First Quarter Second Quarter Third Quarter Fourth Quarter Full Year Net Sales 958,408$ 1,116,846$ 1,099,261$ 2,230,947$ 5,405,461$ Costs of Goods Sold, Buying and Occupancy (561,261) (664,376) (617,626) (1,174,879) (3,018,142) Gross Profit 397,146 452,470 481,635 1,056,068 2,387,319 General, Administrative and Store Operating Expenses (275,766) (313,247) (315,311) (443,007) (1,347,332) Operating Income 121,380 139,224 166,324 613,060 1,039,987 Interest Expense (97,150) (93,143) (90,094) (90,023) (370,410) Other Income (Loss) 5,603 (36,534) (35,244) 3,822 (62,352) Income from Continuing Operations before Income Taxes 29,832 9,548 40,987 526,859 607,225 Provision (Benefit) for Income Taxes 6,143 (5,076) 13,260 133,819 148,146 Net Income from Continuing Operations 23,689 14,623 27,727 393,040 459,079 Income (Loss) from Discontinued Operations, Net of Tax 16,566 22,973 (279,719) (585,296) (825,475) Net Income (Loss) 40,255$ 37,596$ (251,992)$ (192,255)$ (366,396)$ Earnings (Loss) per Common Share - Basic Continuing Operations 0.09$ 0.05$ 0.10$ 1.42$ 1.66$ Discontinued Operations 0.06$ 0.08$ (1.01)$ (2.12)$ (2.99)$ Total Earnings (Loss) per Common Share - Basic 0.15$ 0.14$ (0.91)$ (0.70)$ (1.33)$ Earnings (Loss) per Common Share - Dilutive Continuing Operations 0.09$ 0.05$ 0.10$ 1.41$ 1.65$ Discontinued Operations 0.06$ 0.08$ (1.01)$ (2.10)$ (2.97)$ Total Earnings (Loss) per Common Share - Dilutive 0.14$ 0.14$ (0.91)$ (0.69)$ (1.32)$ Weighted Average Shares Outstanding Basic 275,481 276,297 276,398 276,477 276,163 Dilutive 278,165 278,487 277,985 278,785 278,356 Reflects the Consolidated Statements of Income (Loss) of Bath & Body Works, Inc. (the "Company") as if the Victoria's Secret business was reported as a discontinued operation for the periods presented. Income (Loss) from Discontinued Operations, Net of Tax reflects the after-tax operating results of Victoria’s Secret, and does not include any allocation of general corporate overhead expense or interest expense of the Company to Victoria’s Secret. Beginning in the third quarter of fiscal 2021, Victoria’s Secret’s historical financial results for periods prior to the spin-off will be reflected in the Company’s consolidated financial statements as discontinued operations. BATH & BODY WORKS, INC. CONSOLIDATED STATEMENTS OF INCOME (LOSS) - FISCAL 2019 DISCONTINUED OPERATIONS PRESENTATION - GIVING EFFECT TO THE VICTORIA'S SECRET & CO. SPIN-OFF (Unaudited) (In thousands, except per share amounts)
First Quarter Second Quarter Third Quarter Fourth Quarter Full Year Net Sales 760,602$ 1,253,132$ 1,702,177$ 2,718,192$ 6,434,102$ Costs of Goods Sold, Buying and Occupancy (492,754) (694,266) (839,471) (1,311,854) (3,338,345) Gross Profit 267,847 558,866 862,706 1,406,338 3,095,757 General, Administrative and Store Operating Expenses (231,678) (296,127) (426,648) (537,110) (1,491,563) Operating Income 36,169 262,740 436,058 869,228 1,604,194 Interest Expense (94,688) (102,810) (119,317) (115,642) (432,457) Other Income (Loss) 3,749 (80) (51,531) (2,366) (50,228) Income (Loss) from Continuing Operations before Income Taxes (54,770) 159,850 265,210 751,220 1,121,508 Provision (Benefit) for Income Taxes (54,001) 47,460 69,068 194,321 256,848 Net Income (Loss) from Continuing Operations (769) 112,390 196,142 556,899 864,660 Income (Loss) from Discontinued Operations, Net of Tax (296,097) (161,987) 134,440 303,432 (20,210) Net Income (Loss) (296,867)$ (49,597)$ 330,582$ 860,331$ 844,450$ Earnings (Loss) per Common Share - Basic Continuing Operations (0.00)$ 0.40$ 0.70$ 2.00$ 3.11$ Discontinued Operations (1.07)$ (0.58)$ 0.48$ 1.09$ (0.07)$ Total Earnings (Loss) per