On this page of StockholderLetter.com we present the latest annual shareholder letter from Bath & Body Works, Inc. — ticker symbol BBWI. Reading current and past BBWI letters to shareholders can bring important insights into the investment thesis.

 •  5/15/2024 Letter Continued (Full PDF)
 •  4/18/2023 BBWI Stockholder Letter
 •  More "Specialty Retail" Category Stockholder Letters
 •  BBWI Benford's Law Stock Score = 50

BBWI Shareholder/Stockholder Letter Transcript:

Proxy Statement for the 2024 Annual Meeting of
Shareholders and 2023 Annual Report

We make the world a brighter, happier place
through the power of fragrance.
Home of America   s Favorite Fragrances  , Bath & Body Works is a global leader in personal
care and home fragrance, including top-selling collections for fine fragrance mist, body lotion
and body cream, 3-wick candles, home fragrance diffusers and liquid hand soap. Powered by
agility and innovation, our predominantly U.S.-based supply chain enables us to deliver quality,
on-trend luxuries at affordable prices. Bath & Body Works serves and delights customers
however and wherever they want to shop, from welcoming, in-store experiences at 1,850
company-operated Bath & Body Works locations in the U.S. and Canada and more than 480
international franchised locations to an online storefront at bathandbodyworks.com.

Dear Fellow Shareholders,
In 2023, Bath & Body Works made meaningful progress
executing on the five key growth drivers established by the
leadership team to focus on elevating the brand and product,
extending the Company   s reach, deepening engagement with
customers, enabling a seamless omnichannel experience and
enhancing operational excellence.
In addition, in 2023, we were proud to be named one of
America   s Greatest Workplaces for diversity, LGBTQ+
individuals, veterans, and women by Newsweek, a Diversity
First Top 50 Company by the Diversity Research Institute, and
one of the Best Managed Companies by The Wall Street
Journal.
As a Board, we are focused on enabling the Company   s
transformation and are deeply engaged with the leadership
team in overseeing the execution of the Company   s strategy.
The team made critical foundational investments in technology
and marketing, while at the same time remained focused on
operating efficiency and the implementation of cost reduction
initiatives that led to achieving savings ahead of plan.
Importantly, to help support long-term growth, the Company
continued its expansion into adjacent categories such as Men   s,
fragrant haircare, laundry and lip.
The feedback we receive during our year-round engagement
with shareholders informs our practices and policies, and we
are committed to responsive action. Indeed, during 2023, we
embarked on a comprehensive engagement process to better
understand our shareholders    perspectives on executive
compensation and took prompt action to address their
concerns. As we look ahead, we remain committed to engaging
with our shareholders on our areas of focus     whether it be our
growth strategy and execution, our capital allocation plan, or
our ESG priorities, maintaining an ongoing dialogue with
shareholders remains paramount.
At the same time, ensuring a balanced and thoughtful
allocation of capital is a responsibility our Board takes
seriously. After making investments in the business, Bath &
Body Works generated $656 million in free cash flow in fiscal
2023, allowing us to return cash to shareholders through our
quarterly dividend and share repurchases, as well as deleverage
our balance sheet through debt repurchases. At the end of
fiscal 2023, we had reduced our leverage ratio to 2.8x from
3.1x a year ago. In addition, we were pleased to pay
$182 million in dividends and repurchase 4.1 million shares of
common stock for $149 million during the year. Further, our
Board was pleased to recently authorize a new $500 million
share repurchase program.
Our Board is also committed to ensuring we have an optimal
Board structure and composition with the right mix of expertise,
backgrounds and tenures. We are continuing our focus on
governance enhancements through reduction in Board size and
rotation of Committee chairs. Following the annual meeting,
through Board refreshment in 2023 as well as directors who
have stepped down this year or have chosen not to stand for
re-election, our Board will have an average director tenure of
3.4 years. After these most recent changes, our Board will
consist of 10 directors, six of whom come from diverse
communities: female, people of color and/or LGBTQIA+.
Last year, we made continued strides in incorporating our
environmental, social and governance (   ESG   ) strategy into our
work to deliver long-term value and responsible growth. We
released our inaugural ESG report, which outlined our approach
to working toward our 2025 and 2030 ESG commitments,
focused on Engaged People, Thoughtful Products and Brighter
Places. The formalization of our ESG focus, strategy and
commitments followed an extensive ESG prioritization
assessment, which included research and engagement with key
stakeholders including associates across our business,
customers, suppliers, investors and nonprofits.
On behalf of the entire Board, I would like to thank our
dedicated teams around the world that allow us to deliver on
our purpose to make the world a brighter, happier place through
the power of fragrance. With our market leadership, world-class
team and continued progress against our growth drivers, the
Board remains confident in our ability to deliver for our
shareholders and all stakeholders in 2024.
Thank you for your continued support and investment in our
company. We ask for your voting support on the items
contained in this proxy statement, and appreciate you taking
the time to cast your vote.
Sincerely,
Sarah E. Nash
Board Chair
Bath & Body Works, Inc.


