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INTIMATE BRANDS INC
10-Q, 2000-06-09
APPAREL & ACCESSORY STORES

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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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FORM 10-Q

/x/	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 29, 2000
OR
/ /	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                to

Commission file number 1-13814

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INTIMATE BRANDS, INC.
(Exact name of registrant as specified in its charter)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes /x/  No / /

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

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INTIMATE BRANDS, INC.
TABLE OF CONTENTS

				Page No.
Part I. Financial Information
	Item 1. Financial Statements
		Consolidated Statements of Income Thirteen Weeks Ended April 29, 2000 and May 1, 1999		3
		Consolidated Balance Sheets April 29, 2000, January 29, 2000 and May 1, 1999		4
		Consolidated Statements of Cash Flows Thirteen Weeks Ended April 29, 2000 and May 1, 1999		5
		Notes to Consolidated Financial Statements		6
	Item 2. Management's Discussion and Analysis of Results of Operations and Financial Condition			11
Part II. Other Information
	Item 1. Legal Proceedings			16
	Item 4. Submission of Matters to a Vote of Security Holders			16
	Item 5. Other Information			16
	Item 6. Exhibits and Reports on Form 8-K			17

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PART I—FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

INTIMATE BRANDS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Thousands except per share amounts)
(Unaudited)

				Thirteen Weeks Ended
				April 29, 2000			May 1, 1999
Net sales				$	1,012,252		$	877,821
Costs of goods sold and buying and occupancy costs					(627,878	)		(551,229	)
Gross income					384,374			326,592
General, administrative and store operating expenses					(268,103	)		(231,898	)
Operating income					116,271			94,694
Interest expense					(5,350	)		(8,864	)
Other income					2,259			1,976
Income before income taxes					113,180			87,806
Provision for income taxes					45,300			35,100
Net income				$	67,880		$	52,706
Net income per share:
	Basic			$	0.14		$	0.10
	Diluted			$	0.13		$	0.10
Dividends per share				$	0.070		$	0.067

The accompanying Notes are an integral part of these Consolidated Financial Statements.

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INTIMATE BRANDS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Thousands)

				April 29, 2000			January 29, 2000			May 1, 1999
				(Unaudited)						(Unaudited)
ASSETS
Current assets:
	Cash and equivalents			$	13,025		$	76,373		$	15,472
	Accounts receivable				17,098			18,135			16,819
	Inventories				644,412			583,469			524,754
	Other				96,642			93,935			89,832
Total current assets					771,177			771,912			646,877
Property and equipment, net					445,462			449,043			404,890
Other assets					122,967			124,036			81,739
Total assets				$	1,339,606		$	1,344,991		$	1,133,506
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
	Accounts payable			$	99,034		$	102,446		$	76,700
	Current portion of long-term debt				150,000			150,000			100,000
	Accrued expenses				202,759			248,729			207,704
	Payable to The Limited, Inc.				121,811			23,741			159,177
	Income taxes				36,480			128,845			28,273
Total current liabilities					610,084			653,761			571,854
Long-term debt					100,000			100,000			250,000
Deferred income taxes					816			816			3,692
Other long-term liabilities					47,497			45,683			42,050
Shareholders' equity:
	Common stock				5,305			2,646			2,527
	Paid-in capital				1,213,555			1,217,806			670,723
	Retained earnings (deficit)				(80,083	)		(113,067	)		128,625
					1,138,777			1,107,385			801,875
Less: treasury stock, at average cost					(557,568	)		(562,654	)		(535,965	)
Total shareholders' equity					581,209			544,731			265,910
Total liabilities and shareholders' equity				$	1,339,606		$	1,344,991		$	1,133,506

The accompanying Notes are an integral part of these Consolidated Financial Statements.

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INTIMATE BRANDS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Thousands)
(Unaudited)

					Thirteen Weeks Ended
					April 29, 2000			May 1, 1999
Operating activities:
	Net income				$	67,880		$	52,706
	Adjustments to reconcile net income to net cash used for operating activities:
		Depreciation and amortization				27,176			27,159
		Change in assets and liabilities:
			Inventories			(60,943	)		(44,858	)
			Accounts payable and accrued expenses			(49,382	)		(41,952	)
			Income taxes			(92,365	)		(84,909	)
			Other assets and liabilities			(159	)		(5,004	)
Net cash used for operating activities						(107,793	)		(96,858	)
Investing activities:
	Capital expenditures					(22,223	)		(33,222	)
Financing activities:
	Dividends paid					(34,896	)		(33,577	)
	Repurchase of common stock					—			(365,212	)
	Change in payable to The Limited, Inc.					98,070			153,317
	Stock options and other					3,494			3,250
Net cash provided by (used for) financing activities						66,668			(242,222	)
Net decrease in cash and equivalents						(63,348	)		(372,302	)
Cash and equivalents, beginning of year						76,373			387,774
Cash and equivalents, end of period					$	13,025		$	15,472

The accompanying Notes are an integral part of these Consolidated Financial Statements.

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INTIMATE BRANDS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1. Basis of Presentation

    Intimate Brands, Inc. (the Company) includes specialty retail and catalogue operations, which offer women's intimate and other apparel, personal care products and accessories. The Company consists of Victoria's Secret Stores, Victoria's Secret Catalogue, Bath & Body Works, and Gryphon Development (Gryphon). The Limited, Inc. owns 84.1% of the outstanding common stock of the Company.

