panties. The September merchandise margin rate was down to last year, driven by incremental shipping offers.

At La Senza, September comps were up 2%. The merchandise margin rate was down significantly to last year as La Senza combated traffic declines with incremental promotional activity, driving an improvement in conversion rates.

At Bath & Body Works, September comps were up 12%, driven by strong traffic in the performance of our home fragrance, anti-bac and Signature Collection category.

The merchandise margin rate for the month was down to last year, driven by cost increases. This week, we launched our newest Signature Collection fragrance, Charmed Life. The shop will continue to include our fall treats and Halloween assortment. We will also begin introducing holiday seasonal fragrances in our core categories.

In closing, we expect total company comps in October to be up low-single digits.

Thank you for your continuing interest in Limited Brands.

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