Bath & Body Works公司是一家專注於個人護理和家庭香氛的全球全渠道零售商。該公司通過位於美利堅合衆國（"美國"）和加拿大的零售店以及其網站和其他渠道，以Bath & Body Works®、White Barn®和其他品牌的名稱銷售商品。該公司的國際業務是通過特許經營、授權和批發合作伙伴開展的。該公司作爲一個報告單一業務部門運營。
之前，公司的Easton投資包括Easton Town Center, LLC（“以太經典”）和Easton Gateway, LLC（“EG”）的股份權益，這些實體擁有並開發商業娛樂和購物中心。公司的投資在以太經典和EG中採用權益法會計。在2024年5月10日，公司出售了與EG相關業務的全部權益，並在2024年8月1日，出售了其在以太經典中的全部權益。公司在這些交易的完成中獲得了總現金收益$50 百萬，並確認了稅前收益$39 百萬，扣除費用後，這一收益包含在2024年迄今的綜合損益表的其他收入中。
In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses, that requires disclosures of disaggregated information about certain income statement expense line items on an annual and interim basis. This standard is effective for fiscal years beginning after December 15, 2026, with early adoption permitted, and will be applied prospectively, with the option to apply retrospectively. The Company is currently evaluating the impact of adopting this standard on its disclosures.
2. Revenue Recognition
Accounts receivable, net from revenue-generating activities were $94 million as of November 2, 2024, $84 million as of February 3, 2024 and $84 million as of October 28, 2023. These accounts receivable primarily relate to amounts due from the Company’s franchise, license and wholesale partners. Under these arrangements, payment terms are typically 45 to 75 days.
The Company records deferred revenue when cash payments are received in advance of transfer of control of goods or services. Deferred revenue primarily relates to gift cards, loyalty points and rewards and direct channel shipments, which are all impacted by seasonal and holiday-related sales patterns. Deferred revenue, which is recorded within Accrued Expenses and Other on the Consolidated Balance Sheets, was $170 million as of November 2, 2024, $198 million as of February 3, 2024 and $163 million as of October 28, 2023. The Company recognized $116 million as revenue year-to-date 2024 from amounts recorded as deferred revenue at the beginning of the Company’s fiscal year.
The following table provides a disaggregation of Net Sales for the third quarters of and year-to-date 2024 and 2023:
Third Quarter
Year-to-Date
2024
2023
2024
2023
(in millions)
Stores - U.S. and Canada (a)
$
1,220
$
1,168
$
3,425
$
3,345
Direct - U.S. and Canada
321
317
879
926
International (b)
69
77
216
246
Total Net Sales
$
1,610
$
1,562
$
4,520
$
4,517
_______________
(a)Results include fulfilled buy online-pick up in store orders.
(b)Results include royalties associated with franchised stores and wholesale sales.
The Company’s Net Sales outside of the U.S. include sales from Company-operated stores and its e-commerce site in Canada, royalties associated with franchised stores and wholesale sales. Certain of these sales are subject to the impact of fluctuations in foreign currency. The Company’s Net Sales outside of the U.S. totaled $163 million and $161 million for the third quarters of 2024 and 2023, respectively, and $452 million and $468 million for year-to-date 2024 and 2023, respectively.
3. Net Income Per Share and Shareholders’ Equity (Deficit)
Net Income Per Share
Net Income per Basic Share is computed based on the weighted-average number of common shares outstanding. Net Income per Diluted Share includes the weighted-average effect of dilutive restricted share units, performance share units and stock options (collectively, “Dilutive Awards”) on the weighted-average common shares outstanding.
The following table provides the weighted-average shares utilized for the calculation of Net Income per Basic and Diluted Share for the third quarters of and year-to-date 2024 and 2023:
Third Quarter
Year-to-Date
2024
2023
2024
2023
(in millions)
Common Shares
233
242
237
243
Treasury Shares
(15)
(15)
(15)
(15)
Basic Shares
218
227
222
228
Effect of Dilutive Awards
1
1
1
1
Diluted Shares
219
228
223
229
Anti-dilutive Awards (a)
1
—
1
1
_______________
(a)These awards were excluded from the calculation of Net Income per Diluted Share because their inclusion would have been anti-dilutive.
