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ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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31-1029810
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(State or other jurisdiction of
incorporation or organization)
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(IRS Employer Identification No.)
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Three Limited Parkway
Columbus, Ohio
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43230
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(Address of principal executive offices)
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(Zip Code)
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(614) 415-7000
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(Registrant's Telephone Number, Including Area Code)
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||
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Large accelerated filer
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ý
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Accelerated filer
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o
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Non-accelerated filer
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o
(Do not check if a smaller reporting company)
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Smaller reporting company
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o
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Common Stock, $.50 Par Value
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Outstanding at August 28, 2015
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290,378,683 Shares
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Page No.
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Item 1.
Financial Statements *
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Consolidated Statements of Income for the Thirteen Weeks and Twenty-Six Weeks Ended August 1, 2015 and August 2, 2014 (Unaudited)
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Consolidated Statements of Comprehensive Income for the Thirteen Weeks and Twenty-Six Weeks Ended August 1, 2015 and August 2, 2014 (Unaudited)
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Consolidated Balance Sheets as of August 1, 2015 (Unaudited), January 31, 2015 and August 2, 2014 (Unaudited)
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Consolidated Statements of Cash Flows for the Twenty-Six Weeks Ended August 1, 2015 and August 2, 2014 (Unaudited)
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Item 4.
Controls and Procedures
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Item 1.
Legal Proceedings
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Item 1A.
Risk Factors
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Item 3.
Defaults Upon Senior Securities
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Item 4.
Mine Safety Disclosures
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Item 5.
Other Information
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Item 6.
Exhibits
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*
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The Company's fiscal year ends on the Saturday nearest to January 31. As used herein, “second quarter of 2015” and “second quarter of 2014” refer to the thirteen week periods ending August 1, 2015 and August 2, 2014, respectively. “Year-to-date 2015” and “year-to-date 2014” refer to the twenty-six week periods ending August 1, 2015 and August 2, 2014, respectively.
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Item 1.
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FINANCIAL STATEMENTS
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Second Quarter
|
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Year-to-Date
|
||||||||||||
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2015
|
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2014
|
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2015
|
|
2014
|
||||||||
Net Sales
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$
|
2,765
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|
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$
|
2,675
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|
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$
|
5,277
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|
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$
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5,066
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Costs of Goods Sold, Buying and Occupancy
|
(1,651
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)
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(1,631
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)
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(3,107
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)
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(3,040
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)
|
||||
Gross Profit
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1,114
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1,044
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|
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2,170
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|
|
2,026
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|
||||
General, Administrative and Store Operating Expenses
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(711
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)
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(668
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)
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(1,395
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)
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(1,314
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)
|
||||
Operating Income
|
403
|
|
|
376
|
|
|
775
|
|
|
712
|
|
||||
Interest Expense
|
(78
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)
|
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(82
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)
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(158
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)
|
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(166
|
)
|
||||
Other Income (Loss)
|
(2
|
)
|
|
2
|
|
|
76
|
|
|
5
|
|
||||
Income Before Income Taxes
|
323
|
|
|
296
|
|
|
693
|
|
|
551
|
|
||||
Provision for Income Taxes
|
121
|
|
|
108
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|
|
240
|
|
|
206
|
|
||||
Net Income
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$
|
202
|
|
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$
|
188
|
|
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$
|
453
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|
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$
|
345
|
|
Net Income Per Basic Share
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$
|
0.69
|
|
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$
|
0.65
|
|
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$
|
1.55
|
|
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$
|
1.18
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|
Net Income Per Diluted Share
|
$
|
0.68
|
|
|
$
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0.63
|
|
|
$
|
1.52
|
|
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$
|
1.16
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Dividends Per Share
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$
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0.50
|
|
|
$
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0.34
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|
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$
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3.00
|
|
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$
|
1.68
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|
|
Second Quarter
|
|
Year-to-Date
|
||||||||||||
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2015
|
|
2014
|
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2015
|
|
2014
|
||||||||
Net Income
|
$
|
202
|
|
|
$
|
188
|
|
|
$
|
453
|
|
|
$
|
345
|
|
Other Comprehensive Income (Loss), Net of Tax:
|
|
|
|
|
|
|
|
||||||||
Reclassification of Cash Flow Hedges to Earnings
|
(27
|
)
|
|
2
|
|
|
(10
|
)
|
|
8
|
|
||||
Foreign Currency Translation
|
22
|
|
|
(1
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)
|
|
12
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|
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(3
|
)
|
||||
Unrealized Gain (Loss) on Cash Flow Hedges
|
14
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|
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(5
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)
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|
4
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(13
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)
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||||
Total Other Comprehensive Income (Loss), Net of Tax
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9
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|
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(4
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)
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6
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|
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(8
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)
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||||
Total Comprehensive Income
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$
|
211
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|
|
$
|
184
|
|
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$
|
459
|
|
|
$
|
337
|
|
|
August 1,
2015 |
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January 31,
2015 |
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August 2,
2014 |
||||||
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(Unaudited)
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(Unaudited)
|
||||||
ASSETS
|
|
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|
||||||
Current Assets:
|
|
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|
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|
||||||
Cash and Cash Equivalents
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$
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780
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$
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1,681
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|
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$
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1,147
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Marketable Securities
|
50
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|
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—
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—
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|||
Accounts Receivable, Net
|
257
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|
|
252
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|
|
233
|
|
|||
Inventories
|
1,106
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|
|
1,036
|
|
|
1,075
|
|
|||
Deferred Income Taxes
|
35
|
|
|
33
|
|
|
27
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|
|||
Other
|
270
|
|
|
230
|
|
|
217
|
|
|||
Total Current Assets
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2,498
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|
|
3,232
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|
|
2,699
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|||
Property and Equipment, Net
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2,275
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|
|
2,277
|
|
|
2,164
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|||
Goodwill
|
1,318
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|
1,318
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|
|
1,318
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|||
Trade Names and Other Intangible Assets, Net
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411
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|
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411
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|
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411
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Other Assets
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302
|
|
|
306
|
|
|
278
|
|
|||
Total Assets
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$
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6,804
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|
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$
|
7,544
|
|
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$
|
6,870
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LIABILITIES AND EQUITY (DEFICIT)
|
|
|
|
|
|
||||||
Current Liabilities:
|
|
|
|
|
|
||||||
Accounts Payable
|
$
|
725
|
|
|
$
|
613
|
|
|
$
|
622
|
|
Accrued Expenses and Other
|
840
|
|
|
900
|
|
|
743
|
|
|||
Current Portion of Long-term Debt
|
—
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|
|
—
|
|
|
214
|
|
|||
Income Taxes
|
5
|
|
|
166
|
|
|
1
|
|
|||
Total Current Liabilities
|
1,570
|
|
|
1,679
|
|
|
1,580
|
|
|||
Deferred Income Taxes
|
273
|
|
|
261
|
|
|
229
|
|
|||
Long-term Debt
|
4,759
|
|
|
4,765
|
|
|
4,758
|
|
|||
Other Long-term Liabilities
|
849
|
|
|
820
|
|
|
806
|
|
|||
Shareholders’ Equity (Deficit):
|
|
|
|
|
|
||||||
Preferred Stock - $1.00 par value; 10 shares authorized; none issued
|
—
|
|
|
—
|
|
|
—
|
|
|||
Common Stock - $0.50 par value; 1,000 shares authorized; 312, 310 and 309 shares issued; 291, 292 and 292 shares outstanding, respectively
|
156
|
|
|
155
|
|
|
155
|
|
|||
Paid-in Capital
|
483
|
|
|
427
|
|
|
365
|
|
|||
Accumulated Other Comprehensive Income
|
41
|
|
|
35
|
|
|
32
|
|
|||
Retained Earnings (Accumulated Deficit)
|
(194
|
)
|
|
233
|
|
|
(263
|
)
|
|||
Less: Treasury Stock, at Average Cost; 21, 18 and 17 shares, respectively
|
(1,134
|
)
|
|
(832
|
)
|
|
(793
|
)
|
|||
Total L Brands, Inc. Shareholders’ Equity (Deficit)
|
(648
|
)
|
|
18
|
|
|
(504
|
)
|
|||
Noncontrolling Interest
|
1
|
|
|
1
|
|
|
1
|
|
|||
Total Equity (Deficit)
|
(647
|
)
|
|
19
|
|
|
(503
|
)
|
|||
Total Liabilities and Equity (Deficit)
|
$
|
6,804
|
|
|
$
|
7,544
|
|
|
$
|
6,870
|
|
|
Year-to-Date
|
||||||
|
2015
|
|
2014
|
||||
Operating Activities:
|
|
|
|
||||
Net Income
|
$
|
453
|
|
|
$
|
345
|
|
Adjustments to Reconcile Net Income to Net Cash Provided by (Used for) Operating Activities:
|
|
|
|
||||
Depreciation and Amortization of Long-lived Assets
|
224
|
|
|
219
|
|
||
Amortization of Landlord Allowances
|
(20
|
)
|
|
(20
|
)
|
||
Deferred Income Taxes
|
7
|
|
|
19
|
|
||
Share-based Compensation Expense
|
50
|
|
|
45
|
|
||
Excess Tax Benefits from Share-based Compensation
|
(61
|
)
|
|
(37
|
)
|
||
Gain on Divestiture of Third-party Apparel Sourcing Business
|
(78
|
)
|
|
—
|
|
||
Loss on Sale of Assets
|
3
|
|
|
—
|
|
||
Changes in Assets and Liabilities:
|
|
|
|
||||
Accounts Receivable
|
(6
|
)
|
|
11
|
|
||
Inventories
|
(71
|
)
|
|
91
|
|
||
Accounts Payable, Accrued Expenses and Other
|
(36
|
)
|
|
(62
|
)
|
||
Income Taxes Payable
|
(151
|
)
|
|
(187
|
)
|
||
Other Assets and Liabilities
|
61
|
|
|
22
|
|
||
Net Cash Provided by Operating Activities
|
375
|
|
|
446
|
|
||
Investing Activities:
|
|
|
|
||||
Capital Expenditures
|
(358
|
)
|
|
(349
|
)
|
||
Proceeds from Sale of Assets
|
135
|
|
|
—
|
|
||
Proceeds from Divestiture of Third-party Apparel Sourcing Business
|
85
|
|
|
—
|
|
||
Purchase of Marketable Securities
|
(50
|
)
|
|
—
|
|
||
Other Investing Activities
|
1
|
|
|
15
|
|
||
Net Cash Used for Investing Activities
|
(187
|
)
|
|
(334
|
)
|
||
Financing Activities:
|
|
|
|
||||
Borrowings from Revolving Facility
|
—
|
|
|
5
|
|
||
Repayments on Revolving Facility
|
—
|
|
|
(5
|
)
|
||
Repurchase of Common Stock
|
(295
|
)
|
|
(48
|
)
|
||
Dividends Paid
|
(880
|
)
|
|
(491
|
)
|
||
Excess Tax Benefits from Share-based Compensation
|
61
|
|
|
37
|
|
||
Proceeds from Exercise of Stock Options and Other
|
23
|
|
|
22
|
|
||
Financing Costs
|
—
|
|
|
(5
|
)
|
||
Net Cash Used for Financing Activities
|
(1,091
|
)
|
|
(485
|
)
|
||
Effects of Exchange Rate Changes on Cash and Cash Equivalents
|
2
|
|
|
1
|
|
||
Net Decrease in Cash and Cash Equivalents
|
(901
|
)
|
|
(372
|
)
|
||
Cash and Cash Equivalents, Beginning of Period
|
1,681
|
|
|
1,519
|
|
||
Cash and Cash Equivalents, End of Period
|
$
|
780
|
|
|
$
|
1,147
|
|
•
|
Victoria’s Secret
|
•
|
Victoria's Secret PINK
|
•
|
Bath & Body Works
|
•
|
La Senza
|
•
|
Henri Bendel
|
|
Second Quarter
|
|
Year-to-Date
|
||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||
|
(in millions)
|
||||||||||
Weighted-average Common Shares:
|
|
|
|
|
|
|
|
||||
Issued Shares
|
312
|
|
|
309
|
|
|
312
|
|
|
309
|
|
Treasury Shares
|
(21
|
)
|
|
(17
|
)
|
|
(20
|
)
|
|
(17
|
)
|
Basic Shares
|
291
|
|
|
292
|
|
|
292
|
|
|
292
|
|
Effect of Dilutive Options and Restricted Stock
|
6
|
|
|
5
|
|
|
6
|
|
|
5
|
|
Diluted Shares
|
297
|
|
|
297
|
|
|
298
|
|
|
297
|
|
Anti-dilutive Options and Awards (a)
|
1
|
|
|
1
|
|
|
1
|
|
|
1
|
|
(a)
|
These options and awards were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive.