Common Share - Basic (1.07)$ (0.18)$ 1.19$ 3.08$ 3.04$ Earnings (Loss) per Common Share - Dilutive Continuing Operations (0.00)$ 0.40$ 0.69$ 1.96$ 3.07$ Discontinued Operations (1.07)$ (0.58)$ 0.48$ 1.07$ (0.07)$ Total Earnings (Loss) per Common Share - Dilutive (1.07)$ (0.18)$ 1.17$ 3.03$ 3.00$ Weighted Average Shares Outstanding Basic 276,988 277,795 278,629 279,038 278,112 Dilutive 276,988 279,880 283,001 283,802 281,471 Reflects the Consolidated Statements of Income (Loss) of Bath & Body Works, Inc. (the "Company") as if the Victoria's Secret business was reported as a discontinued operation for the periods presented. Income (Loss) from Discontinued Operations, Net of Tax reflects the after-tax operating results of Victoria’s Secret, and does not include any allocation of general corporate overhead expense or interest expense of the Company to Victoria’s Secret. Beginning in the third quarter of fiscal 2021, Victoria’s Secret’s historical financial results for periods prior to the spin-off will be reflected in the Company’s consolidated financial statements as discontinued operations. BATH & BODY WORKS, INC. CONSOLIDATED STATEMENTS OF INCOME (LOSS) - FISCAL 2020 DISCONTINUED OPERATIONS PRESENTATION - GIVING EFFECT TO THE VICTORIA'S SECRET & CO. SPIN-OFF (Unaudited) (In thousands, except per share amounts)
First Quarter Second Quarter First Half Net Sales 1,469,479$ 1,703,726$ 3,173,205$ Costs of Goods Sold, Buying and Occupancy (727,781) (875,348) (1,603,129) Gross Profit 741,698 828,379 1,570,076 General, Administrative and Store Operating Expenses (404,534) (444,217) (848,751) Operating Income 337,164 384,161 721,325 Interest Expense (113,701) (96,684) (210,385) Other Loss (105,186) (230) (105,416) Income from Continuing Operations before Income Taxes 118,276 287,247 405,524 Provision for Income Taxes 28,017 71,983 100,000 Net Income from Continuing Operations 90,259 215,265 305,524 Income from Discontinued Operations, Net of Tax 186,356 158,929 345,285 Net Income 276,616$ 374,193$ 650,809$ Earnings per Common Share - Basic Continuing Operations 0.32$ 0.78$ 1.10$ Discontinued Operations 0.67$ 0.58$ 1.25$ Total Earnings per Common Share - Basic 0.99$ 1.36$ 2.35$ Earnings per Common Share - Dilutive Continuing Operations 0.32$ 0.77$ 1.08$ Discontinued Operations 0.66$ 0.57$ 1.22$ Total Earnings per Common Share - Dilutive 0.97$ 1.34$ 2.31$ Weighted Average Shares Outstanding Basic 279,121 274,978 277,050 Dilutive 284,461 280,002 282,232 Reflects the Consolidated Statements of Income of Bath & Body Works, Inc. (the "Company") as if the Victoria's Secret business was reported as a discontinued operation for the periods presented. Income from Discontinued Operations, Net of Tax reflects the after-tax operating results of, and costs to separate, Victoria’s Secret, and does not include any allocation of general corporate overhead expense or interest expense of the Company to Victoria’s Secret. Beginning in the third quarter of fiscal 2021, Victoria’s Secret’s historical financial results for periods prior to the spin-off will be reflected in the Company’s consolidated financial statements as discontinued operations. BATH & BODY WORKS, INC. CONSOLIDATED STATEMENTS OF INCOME - FISCAL 2021 DISCONTINUED OPERATIONS PRESENTATION - GIVING EFFECT TO THE VICTORIA'S SECRET & CO. SPIN-OFF (Unaudited) (In thousands, except per share amounts)
