Brand Value Bankruptcy Is Being Abandoned By The Rest Of The World And The Underwear Show Should Be Suspended Immediately.

August 23, 2018: in the US, the economy is booming, especially in retail.

A strong revival of the longest bull market in the United States, the underwear brand Victoria 's Secret, which could once be written into the history of clothing.

However, the L Brands Inc. (NYSE:LB) share price has continued to languish, and has been lingering in the 8 year low position.

After Wednesday's downtime, the EPS Brands was expected to fall to nearly $6% after the 2.45-2.70 was expected to fall to US $2.77. The market is expected to be US $2.77.

The underwear and beauty giant, headquartered in Columbo, Ohio, was expected to be 2.70-3.00 U.S. dollars in the 2018 fiscal year EPS, and the stimulus reduction means a maximum of 18%.

In the two quarter results, L Brands Inc. also announced that Denise Landman Landman, chief executive of Pink, a young parity brand, will retire before the end of the year. Instead, it will be the group beauty brand Bath & Body Works product development and business President Amy Hauk, who joined the group in 2008.

Group Chairman and CEO Leslie H. Wexner thanked Denise Landman for shaping Pink Pink into a brand of $3 billion welcomed by college students. But it included the CEO Sharen Jester Turney, which was launched in 2016, showing that the retail giant "Leslie" Leslie was actually desperate for the original management of the company.

At the beginning of last month, Sharen Turney joined the mainland China underwear group (2298.HK) as the chief strategy officer.

Denise Landman, the last time to attend the earnings conference, said that the Pink business in the two quarter continued to slump, while the number of same store sales declined, and the swimsuit business being pulled out had a 2% negative impact.

She said Pink is trying to make up the business by moving Bra.

Randal Konik, a Jefferies analyst at investment bank, said that Pink was the main driving force behind the development of the company. Now the development of this series has reached the ceiling, and the demand is weak, regardless of all the discount and replacement traffic. Considering that Pink has never done so before, the brand is believed to be the next Juicy Juicy Couture.

Juicy Couture was very popular in 90s, but eventually the whole company collapsed.

The Shanghai store model will not be promoted, and the Chinese market will launch a small store mode.

Christina Ng Ng, an analyst at fashion industry research and consulting firm No Agency, pointed out in its report on Thursday that

Brand, "Wei is losing the whole world", she also said that as a way to improve profit margins, L Brands Inc. should consider understanding the suspension of underwear show and save huge marketing expenses.

Since 1990s, the secret underwear show has been classics for over 20 years. But in recent years, it has gone from bad to worse under the impact of young consumer oriented social media.

In 2017, the ratings on the CBS show were only 1.5, down 30% from 2.1 in 2016 and less than 5 million.

In April this year, YouGov Plc (YOU.L), a British online data research and consultancy company, issued a report on YouGov BrandIndex, which concerns the brand index. It pointed out that under the vigorous global #MeToo campaign, 18-49 year old women both declined the attention and two important indicators of the purchase, and considered that the underwear show with a low viewing rate in 2017 should be considered to be closed.

No Agency also pointed out in Thursday's report that the Vic underwear show was once the manufacturing machine of the model rich list. Over the past year, more than half of Forbes's model rich list were "angel". The models were popular quickly after being chosen to participate in the annual underwear show. However, after the popularity of social media such as instagram and so on, it was no longer a star making machine. Instead, the brand needed to find social media red to promote its underwear show.

The huge changes not only reflect the disgrace of Wei and the underwear show, but also show that the brand needs to completely reverse the previous marketing strategy.

Analyst Christina Ng said that the younger generation of consumers is more stubborn about the value and image of brand output. Although the concept and product of brand display do not always agree with brand image, young consumers who prefer online shopping are more likely to choose to buy or boycott a brand because of the brand image in the social media.

At the analysts' conference call after Thursday's earnings report, Wells Fargo Securities, LLC rich retail analyst Irwin Bernard Boruchow said in a question, how the company looks at the cost structure along with the sudden fall in revenue and profit margins, and whether it should control costs in distress, including controlling the large flagship stores and underwear show in the most expensive blocks in the world, and even considering the re pfer of franchise or joint venture mode in the Chinese market.