|
|
Amount Authorized
|
|
Shares
Repurchased
|
|
Amount
Repurchased
|
|
Average Stock Price of Shares Repurchased within Program
|
||||||||||||||
Repurchase Program
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
||||||||||||
|
(in millions)
|
|
(in thousands)
|
|
(in millions)
|
|
|
||||||||||||||
June 2015
|
$
|
250
|
|
|
624
|
|
|
NA
|
|
|
$
|
52
|
|
|
NA
|
|
|
$
|
83.75
|
|
|
February 2015
|
$
|
250
|
|
|
2,788
|
|
|
NA
|
|
|
$
|
250
|
|
|
NA
|
|
|
$
|
89.45
|
|
|
November 2012
|
$
|
250
|
|
|
NA
|
|
|
826
|
|
|
NA
|
|
|
$
|
45
|
|
|
$
|
48.52
|
|
|
|
Ordinary Dividends
|
|
Special Dividends
|
|
Total Dividends
|
|
Total Paid
|
||||||||
|
|
(per share)
|
|
(in millions)
|
||||||||||||
2015
|
|
|
|
|
|
|
|
|
||||||||
Second Quarter
|
|
$
|
0.50
|
|
|
$
|
—
|
|
|
$
|
0.50
|
|
|
$
|
146
|
|
First Quarter
|
|
0.50
|
|
|
2.00
|
|
|
2.50
|
|
|
734
|
|
||||
2015 Total
|
|
$
|
1.00
|
|
|
$
|
2.00
|
|
|
$
|
3.00
|
|
|
$
|
880
|
|
2014
|
|
|
|
|
|
|
|
|
||||||||
Second Quarter
|
|
$
|
0.34
|
|
|
$
|
—
|
|
|
$
|
0.34
|
|
|
$
|
99
|
|
First Quarter
|
|
0.34
|
|
|
1.00
|
|
|
1.34
|
|
|
392
|
|
||||
2014 Total
|
|
$
|
0.68
|
|
|
$
|
1.00
|
|
|
$
|
1.68
|
|
|
$
|
491
|
|
|
August 1,
2015 |
|
January 31, 2015
|
|
August 2,
2014 |
||||||
|
(in millions)
|
||||||||||
Finished Goods Merchandise
|
$
|
963
|
|
|
$
|
942
|
|
|
$
|
967
|
|
Raw Materials and Merchandise Components
|
143
|
|
|
94
|
|
|
108
|
|
|||
Total Inventories
|
$
|
1,106
|
|
|
$
|
1,036
|
|
|
$
|
1,075
|
|
|
August 1,
2015 |
|
January 31,
2015 |
|
August 2,
2014 |
||||||
|
(in millions)
|
||||||||||
Property and Equipment, at Cost
|
$
|
5,565
|
|
|
$
|
5,480
|
|
|
$
|
5,304
|
|
Accumulated Depreciation and Amortization
|
(3,290
|
)
|
|
(3,203
|
)
|
|
(3,140
|
)
|
|||
Property and Equipment, Net
|
$
|
2,275
|
|
|
$
|
2,277
|
|
|
$
|
2,164
|
|
|
August 1,
2015 |
|
January 31, 2015
|
|
August 2,
2014 |
||||||
|
(in millions)
|
||||||||||
Senior Unsecured Debt with Subsidiary Guarantee
|
|
|
|
|
|
||||||
$1 billion, 5.625% Fixed Interest Rate Notes due February 2022 (“2022 Notes”)
|
$
|
1,000
|
|
|
$
|
1,000
|
|
|
$
|
1,000
|
|
$1 billion, 6.625% Fixed Interest Rate Notes due April 2021 (“2021 Notes”)
|
1,000
|
|
|
1,000
|
|
|
1,000
|
|
|||
$500 million, 5.625% Fixed Interest Rate Notes due October 2023 (“2023 Notes”)
|
500
|
|
|
500
|
|
|
500
|
|
|||
$500 million, 8.50% Fixed Interest Rate Notes due June 2019, Less Unamortized Discount (“2019 Notes”)(a)
|
499
|
|
|
501
|
|
|
494
|
|
|||
$400 million, 7.00% Fixed Interest Rate Notes due May 2020 (“2020 Notes”)
|
400
|
|
|
400
|
|
|
400
|
|
|||
Total Senior Unsecured Debt with Subsidiary Guarantee
|
$
|
3,399
|
|
|
$
|
3,401
|
|
|
$
|
3,394
|
|
Senior Unsecured Debt
|
|
|
|
|
|
||||||
$700 million, 6.90% Fixed Interest Rate Notes due July 2017, Less Unamortized Discount (“2017 Notes”)(b)
|
$
|
711
|
|
|
$
|
715
|
|
|
$
|
715
|
|
$350 million, 6.95% Fixed Interest Rate Debentures due March 2033, Less Unamortized Discount (“2033 Notes”)
|
350
|
|
|
350
|
|
|
350
|
|
|||
$300 million, 7.60% Fixed Interest Rate Notes due July 2037, Less Unamortized Discount (“2037 Notes”)
|
299
|
|
|
299
|
|
|
299
|
|
|||
5.25% Fixed Interest Rate Notes due November 2014, Less Unamortized Discount (“2014 Notes”)(c)
|
—
|
|
|
—
|
|
|
214
|
|
|||
Total Senior Unsecured Debt
|
$
|
1,360
|
|
|
$
|
1,364
|
|
|
$
|
1,578
|
|
Total
|
$
|
4,759
|
|
|
$
|
4,765
|
|
|
$
|
4,972
|
|
Current Portion of Long-term Debt
|
—
|
|
|
—
|
|
|
(214
|
)
|
|||
Total Long-term Debt, Net of Current Portion
|
$
|
4,759
|
|
|
$
|
4,765
|
|
|
$
|
4,758
|
|
(a)
|
The balances include a fair value interest rate hedge adjustment which increased the debt balance by
$5 million
as of
August 1, 2015
,
$8 million
as of
January 31, 2015
and
$2 million
as of
August 2, 2014
.
|
(b)
|
The balances include a fair value interest rate hedge adjustment which increased the debt balance by
$11 million
as of
August 1, 2015
,
$15 million
as of
January 31, 2015
and
$16 million
as of
August 2, 2014
.
|
(c)
|
The outstanding principal balance was
$213 million
as of
August 2, 2014
. The total balance includes a fair value interest rate hedge adjustment which increased the debt balance by
$1 million
as of
August 2, 2014
.
|
|
August 1,
2015 |
|
January 31, 2015
|
|
August 2,
2014 |
||||||
|
(in millions)
|
||||||||||
Other Long-term Assets
|
$
|
25
|
|
|
$
|
21
|
|
|
$
|
—
|
|
Other Long-term Liabilities
|
—
|
|
|
—
|
|
|
26
|
|
|
|
|
Second Quarter
|
|
Year-to-Date
|
||||||||||||
|
Location
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
|
(in millions)
|
||||||||||||||
Gain (Loss) Recognized in Other Comprehensive Income
|
Other Comprehensive Income (Loss)
|
|
$
|
14
|
|
|
$
|
(5
|
)
|
|
$
|
4
|
|
|
$
|
(13
|
)
|
(Gain) Loss Reclassified from Accumulated Other Comprehensive Income (Loss) into Other Income (Loss) (a)
|
Other Income (Loss)
|
|
(27
|
)
|
|
2
|
|
|
(10
|
)
|
|
8
|
|
(a)
|
Represents reclassification of amounts from accumulated other comprehensive income to earnings to completely offset foreign currency transaction gains and losses recognized on the intercompany loans.
No
ineffectiveness was associated with these foreign exchange cash flow hedges.
|
|
August 1,
2015 |
|
January 31,
2015 |
|
August 2,
2014 |
||||||
|
(in millions)
|
||||||||||
Other Assets
|
$
|
7
|
|
|
$
|
12
|
|
|
$
|
3
|
|
|
August 1,
2015 |
|
January 31,
2015 |
|
August 2,
2014 |
||||||
|
(in millions)
|
||||||||||
Carrying Value
|
$
|
4,759
|
|
|
$
|
4,765
|
|
|
$
|
4,972
|
|
Estimated Fair Value (a)
|
5,233
|
|
|
5,305
|
|
|
5,443
|
|
(a)
|
The estimated fair value of the Company’s publicly traded debt is based on reported transaction prices which are considered Level 2 inputs in accordance with ASC Topic 820,
Fair Value Measurements and Disclosure
. The estimates presented are not necessarily indicative of the amounts that the Company could realize in a current market exchange.
|
•
|
Level
1
– Quoted market prices in active markets for identical assets or liabilities.
|
•
|
Level
2
– Observable inputs other than quoted market prices included in Level 1, such as quoted prices of similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
|
•
|
Level
3
– Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
As of August 1, 2015
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash and Cash Equivalents
|
$
|
780
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
780
|
|
Marketable Securities
|
50
|
|
|
—
|
|
|
—
|
|
|
50
|
|
||||
Interest Rate Designated Fair Value Hedges
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
||||
Cross-currency Cash Flow Hedges
|
—
|
|
|
25
|
|
|
—
|
|
|
25
|
|
||||
As of January 31, 2015
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash and Cash Equivalents
|
$
|
1,681
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,681
|
|
Interest Rate Designated Fair Value Hedges
|
—
|
|
|
12
|
|
|
—
|
|
|
12
|
|
||||
Cross-currency Cash Flow Hedges
|
—
|
|
|
21
|
|
|
—
|
|
|
21
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Lease Guarantees
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
||||
As of August 2, 2014
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash and Cash Equivalents
|
$
|
1,147
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,147
|
|
Interest Rate Designated Fair Value Hedges
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Cross-currency Cash Flow Hedges
|
—
|
|
|
26
|
|
|
—
|
|
|
26
|
|
||||
Lease Guarantees
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|
Second Quarter
|
|
Year-to-Date
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(in millions)
|
||||||||||||||
Beginning Balance
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
1
|
|
Change in Estimated Fair Value Reported in Earnings
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||
Ending Balance
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
Foreign Currency Translation
|
|
Cash Flow Hedges
|
|
Accumulated Other Comprehensive Income
|
||||||
|
(in millions)
|
||||||||||
Balance as of January 31, 2015
|
$
|
51
|
|
|
$
|
(16
|
)
|
|
$
|
35
|
|
Other Comprehensive Income Before Reclassifications
|
12
|
|
|
4
|
|
|
16
|
|
|||
Amounts Reclassified from Accumulated Other Comprehensive Income
|
—
|
|
|
(10
|
)
|
|
(10
|
)
|
|||
Current-period Other Comprehensive Income (Loss)
|
12
|
|
|
(6
|
)
|
|
6
|
|
|||
Balance as of August 1, 2015
|
$
|
63
|
|
|
$
|
(22
|
)
|
|
$
|
41
|
|
|
Foreign Currency Translation
|
|
Cash Flow Hedges
|
|
Accumulated Other Comprehensive Income
|
||||||
|
(in millions)
|
||||||||||
Balance as of February 1, 2014
|
$
|
30
|
|
|
$
|
10
|
|
|
$
|
40
|
|
Other Comprehensive Income Before Reclassifications
|
(3
|
)
|
|
(13
|
)
|
|
(16
|
)
|
|||
Amounts Reclassified from Accumulated Other Comprehensive Income
|
—
|
|
|
8
|
|
|
8
|
|
|||
Current-period Other Comprehensive Loss
|
(3
|
)
|
|
(5
|
)
|
|
(8
|
)
|
|||
Balance as of August 2, 2014
|
$
|
27
|
|
|
$
|
5
|
|
|
$
|
32
|
|
Details About Accumulated Other Comprehensive Income Components
|
|
Amount Reclassified from Accumulated Other Comprehensive Income
|
|
Location on Consolidated Statement of Income
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Second Quarter
|
|
Year-to-Date
|
|
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
||||||||
|
|
(in millions)
|
|
|
||||||||||||||
Cash Flow Hedges (Gain) Loss
|
|
$
|
(27
|
)
|
|
$
|
2
|
|
|
$
|
(10
|
)
|
|
$
|
8
|
|
|
Other Income (Loss)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Provision for Income Taxes
|
||||
|
|
$
|
(27
|
)
|
|
$
|
2
|
|
|
$
|
(10
|
)
|
|
$
|
8
|
|
|
Net Income
|
•
|
Victoria's Secret Beauty and Accessories stores operated by partners under franchise, license and wholesale arrangements, which feature Victoria's Secret branded beauty and accessories products;
|
•
|
Victoria's Secret International stores, comprised of company-owned stores in the U.K., as well as stores operated by partners under franchise, license and wholesale arrangements; and
|
•
|
Bath & Body Works International stores operated by partners under franchise, license and wholesale arrangements.
|
•
|
Mast Global, a merchandise sourcing and production function serving the Company and its international partners;
|
•
|
La Senza, comprised of company-owned stores in Canada, as well as stores operated by partners under franchise, license and wholesale arrangements, which feature women's intimate apparel;
|
•
|
Henri Bendel, operator of
29
specialty stores, which feature handbags, jewelry and other accessory products; and
|
•
|
Corporate functions including non-core real estate, equity investments and other governance functions such as treasury and tax.
|
|
Victoria’s
Secret
|
|
Bath &
Body Works
|
|
Victoria’s Secret
and
Bath & Body Works International
|
|
Other
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
2015
|
|
|
|
|
|
|
|
|
|
||||||||||
Second Quarter:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Sales
|
$
|
1,806
|
|
|
$
|
748
|
|
|
$
|
89
|
|
|
$
|
122
|
|
|
$
|
2,765
|
|
Operating Income (Loss)
|
298
|
|
|
138
|
|
|
20
|
|
|
(53
|
)
|
|
403
|
|
|||||
Year-to-Date:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Sales
|
$
|
3,490
|
|
|
$
|
1,361
|
|
|
$
|
181
|
|
|
$
|
245
|
|
|
$
|
5,277
|
|
Operating Income (Loss)
|
587
|
|
|
235
|
|
|
41
|
|
|
(88
|
)
|
|
775
|
|
|||||
2014
|
|
|
|
|
|
|
|
|
|
||||||||||
Second Quarter:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Sales
|
$
|
1,745
|
|
|
$
|
704
|
|
|
$
|
80
|
|
|
$
|
146
|
|
|
$
|
2,675
|
|
Operating Income (Loss)
|
293
|
|
|
115
|
|
|
17
|
|
|
(49
|
)
|
|
376
|
|
|||||
Year-to-Date:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Sales
|
$
|
3,349
|
|
|
$
|
1,286
|
|
|
$
|
151
|
|
|
$
|
280
|
|
|
$
|
5,066
|
|
Operating Income (Loss)
|
571
|
|
|
195
|
|
|
32
|
|
|
(86
|
)
|
|
712
|
|
|
August 1, 2015
|
||||||||||||||||||
|
L Brands, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-
guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
L Brands, Inc.