First Quarter Second Quarter Third Quarter Fourth Quarter Full Year First Quarter Second Quarter Third Quarter Fourth Quarter Full Year First Quarter Second Quarter Year-to- Date Details of Special Items - Income (Expense) Restructuring Charges (a) -$ -$ -$ -$ -$ -$ (29,572)$ -$ -$ (29,572)$ -$ -$ -$ Special Items included in Operating Income - - - - - - (29,572) - - (29,572) - - - Loss on Extinguishment of Debt (b) - (39,564) - - (39,564) - - (52,668) - (52,668) (105,464) - (105,464) La Senza Charges (c ) - - (37,217) - (37,217) - - - - - - - - Special Items included in Other Income (Loss) - (39,564) (37,217) - (76,781) - - (52,668) - (52,668) (105,464) - (105,464) Net Tax Benefit from the Resolution of Certain Tax Matters (d) - - - - - 50,360 - - 50,360 - - - Tax Effect of Special Items included in Operating Income and Other Income (Loss) - 9,532 9,516 - 19,048 - 5,713 12,640 - 18,353 25,337 - 25,337 Special Items included in Net Income (Loss) from Continuing Operations -$ (30,032)$ (27,701)$ -$ (57,733)$ 50,360$ (23,859)$ (40,028)$ -$ (13,527)$ (80,127)$ -$ (80,127)$ Reconciliation of Reported Operating Income to Adjusted Operating Income Reported Operating Income 121,380$ 139,224$ 166,324$ 613,060$ 1,039,987$ 36,169$ 262,740$ 436,058$ 869,228$ 1,604,194$ 337,164$ 384,161$ 721,325$ Special Items included in Operating Income - - - - - - 29,572 - - 29,572 - - - Adjusted Operating Income 121,380$ 139,224$ 166,324$ 613,060$ 1,039,987$ 36,169$ 292,312$ 436,058$ 869,228$ 1,633,766$ 337,164$ 384,161$ 721,325$ Reconciliation of Reported Net Income (Loss) from Continuing Operations to Adjusted Net Income (Loss) from Continuing Operations Reported Net Income (Loss) from Continuing Operations 23,689$ 14,623$ 27,727$ 393,040$ 459,079$ (769)$ 112,390$ 196,142$ 556,899$ 864,660$ 90,259$ 215,265$ 305,524$ Special Items included in Net Income (Loss) from Continuing Operations - 30,032 27,701 - 57,733 (50,360) 23,859 40,028 - 13,527 80,127 - 80,127 Adjusted Net Income (Loss) from Continuing Operations 23,689$ 44,655$ 55,428$ 393,040$ 516,812$ (51,129)$ 136,249$ 236,170$ 556,899$ 878,187$ 170,386$ 215,265$ 385,651$ Reconciliation of Reported Earnings (Loss) from Continuing Operations Per Diluted Share to Adjusted Earnings (Loss) from Continuing Operations Per Diluted Share Reported Earnings (Loss) from Continuing Operations Per Diluted Share 0.09$ 0.05$ 0.10$ 1.41$ 1.65$ (0.00)$ 0.40$ 0.69$ 1.96$ 3.07$ 0.32$ 0.77$ 1.08$ Special Items included in Earnings (Loss) from Continuing Operations Per Diluted Share - 0.11 0.10 - 0.21 (0.18) 0.09 0.14 - 0.05 0.28 - 0.28 Adjusted Earnings (Loss) from Continuing Operations Per Diluted Share 0.09$ 0.16$ 0.20$ 1.41$ 1.86$ (0.18)$ 0.49$ 0.83$ 1.96$ 3.12$ 0.60$ 0.77$ 1.37$ The Adjusted Financial Information should not be construed as an alternative to the reported results determined in accordance with generally accepted accounting principles. Further, the Company’s definition of adjusted income information may differ from similarly titled measures used by other companies. Management believes that the presentation of adjusted financial information provides additional information to investors to facilitate the comparison of past and present operations. While it is not possible to predict future results, management believes the adjusted information is useful for the assessment of the ongoing operations of the Company because the adjusted items are not indicative of our ongoing operations due to their size and nature. Additionally, management uses adjusted financial information as key performance measures of results of operations for the purpose of evaluating performance internally. The Adjusted Financial Information should be read in conjunction with the Company’s historical financial statements and notes thereto contained in the Company’s quarterly reports on Form 10-Q and annual report on Form 10-K. BATH AND BODY WORKS, INC. ADJUSTED FINANCIAL