USA: Limited Brands reports sharp fall in 3Q earnings

COLUMBUS: Limited Brands Inc. has reported a 48% fall in profit for the third quarter, hurt by weak sales during the abnormally warm fall, and it predicted profit would fall short of Wall Street estimates for the fourth quarter.

Citing a challenging retail environment, the parent of Victoria's Secret and Bath & Body Works also said November sales at stores open at least a year would decline in the mid-single digits. It had earlier said they would be flat.

The company reported a profit of $12.1 million, or 3 cents per share, for the quarter ended Nov. 3, compared with a profit of $23.5 million, or 6 cents a share, a year ago. Sales were $1.9 billion, down from $2.1 billion a year earlier, when Limited Brands still owned the Limited Stores and Express apparel brands.

Limited Brands said last month that its profit would be down because of disappointing September sales and economic uncertainty.

The retailer said sales at stores open at least a year, considered a key indicator of a retailer's strength, fell 3 percent for the quarter. This summer, Limited Brands shed underperforming apparel lines to focus on Victoria's Secret and Bath & Body Works.

Because of problems getting a new distribution center in suburban Columbus up to capacity, the company has reduced circulation of its Victoria's Secret catalog to slow demand and sales in the fourth quarter so as not to disappoint customers with poor service.

Same-store sales are up 1 percent for the year. Limited Brands operates 2,921 stores.

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Added: November 21, 2007 Source: Agencies
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