|
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and Cash Equivalents
|
$
|
—
|
|
|
$
|
453
|
|
|
$
|
327
|
|
|
$
|
—
|
|
|
$
|
780
|
|
Marketable Securities
|
—
|
|
|
50
|
|
|
—
|
|
|
—
|
|
|
50
|
|
|||||
Accounts Receivable, Net
|
1
|
|
|
201
|
|
|
55
|
|
|
—
|
|
|
257
|
|
|||||
Inventories
|
—
|
|
|
980
|
|
|
126
|
|
|
—
|
|
|
1,106
|
|
|||||
Deferred Income Taxes
|
—
|
|
|
37
|
|
|
(2
|
)
|
|
—
|
|
|
35
|
|
|||||
Other
|
1
|
|
|
141
|
|
|
128
|
|
|
—
|
|
|
270
|
|
|||||
Total Current Assets
|
2
|
|
|
1,862
|
|
|
634
|
|
|
—
|
|
|
2,498
|
|
|||||
Property and Equipment, Net
|
—
|
|
|
1,485
|
|
|
790
|
|
|
—
|
|
|
2,275
|
|
|||||
Goodwill
|
—
|
|
|
1,318
|
|
|
—
|
|
|
—
|
|
|
1,318
|
|
|||||
Trade Names and Other Intangible Assets, Net
|
—
|
|
|
411
|
|
|
—
|
|
|
—
|
|
|
411
|
|
|||||
Net Investments in and Advances to/from Consolidated Affiliates
|
3,979
|
|
|
15,589
|
|
|
1,642
|
|
|
(21,210
|
)
|
|
—
|
|
|||||
Other Assets
|
179
|
|
|
40
|
|
|
695
|
|
|
(612
|
)
|
|
302
|
|
|||||
Total Assets
|
$
|
4,160
|
|
|
$
|
20,705
|
|
|
$
|
3,761
|
|
|
$
|
(21,822
|
)
|
|
$
|
6,804
|
|
LIABILITIES AND EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts Payable
|
$
|
7
|
|
|
$
|
385
|
|
|
$
|
333
|
|
|
$
|
—
|
|
|
$
|
725
|
|
Accrued Expenses and Other
|
85
|
|
|
500
|
|
|
255
|
|
|
—
|
|
|
840
|
|
|||||
Income Taxes
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
|||||
Total Current Liabilities
|
92
|
|
|
885
|
|
|
593
|
|
|
—
|
|
|
1,570
|
|
|||||
Deferred Income Taxes
|
(3
|
)
|
|
(26
|
)
|
|
302
|
|
|
—
|
|
|
273
|
|
|||||
Long-term Debt
|
4,759
|
|
|
597
|
|
|
—
|
|
|
(597
|
)
|
|
4,759
|
|
|||||
Other Long-term Liabilities
|
—
|
|
|
619
|
|
|
243
|
|
|
(13
|
)
|
|
849
|
|
|||||
Total Equity (Deficit)
|
(688
|
)
|
|
18,630
|
|
|
2,623
|
|
|
(21,212
|
)
|
|
(647
|
)
|
|||||
Total Liabilities and Equity (Deficit)
|
$
|
4,160
|
|
|
$
|
20,705
|
|
|
$
|
3,761
|
|
|
$
|
(21,822
|
)
|
|
$
|
6,804
|
|
|
January 31, 2015
|
||||||||||||||||||
|
L Brands, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-
guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
L Brands, Inc.
|
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and Cash Equivalents
|
$
|
—
|
|
|
$
|
1,462
|
|
|
$
|
219
|
|
|
$
|
—
|
|
|
$
|
1,681
|
|
Accounts Receivable, Net
|
1
|
|
|
197
|
|
|
54
|
|
|
—
|
|
|
252
|
|
|||||
Inventories
|
—
|
|
|
919
|
|
|
117
|
|
|
—
|
|
|
1,036
|
|
|||||
Deferred Income Taxes
|
—
|
|
|
34
|
|
|
(1
|
)
|
|
—
|
|
|
33
|
|
|||||
Other
|
—
|
|
|
146
|
|
|
84
|
|
|
—
|
|
|
230
|
|
|||||
Total Current Assets
|
1
|
|
|
2,758
|
|
|
473
|
|
|
—
|
|
|
3,232
|
|
|||||
Property and Equipment, Net
|
—
|
|
|
1,385
|
|
|
892
|
|
|
—
|
|
|
2,277
|
|
|||||
Goodwill
|
—
|
|
|
1,318
|
|
|
—
|
|
|
—
|
|
|
1,318
|
|
|||||
Trade Names and Other Intangible Assets, Net
|
—
|
|
|
411
|
|
|
—
|
|
|
—
|
|
|
411
|
|
|||||
Net Investments in and Advances to/from Consolidated Affiliates
|
4,635
|
|
|
14,003
|
|
|
1,405
|
|
|
(20,043
|
)
|
|
—
|
|
|||||
Other Assets
|
188
|
|
|
35
|
|
|
693
|
|
|
(610
|
)
|
|
306
|
|
|||||
Total Assets
|
$
|
4,824
|
|
|
$
|
19,910
|
|
|
$
|
3,463
|
|
|
$
|
(20,653
|
)
|
|
$
|
7,544
|
|
LIABILITIES AND EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts Payable
|
$
|
—
|
|
|
$
|
300
|
|
|
$
|
313
|
|
|
$
|
—
|
|
|
$
|
613
|
|
Accrued Expenses and Other
|
83
|
|
|
495
|
|
|
322
|
|
|
—
|
|
|
900
|
|
|||||
Income Taxes
|
(4
|
)
|
|
183
|
|
|
(13
|
)
|
|
—
|
|
|
166
|
|
|||||
Total Current Liabilities
|
79
|
|
|
978
|
|
|
622
|
|
|
—
|
|
|
1,679
|
|
|||||
Deferred Income Taxes
|
(4
|
)
|
|
(32
|
)
|
|
297
|
|
|
—
|
|
|
261
|
|
|||||
Long-term Debt
|
4,765
|
|
|
597
|
|
|
—
|
|
|
(597
|
)
|
|
4,765
|
|
|||||
Other Long-term Liabilities
|
—
|
|
|
609
|
|
|
224
|
|
|
(13
|
)
|
|
820
|
|
|||||
Total Equity (Deficit)
|
(16
|
)
|
|
17,758
|
|
|
2,320
|
|
|
(20,043
|
)
|
|
19
|
|
|||||
Total Liabilities and Equity (Deficit)
|
$
|
4,824
|
|
|
$
|
19,910
|
|
|
$
|
3,463
|
|
|
$
|
(20,653
|
)
|
|
$
|
7,544
|
|
|
August 2, 2014
|
||||||||||||||||||
|
L Brands, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-
guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
L Brands, Inc.
|
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and Cash Equivalents
|
$
|
—
|
|
|
$
|
920
|
|
|
$
|
227
|
|
|
$
|
—
|
|
|
$
|
1,147
|
|
Accounts Receivable, Net
|
1
|
|
|
175
|
|
|
57
|
|
|
—
|
|
|
233
|
|
|||||
Inventories
|
—
|
|
|
947
|
|
|
128
|
|
|
—
|
|
|
1,075
|
|
|||||
Deferred Income Taxes
|
—
|
|
|
43
|
|
|
(16
|
)
|
|
—
|
|
|
27
|
|
|||||
Other
|
—
|
|
|
131
|
|
|
86
|
|
|
—
|
|
|
217
|
|
|||||
Total Current Assets
|
1
|
|
|
2,216
|
|
|
482
|
|
|
—
|
|
|
2,699
|
|
|||||
Property and Equipment, Net
|
—
|
|
|
1,295
|
|
|
869
|
|
|
—
|
|
|
2,164
|
|
|||||
Goodwill
|
—
|
|
|
1,318
|
|
|
—
|
|
|
—
|
|
|
1,318
|
|
|||||
Trade Names and Other Intangible Assets, Net
|
—
|
|
|
411
|
|
|
—
|
|
|
—
|
|
|
411
|
|
|||||
Net Investments in and Advances to/from Consolidated Affiliates
|
4,337
|
|
|
15,123
|
|
|
1,158
|
|
|
(20,618
|
)
|
|
—
|
|
|||||
Other Assets
|
184
|
|
|
21
|
|
|
685
|
|
|
(612
|
)
|
|
278
|
|
|||||
Total Assets
|
$
|
4,522
|
|
|
$
|
20,384
|
|
|
$
|
3,194
|
|
|
$
|
(21,230
|
)
|
|
$
|
6,870
|
|
LIABILITIES AND EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts Payable
|
$
|
—
|
|
|
$
|
361
|
|
|
$
|
261
|
|
|
$
|
—
|
|
|
$
|
622
|
|
Accrued Expenses and Other
|
88
|
|
|
413
|
|
|
242
|
|
|
—
|
|
|
743
|
|
|||||
Current Portion of Long-term Debt
|
214
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
214
|
|
|||||
Income Taxes
|
—
|
|
|
(12
|
)
|
|
13
|
|
|
—
|
|
|
1
|
|
|||||
Total Current Liabilities
|
302
|
|
|
762
|
|
|
516
|
|
|
—
|
|
|
1,580
|
|
|||||
Deferred Income Taxes
|
(4
|
)
|
|
(18
|
)
|
|
251
|
|
|
—
|
|
|
229
|
|
|||||
Long-term Debt
|
4,758
|
|
|
597
|
|
|
—
|
|
|
(597
|
)
|
|
4,758
|
|
|||||
Other Long-term Liabilities
|
1
|
|
|
586
|
|
|
233
|
|
|
(14
|
)
|
|
806
|
|
|||||
Total Equity (Deficit)
|
(535
|
)
|
|
18,457
|
|
|
2,194
|
|
|
(20,619
|
)
|
|
(503
|
)
|
|||||
Total Liabilities and Equity (Deficit)
|
$
|
4,522
|
|
|
$
|
20,384
|
|
|
$
|
3,194
|
|
|
$
|
(21,230
|
)
|
|
$
|
6,870
|
|
|
Second Quarter 2015
|
||||||||||||||||||
|
L Brands, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-
guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
L Brands, Inc.
|
||||||||||
Net Sales
|
$
|
—
|
|
|
$
|
2,588
|
|
|
$
|
814
|
|
|
$
|
(637
|
)
|
|
$
|
2,765
|
|
Costs of Goods Sold, Buying and Occupancy
|
—
|
|
|
(1,607
|
)
|
|
(705
|
)
|
|
661
|
|
|
(1,651
|
)
|
|||||
Gross Profit
|
—
|
|
|
981
|
|
|
109
|
|
|
24
|
|
|
1,114
|
|
|||||
General, Administrative and Store Operating Expenses
|
(2
|
)
|
|
(629
|
)
|
|
(106
|
)
|
|
26
|
|
|
(711
|
)
|
|||||
Operating Income (Loss)
|
(2
|
)
|
|
352
|
|
|
3
|
|
|
50
|
|
|
403
|
|
|||||
Interest Expense
|
(78
|
)
|
|
(4
|
)
|
|
(3
|
)
|
|
7
|
|
|
(78
|
)
|
|||||
Other Income
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|||||
Income (Loss) Before Income Taxes
|
(80
|
)
|
|
348
|
|
|
(2
|
)
|
|
57
|
|
|
323
|
|
|||||
Provision for Income Taxes
|
—
|
|
|
90
|
|
|
31
|
|
|
—
|
|
|
121
|
|
|||||
Equity in Earnings (Loss), Net of Tax
|
282
|
|
|
154
|
|
|
130
|
|
|
(566
|
)
|
|
—
|
|
|||||
Net Income (Loss)
|
$
|
202
|
|
|
$
|
412
|
|
|
$
|
97
|
|
|
$
|
(509
|
)
|
|
$
|
202
|
|
|
|
|
|
|
|
|
|
|
|
|
Second Quarter 2015
|
||||||||||||||||||
|
L Brands, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-
guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
L Brands, Inc.
|
||||||||||
Net Income (Loss)
|
$
|
202
|
|
|
$
|
412
|
|
|
$
|
97
|
|
|
$
|
(509
|
)
|
|
$
|
202
|
|
Other Comprehensive Income (Loss), Net of Tax:
|
|
|
|
|
|
|
|
|
|
||||||||||
Reclassification of Cash Flow Hedges to Earnings
|
—
|
|
|
—
|
|
|
(27
|
)
|
|
—
|
|
|
(27
|
)
|
|||||
Foreign Currency Translation
|
—
|
|
|
—
|
|
|
22
|
|
|
—
|
|
|
22
|
|
|||||
Unrealized Loss on Cash Flow Hedges
|
—
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
14
|
|
|||||
Total Other Comprehensive Income (Loss), Net of Tax
|
—
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|
9
|
|
|||||
Total Comprehensive Income (Loss)
|
$
|
202
|
|
|
$
|
412
|
|
|
$
|
106
|
|
|
$
|
(509
|
)
|
|
$
|
211
|
|
|
Second Quarter 2014
|
||||||||||||||||||
|
L Brands, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-
guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
L Brands, Inc.