Common Stock Repurchases
2022 Share Repurchase Program
In February 2022, the Company’s Board of Directors (the “Board”) authorized a $1.5 billion share repurchase program (the “February 2022 Program”). Under the February 2022 Program, the Company repurchased the following shares of its common stock during year-to-date 2024 and 2023:
Repurchase Program
Shares Repurchased
Amount Repurchased
Average Stock Price
2024
2023
2024
2023
2024
2023
(in thousands)
(in millions)
February 2022
842
2,765
$
39
$
100
$
46.08
$
36.16
The February 2022 Program had no remaining authority as of May 4, 2024. There were share repurchases of $1 million reflected in Accounts Payable on the February 3, 2024 and October 28, 2023 Consolidated Balance Sheets.
In November 2024, the Company declared its fourth quarter 2024 ordinary dividend of $0.20 per share payable on December 6, 2024 to stockholders of record at the close of business on November 22, 2024.
4. Inventories
The following table provides details of Inventories as of November 2, 2024, February 3, 2024 and October 28, 2023:
November 2, 2024
February 3, 2024
October 28, 2023
(in millions)
Finished Goods Merchandise
$
1,003
$
558
$
1,035
Raw Materials and Merchandise Components
175
152
170
Total Inventories
$
1,178
$
710
$
1,205
Inventories are principally valued at the lower of cost or net realizable value, on an average cost basis.
5. Long-lived Assets
The following table provides details of Property and Equipment, Net as of November 2, 2024, February 3, 2024 and October 28, 2023:
Depreciation expense was $69 million and $70 million for the third quarters of 2024 and 2023, respectively. Depreciation expense was $211 million and $199 million for year-to-date 2024 and 2023, respectively.
6. Income Taxes
The provision for income taxes is based on the current estimate of the annual effective tax rate and is adjusted as necessary for quarterly events.
For the third quarter of 2024, the Company’s effective tax rate was 26.7% compared to 25.3% in the third quarter of 2023. The 2024 third quarter rate was higher than the Company’s combined estimated federal and state statutory rates primarily due to accrued interest expense related to unrecognized tax benefits. The 2023 third quarter rate was consistent with the Company’s combined estimated federal and state statutory rates.
For year-to-date 2024, the Company’s effective tax rate was 17.2% compared to 24.9% for year-to-date 2023. The 2024 year-to-date rate was lower than the Company's combined estimated federal and state statutory rates primarily due to the sales of Easton investments during the second quarter of 2024, which resulted in the release of a valuation allowance on a deferred tax asset. The 2023 year-to-date rate was consistent with the Company’s combined estimated federal and state statutory rates.
Income taxes paid were $81 million and $45 million for the third quarters of 2024 and 2023, respectively. Income taxes paid were $285 million and $213 million for year-to-date 2024 and 2023, respectively.
7. Long-term Debt and Borrowing Facility
The following table provides the Company’s outstanding debt balances, net of unamortized debt issuance costs and discounts, as of November 2, 2024, February 3, 2024 and October 28, 2023:
November 2, 2024
February 3, 2024
October 28, 2023
(in millions)
Senior Debt with Subsidiary Guarantee
$314 million, 9.375% Fixed Interest Rate Notes due July 2025 (“2025 Notes”)
$
314
$
313
$
312
$284 million, 6.694% Fixed Interest Rate Notes due January 2027 (“2027 Notes”)
276
287
286
$444 million, 5.250% Fixed Interest Rate Notes due February 2028 (“2028 Notes”)
443
460
483
$482 million, 7.500% Fixed Interest Rate Notes due June 2029 (“2029 Notes”)
476
492
492
$844 million, 6.625% Fixed Interest Rate Notes due October 2030 (“2030 Notes”)
838
930
950
$802 million, 6.875% Fixed Interest Rate Notes due November 2035 (“2035 Notes”)
796
806
855
$575 million, 6.750% Fixed Interest Rate Notes due July 2036 (“2036 Notes”)
571
608
609
Total Senior Debt with Subsidiary Guarantee
3,714
3,896
3,987
Senior Debt
$284 million, 6.950% Fixed Interest Rate Debentures due March 2033 (“2033 Notes”)
283
293
310
$201 million, 7.600% Fixed Interest Rate Notes due July 2037 (“2037 Notes”)
200
199
200
Total Senior Debt
483
492
510
Total Debt
4,197
4,388
4,497
Current Debt
(314)
—
—
Total Long-term Debt, Net of Current Portion
$
3,883
$
4,388
$
4,497
Repurchases of Notes
The Company did not repurchase any outstanding senior notes in the third quarter of 2024. For year-to-date 2024, the Company repurchased in the open market and extinguished $200 million principal amounts of its outstanding senior notes. The aggregate repurchase price for these notes was $202 million, resulting in a pre-tax loss of $3 million, including the write-off of unamortized issuance costs. This loss is included in Other Income in the year-to-date 2024 Consolidated Statement of Income.
