L Brands Inc.'s (NYSE:L) core lingerie business showed signs of weakness in the latest quarter and the company gave a disappointing forecast for the current quarter amid a retail industry contending with dwindling foot traffic and growing competition.
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Shares, which have fallen 29% this year, lost another 2.8% after hours to $66.
Victoria's Secret struggled during the period, with comparable sales falling 1%, compared with a 6% rise in the quarter last year. The slip comes after the company in May had cautioned about soft demand there but saw improvement in the previous quarter. Longtime chief executive Leslie Wexner took over the segment in February and has been trying to scale back promotions and narrow merchandise offerings. The October report raises questions about whether those efforts are taking hold.
Same-store sales in the much smaller Bath & Body Works segment, meanwhile, rose 7%, the same as last year.
In all, L Brands reported a profit of $121.6 million, or 42 cents a share, down from $164 million, or 55 cents a share, a year earlier. The company had guided for earnings of 40 cents a share.
Earlier this month, L Brands reported revenue increased 4% to $2.58 billion. Total same-store sales rose 2% in the quarter, more than the 1.5% analysts had expected but lower than last year's 7% clip.
Many retailers have been reporting lackluster sales that are largely the result of lower traffic as more shoppers move online, especially to Amazon.com, and as fast-fashion chains like Hennes & Mauritz AB gab market share.
And for the current quarter L Brands expects earnings to fall to between $1.85 and $2 a share from $2.15 last year. Analysts project earnings to be flat in the period.
Write to Anne Steele at Anne.Steele@wsj.com
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