|
||||||||||
Net Sales
|
$
|
—
|
|
|
$
|
2,479
|
|
|
$
|
773
|
|
|
$
|
(577
|
)
|
|
$
|
2,675
|
|
Costs of Goods Sold, Buying and Occupancy
|
—
|
|
|
(1,549
|
)
|
|
(630
|
)
|
|
548
|
|
|
(1,631
|
)
|
|||||
Gross Profit
|
—
|
|
|
930
|
|
|
143
|
|
|
(29
|
)
|
|
1,044
|
|
|||||
General, Administrative and Store Operating Expenses
|
(1
|
)
|
|
(593
|
)
|
|
(104
|
)
|
|
30
|
|
|
(668
|
)
|
|||||
Operating Income (Loss)
|
(1
|
)
|
|
337
|
|
|
39
|
|
|
1
|
|
|
376
|
|
|||||
Interest Expense
|
(82
|
)
|
|
(8
|
)
|
|
(2
|
)
|
|
10
|
|
|
(82
|
)
|
|||||
Other Income
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||
Income (Loss) Before Income Taxes
|
(83
|
)
|
|
329
|
|
|
39
|
|
|
11
|
|
|
296
|
|
|||||
Provision for Income Taxes
|
—
|
|
|
56
|
|
|
52
|
|
|
—
|
|
|
108
|
|
|||||
Equity in Earnings (Loss), Net of Tax
|
271
|
|
|
79
|
|
|
81
|
|
|
(431
|
)
|
|
—
|
|
|||||
Net Income (Loss)
|
$
|
188
|
|
|
$
|
352
|
|
|
$
|
68
|
|
|
$
|
(420
|
)
|
|
$
|
188
|
|
|
Second Quarter 2014
|
||||||||||||||||||
|
L Brands, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-
guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
L Brands, Inc.
|
||||||||||
Net Income (Loss)
|
$
|
188
|
|
|
$
|
352
|
|
|
$
|
68
|
|
|
$
|
(420
|
)
|
|
$
|
188
|
|
Other Comprehensive Income (Loss), Net of Tax:
|
|
|
|
|
|
|
|
|
|
||||||||||
Reclassification of Cash Flow Hedges to Earnings
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||
Foreign Currency Translation
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||||
Unrealized Loss on Cash Flow Hedges
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
|||||
Total Other Comprehensive Income (Loss), Net of Tax
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
|||||
Total Comprehensive Income (Loss)
|
$
|
188
|
|
|
$
|
352
|
|
|
$
|
64
|
|
|
$
|
(420
|
)
|
|
$
|
184
|
|
|
Year-to-Date 2015
|
||||||||||||||||||
|
L Brands, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-
guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
L Brands, Inc.
|
||||||||||
Net Sales
|
$
|
—
|
|
|
$
|
4,957
|
|
|
$
|
1,630
|
|
|
$
|
(1,310
|
)
|
|
$
|
5,277
|
|
Costs of Goods Sold, Buying and Occupancy
|
—
|
|
|
(3,031
|
)
|
|
(1,321
|
)
|
|
1,245
|
|
|
(3,107
|
)
|
|||||
Gross Profit
|
—
|
|
|
1,926
|
|
|
309
|
|
|
(65
|
)
|
|
2,170
|
|
|||||
General, Administrative and Store Operating Expenses
|
(6
|
)
|
|
(1,245
|
)
|
|
(202
|
)
|
|
58
|
|
|
(1,395
|
)
|
|||||
Operating Income (Loss)
|
(6
|
)
|
|
681
|
|
|
107
|
|
|
(7
|
)
|
|
775
|
|
|||||
Interest Expense
|
(158
|
)
|
|
(12
|
)
|
|
(5
|
)
|
|
17
|
|
|
(158
|
)
|
|||||
Other Income
|
—
|
|
|
4
|
|
|
72
|
|
|
—
|
|
|
76
|
|
|||||
Income (Loss) Before Income Taxes
|
(164
|
)
|
|
673
|
|
|
174
|
|
|
10
|
|
|
693
|
|
|||||
Provision for Income Taxes
|
—
|
|
|
168
|
|
|
72
|
|
|
—
|
|
|
240
|
|
|||||
Equity in Earnings (Loss), Net of Tax
|
617
|
|
|
379
|
|
|
253
|
|
|
(1,249
|
)
|
|
—
|
|
|||||
Net Income (Loss)
|
$
|
453
|
|
|
$
|
884
|
|
|
$
|
355
|
|
|
$
|
(1,239
|
)
|
|
$
|
453
|
|
|
Year-to-Date 2015
|
||||||||||||||||||
|
L Brands, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-
guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
L Brands, Inc.
|
||||||||||
Net Income (Loss)
|
$
|
453
|
|
|
$
|
884
|
|
|
$
|
355
|
|
|
$
|
(1,239
|
)
|
|
$
|
453
|
|
Other Comprehensive Income (Loss), Net of Tax:
|
|
|
|
|
|
|
|
|
|
||||||||||
Reclassification of Cash Flow Hedges to Earnings
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
|
(10
|
)
|
|||||
Foreign Currency Translation
|
—
|
|
|
—
|
|
|
12
|
|
|
—
|
|
|
12
|
|
|||||
Unrealized Loss on Cash Flow Hedges
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
|||||
Total Other Comprehensive Income (Loss), Net of Tax
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
|||||
Total Comprehensive Income (Loss)
|
$
|
453
|
|
|
$
|
884
|
|
|
$
|
361
|
|
|
$
|
(1,239
|
)
|
|
$
|
459
|
|
|
Year-to-Date 2014
|
||||||||||||||||||
|
L Brands, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-
guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
L Brands, Inc.
|
||||||||||
Net Sales
|
$
|
—
|
|
|
$
|
4,710
|
|
|
$
|
1,557
|
|
|
$
|
(1,201
|
)
|
|
$
|
5,066
|
|
Costs of Goods Sold, Buying and Occupancy
|
—
|
|
|
(2,908
|
)
|
|
(1,277
|
)
|
|
1,145
|
|
|
(3,040
|
)
|
|||||
Gross Profit
|
—
|
|
|
1,802
|
|
|
280
|
|
|
(56
|
)
|
|
2,026
|
|
|||||
General, Administrative and Store Operating Expenses
|
(4
|
)
|
|
(1,161
|
)
|
|
(207
|
)
|
|
58
|
|
|
(1,314
|
)
|
|||||
Operating Income (Loss)
|
(4
|
)
|
|
641
|
|
|
73
|
|
|
2
|
|
|
712
|
|
|||||
Interest Expense
|
(166
|
)
|
|
(15
|
)
|
|
(4
|
)
|
|
19
|
|
|
(166
|
)
|
|||||
Other Income
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
|||||
Income (Loss) Before Income Taxes
|
(170
|
)
|
|
626
|
|
|
74
|
|
|
21
|
|
|
551
|
|
|||||
Provision for Income Taxes
|
(1
|
)
|
|
118
|
|
|
89
|
|
|
—
|
|
|
206
|
|
|||||
Equity in Earnings (Loss), Net of Tax
|
514
|
|
|
258
|
|
|
250
|
|
|
(1,022
|
)
|
|
—
|
|
|||||
Net Income (Loss)
|
$
|
345
|
|
|
$
|
766
|
|
|
$
|
235
|
|
|
$
|
(1,001
|
)
|
|
$
|
345
|
|
|
Year-to-Date 2014
|
||||||||||||||||||
|
L Brands, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-
guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
L Brands, Inc.
|
||||||||||
Net Income (Loss)
|
$
|
345
|
|
|
$
|
766
|
|
|
$
|
235
|
|
|
$
|
(1,001
|
)
|
|
$
|
345
|
|
Other Comprehensive Income (Loss), Net of Tax:
|
|
|
|
|
|
|
|
|
|
||||||||||
Reclassification of Cash Flow Hedges to Earnings
|
—
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
8
|
|
|||||
Foreign Currency Translation
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||||
Unrealized Loss on Cash Flow Hedges
|
—
|
|
|
—
|
|
|
(13
|
)
|
|
—
|
|
|
(13
|
)
|
|||||
Total Other Comprehensive Income (Loss), Net of Tax
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
(8
|
)
|
|||||
Total Comprehensive Income (Loss)
|
345
|
|
|
766
|
|
|
227
|
|
|
(1,001
|
)
|
|
337
|
|
|
Year-to-Date 2015
|
||||||||||||||||||
|
L Brands, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-
guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
L Brands, Inc.
|
||||||||||
Net Cash Provided by (Used for) Operating Activities
|
$
|
(147
|
)
|
|
$
|
481
|
|
|
$
|
41
|
|
|
$
|
—
|
|
|
$
|
375
|
|
Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital Expenditures
|
—
|
|
|
(254
|
)
|
|
(104
|
)
|
|
—
|
|
|
(358
|
)
|
|||||
Proceeds from the Sale of Assets
|
—
|
|
|
—
|
|
|
135
|
|
|
—
|
|
|
135
|
|
|||||
Proceeds from Divestiture of Third-party Apparel Sourcing Business
|
—
|
|
|
1
|
|
|
84
|
|
|
—
|
|
|
85
|
|
|||||
Purchase of Marketable Securities
|
—
|
|
|
(50
|
)
|
|
—
|
|
|
—
|
|
|
(50
|
)
|
|||||
Other Investing Activities
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|||||
Net Cash Provided by (Used for) Investing Activities
|
—
|
|
|
(303
|
)
|
|
116
|
|
|
—
|
|
|
(187
|
)
|
|||||
Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Repurchase of Common Stock
|
(295
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(295
|
)
|
|||||
Dividends Paid
|
(880
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(880
|
)
|
|||||
Excess Tax Benefits from Share-based Compensation
|
—
|
|
|
53
|
|
|
8
|
|
|
—
|
|
|
61
|
|
|||||
Net Financing Activities and Advances to/from Consolidated Affiliates
|
1,299
|
|
|
(1,240
|
)
|
|
(59
|
)
|
|
—
|
|
|
—
|
|
|||||
Proceeds from Exercise of Stock Options and Other
|
23
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23
|
|
|||||
Net Cash Provided by (Used for) Financing Activities
|
147
|
|
|
(1,187
|
)
|
|
(51
|
)
|
|
—
|
|
|
(1,091
|
)
|
|||||
Effects of Exchange Rate Changes on Cash and Cash Equivalents
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||
Net Increase (Decrease) in Cash and Cash Equivalents
|
—
|
|
|
(1,009
|
)
|
|
108
|
|
|
—
|
|
|
(901
|
)
|
|||||
Cash and Cash Equivalents, Beginning of Period
|
—
|
|
|
1,462
|
|
|
219
|
|
|
—
|
|
|
1,681
|
|
|||||
Cash and Cash Equivalents, End of Period
|
$
|
—
|
|
|
$
|
453
|
|
|
$
|
327
|
|
|
$
|
—
|
|
|
$
|
780
|
|
|
Year-to-Date 2014
|
||||||||||||||||||
|
L Brands, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-
guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
L Brands, Inc.
|
||||||||||
Net Cash Provided by (Used for) Operating Activities
|
$
|
(172
|
)
|
|
$
|
514
|
|
|
$
|
104
|
|
|
$
|
—
|
|
|
$
|
446
|
|
Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital Expenditures
|
—
|
|
|
(248
|
)
|
|
(101
|
)
|
|
—
|
|
|
(349
|
)
|
|||||
Other Investing Activities
|
—
|
|
|
—
|
|
|
15
|
|
|
—
|
|
|
15
|
|
|||||
Net Cash Used for Investing Activities
|
—
|
|
|
(248
|
)
|
|
(86
|
)
|
|
—
|
|
|
(334
|
)
|
|||||
Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Borrowings from Revolving Facility
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
|||||
Repayments on Revolving Facility
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
|||||
Repurchase of Common Stock
|
(48
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(48
|
)
|
|||||
Dividends Paid
|
(491
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(491
|
)
|
|||||
Excess Tax Benefits from Share-based Compensation
|
—
|
|
|
31
|
|
|
6
|
|
|
—
|
|
|
37
|
|
|||||
Net Financing Activities and Advances to/from Consolidated Affiliates
|
694
|
|
|
(730
|
)
|
|
36
|
|
|
—
|
|
|
—
|
|
|||||
Proceeds from Exercise of Stock Options and Other
|
22
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|||||
Financing Costs
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|||||
Net Cash Provided by (Used for) Financing Activities
|
172
|
|
|
(699
|
)
|
|
42
|
|
|
—
|
|
|
(485
|
)
|
|||||
Effects of Exchange Rate Changes on Cash and Cash Equivalents
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|||||
Net Increase (Decrease) in Cash and Cash Equivalents
|
—
|
|
|
(433
|
)
|
|
61
|
|
|
—
|
|
|
(372
|
)
|
|||||
Cash and Cash Equivalents, Beginning of Period
|
—
|
|
|
1,353
|
|
|
166
|
|
|
—
|
|
|
1,519
|
|
|||||
Cash and Cash Equivalents, End of Period
|
$
|
—
|
|
|
$
|
920
|
|
|
$
|
227
|
|
|
$
|
—
|
|
|
$
|
1,147
|
|
•
|
general 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;
|
•
|
the seasonality of our business;
|
•
|
the dependence on a high volume of mall traffic and the availability of suitable store locations on appropriate terms;
|
•
|
our ability to grow through new store openings and existing store remodels and expansions;
|
•
|
our ability to successfully expand into global markets and related risks;
|
•
|
our relationships with independent franchise, license and wholesale partners;
|
•
|
our direct channel businesses;
|
•
|
our failure to protect our reputation and our brand images;
|
•
|
our failure to protect our trade names, trademarks and patents;
|
•
|
the highly competitive nature of the retail industry generally and the segments in which we operate particularly;
|
•
|
consumer acceptance of our products and our ability to keep up with fashion trends, develop new merchandise and launch new product lines successfully;
|
•
|
our ability to source, distribute and sell goods and materials on a global basis, including risks related to:
|
•
|
political instability;
|
•
|
duties, taxes and other charges;
|
•
|
legal and regulatory matters;
|
•
|
volatility in currency exchange rates;
|
•
|
local business practices and political issues;
|
•
|
potential delays or disruptions in shipping and transportation and related pricing impacts;
|
•
|
disruption due to labor disputes; and
|
•
|
changing expectations regarding product safety due to new legislation;
|
•
|
fluctuations in foreign currency exchange rates;
|
•
|
stock price volatility;
|
•
|
our failure to maintain our credit rating;
|
•
|
our ability to service or refinance our debt;
|
•
|
our ability to retain key personnel;
|
•
|
our ability to attract, develop and retain qualified employees and manage labor-related costs;
|
•
|
the inability of our manufacturers to deliver products in a timely manner and meet quality standards;
|
•
|
fluctuations in product input costs;
|
•
|
fluctuations in energy costs;
|
•
|
increases in the costs of mailing, paper and printing;
|
•
|
claims arising from our self-insurance;
|
•
|
our ability to implement and maintain information technology systems and to protect associated data;
|
•
|
our failure to maintain the security of customer, associate, supplier or company information;
|
•
|
our failure to comply with regulatory requirements;
|
•
|
tax matters; and
|
•
|
legal and compliance matters.