During the third quarter of and year-to-date 2023, the Company repurchased in the open market and extinguished $174 million and $373 million principal amounts of its outstanding senior notes, respectively. The aggregate repurchase price for these notes were $161 million and $343 million for the third quarter of and year-to-date 2023, respectively, resulting in pre-tax gains of $12 million and $28 million, including the write-off of unamortized issuance costs, during the third quarter of and year-to-date 2023, respectively. These gains are included in Other Income in the 2023 Consolidated Statements of Income.
The following table provides details of the outstanding principal amounts of senior notes repurchased and extinguished during 2024 and 2023:
Third Quarter
Year-to-Date
2024
2023
2024
2023
(in millions)
2025 Notes
$
—
$
—
$
—
$
6
2027 Notes
—
—
14
—
2028 Notes
—
14
17
14
2029 Notes
—
—
17
—
2030 Notes
—
35
94
42
2033 Notes
—
31
10
39
2035 Notes
—
78
10
139
2036 Notes
—
3
38
86
2037 Notes
—
13
—
47
Total
$
—
$
174
$
200
$
373
Asset-backed Revolving Credit Facility
The Company and certain of the Company’s 100% owned subsidiaries guarantee and pledge collateral to secure an asset-backed revolving credit facility (“ABL Facility”). The ABL Facility, which allows borrowings and letters of credit in U.S. dollars, has aggregate commitments of $750 million and an expiration date in August 2026.
Availability under the ABL Facility is the lesser of (i) the borrowing base, determined primarily based on the Company’s eligible U.S. and Canadian credit card receivables, accounts receivable, inventory and eligible real property, or (ii) the aggregate commitment. If at any time the outstanding amount under the ABL Facility exceeds the lesser of (i) the borrowing base and (ii) the aggregate commitment, the Company is required to repay the outstanding amounts under the ABL Facility to the extent of such excess. As of November 2, 2024, the Company’s borrowing base was $1.123 billion, and it had no borrowings outstanding under the ABL Facility.
The ABL Facility supports the Company’s letter of credit program. The Company had $10 million of outstanding letters of credit as of November 2, 2024 that reduced its availability under the ABL Facility. As of November 2, 2024, the Company’s availability under the ABL Facility was $740 million.
As of November 2, 2024, the ABL Facility fees related to committed and unutilized amounts were 0.30% per annum, and the fees related to outstanding letters of credit were 1.25% per annum. In addition, the interest rate on outstanding U.S. dollar borrowings was the Term Secured Overnight Financing Rate plus 1.25% and a credit spread adjustment of 0.10% per annum.
The ABL Facility requires the Company to maintain a fixed charge coverage ratio of not less than 1.00 to 1.00 during an event of default or any period commencing on any day when specified excess availability is less than the greater of (i) $70 million or (ii) 10% of the maximum borrowing amount. As of November 2, 2024, the Company was not required to maintain this ratio.
8. Fair Value Measurements
Cash and Cash Equivalents include cash on hand, deposits with financial institutions and highly liquid investments with original maturities of less than 90 days. The Company’s Cash and Cash Equivalents are considered Level 1 fair value measurements as they are valued using unadjusted quoted prices in active markets for identical assets.
