Victoria’s Secret has announced the appointment of John Mehas, formerly of shoe maker Tory Burch, as its new chief executive.
Mehas is due to take up the role in early January 2019 and will replace Jan Singer, the former Spanx chief executive who announced her departure last week after two years.
The announcement, made yesterday, came alongside news that the struggling lingerie retailer would also slash its dividend in half to $1.20, sending share prices dropping as much as six per cent in after hours trading on Monday.
The $325 million (£253 million) freed up by the dividend cut will reportedly be used to pay outstanding debts, with liabilities totalling $8.74 billion (£6.8 billion) at the end of the previous quarter.
In the three months to November 3, Victoria Secret’s parent company L Brands revealed plummeting profits, seeing a loss of $42.3 million (£32.9 million) compared to a profit of $86 million (£66.9 million) a year earlier.
Total sales were in line with predictions, growing six per cent to $2.77 billion (£2.1 billion), while it lifted its earnings guidance for the full year to between $2.60 and $2.80 per share, up from $2.45 to $2.70 and well above analysts’ forecasts.
“I am confident that, under John’s leadership, Victoria’s Secret Lingerie, the world’s leading lingerie brand, will continue to be a powerhouse and will deliver products and experiences that resonate with women around the globe,” L Brands boss Leslie Wexner said.
“Our number one priority is improving performance at Victoria’s Secret Lingerie and Pink.
“In doing so, our new leaders are coming in with a fresh perspective and looking at everything… our marketing, brand positioning, internal talent, real estate portfolio and cost structure.”
For the past few years, the once-dominant lingerie brand has come under scrutiny from consumers and investors alike, seeing its stock price drop 39 per cent in the year to date, alongside a two per cent drop in like-for-like sales in its latest quarter.
As consumer sentiment has largely shifted towards more body-inclusive lingerie brands like Rhianna’s Savage X Fenty, Victoria’s Secret has struggled to move along with it.