Victoria's Secret & Co. (NYSE:VSCO) Q4 2023 Earnings Conference March 7, 2024 8:00 AM ET

Company Participants

Kevin Wynk - Vice President, External Financial Reporting and Investor Relations

Martin Waters - Chief Executive Officer

Tim Johnson - Chief Financial Officer

Conference Call Participants

Alex Straton - Morgan Stanley

Irwin Boruchow - Wells Fargo

Simeon Siegel - BMO Capital Markets

Jonna Kim - TD Cowen

Dana Telsey - Telsey Group

Matthew Boss - JPMorgan

Marni Shapiro - Retail Tracker

Mauricio Serna - UBS

Operator

Good morning. My name is Fran and I will be your conference operator today. At this time, I'd like to welcome everybody to the Victoria's Secret & Company Fourth Quarter 2023 Earnings Conference Call. Please be advised that today's conference is being recorded. All parties will remain in a listen-only mode until the question-and-answer session of today's call.

I would now like to turn the call over to Mr. Kevin Wynk, Vice President of External Financial Reporting and Investor Relations at Victoria's Secrets & Company. Kevin, you may begin.

Kevin Wynk

Thanks Fran. Good morning and welcome to Victoria's Secret & Company's fourth quarter earnings conference call for the period ending February 3, 2024. As a matter of formality, I would like to remind you that any forward-looking statements we may make today are subject to our Safe Harbor statements found in our SEC filings and in our press releases.

Joining me on the call today is CEO, Martin Waters; and CFO, Tim Johnson. We are available today for up to 45 minutes to answer any questions. Certain results we discussed on the call today are adjusted results and exclude the impact of certain items described in our press release and our SEC filings.

Reconciliation of these and other non-GAAP measures to the most comparable GAAP measures are included in our press release, our SEC filings, and the investor presentation posted on the investor section of our website. Thanks.

And now I'll turn the call over to Martin.

Martin Waters

Thanks, Kevin, and good morning, everyone. I want to first share my appreciation and gratitude for the hard work and dedication of our associates and partners around the world who executed our strategies, delighted our customers and delivered solid financial results in the all important holiday quarter.

I'm pleased to report that fourth quarter adjusted operating income and EPS came in at the high end of our guidance. Sales in the quarter were up 3% compared to last year and were at the midpoint of our guidance. Our fourth quarter gross margin rate increased significantly compared to last year, exceeding our expectations, driven by disciplined inventory management and cost reductions related to our Transform the Foundation initiative to modernize our supply chain.