Victoria's Secret's losses continue to plague parent company L Brands (NYSE:LB). Company sales decreased 37% in the first quarter, which ended May 2.

A company divided

L Brands' portfolio includes Victoria's Secret and its sister brand, Pink, as well as Bath and Body Works. The latter has performed well, while the former keeps pulling it down.

In the first quarter of 2020, Bath and Body Works comps increased 41% while Victoria's Secret comps fell 13%. Total company comps rose 4% as a result. Bath and Body Works comps increased 20% in the period before stores were closed on March 17, and the direct business, which remained open, increased 85%.

Bath and Body Works Store.

Image source: L Brands.

Adjusted net loss was $275.2 million and adjusted loss per share was $0.99. Adjustments were related to impairment charges and tax benefits.

The company said it was working to create a "pure-play" public company from Bath and Body Works while separating Victoria's Secret and Pink into a stand-alone company. There are currently 1,070 company-owned Victoria's Secret stores and 1,737 company-owned Bath and Body Works stores. Beyond that, the company did not offer second-quarter guidance.

A new strategy

On May 4, L Brands announced the termination of an agreement with Sycamore Partners to buy a majority stake in Victoria's Secret. Sycamore Partners had tried to back out of the agreement after the rise of the COVID-19 pandemic, and L Brands ultimately settled with the firm. Of the settlement, board chair Sarah Nash said it was best to "focus our efforts entirely on navigating this environment to address those challenges and positioning our brands for success rather than engaging in costly and distracting litigation to force a partnership with Sycamore."