The following table provides a summary of the principal value and estimated fair value of the Company’s outstanding debt as of November 2, 2024, February 3, 2024 and October 28, 2023:
November 2, 2024
February 3, 2024
October 28, 2023
(in millions)
Principal Value
$
4,230
$
4,430
$
4,542
Fair Value, Estimated (a)
4,273
4,456
4,122
_______________
(a)The estimated fair value of the Company’s debt is based on reported transaction prices, which are considered Level 2 inputs in accordance with Accounting Standards Codification 820, Fair Value Measurement. The estimates presented are not necessarily indicative of the amounts that the Company could realize in a current market exchange.
Management believes that the carrying values of the Company’s Accounts Receivable, Accounts Payable and Accrued Expenses approximate their fair values because of their short maturities.
The Company is subject to various claims and contingencies related to lawsuits, taxes, insurance, regulatory and other matters arising in the ordinary course of business. Actions filed against the Company from time to time may include commercial, tort, intellectual property, tax, customer, employment, wage and hour, data privacy, securities, anti-corruption and other claims, including purported class action lawsuits. Management believes that the ultimate liability arising from such claims and contingencies, if any, is not likely to have a material adverse effect on the Company’s results of operations, financial condition or cash flows.
我們已審閱了Bath & Body Works, Inc.（以下簡稱「公司」）截至2024年11月2日和2023年10月28日的附屬綜合資產負債表，截至2024年11月2日和2023年10月28日的相關綜合收益、全面收益和總股本（赤字）的合併利潤表，以及截至2024年11月2日和2023年10月28日的十三週和三十九週期的合併現金流量表，以及相關附註（統稱爲「合併中期財務報表」）。根據我們的審閱，我們不知道應該對合並中期財務報表進行任何重大修改，以使其符合美國通行的會計準則。
We caution that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this report or made by our Company or our management involve risks and uncertainties and are subject to change based on various factors, many of which are beyond our control. Accordingly, our future performance and financial results may differ materially from those expressed or implied in any such forward-looking statements. Words such as “estimate,” “project,” “plan,” “believe,” “expect,” “anticipate,” “intend,” “planned,” “potential,” “target,” “goal” and any similar expressions may identify forward-looking statements. Risks associated with the following factors, among others, in some cases have affected and, in the future, could affect our financial performance and actual results and could cause actual results to differ materially from those expressed or implied in any forward-looking statements included in this report or otherwise made by the Company or our management:
•general economic conditions, inflation, consumer confidence, consumer spending patterns and market disruptions including pandemics or significant health hazards, severe weather conditions, natural disasters, terrorist activities, financial crises, political crises or other major events, or the prospect of these events;
•the seasonality of our business;
•our ability to attract, develop and retain qualified associates and manage labor-related costs;
•difficulties arising from turnover in Company leadership or other key positions;
•the dependence on store traffic and the availability of suitable store locations on appropriate terms;
•our continued growth in part through new store openings and existing store remodels and expansions;
•our ability to successfully operate and expand internationally and related risks;
•our independent franchise, license, wholesale and other distribution-related partners;
•our direct channel business;
•our ability to protect our reputation and our brand image;
•our ability to attract customers with marketing, advertising, promotional programs and our loyalty program;
•our ability to maintain, enforce and protect our trade names, trademarks and patents;
•the highly competitive nature of the retail industry and the segments in which we operate;
•consumer acceptance of our products and our ability to manage the life cycle of our brand, develop new merchandise and launch and expand new product lines successfully;
•our ability to source, distribute and sell goods and materials on a global basis, including risks related to:
•political instability, wars and other armed conflicts, environmental hazards or natural disasters;
•significant health hazards or pandemics, which could result in closed factories and/or stores, reduced workforces, scarcity of raw materials, and scrutiny or embargoing of goods produced in impacted areas;
•duties, taxes and other charges;
•legal and regulatory matters;
•volatility in currency exchange rates;
•local business practices and political issues;
•delays or disruptions in shipping and transportation and related pricing impacts;
•disruption due to labor disputes; or
•changing expectations regarding product safety due to new legislation;
•our ability to successfully complete environmental, social and governance initiatives, and associated costs thereof;
•the geographic concentration of third-party manufacturing facilities and our distribution facilities in central Ohio;
•our reliance on a limited number of suppliers to support a substantial portion of our inventory purchasing needs;
•the ability of our vendors to deliver products in a timely manner, meet quality standards and comply with applicable laws and regulations;
•the spin-off of Victoria’s Secret may not be tax-free for U.S. federal income tax purposes;
•fluctuations in foreign currency exchange rates;
•fluctuations in product input costs;
•fluctuations in energy costs;
•our ability to adequately protect our assets from loss and theft;
We are focused on enhancing our operational excellence and efficiency by targeting an aggregate of $300 million of planned annual cost savings across both Gross Profit and General, Administrative and Store Operating Expenses, which is up $20 million from our previous expectations. We delivered approximately $150 million of annual cost reductions as part of this initiative in fiscal 2023, and now expect approximately $150 million in additional annual cost savings in fiscal 2024. Our cost optimization work delivered approximately $35 million and $115 million in cost savings in the third quarter of and year-to-date 2024, respectively.