INFORMATION DISCONTINUED OPERATIONS PRESENTATION - GIVING EFFECT TO THE VICTORIA'S SECRET & CO. SPIN-OFF (Unaudited) (In thousands except per share amounts) (b) - In the first quarter of 2021 we recognized a $105.5 million pre-tax loss ($80.1 million net of tax of $25.4 million), in the third quarter of 2020 we recognized a $52.7 million pre-tax loss ($40.0 million net of tax of $12.7 million) and in the second quarter of 2019 we recognized a $39.6 million pre-tax loss ($30.0 million net of tax of $9.5 million) associated with the early extinguishment of outstanding notes. These pre-tax losses are included in other income (loss). (c ) - In the third quarter of 2019, we recognized a $37.2 million charge ($27.7 million net of tax of $9.5 million), included in other income (loss), to increase reserves related to ongoing guarantees for the La Senza business which was sold in the fourth quarter of 2018. (d) - In the first quarter of 2020, we recognized a $50.4 million tax benefit related to the resolution of certain tax matters. 2019 2020 2021 (a) - In the second quarter of 2020, we recognized a $29.6 million charge ($23.9 million net of tax of $5.7 million), included in general, administrative and store operating expenses, related to previously announced restructuring actions.
First Quarter Second Quarter Third Quarter Fourth Quarter Full Year Net Sales 958,408$ 1,116,846$ 1,099,261$ 2,230,947$ 5,405,461$ Costs of Goods Sold, Buying and Occupancy (561,261) (664,376) (617,626) (1,174,879) (3,018,142) Gross Profit 397,146 452,470 481,635 1,056,068 2,387,319 General, Administrative and Store Operating Expenses (275,766) (313,247) (315,311) (443,007) (1,347,332) Operating Income 121,380 139,224 166,324 613,060 1,039,987 Interest Expense (97,150) (93,143) (90,094) (90,023) (370,410) Other Income (a) 5,603 3,030 1,973 3,822 14,429 Income from Continuing Operations before Income Taxes 29,832 49,112 78,204 526,859 684,006 Provision for Income Taxes (b) 6,143 4,456 22,776 133,819 167,194 Net Income from Continuing Operations 23,689$ 44,655$ 55,428$ 393,040$ 516,812$ Earnings (Loss) per Common Share - Basic Continuing Operations 0.09$ 0.16$ 0.20$ 1.42$ 1.87$ Earnings (Loss) per Common Share - Dilutive Continuing Operations 0.09$ 0.16$ 0.20$ 1.41$ 1.86$ Weighted Average Shares Outstanding Basic 275,481 276,297 276,398 276,477 276,163 Dilutive 278,165 278,487 277,985 278,785 278,356 Reflects the Adjusted Statements of Income from Continuing Operations of Bath & Body Works, Inc. as if the Victoria's Secret business was reported as a discontinued operation for the periods presented. Refer to "Adjusted Financial Information" for more information on the adjustments made to historical results. Beginning in the third quarter of fiscal 2021, Victoria’s Secret’s historical financial results for periods prior to the spin- off will be reflected in the Company’s consolidated financial statements as discontinued operations. BATH & BODY WORKS, INC. ADJUSTED STATEMENTS OF INCOME FROM CONTINUING OPERATIONS - FISCAL 2019 DISCONTINUED OPERATIONS PRESENTATION - GIVING EFFECT TO THE VICTORIA'S SECRET & CO. SPIN-OFF (Unaudited) (In thousands, except per share amounts) (b) - Includes the income tax effects of the items referenced above. (a) - In the second quarter we recognized a $39.6 million pre-tax loss ($30.0 million net of tax of $9.5 million) associated with the early extinguishment of outstanding notes. In the third quarter, we recognized a $37.2 million charge ($27.7 million net of tax of $9.5 million), to increase reserves related to ongoing guarantees for the La Senza business which was sold in the fourth quarter of 2018.
