2
3
DISCIPLINED EXECUTION OF RETAIL FUNDAMENTALS
“SAID” “DID”
Grow inventory per foot slower than sales Achieved in 4 out of last 5 years
Maintain healthy real estate 99% of stores are cash flow positive
$12.6 $2.19
$12.2 $2.04
$11.5 $1.95
$10.8
$10.3 $1.74
$1.67
2012 2013 2014 2015 2016 2012 2013 2014 2015 2016
% Growth 7% 4% 6% 6% 3% % Growth 11% 5% 12% 12% ‐7%
2,690 Total Stores1
32 Stores
< $0
1Only includes stores as of January 28, 2017 that have been open for at least one
year and have not had construction activity for at least one year. Excludes clearance
stores.
9
HEALTHY REAL ESTATE
2,977 Total Stores1
High profitability across all location
types
1Total North American Stores open as of
January 28, 2017, excluding clearance centers
10
SIGNIFICANT CASH FLOW
1Restated to reflect the required change in presentation related to the new accounting standard for stock-based compensation adopted in 2017
11
BALANCED, PROACTIVE CAPITAL STRUCTURE MANAGEMENT
Debt Rating at End of Year BBB/ BB+/ BB+/ BB+/ BB+/ BB+/
(S&P/Moody's/Fitch) Baa2/NR Ba1/BB+ Ba1/BB+ Ba1/BB+ Ba1/BB+ Ba1/BB+
1Calculated as 8 times total rent expense, including all businesses owned at the time.
2Adjusted operating income, excluding depreciation & amortization and total rent expense, including all businesses owned at the time. 12
RETURNED $7.1 BILLION TO SHAREHOLDERS
$2.40
$2.00
$1.36
$1.20
$1.00
14
TOTAL SHAREHOLDER RETURNS
1-year Total Return 3-year Total Return 5-year Total Return 10-year Total Return
1 Best Buy 44.6% 1 Children's Place 26.9% 1 Best Buy 29.4% 1 TJX 18.3%
2 Tiffany & Co. 34.9% 2 Best Buy 23.9% 2 Home Depot 24.2% 2 Fast Retailing 18.1%
Median of top 3 Children's Place 30.3% Median of top 3 Home Depot 19.9% Median of top 3 Walgreen Co. 20.2% Median of top 3 Home Depot 17.7%
quartile: 4 Staples 26.1% quartile: 4 Inditex 15.1% quartile: 4 Inditex 14.6% quartile: 4 Inditex 16.5%
26.1% 5 Giordano 18.0% 15.1% 5 Walgreen Co. 12.2% 14.6% 5 Children's Place 14.2% 16.5% 5 Children's Place 14.4%
6 Home Depot 14.2% 6 Coach 8.3% 6 Fast Retailing 12.6% 6 L Brands 12.0%
7 Coach 13.8% 7 TJX 8.1% 7 TJX 10.9% 7 Foot Locker 11.4%
8 Wal-Mart Stores 11.1% 8 Giordano 6.8% 8 Tiffany & Co. 10.4% 8 Wal-Mart Stores 8.6%
9 Gap 5.6% 9 Wal-Mart Stores 4.0% 9 Wal-Mart Stores 4.2% 9 Giordano 8.2%
Median of top 10 Walgreen Co. 0.6% Median of top 10 Target 1.1% Median of top 10 Foot Locker 2.9% Median of top 10 Walgreen Co. 8.1%
quartile: 11 Inditex 0.1% quartile: 11 Staples 0.0% quartile: 11 Staples 2.9% quartile: 11 Tiffany & Co. 8.1%
0.1% 12 TJX (5.4%) 0.0% 12 Fast Retailing (0.0%) 2.9% 12 Giordano 1.4% 8.1% 12 Gap 5.0%
13 Li & Fung (5.7%) 13 Tiffany & Co. (0.9%) 13 Target 0.4% 13 Best Buy 4.8%
14 Fast Retailing (10.5%) 14 American Eagle (1.3%) 14 L Brands 0.1% 14 H&M 4.0%
15 Ralph Lauren (11.4%) 15 H&M (9.7%) 15 H&M (0.3%) 15 Ralph Lauren 2.7%
16 Target (17.5%) 16 Foot Locker (11.9%) 16 Coach (3.3%) 16 Buckle 2.0%
Median of top 17 Abercrombie & Fitch (18.2%) Median of top 17 L Brands (12.1%) Median of top 17 Gap (5.0%) Median of top 17 Coach 1.4%
quartile: 18 H&M (22.6%) quartile: 18 Gap (16.6%) quartile: 18 American Eagle (7.1%) quartile: 18 Target 0.8%
(22.6%) 19 American Eagle (30.9%) (16.6%) 19 Ralph Lauren (17.6%) (7.1%) 19 Ralph Lauren (9.5%) 0.8% 19 Bed Bath & Beyond (2.0%)
20 Esprit Holdings (33.2%) 20 Chico's (18.0%) 20 Chico's (14.0%) 20 American Eagle (3.4%)
21 Chico's (34.3%) 21 Li & Fung (23.8%) 21 Buckle (14.0%) 21 Chico's (5.3%)
22 Buckle (36.0%) 22 Bed Bath & Beyond (23.9%) 22 Abercrombie & Fitch (15.5%) 22 Staples (5.3%)
23 Bed Bath & Beyond (38.9%) 23 Buckle (28.0%) 23 Esprit Holdings (15.6%) 23 Li & Fung (9.7%)
Median of top 24 Foot Locker (44.0%) Median of top 24 Esprit Holdings (28.4%) Median of top 24 Bed Bath & Beyond (15.9%) Median of top 24 Ascena Retail Group (13.8%)
quartile: 25 L Brands (47.2%) quartile: 25 Abercrombie & Fitch (28.9%) quartile: 25 Li & Fung (18.6%) quartile: 25 Abercrombie & Fitch (14.2%)
(44.0%) 26 Ascena Retail Group (74.7%) (28.4%) 26 Ascena Retail Group (51.4%) (15.9%) 26 Ascena Retail Group (36.9%) (13.8%) 26 Esprit Holdings (24.9%)
S&P 500 16.0% S&P 500 9.6% S&P 500 14.4% S&P 500 7.6%
S&P Retail Index 10.7% S&P Retail Index 16.9% S&P Retail Index 19.2% S&P Retail Index 13.0%
As of September 1, 2017 15
2017 OUTLOOK
L Brands, Inc.