Outlook
As we look ahead to the fourth quarter, the market remains competitive with a value conscious consumer. Our strategic priorities are focused on driving revenue growth through our core categories, supported by newness and innovation to create customer demand and convey the quality and value of our products. We are also focused on extending our reach by expanding and diversifying our product portfolio through category adjacencies, including men’s, hair, lip, and laundry, and expansion of off-mall stores and international geographies. We are continuing to invest in marketing, loyalty and in foundational tools and systems enabling new capabilities that we believe will increase customer engagement and provide a more seamless and convenient cross-channel shopping experience. We also continue to focus on enhancing operational excellence and efficiency through the cost optimization discussed above, which will support our strategic priorities.
Adjusted Financial Information
In addition to our results provided in accordance with GAAP above and throughout this Quarterly Report on Form 10-Q, provided below are non-GAAP measures that present Net Income and Net Income Per Diluted Share for the third quarters of and year-to-date 2024 and 2023 on an adjusted basis to remove certain items. We believe that these items are not indicative of our operations due to their size and nature.
We use adjusted financial information as key performance measures for the purpose of evaluating performance internally. These non-GAAP measures are not intended to replace the presentation of our financial results in accordance with GAAP. Instead, we believe that the presentation of adjusted financial information provides additional information to investors to facilitate the comparison of past and present operations. Further, our definitions of adjusted financial information may differ from similarly titled measures used by other companies.
(a)Sales per average selling square foot and sales per average store, which are indicators of store productivity, are calculated based on store sales for the period divided by the average, including the beginning and end of period, of total selling square footage and store count, respectively.
The following table represents Company-operated store data for year-to-date 2024:
For the third quarter of 2024, our Interest Expense was $77 million, compared to $84 million in the third quarter of 2023. The decrease was due to lower average daily borrowings which were driven by the repurchase and early extinguishment of outstanding notes and lower average borrowing rate.
Other Income
For the third quarter of 2024, our Other Income was $4 million, compared to $22 million in the third quarter of 2023. The decrease was primarily due to a $12 million pre-tax gain on the repurchase and early extinguishments of outstanding notes in the third quarter of 2023 and lower interest income on invested cash in the third quarter of 2024.
The February 2022 Program had no remaining authority as of May 4, 2024. There were share repurchases of $1 million reflected in Accounts Payable on the February 3, 2024 and October 28, 2023 Consolidated Balance Sheets.
2024 Share Repurchase Program
In January 2024, our Board authorized a new $500 million share repurchase program (the “January 2024 Program”). Under the January 2024 Program, we repurchased the following shares of our common stock during year-to-date 2024:
Repurchase Program
Shares Repurchased
Amount Repurchased
Average Stock Price
(in thousands)
(in millions)
January 2024
8,121
$
309
$
38.05
The January 2024 Program had $191 million of remaining authority as of November 2, 2024. There were share repurchases of $1 million reflected in Accounts Payable on the November 2, 2024 Consolidated Balance Sheet.