|
Item 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
Year-to-Date
|
||||||
|
2015
|
|
2014
|
||||
|
(in millions)
|
||||||
Detail of Special Items included in Other Income - Income (Expense)
|
|
|
|
||||
Gain on Divestiture of Third-Party Apparel Sourcing Business (a)
|
$
|
78
|
|
|
$
|
—
|
|
Total Special Items included in Other Income
|
$
|
78
|
|
|
$
|
—
|
|
|
|
|
|
||||
Detail of Special Items included in Provision for Income Taxes - Benefit (Provision)
|
|
|
|
||||
Tax effect of Special Items included in Other Income
|
$
|
(9
|
)
|
|
$
|
—
|
|
Total Special Items included in Provision for Income Taxes
|
$
|
(9
|
)
|
|
$
|
—
|
|
|
|
|
|
||||
Reconciliation of Reported Net Income to Adjusted Net Income
|
|
|
|
||||
Reported Net Income
|
$
|
453
|
|
|
$
|
345
|
|
Special Items included in Net Income
|
(69
|
)
|
|
—
|
|
||
Adjusted Net Income
|
$
|
384
|
|
|
$
|
345
|
|
|
|
|
|
||||
Reconciliation of Reported Earnings Per Share to Adjusted Earnings Per Share
|
|
|
|
||||
Reported Earnings Per Share
|
$
|
1.52
|
|
|
$
|
1.16
|
|
Special Items included in Earnings Per Share
|
(0.23
|
)
|
|
—
|
|
||
Adjusted Earnings Per Share
|
$
|
1.29
|
|
|
$
|
1.16
|
|
(a)
|
In the first quarter of 2015, we divested our remaining ownership interest in our third-party apparel sourcing business. We received cash proceeds of
$85 million
and recognized a pre-tax gain of
$78 million
(after-tax gain of
$69 million
). For additional information see Note
6
, "Equity Investments and Other" included in Item 1. Financial Statements.
|
|
|
Second Quarter
|
|
Year-to-Date
|
||||||||||||||||||
|
|
2015
|
|
2014
|
|
% Change
|
|
2015
|
|
2014
|
|
% Change
|
||||||||||
Sales per Average Selling Square Foot
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Victoria’s Secret U.S.
|
|
$
|
205
|
|
|
$
|
202
|
|
|
1
|
%
|
|
$
|
398
|
|
|
$
|
389
|
|
|
2
|
%
|
Bath & Body Works U.S.
|
|
171
|
|
|
163
|
|
|
5
|
%
|
|
313
|
|
|
298
|
|
|
5
|
%
|
||||
Sales per Average Store (in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Victoria’s Secret U.S.
|
|
$
|
1,246
|
|
|
$
|
1,216
|
|
|
2
|
%
|
|
$
|
2,425
|
|
|
$
|
2,340
|
|
|
4
|
%
|
Bath & Body Works U.S.
|
|
404
|
|
|
385
|
|
|
5
|
%
|
|
738
|
|
|
704
|
|
|
5
|
%
|
||||
Average Store Size (selling square feet)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Victoria’s Secret U.S.
|
|
6,107
|
|
|
6,021
|
|
|
1
|
%
|
|
|
|
|
|
|
|||||||
Bath & Body Works U.S.
|
|
2,362
|
|
|
2,357
|
|
|
—
|
%
|
|
|
|
|
|
|
|||||||
Total Selling Square Feet (in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Victoria’s Secret U.S.
|
|
6,749
|
|
|
6,473
|
|
|
4
|
%
|
|
|
|
|
|
|
|||||||
Bath & Body Works U.S.
|
|
3,697
|
|
|
3,665
|
|
|
1
|
%
|
|
|
|
|
|
|
|
|
Second Quarter
|
|
Year-to-Date
|
||||||||
Number of Stores
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||
Victoria’s Secret U.S.
|
|
|
|
|
|
|
|
|
||||
Beginning of Period
|
|
1,104
|
|
|
1,065
|
|
|
1,098
|
|
|
1,060
|
|
Opened
|
|
4
|
|
|
11
|
|
|
11
|
|
|
18
|
|
Closed
|
|
(3
|
)
|
|
(1
|
)
|
|
(4
|
)
|
|
(3
|
)
|
End of Period
|
|
1,105
|
|
|
1,075
|
|
|
1,105
|
|
|
1,075
|
|
Victoria’s Secret Canada
|
|
|
|
|
|
|
|
|
||||
Beginning of Period
|
|
42
|
|
|
35
|
|
|
41
|
|
|
34
|
|
Opened
|
|
1
|
|
|
3
|
|
|
2
|
|
|
4
|
|
Closed
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
End of Period
|
|
43
|
|
|
38
|
|
|
43
|
|
|
38
|
|
Bath & Body Works U.S.
|
|
|
|
|
|
|
|
|
||||
Beginning of Period
|
|
1,559
|
|
|
1,553
|
|
|
1,558
|
|
|
1,559
|
|
Opened
|
|
7
|
|
|
3
|
|
|
10
|
|
|
4
|
|
Closed
|
|
(1
|
)
|
|
(1
|
)
|
|
(3
|
)
|
|
(8
|
)
|
End of Period
|
|
1,565
|
|
|
1,555
|
|
|
1,565
|
|
|
1,555
|
|
Bath & Body Works Canada
|
|
|
|
|
|
|
|
|
||||
Beginning of Period
|
|
89
|
|
|
81
|
|
|
88
|
|
|
79
|
|
Opened
|
|
2
|
|
|
4
|
|
|
3
|
|
|
7
|
|
Closed
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
End of Period
|
|
91
|
|
|
85
|
|
|
91
|
|
|
85
|
|
Victoria’s Secret U.K.
|
|
|
|
|
|
|
|
|
||||
Beginning of Period
|
|
10
|
|
|
7
|
|
|
10
|
|
|
5
|
|
Opened
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
Closed
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
End of Period
|
|
10
|
|
|
7
|
|
|
10
|
|
|
7
|
|
La Senza
|
|
|
|
|
|
|
|
|
||||
Beginning of Period
|
|
133
|
|
|
153
|
|
|
145
|
|
|
157
|
|
Opened
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Closed
|
|
—
|
|
|
—
|
|
|
(12
|
)
|
|
(4
|
)
|
End of Period
|
|
133
|
|
|
153
|
|
|
133
|
|
|
153
|
|
Henri Bendel
|
|
|
|
|
|
|
|
|
||||
Beginning of Period
|
|
29
|
|
|
29
|
|
|
29
|
|
|
29
|
|
Opened
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Closed
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
End of Period
|
|
29
|
|
|
29
|
|
|
29
|
|
|
29
|
|
Total
|
|
|
|
|
|
|
|
|
||||
Beginning of Period
|
|
2,966
|
|
|
2,923
|
|
|
2,969
|
|
|
2,923
|
|
Opened
|
|
14
|
|
|
21
|
|
|
26
|
|
|
35
|
|
Closed
|
|
(4
|
)
|
|
(2
|
)
|
|
(19
|
)
|
|
(16
|
)
|
End of Period
|
|
2,976
|
|
|
2,942
|
|
|
2,976
|
|
|
2,942
|
|
|
|
Second Quarter
|
|
Year-to-Date
|
||||||||
Number of Stores
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||
Victoria’s Secret Beauty & Accessories
|
|
|
|
|
|
|
|
|
||||
Beginning of Period
|
|
304
|
|
|
209
|
|
|
290
|
|
|
198
|
|
Opened
|
|
23
|
|
|
21
|
|
|
38
|
|
|
34
|
|
Closed
|
|
(2
|
)
|
|
—
|
|
|
(3
|
)
|
|
(2
|
)
|
End of Period
|
|
325
|
|
|
230
|
|
|
325
|
|
|
230
|
|
Victoria's Secret
|
|
|
|
|
|
|
|
|
||||
Beginning of Period
|
|
15
|
|
|
6
|
|
|
14
|
|
|
4
|
|
Opened
|
|
2
|
|
|
2
|
|
|
3
|
|
|
4
|
|
Closed
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
End of Period
|
|
17
|
|
|
8
|
|
|
17
|
|
|
8
|
|
Bath & Body Works
|
|
|
|
|
|
|
|
|
||||
Beginning of Period
|
|
91
|
|
|
59
|
|
|
80
|
|
|
55
|
|
Opened
|
|
10
|
|
|
7
|
|
|
23
|
|
|
11
|
|
Closed
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
End of Period
|
|
101
|
|
|
66
|
|
|
101
|
|
|
66
|
|
La Senza
|
|
|
|
|
|
|
|
|
||||
Beginning of Period
|
|
258
|
|
|
328
|
|
|
266
|
|
|
331
|
|
Opened
|
|
1
|
|
|
2
|
|
|
1
|
|
|
2
|
|
Closed
|
|
(26
|
)
|
|
(23
|
)
|
|
(34
|
)
|
|
(26
|
)
|
End of Period
|
|
233
|
|
|
307
|
|
|
233
|
|
|
307
|
|
Total
|
|
|
|
|
|
|
|
|
||||
Beginning of Period
|
|
668
|
|
|
602
|
|
|
650
|
|
|
588
|
|
Opened
|
|
36
|
|
|
32
|
|
|
65
|
|
|
51
|
|
Closed
|
|
(28
|
)
|
|
(23
|
)
|
|
(39
|
)
|
|
(28
|
)
|
End of Period
|
|
676
|
|
|
611
|
|
|
676
|
|
|
611
|
|
|
|
|
|
|
Operating Income Rate
|
||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||
Second Quarter
|
(in millions)
|
|
|
|
|
||||||||
Victoria’s Secret
|
$
|
298
|
|
|
$
|
293
|
|
|
16.5
|
%
|
|
16.8
|
%
|
Bath & Body Works
|
138
|
|
|
115
|
|
|
18.4
|
%
|
|
16.3
|
%
|
||
Victoria’s Secret and Bath & Body Works International
|
20
|
|
|
17
|
|
|
22.8
|
%
|
|
21.3
|
%
|
||
Other (a)
|
(53
|
)
|
|
(49
|
)
|
|
(43.0
|
)%
|
|
(33.3
|
)%
|
||
Total Operating Income
|
$
|
403
|
|
|
$
|
376
|
|
|
14.6
|
%
|
|
14.1
|
%
|
(a)
|
Includes Mast Global, La Senza, Henri Bendel and Corporate.
|
|
2015
|
|
2014
|
|
% Change
|
|||||
Second Quarter
|
(in millions)
|
|
|
|||||||
Victoria’s Secret Stores (a)
|
$
|
1,437
|
|
|
$
|
1,363
|
|
|
5
|
%
|
Victoria’s Secret Direct
|
369
|
|
|
382
|
|
|
(4
|
)%
|
||
Total Victoria’s Secret
|
1,806
|
|
|
1,745
|
|
|
3
|
%
|
||
Bath & Body Works Stores (a)
|
672
|
|
|
638
|
|
|
5
|
%
|
||
Bath & Body Works Direct
|
76
|
|
|
66
|
|
|
15
|
%
|
||
Total Bath & Body Works
|
748
|
|
|
704
|
|
|
6
|
%
|
||
Victoria’s Secret and Bath & Body Works International (b)
|
89
|
|
|
80
|
|
|
12
|
%
|
||
Other (c)
|
122
|
|
|
146
|
|
|
(16
|
)%
|
||
Total Net Sales
|
$
|
2,765
|
|
|
$
|
2,675
|
|
|
3
|
%
|
(a)
|
Includes company-owned stores in the U.S. and Canada.
|
(b)
|
Includes Victoria's Secret and Bath & Body Works company-owned and partner-operated stores outside of the U.S. and Canada.
|
(c)
|
Includes Mast Global, La Senza, Henri Bendel and Corporate.
|
|
Victoria’s
Secret
|
|
Bath &
Body Works
|
|
Victoria’s Secret
and
Bath & Body Works International
|
|
Other
|
|
Total
|
||||||||||
Second Quarter
|
(in millions)
|
||||||||||||||||||
2014 Net Sales
|
$
|
1,745
|
|
|
$
|
704
|
|
|
$
|
80
|
|
|
$
|
146
|
|
|
$
|
2,675
|
|
Comparable Store Sales
|
33
|
|
|
31
|
|
|
2
|
|
|
1
|
|
|
67
|
|
|||||
Sales Associated with New, Closed and Non-comparable Remodeled Stores, Net
|
49
|
|
|
8
|
|
|
6
|
|
|
(8
|
)
|
|
55
|
|
|||||
Foreign Currency Translation
|
(8
|
)
|
|
(5
|
)
|
|
(3
|
)
|
|
(9
|
)
|
|
(25
|
)
|
|||||
Direct Channels
|
(13
|
)
|
|
10
|
|
|
—
|
|
|
2
|
|
|
(1
|
)
|
|||||
International Wholesale, Royalty and Other
|
—
|
|
|
—
|
|
|
4
|
|
|
(10
|
)
|
|
(6
|
)
|
|||||
2015 Net Sales
|
$
|
1,806
|
|
|
$
|
748
|
|
|
$
|
89
|
|
|
$
|
122
|
|
|
$
|
2,765
|
|
Second Quarter
|
2015
|
|
2014
|
||
Victoria’s Secret Stores (a) (b)
|
3
|
%
|
|
3
|
%
|
Bath & Body Works (a) (b)
|
5
|
%
|
|
3
|
%
|
Total Comparable Store Sales (b) (c)
|
4
|
%
|
|
3
|
%
|
(a)
|
Includes company-owned stores in the U.S. and Canada.
