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Limited Brands Profits Drop Despite 14% Revenue Gain

Limited Brands said its earnings fell 15% in its fourth quarter, despite strong sales at Victoria's Secret and Bath & Body Works.

Limited Brands said it made $439.8 million, or $1.08 a share, for the quarter ended Feb. 3 compared with profits of $519.2 million, or $1.28 a share, in its fourth quarter a year ago. Sales totaled $4 billion compared with $3.5 billion a year ago.

The fourth quarter had 14 weeks compared with 13 weeks in the year-ago quarter. Discounting the extra week and a $30.4 million gain the company reported a year ago from unused gift cards at Bath & Body Works and Express, the retailer said sales would have risen 10%.

Analysts surveyed by Thomson Financial expected profits of $1.08 per share on sales of $4 billion.

In the year-ago quarter, earnings were boosted by favorable resolution of tax matters and the unused gift cards, the company said. Excluding those items, earnings would have been 98 cents a share a year ago.

Sales at stores opened at least a year -- considered a key indicator of a retailer's strength -- were up 8% for the quarter and up 10% for Victoria's Secret and 9% for Bath & Body Works. Same-store sales among its apparel brands were up 1 percent in the quarter.

The results were released after the stock market closed on Wednesday. Limited Brands shares were up 41 cents to $27.66 in trading on the New York Stock Exchange. The stock has traded between $22.80 and $32.60 the past year.

Limited Brands operates about 3,800 stores under the names Victoria's Secret, Bath & Body Works, Express, Limited Stores, C.O. Bigelow, La Senza, White Barn Candle Co., Henri Bendel and Diva London.

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