Corporate Sales (Bath & Body Works and Victoria’s Secret): $11.8 billion
Beauty Sales (Bath & Body Works): $6.4 billion

Major Products/Brands: Bath & Body Works personal care, Victoria’s Secret fine fragrances and cosmetics, Pink cosmetics

New Products: Bath & Body Works: The Pride Collection; Cucumber Melon, Pineapple Mango, Coconut Colada and Strawberry Kiwi Gentle Foaming Hand Soaps; Victoria’s Secret: Bombshell Oud fragrance

Comments: Following the executive shakeup and departure of Leslie Wexner, L Brands’ controversial longtime chairman and CEO, this marks the final year the name “L Brands” will appear in Beauty Packaging’s annual Top 20. As of August 2021, the company completed the separation of its Victoria’s Secret business, now a new company called Victoria’s Secret & Co., and has officially dropped the L Brands name in favor of a new identity: Bath & Body Works, Inc.

In her address to shareholders, Sarah Nash, chair of the board, lauded the actions L Brands took that led to record third and fourth quarter results, increased liquidity and a year-end cash balance of $3.9 billion. In March 2021, the Board authorized the repayment of more than $1 billion in debt, a $500 million share repurchase program and the reinstatement of their annual dividend at $0.60 per share—all of which helped position the Bath & Body Works and Victoria’s Secret businesses for separation in August.

CEO Andrew Meslow also praised the performance of Bath & Body Works, noting that at the start of 2020, Bath & Body Works was a $5.4 billion brand and by the end of 2020, sales miraculously climbed 20% and it became a $6.4 billion brand. Meslow attributed it in part to the brand’s ability to establish soaps and sanitizers as traffic drivers during the height of the pandemic, as well as its ability to quickly further its “buy-online-pick-up-in-store (BOPIS)” model, enabling continued customer engagement.

On the Victoria’s Secret side of the business, L Brands closed 240 underperforming stores while laying the groundwork for an image overhaul and eventual business separation.

2021 Highlights

In its first year as a standalone company, Victoria’s Secret & Co. reckoned with its dated, overtly sexual identity and took some bold steps toward a more modern, female-focused marketing objective. Gone are the bombshells wearing wings and fantasy bras on the runway; the future of the brand is now about real women. “We needed to stop being about what men want and to be about what women want,” Martin Waters, CEO of Victoria’s Secret told The New York Times.

To that end, the company established The Victoria’s Secret Global Fund for Women’s Cancers and created The VS Collective, a campaign fronted by seven women with diverse backgrounds who will “inspire women with products, experiences and initiatives that champion them and support their journey,” according to the company.

“With The VS Collective, we are creating a platform that will build new, deeper relationships with all women. Through a series of collaborations, business partnerships and cause-related initiatives, we’re bringing new dimensions to our brand experience. In marrying our new partners’ energy, creativity and perspectives with our network and scale, we can transform how we connect with and show up for women,” said Martha Pease, chief marketing officer for Victoria’s Secret.

Looking Ahead

Bath & Body Works success has continued. In Q1, the company reported sales had nearly doubled to more than $1.4 billion. Q2 net sales were even higher, hitting $1.7 billion.

Corporate Sales: $12.9 billion
Beauty Sales: $5.3 billion (est.)

Major Products/Brands:

• Bath & Body Works home and personal care
• White Barn and C.O. Bigelow 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 continues to experience a tumultuous series of events. Beyond the company’s below-expectations 2019 financial performance, a promising deal to sell the struggling company announced in 2020 fell apart just months later, and longtime chairman and CEO Les Wexner left the company.

Fiscally, L Brands reported that Victoria’s Secret Beauty experienced a good year marked by a solid holiday performance, with positive low-single digit comparable sales and an improvement in the merchandise margin rate. However, the Victoria’s Secret mother brand underperformed in 2019, with comparable sales declining 7% for the year due to a combination of factors stemming from “a poor assortment” which reduced foot traffic and resulted in increased promotion that negatively impacted margin rates. Despite declines in its other business sectors, L Brands opened 59 new stores in 2019, ending the year with 812 stores outside North America.

In contrast, Bath & Body Works celebrated a record 2019. Sales grew 10%, digital channel sales jumped 32% and operating income increased 11% in comparison to the previous year. By year’s end, L Brands counted more than 800 newly remodeled Bath & Body Works and White Barn stores.

International revenue in 2019 was flat in 2019 compared to 2018, but adjusted operating income increased, driven by growth in the Bath & Body Works franchise business.

2020 Highlights

L Brands began 2020 with the promise of a sought-after buyout to Sycamore Partners for $1.1 billion but amid the havoc of Covid-19 and an ensuing legal battle, the deal “mutually” collapsed and Sycamore walked away.