|
(b)
|
The percentage change in comparable store sales represents the change in sales at comparable stores only and excludes the change in sales from our direct channels. A store is typically included in the calculation of comparable store sales when it has been open or owned 12 months or more and it has not had a change in selling square footage of 20% or more. Additionally, stores of a given brand are excluded if total selling square footage for the brand in the mall changes by 20% or more through the opening or closing of a second store.
|
(c)
|
Includes Victoria's Secret U.S., Victoria’s Secret Canada, Bath & Body Works U.S., Bath & Body Works Canada, Victoria's Secret U.K., La Senza and Henri Bendel.
|
•
|
At Victoria's Secret Stores, net sales increased
5%
due to increases in PINK and core lingerie, driven by a compelling merchandise assortment that incorporated newness, innovation and fashion, as well as in-store execution. These results were partially offset by a decrease in beauty driven by the exit of the make-up category and swim driven by fashion misses.
|
•
|
At Victoria's Secret Direct, net sales decreased
4%
due to the decrease in non go-forward apparel and swim driven by fashion misses. These results were partially offset by increases in core lingerie, PINK and go-forward apparel driven by a compelling merchandise assortment that incorporated newness, innovation and fashion.
|
•
|
At Victoria's Secret Stores, gross profit increased due to higher merchandise margin dollars as a result of the increase in net sales. The increase in merchandise margin was partially offset by higher buying and occupancy expenses due to an increase in occupancy expense driven by investments in store real estate.
|
•
|
At Victoria's Secret Direct, gross profit increased due to higher merchandise margin dollars primarily due to increases in net sales in the core categories of core lingerie, PINK and go-forward apparel. Buying and occupancy expenses decreased due to a decrease in catalogue costs.
|
•
|
At Bath & Body Works Stores, gross profit increased primarily due to higher merchandise margin dollars related to the increase in net sales and less promotional activity. The increase in merchandise margin was partially offset by higher buying and occupancy expenses due to an increase in occupancy expense driven by higher net sales and investments in store real estate.
|
•
|
At Bath & Body Works Direct, gross profit increased primarily due to higher merchandise margin dollars as a result of the increase in net sales. The increase in merchandise margin was partially offset by higher buying and occupancy expenses due to higher fulfillment costs as a result of the increase in net sales.
|
Second Quarter
|
2015
|
|
2014
|
||||
Average daily borrowings (in millions)
|
$
|
4,750
|
|
|
$
|
4,964
|
|
Average borrowing rate (in percentages)
|
6.62
|
%
|
|
6.65
|
%
|
|
|
|
|
|
Operating Income Rate
|
||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||
Year-to-Date
|
(in millions)
|
|
|
|
|
||||||||
Victoria’s Secret
|
$
|
587
|
|
|
$
|
571
|
|
|
16.8
|
%
|
|
17.0
|
%
|
Bath & Body Works
|
235
|
|
|
195
|
|
|
17.2
|
%
|
|
15.2
|
%
|
||
Victoria’s Secret and Bath & Body Works International
|
41
|
|
|
32
|
|
|
23.1
|
%
|
|
21.6
|
%
|
||
Other (a)
|
(88
|
)
|
|
(86
|
)
|
|
(35.8
|
)%
|
|
(30.6
|
)%
|
||
Total Operating Income
|
$
|
775
|
|
|
$
|
712
|
|
|
14.7
|
%
|
|
14.1
|
%
|
(a)
|
Includes Mast Global, La Senza, Henri Bendel and Corporate.
|
|
2015
|
|
2014
|
|
% Change
|
|||||
Year-to-Date
|
(in millions)
|
|
|
|||||||
Victoria’s Secret Stores (a)
|
$
|
2,783
|
|
|
$
|
2,609
|
|
|
7
|
%
|
Victoria’s Secret Direct
|
707
|
|
|
740
|
|
|
(5
|
)%
|
||
Total Victoria’s Secret
|
3,490
|
|
|
3,349
|
|
|
4
|
%
|
||
Bath & Body Works Stores (a)
|
1,226
|
|
|
1,168
|
|
|
5
|
%
|
||
Bath & Body Works Direct
|
135
|
|
|
118
|
|
|
15
|
%
|
||
Total Bath & Body Works
|
1,361
|
|
|
1,286
|
|
|
6
|
%
|
||
Victoria’s Secret and Bath & Body Works International (b)
|
181
|
|
|
151
|
|
|
20
|
%
|
||
Other (c)
|
245
|
|
|
280
|
|
|
(13
|
)%
|
||
Total Net Sales
|
$
|
5,277
|
|
|
$
|
5,066
|
|
|
4
|
%
|
(a)
|
Includes company-owned stores in the U.S. and Canada.
|
(b)
|
Includes Victoria's Secret and Bath & Body Works company-owned and partner-operated stores outside of the U.S. and Canada.
|
(c)
|
Includes Mast Global, La Senza, Henri Bendel and Corporate.
|
|
Victoria’s
Secret
|
|
Bath &
Body Works
|
|
Victoria’s Secret
and
Bath & Body Works International
|
|
Other
|
|
Total
|
||||||||||
Year-to-Date
|
(in millions)
|
||||||||||||||||||
2014 Net Sales
|
$
|
3,349
|
|
|
$
|
1,286
|
|
|
$
|
151
|
|
|
$
|
280
|
|
|
$
|
5,066
|
|
Comparable Store Sales
|
93
|
|
|
52
|
|
|
4
|
|
|
2
|
|
|
151
|
|
|||||
Sales Associated with New, Closed and Non-comparable Remodeled Stores, Net
|
95
|
|
|
15
|
|
|
12
|
|
|
(13
|
)
|
|
109
|
|
|||||
Foreign Currency Translation
|
(14
|
)
|
|
(9
|
)
|
|
(5
|
)
|
|
(15
|
)
|
|
(43
|
)
|
|||||
Direct Channels
|
(33
|
)
|
|
17
|
|
|
—
|
|
|
4
|
|
|
(12
|
)
|
|||||
International Wholesale, Royalty and Other
|
—
|
|
|
—
|
|
|
19
|
|
|
(13
|
)
|
|
6
|
|
|||||
2015 Net Sales
|
$
|
3,490
|
|
|
$
|
1,361
|
|
|
$
|
181
|
|
|
$
|
245
|
|
|
$
|
5,277
|
|
Year-to-Date
|
2015
|
|
2014
|
||
Victoria’s Secret Stores (a) (b)
|
4
|
%
|
|
3
|
%
|
Bath & Body Works (a) (b)
|
5
|
%
|
|
3
|
%
|
Total Comparable Store Sales (b) (c)
|
4
|
%
|
|
3
|
%
|
(a)
|
Includes company-owned stores in the U.S. and Canada.
|
(b)
|
The percentage change in comparable store sales represents the change in sales at comparable stores only and excludes the change in sales from our direct channels. A store is typically included in the calculation of comparable store sales when it has been open or owned 12 months or more and it has not had a change in selling square footage of 20% or more. Additionally, stores of a given brand are excluded if total selling square footage for the brand in the mall changes by 20% or more through the opening or closing of a second store.
|
(c)
|
Includes Victoria's Secret U.S., Victoria’s Secret Canada, Bath & Body Works U.S., Bath & Body Works Canada, Victoria's Secret U.K., La Senza and Henri Bendel.
|
•
|
At Victoria's Secret Stores, net sales increased
7%
due to increases in PINK, core lingerie and sport, driven by a compelling merchandise assortment that incorporated newness, innovation and fashion. These results were partially offset by a decrease in beauty driven by the exit of the make-up category and swim driven by fashion misses.
|
•
|
At Victoria's Secret Direct, net sales decreased
5%
primarily due to the decrease in non go-forward apparel. These results were partially offset by increases in PINK, core lingerie, go-forward apparel and sport driven by a compelling merchandise assortment that incorporated newness, innovation and fashion.
|
•
|
At Victoria's Secret Stores, gross profit increased due to higher merchandise margin dollars as a result of the increase in net sales and more full-priced selling. The increase in merchandise margin was partially offset by higher buying and occupancy expenses due to an increase in occupancy expense driven by higher net sales and investments in store real estate.
|
•
|
At Victoria's Secret Direct, gross profit decreased due to higher buying and occupancy expenses driven by investments in our online customer shopping experience. The gross profit decrease was also due to lower merchandise margin dollars driven by decreases in net sales in non go-forward apparel.
|
•
|
At Bath & Body Works Stores, gross profit increased primarily due to higher merchandise margin dollars related to the increase in net sales and less promotional activity. The increase in merchandise margin was partially offset by higher buying and occupancy expenses due to an increase in occupancy expense driven by higher net sales and investments in store real estate.
|
•
|
At Bath & Body Works Direct, gross profit increased primarily due to higher merchandise margin dollars as a result of the increase in net sales. The increase in merchandise margin was partially offset by higher buying and occupancy expenses due to higher fulfillment costs as a result of the increase in net sales.
|
Year-to-Date
|
2015
|
|
2014
|
||||
Average daily borrowings (in millions)
|
$
|
4,750
|
|
|
$
|
4,964
|
|
Average borrowing rate (in percentages)
|
6.60
|
%
|
|
6.65
|
%
|
|
August 1,
2015 |
|
January 31,
2015 |
|
August 2,
2014 |
||||||
|
(in millions)
|
||||||||||
Senior Unsecured Debt with Subsidiary Guarantee
|
|
|
|
|
|
||||||
$1 billion, 5.625% Fixed Interest Rate Notes due February 2022 (“2022 Notes”)
|
$
|
1,000
|
|
|
$
|
1,000
|
|
|
$
|
1,000
|
|
$1 billion, 6.625% Fixed Interest Rate Notes due April 2021 (“2021 Notes”)
|
1,000
|
|
|
1,000
|
|
|
1,000
|
|
|||
$500 million, 5.625% Fixed Interest Rate Notes due October 2023 (“2023 Notes”)
|
500
|
|
|
500
|
|
|
500
|
|
|||
$500 million, 8.50% Fixed Interest Rate Notes due June 2019, Less Unamortized Discount (“2019 Notes”)(a)
|
499
|
|
|
501
|
|
|
494
|
|
|||
$400 million, 7.00% Fixed Interest Rate Notes due May 2020 (“2020 Notes”)
|
400
|
|
|
400
|
|
|
400
|
|
|||
Total Senior Unsecured Debt with Subsidiary Guarantee
|
$
|
3,399
|
|
|
$
|
3,401
|
|
|
$
|
3,394
|
|
Senior Unsecured Debt
|
|
|
|
|
|
||||||
$700 million, 6.90% Fixed Interest Rate Notes due July 2017, Less Unamortized Discount (“2017 Notes”)(b)
|
$
|
711
|
|
|
$
|
715
|
|
|
$
|
715
|
|
$350 million, 6.95% Fixed Interest Rate Debentures due March 2033, Less Unamortized Discount (“2033 Notes”)
|
350
|
|
|
350
|
|
|
350
|
|
|||
$300 million, 7.60% Fixed Interest Rate Notes due July 2037, Less Unamortized Discount (“2037 Notes”)
|
299
|
|
|
299
|
|
|
299
|
|
|||
5.25% Fixed Interest Rate Notes due November 2014, Less Unamortized Discount (“2014 Notes”)(c)
|
—
|
|
|
—
|
|
|
214
|
|
|||
Total Senior Unsecured Debt
|
$
|
1,360
|
|
|
$
|
1,364
|
|
|
$
|
1,578
|
|
Total
|
$
|
4,759
|
|
|
$
|
4,765
|
|
|
$
|
4,972
|
|
Current Portion of Long-term Debt
|
—
|
|
|
—
|
|
|
(214
|
)
|
|||
Total Long-term Debt
|
$
|
4,759
|
|
|
$
|
4,765
|
|
|
$
|
4,758
|
|
(a)
|
The balances include a fair value interest rate hedge adjustment which increased the debt balance by
$5 million
as of
August 1, 2015
,
$8 million
as of
January 31, 2015
and
$2 million
as of
August 2, 2014
.
|
(b)
|
The balances include a fair value interest rate hedge adjustment which increased the debt balance by
$11 million
as of
August 1, 2015
,
$15 million
as of
January 31, 2015
and
$16 million
as of
August 2, 2014
.
|
(c)
|
The outstanding principal balance was
$213 million
as of
August 2, 2014
. The total balance includes a fair value interest rate hedge adjustment which increased the debt balance by
$1 million
as of
August 2, 2014
.
|
|
August 1,
2015 |
|
January 31, 2015
|
|
August 2,
2014 |
||||||
|
(in millions)
|
||||||||||
Cash Provided by Operating Activities (a)
|
$
|
375
|
|
|
$
|
1,786
|
|
|
$
|
446
|
|
Capital Expenditures (a)
|
358
|
|
|
715
|
|
|
349
|
|
|||
Working Capital
|
928
|
|
|
1,553
|
|
|
1,119
|
|
|||
Capitalization:
|
|
|
|
|
|
||||||
Long-term Debt
|
4,759
|
|
|
4,765
|
|
|
4,758
|
|
|||
Shareholders’ Equity (Deficit)
|
(648
|
)
|
|
18
|
|
|
(504
|
)
|
|||
Total Capitalization
|
$
|
4,111
|
|
|
$
|
4,783
|
|
|
$
|
4,254
|
|
Remaining Amounts Available Under Credit Agreements (b)
|
$
|
981
|
|
|
$
|
981
|
|
|
$
|
992
|
|
(a)
|
The
January 31, 2015
amounts represent a twelve-month period, and the
August 1, 2015
and
August 2, 2014
amounts represent
six
-month periods.
