Bath & Body Works, Inc. · NYSE:BBWI
Bath & Body Works — Q4 2024 Earnings Presentation
32 slides from Bath & Body Works's earnings presentation, Feb 27, 2025
Slide 1: Q4 & Full Year 2024 Earnings + 2025 Guidance
Q4 & FULL YEAR 2024 EARNINGS + 2025 GUIDANCE February 27, 2025 1
Slide 2: Q4 Earnings Call Participants
Q4 EARNINGS CALL PARTICIPANTS GINA BOSWELL EVA BORATTO LUKE LONG Chief Executive Officer & Director Chief Financial Officer VP Strategy & Investor Relations 22
Slide 3: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 We caution that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this presentation or made by our company or our ma
Slide 4: Our strategy is working
“Our strategy is working, and we are driving topline growth through product innovation, enhanced marketing and technology, and by extending our reach through category adjacencies and international expansion” - Gina Boswell, CEO 44
Slide 5: Building Momentum in FY '24
BUILDING MOMENTUM IN FY '24 This past year can be best summarized as building momentum and establishing a strong foundation for long-term growth Collaborations: EDL: Loyalty: Adjacencies: Cost Savings: Launched Successfully rolled Grew our Expanded Delivered collaborations out Everyday active1 loyal
Slide 6: Q4 2024 Financial Highlights
Q4 2024 FINANCIAL HIGHLIGHTS HIGHLIGHTS Beat our guidance on both the top and bottom line. $2.8B 46.7% Drove sequential net sales improvement in every quarter of 2024 when normalizing for calendar shifts, the 53rd week (4%) LY1 +80 bps LY last year, and the shortened holiday calendar. Net Sales Gros
Slide 7: Key Priorities
KEY PRIORITIES Accelerating topline growth Strengthening our operational foundation Enhancing operational excellence and efficiency while building a platform for sustained Strengthening our financial success through our positioning and disciplined key strategies return of capital 77
Slide 8: Top Line Growth Drivers
Strong execution drove positive dual TOP LINE GROWTH DRIVERS channel traffic and conversion, with traffic exceeding third-party benchmarks. Customers turned to us to celebrate the holiday season as their trusted gifting destination. Holiday Traditions rose to be the #1 collection, and the Home for t
Slide 9: Q4 2024 North American Category Performance
Q4 2024 NORTH AMERICAN CATEGORY PERFORMANCE Categories performed in line with the market, each maintaining category leadership and unit market share in FY 2024. BODY CARE HOME FRAGRANCE SOAPS & SANITIZERS Q4 sales up low-single digits; Q4 sales down low-single digits; Q4 sales up mid-single digits;
Slide 10: Collaborations
COLLABORATIONS Collaborations are a key element of our product and marketing strategy across our core business EMILY IN PARIS SWEETHEARTS DISNEY PRINCESS 10
Slide 11: Customer Experience
CUSTOMER EXPERIENCE Enhanced by Marketing, Loyalty, Technology We strive to improve the in-store and Marketing Loyalty Technology online customer experience, by investing in marketing, loyalty, and technology. 57% of stores in off-mall locations with a target mix now of 75% off-mall over time given
Slide 12: Strong Loyalty Program
STRONG LOYALTY PROGRAM ~39M Over 80% Active1 loyalty members as of Of 2024 U.S. sales the end of Q4 2024 driven by loyalty members + 6% to Q4 LY + 2 pts to full year LY 1 - Active members of our loyalty program represent loyalty program members who have purchased at least once directly from the comp
Slide 13: Extend Our Reach
EXTEND OUR REACH Growing adjacent categories and expanding internationally. Adjacencies are an opportunity to expand and diversify our product portfolio, applying our fragrance expertise and leadership to large addressable markets. Our adjacent categories of Men's, Hair, Lip and Laundry continue to
Slide 14: Customers Responding Favorably to Innovation
CUSTOMERS RESPONDING FAVORABLY TO INNOVATION MEN’S LIP LAUNDRY Men’s is our largest adjacency, and Lip net sales were up ~50% year-over- We are pleased with the full rollout and we see significant opportunity as we year in the fourth quarter and we expect early performance of Laundry in 2024, contin
Slide 15: International
INTERNATIONAL International expansion remains an important pillar of our strategy and as we enter 2025, we expect the International business to return to topline growth. Aeon Bukit Tinggi – Malaysia Westfield Stratford - UK 15
Slide 16: Operational Efficiency & Disciplined Return of Capital
