Investing.com -- Shares in L Brands Inc (NYSE:LB) fell sharply in after-hour trading as the parent company of Victoria's Secret lowered its full-year guidance on Wednesday after it failed to meet analysts' revenue and earnings forecasts last quarter.
During the first quarter of Fiscal Year 2016, L Brands reported net profits of $152.3 million or 0.52 per share, down considerably from earnings of $250.5 million or 0.84 per share over the same period last year. The company also increased revenue from $2.512 billion to $2.614 billion for the three-month period ending in late-April, amid a 3% increase in comparable store sales. Analysts expected to see per share earnings of 0.55 on revenue of $2.62 billion.
Within the report, Victoria's Secret increased sales by 3.4% to $1.7 billion while its direct sales jumped 6.3% to $359.7 million. Victoria's Secret is in the midst of a considerable transition period after CEO Les Wexner announced a host of tactical shifts in the direction of the brand three months ago. As part of the changes, Victoria's Secret terminated production of its catalog and decided to halt swimwear sales. Wall Street analysts have estimated that the elimination of the catalog could save the company up to $100 million annually, while the decision to discontinue sales of swimwear apparel could lead to considerable short-term revenue declines.
Meanwhile, revenues among Bath & Body Works rose by 7.6% to $660.2 million while direct sales soared by 24% to $73.5 million. Moving forward, L Brands cut its full-year outlook to adjusted earnings per share of 3.60 to 3.80, down from previous estimates of 3.90 to 4.10. Analysts expect full-year adjusted earnings of 4.04 from L Brands.
Shares in L Brands fell 3.51 or 5.51% to 60.22 in after-hours. Over the last 52 weeks, L Brands shares have slid by more than 33%.