|
(b)
|
Letters of credit issued reduce our remaining availability under the Revolving Facility. We have outstanding letters of credit that reduce our remaining availability under the Revolving Facility of
$19 million
as of
August 1, 2015
and
January 31, 2015
and
$8 million
as of
August 2, 2014
.
|
|
Moody’s
|
|
S&P
|
|
Fitch
|
Corporate
|
Ba1
|
|
BB+
|
|
BB+
|
Senior Unsecured Debt with Subsidiary Guarantee
|
Ba1
|
|
BB+
|
|
BB+
|
Senior Unsecured Debt
|
Ba2
|
|
BB-
|
|
BB
|
Outlook
|
Stable
|
|
Stable
|
|
Stable
|
|
Amount Authorized
|
|
Shares
Repurchased
|
|
Amount
Repurchased
|
|
Average Stock Price of Shares Repurchased within Program
|
||||||||||||||
Repurchase Program
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
||||||||||||
|
(in millions)
|
|
(in thousands)
|
|
(in millions)
|
|
|
||||||||||||||
June 2015
|
$
|
250
|
|
|
624
|
|
|
NA
|
|
|
$
|
52
|
|
|
NA
|
|
|
$
|
83.75
|
|
|
February 2015
|
$
|
250
|
|
|
2,788
|
|
|
NA
|
|
|
$
|
250
|
|
|
NA
|
|
|
$
|
89.45
|
|
|
November 2012
|
$
|
250
|
|
|
NA
|
|
|
826
|
|
|
NA
|
|
|
$
|
45
|
|
|
$
|
48.52
|
|
|
|
Ordinary Dividends
|
|
Special Dividends
|
|
Total Dividends
|
|
Total Paid
|
||||||||
|
|
(per share)
|
|
(in millions)
|
||||||||||||
2015
|
|
|
|
|
|
|
|
|
||||||||
Second Quarter
|
|
$
|
0.50
|
|
|
$
|
—
|
|
|
$
|
0.50
|
|
|
$
|
146
|
|
First Quarter
|
|
0.50
|
|
|
2.00
|
|
|
2.50
|
|
|
734
|
|
||||
2015 Total
|
|
$
|
1.00
|
|
|
$
|
2.00
|
|
|
$
|
3.00
|
|
|
$
|
880
|
|
2014
|
|
|
|
|
|
|
|
|
||||||||
Second Quarter
|
|
$
|
0.34
|
|
|
$
|
—
|
|
|
$
|
0.34
|
|
|
$
|
99
|
|
First Quarter
|
|
0.34
|
|
|
1.00
|
|
|
1.34
|
|
|
392
|
|
||||
2014 Total
|
|
$
|
0.68
|
|
|
$
|
1.00
|
|
|
$
|
1.68
|
|
|
$
|
491
|
|
|
Year-to-Date
|
||||||
|
2015
|
|
2014
|
||||
|
(in millions)
|
||||||
Cash and Cash Equivalents, Beginning of Period
|
$
|
1,681
|
|
|
$
|
1,519
|
|
Net Cash Flows Provided by Operating Activities
|
375
|
|
|
446
|
|
||
Net Cash Flows Used for Investing Activities
|
(187
|
)
|
|
(334
|
)
|
||
Net Cash Flows Used for Financing Activities
|
(1,091
|
)
|
|
(485
|
)
|
||
Effect of Exchange Rate Changes on Cash and Cash Equivalents
|
2
|
|
|
1
|
|
||
Net Decrease in Cash and Cash Equivalents
|
(901
|
)
|
|
(372
|
)
|
||
Cash and Cash Equivalents, End of Period
|
$
|
780
|
|
|
$
|
1,147
|
|
Item 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
|
August 1,
2015 |
|
January 31, 2015
|
|
August 2,
2014 |
||||||
|
(in millions)
|
||||||||||
Long-term Debt:
|
|
|
|
|
|
||||||
Carrying Value
|
$
|
4,759
|
|
|
$
|
4,765
|
|
|
$
|
4,972
|
|
Fair Value, Estimated (a)
|
5,233
|
|
|
5,305
|
|
|
5,443
|
|
|||
Cross-currency Swap Arrangements (b)
|
(25
|
)
|
|
(21
|
)
|
|
26
|
|
|||
Fixed-to-Floating Interest Rate Swap Arrangements (b)
|
(7
|
)
|
|
(12
|
)
|
|
(3
|
)
|
(a)
|
The estimated fair value is based on reported transaction prices. The estimates presented are not necessarily indicative of the amounts that we could realize in a current market exchange.
|
(b)
|
Swap arrangements are in an (asset) liability position.
|
Item 4.
|
CONTROLS AND PROCEDURES
|
Item 1.
|
LEGAL PROCEEDINGS
|
Item 1A.
|
RISK FACTORS
|
Item 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
Period
|
Total
Number of
Shares
Purchased (a)
|
|
Average Price
Paid Per
Share (b)
|
|
Total Number of Shares Purchased as Part of Publicly Announced Programs (c)
|
|
Maximum Number of Shares (or Approximate Dollar Value) that May Yet be Purchased Under the Programs (c)
|
||||||
|
(in thousands)
|
|
|
|
(in thousands)
|
||||||||
May 2015
|
588
|
|
|
$
|
89.53
|
|
|
432
|
|
|
$
|
40,719
|
|
June 2015
|
569
|
|
|
85.24
|
|
|
551
|
|
|
243,167
|
|
||
July 2015
|
552
|
|
|
83.35
|
|
|
545
|
|
|
197,762
|
|
||
Total
|
1,709
|
|
|
|
|
1,528
|
|
|
|
(a)
|
The total number of shares repurchased includes shares repurchased as part of publicly announced programs, with the remainder relating to shares repurchased in connection with tax payments due upon vesting of employee restricted stock awards and the use of our stock to pay the exercise price on employee stock options.
|
(b)
|
The average price paid per share includes any broker commissions.
|
(c)
|
For additional share repurchase program information, see Note
3
, "Earnings Per Share and Shareholders' Equity (Deficit)" included in Item
1
. Financial Statements.
|
Item 3.
|
DEFAULTS UPON SENIOR SECURITIES
|
Item 4.
|
MINE SAFETY DISCLOSURES
|
Item 5.
|
OTHER INFORMATION
|
Item 6.
|
EXHIBITS
|
Exhibits
|
|
|
|
|
|
10.1
|
|
L Brands, Inc. 2015 Stock Option and Performance Incentive Plan Terms and Conditions of Restricted Share Unit Grant.
|
|
|
|
10.2
|
|
L Brands, Inc. 2015 Stock Option and Performance Incentive Plan Terms and Conditions of Stock Option Grant.
|
|
|
|
15
|
|
Letter re: Unaudited Interim Financial Information re: Incorporation of Report of Independent Registered Public Accounting Firm.
|
|
|
|
31.1
|
|
Section 302 Certification of CEO.
|
|
|
|
31.2
|
|
Section 302 Certification of CFO.
|
|
|
|
32
|
|
Section 906 Certification (by CEO and CFO).
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Definition Linkbase Document
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
L B
RANDS
, I
NC
.
|
|
|
(Registrant)
|
|
|
|
|
|
By:
|
/s/ STUART B. BURGDOERFER
|
|
|
Stuart B. Burgdoerfer
Executive Vice President and Chief Financial Officer *
|
*
|
Mr. Burgdoerfer is the principal financial officer and the principal accounting officer and has been duly authorized to sign on behalf of the Registrant.
|
(1)
|
RESTRICTIONS
.
None of the Restricted Share Units may be sold, transferred, assigned, pledged or otherwise encumbered or disposed of during the Restricted Periods described on the Restricted Share Unit Agreement or prior to the satisfaction of all conditions which may be specified in an appendix to this Agreement.
|
(2)
|
RECORDING OF AWARD
.
The Company shall cause the Restricted Share Unit award to be appropriately recorded as of the date of grant.
|
(3)
|
RIGHTS OF PARTICIPANT
. During the applicable Restricted Period, the Participant shall not have the right to vote the Restricted Share Units or to receive dividends with respect thereto.
|
(4)
|
FORFEITURES
.
|
(a)
|
Except as noted in this Section (4), Restricted Share Units granted to the Participant pursuant to this Agreement shall be forfeited if the Participant's employment with the Company or its subsidiaries is terminated prior to the expiration or termination of the applicable Restricted Period or if the performance conditions set forth in any appendix hereto are not satisfied. “Termination of employment” shall mean “separation from service” as that term is defined in Section 409A and the Treasury regulations thereunder. Upon such forfeiture, the Restricted Share Unit award shall be cancelled.
|
(b)
|
Subject to the execution of a release of claims against the Company and achievement of performance conditions, if any, not later than the first performance period ending after the performance period in which a Qualifying Termination occurs, upon a Participant’s involuntary termination of employment other than for (x) misconduct or (y) for performance (each as determined by the Committee or its designees in their sole discretion) (a “Qualifying Termination”), except as noted in this Section 4(b) the Participant shall be deemed to have satisfied the provision of services conditions effective as of the last day of the Restricted Period with respect to that percentage of the Restricted Share Units equal to (x) the number of complete months between the first day of the first Restricted Period and the date of the Participant’s Qualifying Termination, divided by (y) the aggregate number of months in all Restricted Periods. Notwithstanding the foregoing, in the case of a Qualifying Termination no portion of the provision of services conditions shall be deemed to have been satisfied and this award shall be forfeited if, at any time prior to the end of the Restricted Period, the Participant either (i) is employed by a competitor of the Company or (ii) has directly or indirectly solicited, induced or attempted to influence any employee to leave the employment of the Company or assisted anyone else in doing so (each as determined by the Committee or its designees in their sole discretion).
|
(c)
|
Subject to the achievement of performance conditions, if any, if the Participant’s employment terminates as a result of Total Disability, as defined in the L Brands Inc. Long-Term Disability Plan, the Restricted Share Units granted to the Participant pursuant to this Agreement shall continue to vest during the period of the Participant’s Total Disability.
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(d)
|
Subject to the achievement of performance conditions, if any, if the Participant's employment terminates as a result of his or her death, or if the Participant’s period of Total Disability terminates as a result of his or her death, all provision of services conditions shall be deemed to have been satisfied and the Restricted Period shall be deemed to have expired.
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(e)
|
Upon the retirement of the Participant and subject to the achievement of performance conditions, if any, not later than the first performance period ending after the performance period in which a Qualifying Termination occurs, the Restricted Period shall be deemed to have expired and all provision of services conditions shall be deemed to have been satisfied with respect to that percentage of the Restricted Share Units equal to (x) the number of complete months between the first day of the Restricted Period and the date of the Participant’s retirement, divided by (y) the number of complete months in the Restricted Period. For this purpose, “retirement” means a Participant’s termination of employment following completion of seven years of service with the Company and attainment of age 55.
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(5)
|
SETTLEMENT OF NON-DEFERRED RESTRICTED SHARE UNITS
.
|
(a)
|
Unless a valid deferral election is made pursuant to Section (6), upon the expiration or termination of a Restricted Period and the satisfaction of all other conditions prescribed by the Committee, the restrictions applicable to the Restricted Share Units shall lapse and a stock certificate for the number of shares of Common Stock equal to the number of restricted share units with respect to which the restrictions have lapsed shall be delivered, free of all such restrictions, to the Participant or the Participant's beneficiary or estate, as the case may be. Such payment in settlement shall be made promptly, but in any event not later than (x) the end of the year in which the Restricted Period ended and the conditions were satisfied or (y) if later, the fifteenth (15th) day of the third calendar month following the date on which the Restricted Period ended, provided that the award holder will not be permitted, directly or indirectly, to designate the taxable year of settlement. The Participant may be required to execute a release of claims against the Company and its subsidiaries in this event.
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(b)
|
If a Participant who is a “specified employee,” as that term is defined in Section 409A and the Treasury regulations thereunder, receives payment(s) in connection with his or her termination of employment (including retirement) on a date determinable based on the date of termination of employment and not a pre-determined fixed date or schedule, then, except in the event of the Participant’s death after such termination of employment, such payment(s) shall be delayed by at least six months after the date of the specified employee’s termination of employment.
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(6)
|
DEFERRAL OF RESTRICTED SHARE UNITS
. A Participant who has been designated to receive a Restricted Share Unit award may elect to defer settlement of such Restricted Share Unit award. The election to defer settlement of Restricted Share Units must be made prior to or within thirty (30) days following the date of the Restricted Share Unit award. Such Restricted Share Unit award shall continue to be subject to the same restrictions, conditions and forfeiture provisions. During the Restricted Period, a Participant shall not have the right to receive any dividends with respect to Restricted Share Units. After the end of the Restricted Period and prior to the time that shares of Common Stock are transferred to the Participant, within sixty (60) days after the date of payment of a dividend by the Company on its shares of Common Stock, the Participant shall be credited with “dividend equivalents” with respect to each outstanding Restricted Share Unit in an amount equal to the amount the Participant would have received as dividends if the Restricted Shares Units were actual shares of Common Stock. Dividend equivalents will be converted into additional Restricted Share Units based on the value of the Common Stock on the dividend payment date, in accordance with the procedures established by the Committee. All elections with respect to Restricted Share Units must be made in accordance with procedures established by the Committee and any election not made in accordance with such procedures shall be disregarded.