Undeterred, L Brands announced it was committing to strategizing the spin-off Bath & Body Works into a standalone public company, and Victoria’s Secret into a standalone, privately held business.

This year has also been marked by a major leadership shakeup. After being dogged by reported ties to convicted sex offender Jeffrey Epstein, Les Wexner stepped down as the company’s longtime CEO and chairman and was replaced by Bath & Body Works’ CEO Andrew Meslow, who will also join L Brands’ board, which is now newly chaired by Sarah Nash who brings with her almost 30 years of investment banking experience at JPMorgan Chase & Co.

After an abysmal Q1 where sales fell nearly $1 billion, to $1.6 billion for the quarter ended May 4 due to the pandemic-related closure of nearly all of the company’s stores, L Brands reported better-than-expected sales for the second quarter of fiscal 2020 despite net sales dropping 20% year-on-year to $2.3 billion. Victoria’s Secret experienced a 39% sales drop, offsetting “exceptionally strong” Bath & Body Works results. Bath & Body Works reported a 13% Q2 sales increase, with direct sales up 191% and sales in brick-and-mortar stores up 87%. All of this on the heels of Q1 results which saw Bath & Body Works sales fall “only 18%” in the first quarter as direct sales rose 85% to nearly $289 million.

In July, the company announced it expected to deliver $400 million in annualized cost reductions through its profit improvement plan for Victoria’s Secret, with approximately $175 million of savings expected to be achieved in fiscal 2020. In the second quarter of fiscal 2020, the company expects to record pre-tax severance costs of approximately $75 million via a 15% personnel reduction, 250 store closures and related inventory and cost management measures.

Corporate Sales: $13.2 billion
Beauty and Home Fragrance Sales: $5 billion (est.)

Major Products/Brands:

• Bath & Body Works home and personal care
• White Barn home fragrances
• Victoria’s Secret fine fragrances and cosmetics

New Products:

• Bath & Body Works—Gingham fragrance collection, Pineapple Mango 3-Wick Candle
• Victoria’s Secret Beauty—Bombshell Paradise (Summer Fragrance Collection)
• Eau de Parfum Rollerballs
• In Bloom Fragrance Mists

Comments: L Brands’ 2018 operating income declined while growth across its brands was mixed. The company’s overall net sales increased $605 million to $13.2 billion, and ongoing declines in the flagship Victoria’s Secret brand were offset by an 11% Bath & Body Works net sales increase of $483 million to $4.63 billion thanks to boosts in most category sales spanning new home fragrance, body care and soaps and sanitizers. Sales in Bath & Body Works’ digital channel increased 30%, and operating income increased 13%.

The direct business aspect of the company’s Victoria’s Secret and Bath & Body Works accrued $2.5 billion in sales and had operating margins in excess of 20% with growth at a mid-to-high-teens rate. L Brands said it planned “substantial” future investments in technology and logistics in 2019 to help promote sustained growth.

The Victoria’s Secret Beauty division had a record sales year with “low-double digit comps” under the leadership of Greg Unis. In 2018, the company began development of PINK Beauty and will continue growing that business in 2019. Likewise, Victoria’s Secret and Bath & Body Works International saw 2018 net sales increase by 20% ($103 million) to $605 million due to new company-owned Victoria’s Secret stores, direct channel growth in Greater China and additional stores opened by L Brands’ partners.

Moving forward, the company promised to review and improve its brand marketing and communications and deliver a more disciplined and proactive management of inventory, expenses, real estate and capital structure. Part of that was a careful assessment of the company’s global presence. L Brands’ total number of  Victoria’s Secret, Bath & Body Works, La Senza and Henri Bendel stores dropped from 3,075 in Feb. 2018 to 2,943 in Feb. 2019, the company’s number of B&B stores in the U.S. and in Canada actually grew from 1,694 in February 2018 to 1,721 by February 2019. The company said it intends to maximize its footprint specifically in its Bath & Body Works and White Barn divisions, with the goal of increasing North American Bath & Body Works square footage by about 3% through the opening of approximately 25 new Bath & Body Works stores and the remodeling of existing stores.

News of Note in 2019

Further streamlining costs, L Brands shuttered all 27 of its Henri Bendel stores in January 2019, as well as the brand’s corresponding e-commerce website. The 123-year old, New York-based retail establishment had sold women’s handbags, jewelry, luxury fashion accessories and home fragrances since 1895.

The company also sold off its La Senza lingerie business to a global private equity firm in January, and in March, announced it would close up to 53 of its Victoria’s Secret stores over the course of 2019. The closures represent about 4% of L Brands’ total Victoria’s Secret portfolio.