Dear Fellow Shareholders,
Having completed my first full year as Chief Executive Officer, I
am more excited than ever for the future of Bath & Body Works.
My confidence is based on our team   s impressive work in
building on our strong foundation as a global leader in personal
care and home fragrance at the intersection of consumer goods
and retail. Our loyal customer base, profitable fleet, growing
digital and omnichannel capabilities, vertically integrated
supply chain, and talented store associates have been drivers of
our success. In 2023, we made important investments in
product innovation, marketing and technology to build on these
strengths and drive progress toward our long-term growth and
profitability goals.
    We diversified our marketing efforts and launched a new
brand campaign entitled Come Back to Your Senses. We also
advanced our digital platforms to connect to our stores and
provide a more seamless experience to our customers. Now
that our technology systems are largely separated from
Victoria   s Secret, we are positioned to further strengthen
loyalty and personalized marketing and more efficiently grow
both sales and earnings.
    We delivered approximately $150 million in cost optimization
savings and increased our total annual cost savings target by
$50 million to $250 million to position the business for
additional operating margin expansion.
We were not immune to macroeconomic impacts on our
customers, especially the high inflation rates early in the year.
We also experienced the continuing post-pandemic
normalization within our candle and sanitizer categories.
Despite these headwinds, all of our product categories
outperformed expectations and our team delivered full-year net
sales and earnings per share that exceeded our guidance.
In addition to these highlights, we returned approximately
$330 million in capital to shareholders through our quarterly
dividend and share repurchase program, while also reducing our
debt leverage. We remain committed to a balanced and
thoughtful capital allocation strategy and strong shareholder
returns.
Our solid financial results in 2023 were driven by progress
against our long-term strategic priorities, which are aligned
behind what we call the five Es: elevating our brand and
product; engaging our customers; extending our reach; enabling
a seamless omnichannel experience; and enhancing our
operational efficiency. Our performance highlights include:
    We focused on product innovation, as well as upgrading our
formulations, packaging and merchandising. We completed
the reformulation of our hand soaps and body care, which are
now made without parabens and sulfates. We also launched
our foaming soap refills in recyclable cartons.
    We expanded further into adjacent categories. Our Men   s
business continued its strong growth. We introduced fragrant
haircare products, with the offering attracting new customers
to our brand. In addition, we expanded our lip assortment
and piloted our laundry line with many of our bestselling
fragrances at a limited number of stores and online. We plan
to complete the rollout of our lip products to all North
American stores by mid-2024 and bring our laundry offering
to our entire U.S. store fleet by fall of this year.
    We celebrated the one-year anniversary of our loyalty
program, and we exited 2023 with approximately 37 million
active members. We continue to increase engagement with
our loyalty members, including by offering impactful
members-only experiences.
As a result of our efforts through the past year, we are entering
2024 with solid fundamentals. Our team will continue to move
with focus and speed to deliver on our strategic priorities and
make continued progress toward our long-term targets of
$10 billion of net sales and 20% operating income margin.
I am confident our best days are ahead of us, and I look forward
to working with my colleagues at Bath & Body Works to deliver
strong and sustainable value creation for shareholders.
Thank you for your investment and your continued support.
Sincerely,
Gina R. Boswell
Chief Executive Officer
Bath & Body Works, Inc.



 5/15/2024 Letter Continued (Full PDF)