First Quarter Second Quarter Third Quarter Fourth Quarter Full Year Net Sales 760,602$ 1,253,132$ 1,702,177$ 2,718,192$ 6,434,102$ Costs of Goods Sold, Buying and Occupancy (492,754) (694,266) (839,471) (1,311,854) (3,338,345) Gross Profit 267,847 558,866 862,706 1,406,338 3,095,757 General, Administrative and Store Operating Expenses (a) (231,678) (266,555) (426,648) (537,110) (1,461,991) Operating Income 36,169 292,312 436,058 869,228 1,633,766 Interest Expense (94,688) (102,810) (119,317) (115,642) (432,457) Other Income (Loss) (b) 3,749 (80) 1,137 (2,366) 2,440 Income (Loss) from Continuing Operations before Income Taxes (54,770) 189,422 317,878 751,220 1,203,748 Provision (Benefit) for Income Taxes (c) (3,641) 53,173 81,708 194,321 325,561 Net Income (Loss) from Continuing Operations (51,129)$ 136,249$ 236,170$ 556,899$ 878,187$ Earnings (Loss) per Common Share - Basic Continuing Operations (0.18)$ 0.49$ 0.85$ 2.00$ 3.16$ Earnings (Loss) per Common Share - Dilutive Continuing Operations (0.18)$ 0.49$ 0.83$ 1.96$ 3.12$ Weighted Average Shares Outstanding Basic 276,988 277,795 278,629 279,038 278,112 Dilutive 276,988 279,880 283,001 283,802 281,471 Reflects the Adjusted Statements of Income (Loss) from Continuing Operations of Bath & Body Works, Inc. as if the Victoria's Secret business was reported as a discontinued operation for the periods presented. Refer to "Adjusted Financial Information" for more information on the adjustments made to historical results. Beginning in the third quarter of fiscal 2021, Victoria’s Secret’s historical financial results for periods prior to the spin- off will be reflected in the Company’s consolidated financial statements as discontinued operations. BATH & BODY WORKS, INC. ADJUSTED STATEMENTS OF INCOME (LOSS) FROM CONTINUING OPERATIONS - FISCAL 2020 DISCONTINUED OPERATIONS PRESENTATION - GIVING EFFECT TO THE VICTORIA'S SECRET & CO. SPIN-OFF (Unaudited) (In thousands, except per share amounts) (a) - In the second quarter, we recognized a $29.6 million charge ($23.9 million net of tax of $5.7 million) related to previously announced restructuring actions. (b) - In the third quarter, we recognized a $52.7 million pre-tax loss ($40.0 million net of tax of $12.7 million) associated with the early extinguishment of outstanding notes. (c ) - In the first quarter, we recognized a $50.4 million tax benefit related to the resolution of certain tax matters, and includes the income tax effects of the items referenced above.
