L Brands Inc. shares LB, +2.01% jumped 4.4% in premarket trade Friday, after the parent of Victoria’s Secret unveiled plans to pay down debt, reinstate its dividend and buy back shares, while raising guidance for the first quarter. The company said it plans to repay $1.03 billion of debt using $1.1 billion of cash on hand. It also announced a new $500 million share buyback plan that will replace the existing program which has $79 million remaining on it. The company will reinstate its annual dividend of 60 cents a share, starting with the quarterly dividend to be paid in June. “L Brands took a series of actions throughout 2020 to improve financial and operational performance, which led to record third and fourth quarter results, increased liquidity, and a year-end cash balance of $3.9 billion,” said Sarah Nash, chair of the board, in a statement. L Brands is now expecting first-quarter per-share earnings to range from 55 cents to 65 cents, up from prior guidance of 35 cents to 45 cents. The FactSet consensus is for 43 cents. Shares have gained 253% in the last 12 months, while the S&P 500 SPX, +1.04% has gained 59%.
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