Posted By: John Steele

COLUMBUS, Ohio - Limited Brands Inc. on Wednesday posted a profit in the third quarter, driven by strong sales at its Victoria's Secret and Bath & Body Works stores that have been opened at least a year.
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Limited Brands also said it was buying La Senza Corp., an intimate apparel retailer based in Canada, for $628 million.

Limited Brands reported a profit of $23.5 million, or 6 cents per share, for the quarter ended Oct. 28 compared to a loss of $683,000, or 0 cents per share, last year. Sales rose 12 percent to $2.1 billion from $1.9 billion a year ago.

Analysts surveyed by Thomson Financial expected earnings of 7 cents a share on revenue of $2.1 billion.

Same-store sales, considered a key indicator of a retailer's strength, rose 10 percent in the quarter, driven by a 17 percent increase at Victoria's Secret and 15 percent at Bath & Body Works.

The report was released after the stock market closed. Limited Brands shares fell 22 cents to $31.78 in trading Wednesday on the New York Stock Exchange. It reached a new 52-week high of $32.60 during the session. The shares have traded as low as $20.65 in the past year.

For the year to date, Limited Brand said it made $236 million, or 59 cents a share, compared with profit of $164 million, or 36 cents a share, a year ago. Same-store sales rose 7 percent and overall sales totaled $6.6 billion compared with $6.2 billion last year.

Limited Brands said it expects to make $1.07 to $1.14 per share in the fourth quarter. Analysts were looking for profits of $1.14 a share.

La Senza shareholders will receive $42.41 for each share they own, a 48 percent premium from the closing price of $28.74 on Wednesday on the Toronto Stock Exchange.

La Senza owns and operates 318 stores in Canada and licenses the operations of 327 stores in 34 other countries.

"La Senza is a great strategic fit with our intimate apparel business, and their international infrastructure, real estate expertise, and operating model will also be great assets to us as we look to enhance our capabilities to meet our strategic growth initiatives internationally," said Leslie Wexner, Limited Brands' chairman and chief executive.

La Senza officials said no changes in leadership or management of the stores is expected.

"Given our companies' similar characteristics, we believe Limited Brands, together with Victoria's Secret, are ideal partners for us," said Irv Teitelbaum, the company's chairman and chief executive. "This combination represents a major strategic step forward enabling us to continue to further pursue La Senza's growth opportunities."

Limited Brands operates 3,534 stores under the names of Victoria's Secret, Bath & Body Works, C.O. Bigelow, Express, Limited Stores, White Barn Candle Co., Henri Bendel and Diva London.

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On the Net:

Limited Stores: http:http://www.limitedbrands.com

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