First Quarter Second Quarter First Half Net Sales 1,469,479$ 1,703,726$ 3,173,205$ Costs of Goods Sold, Buying and Occupancy (727,781) (875,348) (1,603,129) Gross Profit 741,698 828,379 1,570,076 General, Administrative and Store Operating Expenses (404,534) (444,217) (848,751) Operating Income 337,164 384,161 721,325 Interest Expense (113,701) (96,684) (210,385) Other Income (Loss) (a) 278 (230) 48 Income from Continuing Operations before Income Taxes 223,740 287,247 510,988 Provision for Income Taxes (b) 53,354 71,983 125,337 Net Income from Continuing Operations 170,386$ 215,265$ 385,651$ Earnings per Common Share - Basic Continuing Operations 0.61$ 0.78$ 1.39$ Earnings per Common Share - Dilutive Continuing Operations 0.60$ 0.77$ 1.37$ Weighted Average Shares Outstanding Basic 279,121 274,978 277,050 Dilutive 284,461 280,002 282,232 Reflects the Adjusted Statements of Income from Continuing Operations of Bath & Body Works, Inc. as if the Victoria's Secret business was reported as a discontinued operation for the periods presented. Refer to "Adjusted Financial Information" for more information on the adjustments made to historical results. Beginning in the third quarter of fiscal 2021, Victoria’s Secret’s historical financial results for periods prior to the spin-off will be reflected in the Company’s consolidated financial statements as discontinued operations. BATH & BODY WORKS, INC. ADJUSTED STATEMENTS OF INCOME FROM CONTINUING OPERATIONS - FISCAL 2021 DISCONTINUED OPERATIONS PRESENTATION - GIVING EFFECT TO THE VICTORIA'S SECRET & CO. SPIN-OFF (Unaudited) (In thousands, except per share amounts) (a) - In the first quarter, we recognized a $105.5 million pre-tax loss ($80.1 million net of tax of $25.4 million) (b) - Includes the income tax effect of the item referenced above.
July 31, 2021 January 30, 2021 August 1, 2020 Current Assets Cash and Cash Equivalents 1,695$ 3,568$ 2,446$ Accounts Receivable, Net 131 148 150 Inventories 728 572 553 Other 133 52 73 Current Assets of Discontinued Operations 1,826 1,239 1,282 Total Current Assets 4,514 5,579 4,505 Property and Equipment, Net 1,002 1,017 1,084 Operating Lease Assets 1,051 968 876 Goodwill 628 628 628 Trade Names 165 165 165 Deferred Income Taxes 59 58 56 Other Assets 143 176 278 Noncurrent Assets of Discontinued Operations 2,831 2,981 3,288 Total Assets 10,392$ 11,571$ 10,880$ Current Liabilities: Accounts Payable 460$ 345$ 463$ Accrued Expenses and Other 699 712 755 Current Debt - - 450 Current Operating Lease Liabilities 148 173 169 Income Taxes - 83 48 Current Liabilities of Discontinued Operations 1,318 1,512 1,549 Total Current Liabilities 2,625 2,826 3,433 Deferred Income Taxes 149 141 133 Long-term Debt 5,347 6,366 6,180 Long-term Operating Lease Liabilities 1,019 942 865 Other Long-term Liabilities 270 289 167 Long-term Liabilities of Discontinued Operations 2,170 1,667 2,006 Shareholder's Equity (Deficit): Preferred Stock - - - Common Stock 140 143 143 Additional Paid-in-Capital 911 891 869 Accumulated Other Comprehensive Income 87 83 49 Retained Earnings (Accumulated Deficit) (1,505) (1,421) (2,611) Less: Treasury Stock (822) (358) (358) Total L Brands Equity (1,189) (662) (1,908) Noncontrolling Interest 1 1 4 Total Equity (Deficit) (1,188) (661) (1,904) Total Liabilities and Equity 10,392$ 11,571$ 10,880$ Reflects the Consolidated Balance Sheets of Bath & Body Works, Inc. (the "Company") as if the Victoria's Secret business was reported as a discontinued operation for the periods presented. Assets and liabilities of Discontinued Operations include those classes of assets and liabilities that were transferred to Victoria’s Secret & Co. pursuant to the spin-off, and exclude certain liabilities related to Victoria’s Secret & Co. that were retained by the Company in connection with the spin-off. Beginning in the third quarter of fiscal 2021, Victoria’s Secret’s historical financial results for periods prior to the spin-off will be reflected in the Company’s consolidated financial statements as discontinued operations. (In millions) BATH & BODY WORKS, INC. CONSOLIDATED BALANCE SHEETS DISCONTINUED OPERATIONS PRESENTATION - GIVING EFFECT TO THE VICTORIA'S SECRET & CO. SPIN-OFF (Unaudited)
