Victoria’s Secret is closing a quarter of its stores

New York(CNN Business) Victoria’s Secret is permanently closing a quarter of its stores in the United States and Canada over the next few months. It’s another blow to the beleaguered retailer just weeks after its half-billion dollar plan to go private was scrapped.

L Brands (LB), which owns the company, said the 250 store closures might just be the start: It warned it could close more stores over the next few years. There are approximately 1,100 Victoria’s Secret locations in North America.

Chief Financial Officer Stuart Burgdoerfer said in an earnings call Thursday that it was a “very significant decision” that is intended to “strengthen” Victoria’s Secret. L Brands previously had an agreement with private equity firm Sycamore Partners to take the retailer private, but the firm decided to pull out of the agreement in early May citing temporary store closures sparked by the coronavirus pandemic.

L Brands also said it was closing 50 Bath & Body Works stores, mostly in mall locations where it doesn’t expect foot traffic to regain pre-pandemic normalcy. The brand has roughly 1,700 stores in North America.

Despite the store closures, Bath & Body Works had a strong quarter. Its online sales grew 85% over last year. It expects its sanitizer products to grow into a $300 million business this year — up from $100 million last year.

But L Brands’ first-quarter sales dropped 37%. Most of its physical stores between the two brands have been closed since mid-March because of the pandemic.

Investors are fans of the slimming plans: L Brands’ shares are up 18% in Thursday trading.

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