Victoria's Secret boosts guidance after bumper first quarter

(Sharecast News) - Victoria's Secret & Co boosted its full-year guidance on Tuesday, sending the stock soaring, after first-quarter sales at the American lingerie retailer comfortably beat expectations.

Net sales in the three months to 2 May came in at $1.56bn, up 15% year-on-year and ahead of the firm's guidance for between $1.49bn to $1.53bn. Adjusted earnings per share were $0.60, double expectations for $0.30.

The chain said it had seen strong sales growth during the quarter across its main brand, its younger-focused Pink range and its beauty offering.

Hillary Super, chief executive, noted: "Our customers responded strongly to our product innovation, emotionally resonant storytelling and distinct brand projection, driving double-digit growth in new customer acquisition, increased regular price selling and broad-based strength across categories, channels and geographies."

Looking ahead, the retailer lifted guidance for both the current quarter and full year. Second-quarter sales are expected to be in the range of $1.59bn to $1.62bn, while final sales are slated to come in between $7.03bn and $7.13bn. Consensus had previously been for $6.99bn.

Forecasts for annual adjusted operating income were lifted by more than $100m to between $550m and $580m.

As at 1330 BST, Victoria's Secret's shares had put on 38% in pre-market trading.

Super concluded: "We are increasingly confident in the trajectory of the business. We believe we are well positioned to continue building momentum and creating shareholder value."

Victoria's Secret changed the ticker it trades under on the New York Stock Exchange on Tuesday, to VSXY from VSCO. Announcing the planned change last month, Super said: "This isn't about a stock symbol. It's about what we stand for. Sexy has always been part of our DNA. What's changed is how intentionally we are owning it."