Limited Brands Reports Second Quarter 2012 Earnings — PROVIDES THIRD QUARTER AND RAISES FULL YEAR 2012 EARNINGS GUIDANCE — PR Newswire COLUMBUS, Ohio, Aug. 15, 2012 COLUMBUS, Ohio, Aug. 15, 2012 /PRNewswire/ -- Limited Brands, Inc. (NYSE: LTD) today reported 2012 second quarter results. (Logo: http://photos.prnewswire.com/prnh/20020520/CLM001LOGO ) Second Quarter Results Adjusted earnings per share for the second quarter ended July 28, 2012, were $0.50 compared to adjusted earnings per share of $0.48 for the quarter ended July 30, 2011. Second quarter adjusted operating income was $308.9 million compared to $307.0 million last year, and adjusted net income was $147.2 million compared to $150.7 million last year. Adjusted results exclude certain significant items as detailed below: oIn 2012: A pre-tax charge of $3.6 million, or $0.01 per share, related to La Senza store closures. oIn 2011 (totaling to a benefit of $0.25 per share): A non-taxable gain of $147.1 million, or $0.47 per share, and a pre-tax expense of $113.4 million, or $0.22 per share, related to the charitable contribution of all of the company's remaining shares of Express (NYSE: EXPR) to the Limited Brands Foundation. Including the significant items above, reported second quarter earnings per share were $0.49 compared to $0.73 last year; operating income was $305.3 million compared to $193.5 million last year; and net income was $143.6 million compared to $231.2 million last year. Comparable store sales for the second quarter increased 8 percent, and net sales were $2.399 billion compared to $2.458 billion last year. Second quarter 2011 sales included $216.6 million attributable to the third party apparel sourcing business, which was sold in November 2011. At the conclusion of this press release is a reconciliation of reported to adjusted results. 2012 Outlook The company stated that it expects 2012 third quarter adjusted earnings per share to be $0.15 to $0.20 compared to adjusted earnings per share of $0.25 per share last year. For 2012, the company expects earnings per share of $2.73 to $2.88 versus its previous guidance of $2.63 to $2.83. Earnings Call Information Limited Brands will conduct its second quarter earnings call at 9 a.m. Eastern on Thursday, Aug. 16. To listen, call 1-866-583-6618 (international dial-in number: 1-937-200-3978). For an audio replay, call 1-866-NEWS-LTD (international replay number: 1-706-902-3452) or log onto www.Limitedbrands.com.Additional second quarter financial information is also available at www.Limitedbrands.com. ABOUT LIMITED BRANDS: Limited Brands, through Victoria's Secret, Pink, Bath & Body Works, La Senza and Henri Bendel, is an international company. The company operates 2,619 specialty stores in the United States and its brands are sold in more than 700 company-operated and franchised additional locations world-wide. The company's products are also available online at www.VictoriasSecret.com, www.BathandBodyWorks.com, www.HenriBendel.com and www.LaSenza.com. Limited Brands b-roll footage of stores is available through our online newsroom. Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 Limited Brands, Inc. cautions 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 the second quarter earnings call 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" 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 the second quarter earnings call: ogeneral economic conditions, consumer confidence, consumer spending patterns and market disruptions including severe weather conditions, natural disasters, health hazards, terrorist activities, financial crises, political crises or other major events, or the prospect of these events; othe seasonality of our business; othe dependence on a high volume of mall traffic and the possible lack of availability of suitable store locations on appropriate terms; oour ability to grow through new store openings and existing store remodels and expansions; oour ability to successfully expand into international markets and related risks; oour independent licensees and franchisees; oour direct channel business; oour failure to protect our reputation and our brand images; oour failure to protect our trade names, trademarks and patents; othe highly competitive nature of the retail industry generally and the segments in which we operate particularly; oconsumer acceptance of our products and our ability to keep up with fashion trends, develop new merchandise and launch new product lines successfully; oour reliance on foreign sources of production, including risks related to: opolitical instability; oduties, taxes and other charges on imports; olegal and regulatory matters; ovolatility in currency exchange rates; olocal business practices and political issues; opotential delays or disruptions in shipping and related pricing impacts; othe disruption of imports by labor disputes; and ochanging expectations regarding product safety due to new legislation; ostock price volatility; oour failure to maintain our credit rating; oour ability to service our debt; oour ability to retain key personnel; oour ability to attract, develop and retain qualified employees and manage labor costs; othe inability of our manufacturers to deliver products in a timely manner and meet quality standards; ofluctuations in product input costs; ofluctuations in energy costs; oincreases in the costs of mailing, paper and printing; oclaims arising from our self-insurance; oour ability to implement and maintain information technology systems; oour failure to comply with regulatory requirements; otax matters; and olegal and compliance 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 or the second quarter earnings call 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 2011 Annual Report on Form 10-K. LIMITED BRANDS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME THIRTEEN WEEKS ENDED JULY 28, 2012 AND JULY 30, 2011 (Unaudited) (In thousands except per share amounts) 2012 2011 Net Sales $ 2,399,095 $ 2,458,135 