2017 Outlook as of August 16, 2017
Weighted Average Shares Outstanding Approximately 288 million Approximately 288 million
1
Defined as operating cash flow less capital expenditures. 16
17
L BRANDS – CONTRIBUTIONS TO TOTAL ANNUAL SALES GROWTH
Direct Growth
International Growth
19
DIFFERENTIATED CATEGORIES AND LEADING BRANDS
Victoria’s Secret
#1 lingerie brand
– #1 in dollar share for bras and panties
– Global brand leader in awareness
Fashion businesses need to change and evolve to stay relevant. We are focused on
executing significant change in the business:
• Focus on our core categories to accelerate growth (eliminate swim and apparel)
• Streamline the business and increase efficiency (elimination of nearly 300 positions)
21
DIFFERENTIATED CATEGORIES AND LEADING BRANDS
#1 in America for
– Body lotion brand
– Body cream brand
– Shower gel brand
– Fine fragrance mist
– Fragrance collection … Japanese Cherry Blossom
– Fragrance diffuser for the home … Wallflower
– Liquid hand soap brand
– Hand sanitizer brand
– Spa collection
15%
12% 12%
12%
11%
10%
Sales Growth vs. LY
9% 9% 8%
8%
7% 7% 7% 7% 7%
6% 6%
6%
5% 5% 5% 5%
4% 5% 4%
3%
3% 3% 2%
0%
(5%)
(7%)
25
SPEED – DRIVES INVENTORY TURN
Average dollar turn
26
SPEED – DRIVES AGILITY (“READ,” “REACT,” “CHASE”)
27
SPEED – DRIVES AGILITY (“READ,” “REACT,” “CHASE”)
BEFORE TODAY
BEAUTY PARK (2010)
28
FOCUS ON STORE SELLING AND EXECUTION
• Increased training
29
SALES GROWTH OPPORTUNITY
Direct Growth
International Growth
30
GROWTH FROM REAL ESTATE
Square footage growth in North America is accelerating, driving total company growth
Gross 4% 4% 2%
Net of closures 4% 4% 1%
Gross 1% 5% 4%
Net of closures 0% 4% 3%
L Brands
Gross 3% 4% 2%
Net of closures 1% 4% 1%
31
INVESTING IN GROWTH
PERFORMANCE-BASED
32
EFFICIENT USE OF CAPITAL
17%
16% 16%
16% 15%
ROIC1
1Return on invested capital is calculated using net operating profit after tax (NOPAT) that incorporates an adjustment for leases, divided by the average invested capital.
33
SQUARE FOOTAGE GROWTH – VICTORIA’S SECRET
37
SQUARE FOOTAGE GROWTH – VICTORIA’S SECRET
We are increasing our investment in Bath & Body Works North America
Core 30 32 62 1 1 2 0 0 0
Side-by-Side 3 45 48 6 75 81 0 14 14
39
SQUARE FOOTAGE GROWTH – BATH & BODY WORKS
Direct Growth
International Growth
43
DIRECT CHANNEL GROWTH
44
HOW WILL WE GROW?
Direct Growth
International Growth
45
INTERNATIONAL SEGMENT CAGR
2012-16
2012 2013 2014 2015 2016 CAGR
Total VS & BBW International Segment
L Brands Recognized Revenue (USD) $132 $222 $336 $385 $423 34%
*Represents total retail sales from company-owned and partner-owned stores; partner-owned sales may be unaudited and/or non-GAAP.
Note: The operating income decline in 2016 was primarily driven by our investments in China. 46
PRELIMINARY 2017 STORE COUNT OUTLOOK
L BRANDS, INC.
INTERNATIONAL STORE COUNT
2017 FORECAST
PINK - U.K. 3 2 0 5
PINK 5 0 0 5
Victoria's Secret Beauty & Accessories - Travel Retail 152 13 to 18 (5) 160 to 165
This presentation contains certain unaudited “Adjusted” financial information which represents non-GAAP
financial measures. 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.
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. 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. The following pages contain reconciliations of
certain reported results to the adjusted results used in this presentation.
49
APPENDIX
Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures
2016
(in millions except per share amounts)
The Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures reflect the following:
2015
(in millions except per share amounts)
The Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures reflect the following:
2012
(in millions except per share amounts)
The Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures reflect the following:
2011
(in millions)
The Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures reflect the following: