Sales: $5.3 billion
$5.3 billion (estimated) for beauty and personal care products. Corporate sales: $12.9 billion
Key personnel: Sarah Nash, chair; Andrew Meslow, chief executive officer, L Brands and Bath & Body Works; Stuart Burgdoerfer, executive vice president and chief financial officer; Charlie McGuigan, chief operating officer; Shelley B. Milano, executive vice president, chief human resources officer
Major products: Bath & Body Works home and personal care; White Barn home fragrances; Victoria’s Secret fine fragrances and cosmetics; Pink Cosmetics
New products: Victoria’s Secret Beauty—Bombshell Intense fragrance, Pink Coco Oil conditioning body oil; White Barn—3-Wick candles, Fresh Lemonade hand soap
Comments: L Brands is a retailer in search of a buyer. Earlier this year, the company announced it would be acquired by Sycamore Partners for $1.1 billion—a fraction of what it was worth a few years ago. But when COVID-19 hit, Sycamore balked and the deal was off. Still, L Brands says it is committed to establishing Bath & Body Works as a pure-play public company and make the cost reductions necessary to operate Victoria’s Secret as a standalone business.
In a few short months, L Brands lost a buyer, lost mall customers and Les Wexner is gone, too. After years of underperformance, capped by reported ties to convicted sex offender Jeffrey Epstein, Wexner stepped down as L Brands chairman and CEO during the annual meeting in May. Sarah Nash is the new L Brands chair. Prior to this appointment, she was a member of the L Brands board of directors. Nash spent nearly 30 years in investment banking at JPMorgan Chase & Co. Andrew Meslow is the new CEO; prior to this appointment, he was BBW’s chief operating officer.
Nash and Meslow step in as things are getting even worse at L Brands. Victoria’s Secret sales have fallen nearly 50% and the retailer is permanently closing about 25% of its North American stores. Coronavirus is making a very bad situation even worse. The company said Q1 sales fell nearly $1 billion to $1.6 billion for the quarter ended May 4. Nearly all of the company’s stores were closed since March 17 due to the pandemic and gradual reopening is taking place.
But scented candles and hand sanitizers (such as BBW’s PocketBacs) are still in demand when consumers are stuck at home. Bath & Body Works’ sales fell “only 18%” in the first quarter as direct sales rose 85% to nearly $289 million. The company noted that BBW’s Q1 comparable sales increased 20% during the period in which stores were open.
That trend, BBW rising and VS falling, was the story last year, too. While corporate sales declined about 2% last year, BBW’s sales rose 10% to $5.1 billion, thanks to gains in all main categories, including home fragrance, body care, soaps and sanitizers. Even comparable store sales of VS Beauty increased in the low single digits, helped along by growth in accessories and Pink Beauty, partially offset by declines in the lip business.