In Q1 2019, Bath & Body Works sales grew 13% in comparison to last year, while Victoria’s Secret’s same-store sales continued to spiral downward. In fact, Bath & Body Works’ ongoing climb prompted hedge fund Barington Capital to call on L Brands to separate the fragrance and personal care business from the Victoria’s Secret operation, but that was just the tip of the Brands’ turmoil. Barington Capital also asserted that Wexner was insulated by his personal and business relationships with board members, which in turn weakened the board’s oversight in him as CEO. A month later, L Brands added two independent directors to the company in response.

It was more of the same for Victoria’s Secret in Q2: Net sales were $2.9 billion, down from $2.98 billion last year, and short of analysts $2.95 billion projection. How L Brands will revive Victoria’s Secret is anyone’s guess. The brand synonymous with sex appeal is working to better align its approach to keep step with evolving consumer attitudes on beauty, inclusion and diversity. For starters, there have been personnel changes in the beleaguered division, and the company pulled the plug on its nationally televised Victoria’s Secret fashion show.

Looking Ahead

In August, Les Wexner acknowledged ties to now-deceased alleged sex-trafficker Jeffrey Epstein, alleging that Epstein had misappropriated over $46 million of Wenxer’s personal wealth. L Brands also disclosed hiring outside counsel to review the company’s relationship with Epstein.

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Corporate Sales: $12.6 billion
Beauty Sales (Cosmetics and Personal Care): $4.2 billion (est.) (FY 2017 Beauty Sales: $4.6 billion, est.)

Major Products/Brands:

• Bath & Body Works, C.O. Bigelow, White Barn home fragrances
• Victoria’s Secret fine fragrances and cosmetics

New Products:

• Bath & Body Works: Bergamot, Ylang Ylang,
• Peppermint and Patchouli 5-in-1 Essential Oil Mists,
• Essential Oil Body Lotions, 3-in-1 Aromatherapy Essential Oils;
• Soothing Oatmeal, Soothing Almond Milk, Illuminating Apple,
• Exfoliating Walnut, Rejuvenating Pumpkin Enzyme, Revitalizing Red Wine,
• Gentle Honey face and body skin care products;
• Hello hand sanitizers; Sweater Weather, Pumpkin Picking, Autumn Nights,
• Bonfire Bash and FreshWater fragrances and bath and body items;
• and Victoria’s Secret Beauty: Tease Rebel fragrance, Midnight Blooms line of mists and lotions.

Recent Changes at L Brands 

In his annual address to shareholders, CEO Les Wexner openly admitted he was disappointed in the company’s 2017 performance, pointing to a 15% decline in adjusted operating income, and mixed results he attributed to growth at Bath & Body Works which was more than offset by declines at Victoria’s Secret and the company’s international segment.

Bath & Body Works products, which span the Bath & Body Works, White Barn and C.O. Bigelow brand names, sells its products online and at more than 1,600 Bath & Body Works company-owned stores in the U.S. and Canada, as well as 185 stores in more than 30 other countries operating under franchise, license and wholesale arrangements. Bath & Body Works International partners opened 26 net new Bath & Body Works stores in 2017, bringing the total in the Middle East, Latin America, Southeast Asia and Europe to 185, with another 50 additional store openings in the works for 2018.

Last year, Bath & Body Works continued to transition from a fragranced-based body care product brand to one that Wexner says offers a more “refined” product mix that “emphasizes a broader total body care point of view inclusive of healthy and natural ingredients and a strong home fragrance presence.” Sales at Bath & Body Works increased 8%, driven by a positive 2% comparable store sales increase and a 24% increase in sales in the direct channel. Operating income increased 5%.

The Victoria’s Secret fashion arm underwent its own overhaul in merchandising and design integration, as well as changes in leadership, but produced a disappointing performance. The Victoria’s Secret Beauty business, however, had a good year. Sales increased in the low-single digit range, and the merchandise margin rate increased. Wexner says customers are responding favorably to “a more edited assortment” of new merchandise that’s delivering some welcome momentum.

L Brands operates 29 company-owned Victoria’s Secret Beauty and Accessories stores in Greater China and expects to open approximately 10 more in 2018. Its partners opened six net new Victoria’s Secret Beauty and Accessories stores in 2017, bringing the total to 397. The new stores are located in local markets, airports and tourist destinations, and are focused on Victoria’s Secret branded beauty and accessory products. Looking forward, approximately 40 new Victoria’s Secret Beauty and Accessories stores are slated to open and 25 are due to close in 2018.

