Barington indicated that multiple changes to its management team harmed the Victoria’s Secret business. Moreover, the division was slow to adapt to the changing trends in the market and also failed to capitalize on the massive boom in activewear.
Barington also said that Victoria’s Secret has not evolved with the times and is losing touch with customers. The investor added that the brand needs to bring in more diversity and inclusion into its marketing. On the other hand, Barington appreciated the company’s decision to reenter the swimwear category.
While voicing concerns on Victoria’s Secret, Barington stated that the performance of the Bath & Body Works division has been exceptional but the personal care division’s strong momentum was being overshadowed by the lingerie chain’s dismal numbers.
To address these issues, Barington asked L Brands to take the necessary measures to improve the performance of Victoria’s Secret through fresh branding and better merchandising efforts. The activist investor asked the company to also consider either spinning off Victoria’s Secret or taking Bath & Body Works public in order to create more value for shareholders.
Barington also called for changes to the board of directors at L Brands and for the roles of Chairman and CEO to be given to different individuals to improve governance.
L Brands’ shares have dropped over 38% over the past one year. The stock was down slightly by 0.26% in afternoon trade on Tuesday.