Stuart Burgdoerfer, group chief financial officer, said she believed the company's founder, chairman and CEO Wexner Les had considered investment returns, and said that the biggest value was usually created in the absence of obvious return on investment.

Because of the gradual abandonment of consumers, the brand had to sell discounts all year round. The EBIT profit margin of the brand has fallen by 1000 basis points, even though the brand can still generate 900 dollars in the scale effect.

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The president and CEO Martin Waters said that the company will continue to invest.

In the two quarter, there were three new stores in China, including the first store in Tongluowan, Hongkong.

He also said that there was strong growth in the international market, without disclosing specific data.

In the two quarter, the international business income of the Bath and Body Works, which was announced in the earnings report, was $145 million 400 thousand, compared with 113 million 900 thousand US dollars in 2017, an increase of 27.7%.

However, he said that at present, the British market is sluggish, and the retail market in China has increased.

As of the two quarter of August 4th, the group's international business changed from profit to loss, operating losses of $14 million 200 thousand, and operating profit of $1 million 100 thousand last year.

Pink is touches the top.

In the two quarter, L Brands Inc. EBIT plummeted from 40.6% to 129 million US dollars, compared with 217 million 100 thousand US dollars in the same period in 2017, and 4.3% profit margins in EBIT, which fell by 356 basis points. During the period, the group's net profit fell by 28.7%, from 138 million 900 thousand US dollars to 99 million 34 thousand US dollars. During the operating profit period, it dropped to 24.2% dollars to 228 million 100 thousand dollars.

During the reporting period, the operating profit margin of the brand declined by 480 basis points to 6%.

In the first three months of August 4th, the group's earnings per share were $0.36, better than the market expected $0.34, which was in line with the group's expected 0.30-0.35 EPS.

L Brands Inc. first released quarterly sales data at the beginning of the month. In the two quarter, L Brands Inc. Inc. sales grew 3%, slightly exceeding the market forecast of 2.9%, of which VS recorded a 1% decline in the same store sales, while Bath & Body Works cosmetic sales rose 10%, far exceeding the 5.4% increase expected by the market, and the income increased from 2 billion 755 million US dollars to 2 billion 983 million 800 thousand dollars during the period, increasing by 8.3%, and also exceeding the expected US $2 billion 919 million.

Of these, VS's income was $1 billion 724 million 800 thousand, an increase of 4.8% over the same period last year of $1 billion 646 million 300 thousand.

The sluggish performance led to further pressure on L Brands Inc., which opened on Thursday, and the US dollar plunged more than 10% after opening 6.1%, closing at $28.25 a day, tumbling 11.41%, the lowest in October 2010. This year, we have cut 52.83%, while the S & P 500 index has gained 6.33% in the same period.

The performance in the open market shows that investors are desperate for the reviving of Les Wexner, the two largest figure in US retail history.

As early as July, Randal Konik had radically said that the value of the brand has been declared bankrupt, and VS and PINK are being eroded by American Eagle Outfitters Inc. (NYSE:AEO) girl underwear brand Aerie.

Neil Saunders, general manager of GlobalData Retail, said that the concept of "sex marketing" and "dark stores" has become increasingly inappropriate.

No Agency analyst Christina Ng said that it could learn from American counterparts Abercrombie Fitch Co. NYSE:ANF (NYSE:ANF). The US youth apparel group was pulled back from the precipice of bankruptcy under the leadership of Fran Horowitz.

"Immediately announcing the suspension of the underwear show will not only save a lot of money, but the effect may be far better than that of the younger generation who continues to hold the underwear show, and the younger generation who relies on social media consumption will pay attention to the brand because of the tremendous force of the event. Mature consumers usually don't care about it."

At the same time, she said, after Abercrombie changed its value, the concept of most stores has not changed, and the new concept has been advancing very slowly. However, "the illusion that young consumers are advancing with the times" is not enough for many young consumers.