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(a)
|
Restricted Share Units will be settled solely in shares of unrestricted Common Stock. Shares attributable to Restricted Share Units that are vested on the Participant’s termination of employment shall be transferred to the Participant in a single distribution, or may be distributed in substantially equal annual installments of up to ten years following such termination of employment, as elected by the Participant at the time the award is made. If a Participant terminates employment pursuant to Section (4) and the Restricted Period has not expired, distribution of any deferred Restricted Share Units thereunder shall not begin until after the expiration of the Restricted Period.
|
(b)
|
If a single distribution is elected, such shares shall be transferred to the Participant within ninety (90) days following the later of the Participant’s termination of employment or the expiration of the Restricted Period. If installment distributions are elected, the initial installment shall be made during the period beginning March 1 and ending April 30 of the calendar year following the calendar year in which the later of such termination of employment or expiration of the Restricted Period occurred. Subsequent installments shall be made on each anniversary of the initial installment and shall continue for the duration of the selected distribution period. If the Participant dies prior to the time all shares have been distributed, regardless of the election on file, a lump sum distribution of all undistributed shares shall be made to the Participant’s beneficiary or estate within 90 days after the date of the Participant’s death. A Participant shall have no rights as a shareholder with respect to Restricted Share Units until such time, if any, as shares of Common Stock are transferred to the Participant (or his or her beneficiary or estate, if applicable).
|
(c)
|
A Participant may change his or her distribution election, provided such change in distribution election is made not less than twelve (12) months before the date the payment (or in the case of installments, the first payment) is scheduled to be made, and is irrevocable after this date. Such an election may be made to change payment(s) from a single payment distribution to installment distributions, or from installment distributions to a single payment distribution, by submitting such election to the Committee; provided, (i) such election does not become effective until at least twelve (12) months after the date on which the election is made and (ii) except in the case of payment permissible upon the Participant’s death, the payment (or in the case of installments the first payment) must be deferred for a period of not less than five (5) years from the date such payment would have been made or commenced if there had been no election to change the form of payment.
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(d)
|
If an invalid deferral election (including a change in distribution election) is received, the applicable election shall be disregarded. In the case of an invalid initial deferral election, distribution of the shares attributable to the awards shall be made as though the Participant did not elect to defer the Restricted Share Units. In the case of an invalid change in distribution election, distribution of the shares attributable to the awards shall be made as though the Participant did not elect to change the time and form of distribution. For this purpose, an invalid election shall include (but is not limited to) an election that (i) is not executed (regardless of when received), (ii) is executed but received after the applicable irrevocable date (based on whether it is an initial election or a change election), and (iii) cannot otherwise become effective under applicable rules.
|
(e)
|
If a valid deferral election (including a change in distribution election) is incomplete, the applicable election shall be honored. In the case of a valid but incomplete initial deferral election, distribution of the shares attributable to the awards shall be made as though the Participant elected a deferred lump sum payment. In the case of a valid but incomplete change in distribution election, distribution of
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(8)
|
EFFECT OF CHANGE IN CONTROL
.
Upon a termination (x) by the Company other than for cause or (y) to the extent provided in an employment agreement between the Company and the Participant, by the Participant for Good Reason (as defined in the employment agreement), in each case within twenty four (24) months following a Change in Control, and provided that that the Change in Control is a “change in control event” as defined in Section 409A and the Treasury regulations thereunder, any conditions applicable to any Restricted Share Units shall be deemed to have been satisfied and the Restricted Period shall be deemed to have expired.
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(9)
|
TAX WITHHOLDING
. The Company shall have the right to require the Participant or the Participant's beneficiaries or legal representatives to remit to the Company an amount sufficient to satisfy Federal, state or local withholding tax requirements, or to deduct from distributions under the Plan amounts sufficient to satisfy such withholding tax requirements.
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(10)
|
MISCELLANEOUS
.
|
(a)
|
No Right to Employment
. This Agreement shall not confer upon the Participant any right to continue in the employ of the Company or any subsidiary or to be entitled to any remuneration or benefits not set forth in this Agreement or the Plan nor interfere with or limit the right of the Company or any subsidiary to modify the terms of or terminate the Participant's employment at any time.
|
(b)
|
Clawback
. Subject to restrictions set forth in the Plan, if required by law or if the Participant engaged, had knowledge of, or should have had knowledge of, fraudulent conduct or activities relating to the Company, the Company may terminate this Agreement and require the Participant to reimburse to the Company (i) an amount required by law or (ii) the amount of compensation received pursuant to this Agreement and based on the aforementioned conduct.
|
(c)
|
Notice
. Any notice or other communication required or permitted to be given under this Agreement must be given electronically or by regular U.S. mail addressed, if to the Committee or the Company, at the principal office of the Company and, if to the Participant, at the Participant's last known address as set forth in the books and records of the Company.
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(d)
|
Plan to Govern
. This Agreement and the rights of the Participant hereunder are subject to all of the terms and conditions of the Plan, as the same may be amended from time to time, as well as to such rules and regulations as the Committee may adopt for the administration of the Plan.
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(e)
|
Amendment
. Subject to restrictions set forth in the Plan, the Company may from time to time suspend, modify or amend this Agreement. No suspension, modification or amendment of this Agreement may, without the consent of the Participant, adversely affect the rights of the Participant with respect to the Restricted Share Units granted pursuant to this Agreement, except to the extent any such action is undertaken to cause this Agreement to comply with applicable law, stock market or exchange rules and regulations or accounting or tax rules and regulations.
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(f)
|
Severability
. In the event that any provision of this Agreement shall be held illegal or invalid for any reason, such illegality or invalidity shall not affect the remaining provisions of this Agreement, and this Agreement shall be construed and enforced as if the illegal or invalid provision had not been included.
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(g)
|
Entire Agreement
. This Agreement and the Plan contain all of the understandings between the Company and the Participant concerning the Restricted Share Units granted hereunder and supersede all prior agreements and understandings.
|
(h)
|
Counterparts
. This Agreement may be executed in counterparts, each of which when signed by the Company and the Participant will be an original and all of which together will be the same Agreement.
|
(i)
|
Governing Law
. To the extent not preempted by Federal law, this Agreement shall be construed in accordance with and governed by the laws of the State of Delaware.
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(1)
|
EXERCISE OF OPTIONS
. The Participant may exercise one or more of the Options granted in the Stock Option Agreement, to the extent exercisable, in such manner as is determined by the Committee that specifies the number of Options being exercised and the exercise date and by tendering payment for the shares of Common Stock being purchased under the Options. The Options shall expire on the tenth anniversary of the Date of Grant (the “Expiration Date”).
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(2)
|
PAYMENT FOR SHARES
. Payment for the shares of Common Stock issuable upon exercise of an Option shall be made in full in cash or by certified check. The Participant may exercise the Option through a cashless exercise procedure which the Company shall use its reasonable best efforts to maintain. Any payment for shares must include such additional amounts as may be required by the Company to satisfy Federal, state and local withholding tax requirements.
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(3)
|
ISSUANCE OF CERTIFICATES
. As soon as reasonably practicable following the exercise of an Option and the receipt by the Company of payment for the shares and applicable withholding taxes, the shares of Common Stock purchased shall be registered in the name of the Participant in accordance with procedures approved by the Committee.
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(4)
|
TERMINATION OF EMPLOYMENT (FOR REASONS OTHER THAN DEATH OR TOTAL DISABILITY)
. Upon termination of the Participant's employment with the Company for reasons other than death or Total Disability or Cause, the Participant shall be entitled to exercise the Options, to the extent exercisable on the date of the Participant's termination, at any time within the one (1) year period immediately following the date of the Participant's termination of employment (but not later than the Expiration Date); provided, however that if an Incentive Stock Option is not exercised within three (3) months following termination of employment, it shall be treated as a Nonstatutory Stock Option. In the event the Participant’s employment is terminated by his or her employer for Cause, the Participant shall be entitled to exercise the Options, to the extent exercisable on the date of termination, at any time within the thirty (30) day period following such termination of employment.
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(5)
|
TERMINATION OF EMPLOYMENT (TOTAL DISABILITY)
. Upon termination of the Participant’s employment for reasons of Total Disability, as defined in the L Brands Inc. Long-Term Disability Plan, the Participant shall be entitled to exercise the Options, to the extent exercisable on the date of the Participant’s termination, at any time within the one (1) year period immediately following the date of the Participant’s termination of employment (but not later than the Expiration Date), it being understood that the Participant’s termination of employment will occur after nine (9) months of absence due to the Total Disability. Any Options that are not vested on the date that the Participant’s employment terminates for reason of Total Disability, shall continue to vest during the period of such Participant’s Total Disability, and, upon becoming vested, such award shall be exercisable within the one (1) year period after the applicable vesting date, but in no event later than the Expiration Date. In the event of the Participant’s death following the Participant’s termination of employment due to Total Disability, any unvested Options shall vest in accordance with the terms of Section 6 below.
|
(6)
|
TERMINATION OF EMPLOYMENT (DEATH)
. Upon termination of the Participant’s employment due to death while employed by the Company or upon death during the Participant’s period of Total Disability, the Options shall become fully exercisable by the Participant’s beneficiary and may be exercised at any time within one (1) year after the date of the Participant’s death (but not later than the Expiration Date). If the Participant dies following termination of employment for reasons other than Total Disability, the Participant’s beneficiary shall be entitled to exercise the Options, to the extent exercisable on the date of the Participant’s termination of employment, during the same period that the Participant would have been entitled to exercise the Option if the Participant had not died.
|
(7)
|
EFFECT OF CHANGE IN CONTROL
. Upon a termination (i) by the Company other than for cause or (ii) to the extent provided in an employment agreement between the Company and the Participant, by the Participant for Good Reason (as defined in the employment agreement), in each case within 24 months following a Change in Control, the Options, to the extent not then exercisable, shall become fully exercisable.
|
(8)
|
NONTRANSFERABILITY
.
Options granted under the Plan may not be transferred, assigned, pledged or hypothecated (whether by operation of law or otherwise), except (i) as provided by will or the applicable laws of descent and distribution and (ii) if permitted by the Committee, a NSO may be transferred to a member of the NSO holder’s immediate family or to a family partnership or a trust benefitting only members of the NSO holder’s immediate family, and Options shall not be subject, in whole or in part, to execution, attachment or similar process.
|
(9)
|
NOTICE OF RESALE
. If any Participant disposes of shares of Common Stock acquired pursuant to an Incentive Stock Option before one (1) year from the date of issuance by the Company of such stock or two (2) years from the Date of Grant of such Option, then such Participant shall give written notice of the disposition to the Company, on a form provided by the Committee, not later than ten (10) days after the disposition.
|
(10)
|
MISCELLANEOUS
.
|
(a)
|
No Right To Employment
. This Agreement shall not confer upon the Participant any right to continue in the employ of the Company or any subsidiary or to be entitled to any remuneration or benefits not set forth in this Agreement or the Plan nor interfere with or limit the right of the Company or any subsidiary to modify the terms of or terminate the Participant's employment or service at any time.
|
(b)
|
Clawback
. Subject to restrictions set forth in the Plan, if required by law or if the Participant engaged, had knowledge of, or should have had knowledge of, fraudulent conduct or activities relating to the Company, the Company may terminate this Agreement and require the Participant to reimburse to the Company (i) an amount required by law or (ii) the amount of compensation received pursuant to this Agreement and based on the aforementioned conduct.
|
(c)
|
Notice
. Any notice or other communication required or permitted to be given under this Agreement must be given electronically or by regular U.S. mail addressed, if to the Committee or the Company, at the principal office of the Company and, if to the Participant, at the Participant's last known address as set forth in the books and records of the Company.
|
(d)
|
Plan to Govern
. This Agreement and the rights of the Participant hereunder are subject to all of the terms and conditions of the Plan, as the same may be amended from time to time, as well as to such rules and regulations as the Committee may adopt for the administration of the Plan.
|
(e)
|
Amendment
. Subject to restrictions set forth in the Plan, the Company may from time to time suspend, modify or amend this Agreement. No suspension, modification or amendment of this Agreement may, without the consent of the Participant, adversely affect the rights of the Participant with respect to the Options granted pursuant to this Agreement, except to the extent any such action is undertaken to cause this Agreement to comply with applicable law, stock market or exchange rules and regulations or accounting or tax rules and regulations.
|
(f)
|
Severability
. In the event that any provision of this Agreement shall be held illegal or invalid for any reason, such illegality or invalidity shall not affect the remaining provisions of this Agreement, and this Agreement shall be construed and enforced as if the illegal or invalid provision had not been included.
|
(g)
|
Entire Agreement
. This Agreement and the Plan contain all of the understandings between the Company and the Participant concerning the Options granted hereunder and supersede all prior agreements and understandings.
|
(h)
|
Counterparts
. This Agreement may be executed in counterparts, each of which when signed by the Company and the Participant will be an original and all of which together will be the same Agreement.
|
(i)
|
Governing Law
. To the extent not preempted by Federal law, this Agreement shall be construed in accordance with and governed by the laws of the State of Delaware.
|
1.
|
I have reviewed this report on Form 10-Q of L Brands, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ LESLIE H. WEXNER
|
|
Leslie H. Wexner
|
|
Chairman and Chief Executive Officer
|
1.
|
I have reviewed this report on Form 10-Q of L Brands, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ STUART B. BURGDOERFER
|
|
Stuart B. Burgdoerfer
|
|
Executive Vice President and
Chief Financial Officer |
(i)
|
the Quarterly Report of the Company on Form 10-Q dated
September 4, 2015
for the period ending
August 1, 2015
(the “Form 10-Q”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(ii)
|
the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ LESLIE H. WEXNER
|
|
Leslie H. Wexner
|
|
Chairman and Chief Executive Officer
|
|
|
|
/s/ STUART B. BURGDOERFER
|
|
Stuart B. Burgdoerfer
|
|
Executive Vice President and Chief Financial Officer
|