Which Is The Most Important Segment For L Brands’ Future Growth?

June 23rd, 2016 by Trefis Team
LB: La Barge logo
LB
La Barge

 

vs rev to total rev final2

Victoria’s Secret (VS) Stores is the most important segment for L Brands’ growth. As we see here, almost 50% of L Brands’ projected revenues is contributed by the VS stores. In comparison, the second most important segment is Bath & Body Works stores which  is expected to contribute around 25% to 30% of future revenues. Since, VS stores are so important, it is precisely the reason why a restructuring of the segment and a layoff of around 300 employees from this division had dampened the company’s stock price by over 30% year-to-date. Along with repositioning its Beauty business, VS is shedding off inventories from its non-core businesses such as swimwear, shoes, and accessories which were so far being sold through the digital channel. The non-core business contributed to over $500 million in sales in the last year.

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Have more questions on L Brands? See the links below.

Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for L Brands