OPERATIONAL EFFICIENCY & DISCIPLINED RETURN OF CAPITAL 2-year Fuel for Growth program delivered over $300 million of incremental cost savings, significantly exceeding our initial targets. Taking a continuous improvement mindset to manage cost and enhance operational efficiencies. Generated significa
Slide 17: Entering 2025 with Momentum
ENTERING 2025 WITH MOMENTUM We believe our strategy and actions position the company to achieve sustainable, profitable growth, and to drive long-term shareholder value. Poised to drive growth through our product innovation, marketing, and technology. Building on innovation platforms we launched in
Slide 18: Q4 2024 Financial Results
Q4 2024 FINANCIAL RESULTS KEY HIGHLIGHTS • Net sales of $2.8B exceeded guidance and $ in millions, except earnings per share decreased 4.3% compared to prior year. • The fourth quarter was negatively impacted by approximately 500 basis points from the ACTUALS LY GUIDANCE METRIC shifted fiscal calend
Slide 19: Q4 2024 Net Sales by Channel
Q4 2024 NET SALES BY CHANNEL 76% 21% 3% Stores – U.S. Direct – U.S. International & Canada & Canada $2.1B $595M $84M 57% of North American fleet BOPIS net sales are recognized as store net sales, and International system-wide in off-mall locations. we drove 45% growth in demand YoY. retail sales1 up
Slide 20: Store Count and Company-Operated Selling Square Feet
STORE COUNT AND COMPANY-OPERATED SELLING SQUARE FEET Full Year 2024 Total Company-Operated Stores Stores Selling Sq. Ft. (000’s) Opened/ 2/3/2024 Opened Closed 2/1/2025 2/3/2024 Closed 2/1/2025 Remodels Bath & Body Works U.S. 1,739 104 (61) 1,782 4,916 285 (136) 5,066 Bath & Body Works Canada 111 2
Slide 21: FY 2025 Guidance
KEY HIGHLIGHTS FY 2025 GUIDANCE • We expect FY 2025 net sales growth of 1% to 3% $ in millions, except earnings per share versus prior year. • The midpoint of our guidance assumes GUIDANCE METRIC (February 27, 2025) growth consistent with the fourth quarter, when adjusting for calendar impacts and N
Slide 22: Q1 2025 Guidance
Q1 2025 GUIDANCE KEY HIGHLIGHTS $ in millions, except earnings per share • We expect Q1 2025 net sales growth of between 1% and 3% versus prior year. METRIC GUIDANCE • The midpoint of our guidance (February 27, 2025) assumes growth consistent with the fourth quarter, when adjusting for Net Sales up
Slide 23: Capital Allocation Highlights
CAPITAL ALLOCATION HIGHLIGHTS FY’24 Results FY’25 Guidance Capital $226M Expenditures $245M Capital Investments1 $250M - $270M Free Cash $725M Flow Adjusted $750M - $850M Dividend $177M ~$170M Payments $0.80/share annual dividend maintain $0.80/share annual dividend Share Repurchase $400M $300M Debt
Slide 24: Strong Business Model
STRONG LEADER IN ATTRACTIVE SPACES HEALTHY BUSINESS MODEL Market leader in each of our MARGINS 3 categories, Home ~17% Operating Margins2 Our strategy is working, Fragrance, Soaps & and we are beginning to Sanitizers, and Body Care1 see results. We are laser focused on achieving sustainable, STRONG
Slide 25: Q&A
Q&A 25 25
Slide 26: Appendix
Appendix Other financial information 26 26
Slide 27: 2024 Category Highlights
2024 CATEGORY HIGHLIGHTS FY’24 2024 Highlights (% of North American Sales) • Home Fragrance was flat to prior year and maintained market leadership and unit market share. Fragrance Home • In the second half of the year, home fragrance was up slightly to last year, an improvement to the first half of
Slide 28: 2024 Calendar Impacts
2024 CALENDAR IMPACTS Vs. LY Q1 Q2 Q3 Q4 1 Full Year Net Sales (0.9%) (2.1%) 3.0% (4.3%) (1.6%) Reported Calendar Shift & +200 bps 0 bps +200 bps (500) bps (100) bps Extra Week in 2023 Net Sales (2.9%) (2.1%) 1.0% 0.6% (0.6%) (excl. Calendar Shift) 1 – Q4 also incurred an estimated ~150bps headwind
Slide 29: Debt Maturities
DEBT MATURITIES as of February 27, 2025 29
Slide 30: Adjusted Financial Information – Q4 & Full Year 2024
ADJUSTED FINANCIAL INFORMATION – Q4 & FULL YEAR 2024 $ in millions, except per share amounts Fourth Quarter Full Year 2024 2023 2024 2023 (13 weeks) (14 weeks) (52 weeks) (53 weeks) Reconciliation of Net Non-Operating Expense to Adjusted Net Non-Operating Expense Reported Net Non-Operating Expense $
Slide 31: Free Cash Flow Information – FY 2024 & FY 2025
FREE CASH FLOW INFORMATION – FY 2024 & FY 2025 $ in millions Full-Year 2024 Reconciliation of FY24 Net Cash Provided by Operating Activities to Adjusted Free Cash Flow Net Cash Provided by Operating Activities $886 Capital Expenditures (226) Free Cash Flow 660 Tax Payments Related to Sales of Easton
Slide 32: Q4 2024 v Q4 2023 General, Administrative and Store Operating Expense Summary
Q4 2024 v Q4 2023 GENERAL, ADMINISTRATIVE AND STORE OPERATING EXPENSE SUMMARY $ in millions 32