News of Note in 2018

L Brands reported that its 2018 Q2 operating income was $228.1 million, compared to $300.9 million last year, and net income was $99.0 million compared to $138.9 million last year. T

he company reported net sales of $2.984 billion for the quarter ended Aug. 4, 2018, compared to sales of $2.755 billion for the quarter ended July 29, 2017. Comparable sales for the 13 weeks ended Aug. 4, 2018, increased 3% compared to the 13 weeks ended Aug. 5, 2017.

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Corporate Sales:  $12.1 billion
Beauty Sales: $4.4 billion (est.)

Major Products/Brands: Bath & Body Works home fragrances and personal care; Victoria’s Secret fragrances, lip and hair care.

New Products: Victoria’s Secret Heavenly Summer, Fabulous, Angel Eau De Parfum, Angel Gold, Dark Angel; Dreamy Vanilla, Frosted Apple, Sensual Blush and Winter Cranberry body mists; Bombshell Luxe, Winter Bombshell, Love Me, Very Sexy Now 2015, Victoria’s Secret Fantasies Collection: Dream, Love Spell, Passion Struck; Fragrance Mists and 24-Hour Long Lasting Lotions.

Comments: In a year in which many retailers struggled, L Brands’ Leslie Wexner, chairman and chief executive officer, lauded his company for delivering record results “These results are a reflection of the strength of our brands and were driven by tremendous focus and execution across the enterprise,” he said. “I am very optimistic heading into 2016 and confident in our growth opportunities.”

Net sales for the year ended Jan. 30, 2016, were $12.1 billion, an increase of 6% compared to $11.4 billion for the year ended Jan. 31, 2015.  Comparable store sales for the year ended Jan. 30, 2016, increased 5%.

In addition to reviving its White Barn brand candle shops, L Brands also continued the work of opening new or remodeling existing Bath & Body Works stores. Bath & Body Works’ net sales for 2015 was $3.6 billion, spanning 1,672 stores. During a conference call for stock analysts, CFO Stuart Burgdoerfer said the remodeled stores are already producing a 25% increase in sales. The work is part of a plan that includes 75 new stores and 239 remodels domestically in 2016, the completion of which bears a projected cost of $630-$700 million.

L Brands reports that it is the top U.S. brand in 10 product categories including body lotion, body cream, shower gel and hand sanitizer. It’s also the No. 1 specialty retailer for candles.

For Victoria’s Secret, the company continues to put value in its fragrances. In addition to launching new Angel and Bombshell iterations, the company also revisited the ’90s and revamped the formulas and packaging of 19 classic favorites like Love Spell, Vanilla Lace and Mango Temptation for a fresh modern re-issue alongside five new scents including Rush and Exotic. The products are sold in mist and lotion formats. To celebrate the launch, the company introduced the VS Fantasies Fragrance Studio, which not only allowed shoppers to try out the scents, but encouraged them to layer two or three scents together to create their own custom fragrance.

Like Victoria’s Secret, Bath & Body Works also revisited some of its most loved but retired scents in 2015. The company’s limited time only Flashback Fragrance campaign temporarily brought back six customer favorites in shower gel, body lotion, body cream and fragrance mist formats, all featuring beautifully updated packaging.

News of Note in 2016

Second quarter results for L Brands have played out better than expected, with profits rising 24.7%, beating analyst estimates, though the company warned that sales trends at Victoria’s Secret could impact the growth going into the second half of 2016. The company pointed to increased digital sales for Bath & Body Works (+21%) and for Victoria’s Secret (+8%). Worth noting, L Brands is repositioning its beauty business and said it expects to see fiscal results in that segment decline as they make changes in the category. The company will also be more promotional in the beauty space, which they said will be reflected in the third-quarter gross margins.

Corporate Sales: $11.5 billion
Beauty Sales: $4 billion (Est. Bath & Body Works, VS beauty)

Major Products/Brands: Bath & Body Works home fragrances and personal care; Victoria’s Secret fragrances, lip and hair care.

New Products: Bath & Body Works Marshmallow Pumpkin Latte shower gel, Bath & Body Works Apple Harvest body lotion, Bath & Body Works Somoma Weekend Escape shower gel, Victoria’s Secret Heavenly Summer eau de parfum, Victoria’s Secret Forever Sexy fragrance, Victoria’s Secret Hair Flawless styling gel, Victoria’s Secret Beauty Rush flavored gloss.

Comments: Net sales increased 6%, $681 million, at L Brands—which includes Victoria’s Secret and Bath & Body Works— for recorded sales of $11.5 billion in 2014. Bath & Body Works net sales increased $232 million to $3.35 billion, and comparable store sales increased 6%. At both Bath & Body Works Stores and Bath & Body Works Direct, net sales increased across most categories including home.