Dividend Policy and Procedures
Our Board will determine future dividends after giving consideration to our levels of profit and cash flow, capital requirements, current and forecasted liquidity, the restrictions placed upon us by our borrowing arrangements as well as financial and other conditions existing at the time. We use cash flow generated from operating and financing activities to fund our dividends.
During the third quarter of and year-to-date 2023, we repurchased in the open market and extinguished $174 million and $373 million principal amounts of our outstanding senior notes, respectively. The aggregate repurchase price for these notes were $161 million and $343 million for the third quarter of and year-to-date 2023, respectively, resulting in pre-tax gains of $12 million and $28 million, including the write-off of unamortized issuance costs, during the third quarter of and year-to-date 2023, respectively. These gains are included in Other Income in the 2023 Consolidated Statements of Income.
Certain of our subsidiaries, which are listed on Exhibit 22 to this Quarterly Report on Form 10-Q, have guaranteed our obligations under the 2025 Notes, 2027 Notes, 2028 Notes, 2029 Notes, 2030 Notes, 2035 Notes and 2036 Notes (collectively, the “Notes”).
The Notes have been issued by Bath & Body Works, Inc. (the “Parent Company”). The Notes are its senior unsecured obligations and rank equally in right of payment with all of our existing and future senior unsecured obligations, are senior to any of our future subordinated indebtedness, are effectively subordinated to all of our existing and future indebtedness that is secured by a lien and are structurally subordinated to all existing and future obligations of each of our subsidiaries that do not guarantee the Notes.
There have been no material changes to the critical accounting policies and estimates disclosed in our 2023 Annual Report on Form 10-K.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Market Risk
The market risk inherent in our financial instruments represents the potential loss in fair value, earnings or cash flows arising from adverse changes in foreign currency exchange rates or interest rates. We may use derivative financial instruments like foreign currency forward contracts, cross-currency swaps and interest rate swap arrangements to manage exposure to market risks. We do not use derivative financial instruments for trading purposes.
Foreign Exchange Rate Risk
Our Canadian dollar denominated earnings are subject to exchange rate risk as substantially all our merchandise sold in Canada is sourced through U.S. dollar transactions. Although we utilize foreign currency forward contracts to partially offset risks associated with our operations in Canada, these measures may not succeed in offsetting all the short-term impact of foreign currency rate movements and generally may not be effective in offsetting the long-term impact of sustained shifts in foreign currency rates.
Further, although our royalty arrangements with our international partners are denominated in U.S. dollars, the royalties we receive in U.S. dollars are calculated based on sales in the local currency. As a result, our royalties in these arrangements are exposed to foreign currency exchange rate fluctuations.
Our investment portfolio primarily consists of interest-bearing instruments that are classified as cash and cash equivalents based on their original maturities. Our investment portfolio is maintained in accordance with our investment policy, which specifies permitted types of investments, specifies credit quality standards and maturity profiles and limits credit exposure to any single issuer. The primary objectives of our investment activities are the preservation of principal, the maintenance of liquidity and the maximization of interest income while minimizing risk. Our investment portfolio is primarily composed of U.S. government obligations, U.S. Treasury and AAA-rated money market funds, commercial paper and bank deposits. Given the short-term nature and quality of investments in our portfolio, we do not believe there is any material risk to principal associated with increases or decreases in interest rates.
All of our outstanding debt as of November 2, 2024 has fixed interest rates. We will from time to time adjust our exposure to interest rate risk by entering into interest rate swap arrangements. Our exposure to interest rate changes is limited to the fair value of the debt issued, which would not have a material impact on our earnings or cash flows.
Fair Value of Financial Instruments
The following table provides a summary of the principal value and estimated fair value of our outstanding debt as of November 2, 2024, February 3, 2024 and October 28, 2023:
November 2, 2024
February 3, 2024
October 28, 2023
(in millions)
Principal Value
$
4,230
$
4,430
$
4,542
Fair Value, Estimated (a)
4,273
4,456
4,122
_______________
(a) The estimated fair values are based on reported transaction prices and are not necessarily indicative of the amounts that we could realize in a current market exchange.