Cost of Goods Sold, Buying and (1,456,621) (1,556,037) Occupancy Gross Profit 942,474 902,098 General, Administrative and Store (637,136) (708,565) Operating Expenses Operating Income 305,338 193,533 Interest Expense (79,526) (64,260) Other (Expense) Income 3,747 146,749 Income Before Income Taxes 229,559 276,022 Provision for Income Taxes 85,910 44,828 Net Income $ 143,649 $ 231,194 Net Income Per Diluted Share $ $ 0.49 0.73 Weighted Average Shares Outstanding 296,030 314,800 LIMITED BRANDS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME THIRTEEN WEEKS ENDED JULY 28, 2012 AND JULY 30, 2011 (Unaudited) (In thousands except per share amounts) 2012 2011 Reported Adjustments Adjusted Reported Adjustments Adjusted Net Sales $ $ $ $ $ $ 2,399,095 - 2,399,095 2,458,135 - 2,458,135 Cost of Goods Sold, Buying & (1,456,621) 2,800 (1,453,821) (1,556,037) - (1,556,037) Occupancy Gross Profit 942,474 2,800 945,274 902,098 - 902,098 General, Administrative and Store Operating (637,136) 800 (636,336) (708,565) 113,428 (595,137) Expenses Operating 305,338 3,600 308,938 193,533 113,428 306,961 Income Interest (79,526) - (79,526) (64,260) - (64,260) Expense Other (Expense) 3,747 - 3,747 146,749 (147,053) (304) Income Income Before 229,559 3,600 233,159 276,022 (33,625) 242,397 Income Taxes Provision for 85,910 - 85,910 44,828 46,850 91,678 Income Taxes Net Income $ $ $ $ $ $ 143,649 3,600 147,249 231,194 (80,475) 150,719 Net Income Per $ $ $ $ Diluted Share 0.49 0.50 0.73 0.48 Weighted Average Shares 296,030 296,030 314,800 314,800 Outstanding See Notes to Consolidated Statements of Income and Reconciliation of Adjusted Results for additional information. LIMITED BRANDS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME TWENTY SIX WEEKS ENDED JULY 28, 2012 AND JULY 30, 2011 (Unaudited) (In thousands except per share amounts) 2012 2011 Net Sales $ 4,552,879 $ 4,675,152 Cost of Goods Sold, Buying and (2,708,442) (2,931,326) Occupancy Gross Profit 1,844,437 1,743,826 General, Administrative and Store (1,245,873) (1,333,470) Operating Expenses Operating Income 598,564 410,356 Interest Expense (157,318) (118,928) Other (Expense) Income 1,438 233,237 Income Before Income Taxes 442,684 524,665 Provision for Income Taxes 174,477 128,300 Net Income $ 268,207 $ 396,365 Net Income Per Diluted Share $ $ 0.90 1.23 Weighted Average Shares Outstanding 298,634 321,636 LIMITED BRANDS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME TWENTY SIX WEEKS ENDED JULY 28, 2012 AND JULY 30, 2011 (Unaudited) (In thousands except per share amounts) 2012 2011 Reported Adjustments Adjusted Reported Adjustments Adjusted Net Sales $ $ $ $ $ $ 4,552,879 - 4,552,879 4,675,152 - 4,675,152 Cost of Goods Sold, Buying & (2,708,442) 2,800 (2,705,642) (2,931,326) - (2,931,326) Occupancy Gross Profit 1,844,437 2,800 1,847,237 1,743,826 - 1,743,826 General, Administrative and Store Operating (1,245,873) 800 (1,245,073) (1,333,470) 163,428 (1,170,042) Expenses Operating 598,564 3,600 602,164 410,356 163,428 573,784 Income Interest (157,318) - (157,318) (118,928) - (118,928) Expense Other (Expense) 1,438 - 1,438 233,237 (233,478) (241) Income Income Before 442,684 3,600 446,284 524,665 (70,050) 454,615 Income Taxes Provision for 174,477 - 174,477 128,300 45,765 174,065 Income Taxes Net Income $ $ $ $ $ $ 268,207 3,600 271,807 396,365 (115,815) 280,550 Net Income Per $ $ $ $ Diluted Share 0.90 0.91 1.23 0.87 Weighted Average Shares 298,634 298,634 321,636 321,636 Outstanding See Notes to Consolidated Statements of Income and Reconciliation of Adjusted Results for additional information. LIMITED BRANDS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED STATEMENTS OF INCOME AND RECONCILIATION OF ADJUSTED RESULTS (Unaudited) The "Adjusted Results" provided in the attached unaudited Consolidated Statements of Income and Reconciliation of Adjusted Results are non-GAAP financial measures and reflect the following: Fiscal 2012 In the second quarter of 2012, adjusted results exclude the following: o$3.6 million ($3.6 million net of tax) of store closure costs at La Senza. In the first quarter of 2012, there were no adjustments to results. Fiscal 2011 In the second quarter of 2011, adjusted results exclude the following: oA $147.1 million non-taxable gain, included in other income and expense, and associated pre-tax expense of $113.4 million, included in general, administrative and store operating expenses, associated with our charitable contribution of Express, Inc. common stock to The Limited Brands Foundation. In the first quarter of 2011, adjusted results exclude the following: oAn $86.4 million pre-tax gain ($55.6 million net of tax), included in other income and expense, related to the sale of shares of Express, Inc. common stock. oA $50.0 million pre-tax expense ($31.2 million net of tax), included in general, administrative and store operating expenses, related to a pledge to The Limited Brands Foundation. oAn $11.0 million tax benefit primarily related to the favorable resolution of certain discrete income tax matters. The Unaudited Adjusted Consolidated Statements of Income should not be construed as an alternative to the reported results determined in accordance with generally accepted accounting principles. Further, the Company's definition of adjusted income information may differ from similarly titled measures used by other companies. While it is not possible to predict future results, management believes the adjusted information is useful for the assessment of the ongoing operations of the Company. The Unaudited Adjusted Consolidated Statements of Income 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. SOURCE Limited Brands, Inc. Website: http://www.Limitedbrands.com Contact: Limited Brands: Investor Relations, Amie Preston, +1-614-415-6704, firstname.lastname@example.org, Media Relations, Tammy Roberts Myers, +1-614-415-7072, email@example.com
Limited Brands Reports Second Quarter 2012 Earnings
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