L Brands is focused on speed to market, and in with its beauty, personal care and home fragrance businesses, has developed supplier facilities close to the company’s headquarters and distribution facilities in central Ohio, which it intends to expand as the business grows.

Bath & Body Works says it is one of the leading specialty retailers of home fragrance and personal care products including shower gels, lotions, soaps and sanitizers. BBW products are sold at more than 1,600 Bath & Body Works stores in the U.S. and Canada and online at BathandBodyWorks.com. The retailer also operates 80 stores in 23 other countries operating under franchise, license and wholesale arrangements.

At Victoria’s Secret, beauty sales declined due to the elimination of Victoria’s Secret makeup. L Brands says it still maintains its edge in fragrance, with Bombshell, Heavenly and Tease ranking among the top 10 scents in the U.S. Last year, the company added 101 Victoria’s Secret Beauty & Accessories (VSBA) stores, bringing the total to 299 at the end of fiscal 2014. This year, the plan calls for adding as many as 125 new VSBA stores, including nine in China.

News of Note

At the end of 2014, Leslie H. Wexner, the 77-year-old chairman and chief executive officer of L Brands, received Chief Executive magazine’s lifetime achievement award at the CEO2CEO Leadership Summit. Wexner is the longest-serving CEO of a Fortune 500 company. He started The Limited in 1963 with a $5,000 loan from his aunt.

In August 2015, the company reported net sales of $2.77 billion for the second quarter, an increase of 3% compared to sales of the same quarter in 2014.  L Brands said its Victoria Secret unit delivered a 3% gain while Bath & Body Works rose 5%.

Corporate sales: $10.8 billion
Beauty Sales: $3.3 billion (est.)

Major Products: Victoria’s Secret and Pink fragrances, personal care and cosmetics; Bath & Body Works shower gels and lotions, aromatherapy, soaps and sanitizers, home fragrance and personal care accessories

New Products: Bath & Body Works Pear and Cashmere Woods Autumn Body Lotion, Victoria’s Secret Bombshell Eau de Parfum, VS Fantasies Love Spell Fragrance Mist, VS Beach Sexy Self-Tanning Tinted Lotion, Pink travel size Wild at Heart Body Mist, VS Angel Eau de Parfum.

Comments: Chairman and CEO Leslie H. Wexner described overall performance in 2013 as “respectable” nothing great, but he said they have the opportunity to double their business over the next 5-6 years, partially through about 1,000 international stores by the end of 2014, and through online sales. Business in the last quarter was particularly hard hit. Still, all in all, Wexner said that in fiscal 2013, the company delivered “our third straight year of record-setting sales and adjusted earnings.” Focus, speed, frugality and production efficiency are targeted goals moving forward.

In 2013, corporate net sales at L Brands increased by $314 million to $10.8 billion and comparable store sales increased 2%.

For 2013, net sales for Victoria’s Secret increased $107 million to $6.7 billion and comparable store sales increased 3%.

At Bath & Body Works, net sales increased $30 million to $2.9 billion and comparable store sales increased 1%. Sales at Bath & Body Works’ retail stores rose 1%, but sales at www.BathandBodyWorks.com continued to exhibit significant year-over-year growth. Sales rose 16%, driven by increases across all categories, including Signature Collection, home fragrances and soaps and sanitizers.

The Middle East, with about 250 stores, including 40 BBW units, is seen potentially expanding to a $2 billion business. BBW could potentially have hundreds of units there, according to L Brands.

During the year, 90 Victoria’s Secret Beauty and Accessories stores were opened, bringing the total to 198. Approximately 100 more of these franchise-operated units are expected to open this year. BBW franchisees opened 17 stores last year, bringing the total in the Middle East, Latin America and Eastern Europe to 55.

“We’re getting very focused on geographies of the world and where we can expand with the greatest certainty and the greatest opportunities,” said Wexner.


He said the focus is on the U.K., Turkey, the Middle East and Southeast Asia.

Beauty Park Expands

L Brands owns a nearby office park in Ohio, where a number of beauty suppliers have gathered to create an efficient supply chain situation that has proved so successful that growth plans are now underway for the company’s beauty, personal care and home fragrance businesses. New company facilities will be added on land near the Beauty Park.

But makeup is no longer included in the VS beauty mix. In mid-2014, Victoria’s Secret CEO Sharen Turney said, “In order to increase our focus on our fastest-growing, most-profitable businesses, we are exiting some of our non-core apparel categories in (Victoria’s Secret) Direct, as well as Victoria’s Secret Makeup.”