Highlights

  • BBWI’s Q2 FY25 net operating revenue decreased 2.1% to USD 1,526.0 million due to demand challenges.
  • Net income rose 53.5% to USD 152.0 million, while cash inflow dropped 61.0%.
  • FY2024 guidance projects net sales decline of 2% to 4%, with adjusted earnings expected lower.

Bath & Body Works, Inc. (NYSE: BBWI) is a leading American retailer founded in 1990, specializing in lotions, perfumes, and candles, known for innovative marketing, engaging stores, and a strong e-commerce presence. BBWI has a market cap of USD 6.48bn.

In Q2 FY25, BBWI reported a net operating revenue of USD1,526.0 million, marking a 2.1% decrease from the previous year’s USD1,559.0 million. This decline was largely steered by decreased demand attributed to macroeconomic challenges and sector-specific headwinds.

On a positive note, net income attributable to the company’s shareholders increased by 53.5%, reaching USD 152.0 million compared to USD 99.0 million in Q2 FY24. However, cash inflow from operating activities fell sharply to USD30.0 million, a 61.0% decrease, largely due to unfavorable changes in net working capital. Additionally, cash and cash equivalents dropped by 34.9% to USD 514.0 million, impacted by cash outflows from investing and financing activities.

Company Outlook

Bath & Body Works has updated its fiscal year 2024 guidance. It expects net sales to decline by 2% to 4% from last year's USD 7,429 million. The addition of a 53rd week in fiscal 2023 is expected to hurt net sales by about 1%.

The company now projects earnings per diluted share to be between USD 3.37 and USD 3.57, down from USD 3.84 in 2023. Adjusted earnings per diluted share are expected to range from USD 3.06 to USD 3.26, compared to USD 3.27 last year. The updated guidance also includes USD 400 million for planned share repurchases, up from USD 300 million. For the third quarter of 2024, net sales are expected to be flat or increase by 2.5% compared to USD 1,562 million in the third quarter of 2023, with earnings per diluted share expected to be between USD 0.41 and USD 0.47.

Top 10 Shareholders

The top 10 shareholders own about 47.84% of the total shares, indicating diverse ownership. The Vanguard Group, Inc. is the largest shareholder, holding around 12.49%. Third Point LLC, an activist investor, holds about 5.47%.

Price Information

The stock price of BBWI has surged by around 16.45% in the past month. However, it has declined by around 15.82% in the past three months. The stock’s 52-week low price is USD 26.20 whereas, its 52-week high price is USD 52.98. As of 11 Oct 2024, the stock’s closing price is USD 31.43.

Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is October 11, 2024. The reference data in this report has been partly sourced from EODHD/Others.