As of November 2, 2024, we believe that the carrying values of our Accounts Receivable, Accounts Payable and Accrued Expenses approximate their fair values because of their short maturities.
Concentration of Credit Risk
We maintain cash and cash equivalents and derivative contracts with various major financial institutions. We monitor the relative credit standing of financial institutions with whom we transact and limit the amount of credit exposure with any one entity. Our investment portfolio is primarily composed of U.S. government obligations, U.S. Treasury and AAA-rated money market funds, commercial paper and bank deposits. We also periodically review the relative credit standing of franchise, license and wholesale partners and other entities to which we grant credit terms in the normal course of business.
Item 4. CONTROLS AND PROCEDURES
Evaluation of disclosure controls and procedures. As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that as of the end of the period covered by this report, our disclosure controls and procedures were effective and designed to ensure that information required to be disclosed by us in reports we file or submit under the Exchange Act is (1) recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission (“SEC”) rules and forms, and (2) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
Changes in internal control over financial reporting. There were no changes in our internal control over financial reporting that occurred in the third quarter of 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
We are a defendant in a variety of lawsuits arising in the ordinary course of business. Actions filed against the Company from time to time may include commercial, tort, intellectual property, tax, customer, employment, wage and hour, data privacy, securities, anti-corruption and other claims, including purported class action lawsuits. Although it is not possible to predict with certainty the eventual outcome of any litigation, in the opinion of management, our current legal proceedings are not expected to have a material adverse effect on our results of operations, financial condition or cash flows.
Fair and Accurate Credit Transactions Act Cases
We were named as a defendant in two putative class actions: Smidga, et al. v. Bath & Body Works, LLC in the Allegheny County, Pennsylvania Court of Common Pleas and Dahlin v. Bath & Body Works, LLC in the Santa Barbara County, California Superior Court. The complaints each alleged that we violated the Fair and Accurate Credit Transactions Act by printing more than the last five digits of credit or debit card numbers on customers’ receipts and, among other things, sought statutory damages, attorneys’ fees and costs. We reached an agreement with the plaintiffs in these cases that resolves both matters. The cases were consolidated in the Allegheny County, Pennsylvania Court of Common Pleas, which issued final approval of the settlement on October 24, 2024. The resolution of these claims had no material adverse effect on our results of operations, financial condition or cash flows.
Item 1A. RISK FACTORS
The risk factors that affect our business and financial results are discussed in Item 1A. Risk Factors in our 2023 Annual Report on Form 10-K. We wish to caution the reader that the risk factors discussed in Item 1A. Risk Factors in our 2023 Annual Report on Form 10-K and those described elsewhere in this report or other SEC filings could cause actual results to differ materially from those stated in any forward-looking statements.
Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
The following table provides the repurchases of our common stock during the third quarter of 2024:
Fiscal Period
Total Number of Shares Purchased (a)
Average Price Paid per Share (b)
Total Number of Shares Purchased as Part of Publicly Announced Programs (c)
Maximum Number of Shares (or Approximate Dollar Value) that May Yet be Purchased Under the Programs (c)
(in thousands)
(in thousands)
August 2024
1,417
$
32.60
1,413
$
243,750
September 2024
1,223
29.14
1,220
208,192
October 2024
569
30.32
567
190,985
Total
3,209
3,200
_______________
(a)The total number of shares repurchased includes shares repurchased as part of publicly announced programs, with the remainder relating to shares in connection with tax payments due upon vesting of associate restricted share and performance share unit awards and the use of our stock to pay the exercise price on associate stock options.
(b)The average price paid per share includes any broker commissions.
(c)For additional share repurchase program information, see Note 3, “Net Income Per Share and Shareholders’ Equity (Deficit)” included in Part I, Item 1. Financial Statements.
Item 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
Item 4. MINE SAFETY DISCLOSURES
Not applicable.
Item 5. OTHER INFORMATION
Securities Trading Plans of Directors and Executive Officers
None of our directors or executive officers adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement” (as such terms are defined in Item 408(c) of Regulation S-K) during the third quarter of 2024.