    The consolidated financial statements include the accounts of the Company and all significant subsidiaries which are more than 50 percent owned and controlled. All significant intercompany balances and transactions have been eliminated in consolidation.

    The consolidated financial statements as of and for the periods ended April 29, 2000 and May 1, 1999 are unaudited and are presented pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, these consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company's 1999 Annual Report on Form 10-K. In the opinion of management, the accompanying consolidated financial statements reflect all adjustments necessary to present fairly the financial position and results of operations and cash flows for the interim periods, but are not necessarily indicative of the results of operations for a full fiscal year.

    The consolidated financial statements as of and for the periods ended April 29, 2000 and May 1, 1999 included herein have been reviewed by the independent public accounting firm of PricewaterhouseCoopers LLP and the report of such firm follows the Notes to Consolidated Financial Statements.

2. Shareholders' Equity and Earnings Per Share

    On May 2, 2000, the Company announced a two-for-one stock split ("split") in the form of a stock dividend to stockholders of record on May 12, 2000 and payable on May 30, 2000. Par value of the common stock will remain $0.01 per share.

    The effect of the stock split has been recognized retroactively in shareholder's equity on the consolidated balance sheet as of April 29, 2000, and in all share and per share data throughout this report. Shareholders' equity has been restated to reflect the reclassification of an amount equal to the par value of the increase in issued common shares ($2.7 million) from paid in capital to the common stock.

    Weighted average common shares outstanding (thousands):

    The computation of earnings per diluted share excludes options with an exercise price that was greater than the average market price of the common shares. In 2000, the excluded options totaled

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4.0 million of common stock that were outstanding at quarter-end. There were no excluded options for the same period in 1999.

3. Inventories

    The fiscal year of the Company and its subsidiaries is comprised of two principal selling seasons: spring (the first and second quarters) and fall (the third and fourth quarters). Valuation of finished goods inventories is based principally upon the lower of average cost or market determined on a first-in, first-out basis utilizing the retail method. Inventory valuation at the end of the first and third quarters reflects adjustments for inventory markdowns and shrinkage estimates for the total selling season.

4. Property and Equipment, Net

    Property and equipment, net, consisted of (thousands):

5. Income Taxes

    The Company is included in The Limited's consolidated Federal and certain state income tax groups for income tax purposes and is responsible for its proportionate share of income taxes calculated upon its Federal taxable income at a current estimate of the annual consolidated effective tax rate. Income taxes paid to The Limited during the thirteen weeks ended April 29, 2000 and May 1, 1999 approximated $137.7 million and $120.0 million.

6. Long-term Debt

    Long-term debt consists of notes which represent the Company's proportionate share of certain long-term debt of The Limited. The interest rates and maturities of the notes parallel those of the corresponding debt of The Limited.

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    Long-term debt consisted of (thousands):

    Interest paid during the thirteen weeks ended April 29, 2000 and May 1, 1999, including interest on the intercompany cash management account (see Note 7), approximated $10.7 million and $16.4 million.

7. Intercompany Relationship with the Parent

    The Limited provides various services to the Company including, but not limited to, store design and construction supervision, real estate management, travel and flight support and merchandise sourcing. To the extent expenditures are specifically identifiable they are charged to the Company. All other services-related costs not specifically attributable to an operating business have been allocated to the Company based upon various allocation methods. The Company and The Limited have entered into intercompany agreements which establish the provision of services in accordance with the terms described above.

    The Company participates in The Limited's centralized cash management system. Under this system cash received from the Company's operations is transferred to The Limited's centralized cash accounts and cash disbursements are funded from the centralized cash accounts on a daily basis. The intercompany cash management account is an interest-earning asset or interest-bearing liability of the Company. Interest on the intercompany cash management account is calculated based on the Federal Reserve AA Composite 30-day rate.

    The Company's proprietary credit card processing is performed by Alliance Data Systems which is approximately 31%-owned by The Limited.

    The Company and The Limited are parties to a corporate agreement under which the Company granted to The Limited a continuing option to purchase, under certain circumstances, additional shares of Class B Common Stock or shares of nonvoting capital stock of the Company. The Corporate Agreement further provides that, upon request of The Limited, the Company will use its best efforts to effect the registration of any of the shares of Class B Common Stock and nonvoting capital stock held by The Limited for sale.

8. Segment Information

    The Company identifies operating segments based on a business's operating characteristics. Reportable segments were determined based on similar economic characteristics, the nature of products and services, and the methods used to distribute products. The retail segment includes the store-based

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operations of Victoria's Secret Stores and Bath & Body Works and Gryphon. The Catalogue segment consists of the Victoria's Secret Catalogue operations. Sales outside the United States were not significant.

    Segment information for the thirteen weeks ended April 29, 2000 and May 1, 1999 follows (in thousands):

    In addition to its operating segments, management also focuses on Victoria's Secret as a brand. Sales of the Victoria's Secret brand grew 14% in the first quarter of 2000 and 10% in the first quarter of 1999 and totaled $702.9 million in 2000 and $616.8 million in 1999.

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Report of Independent Accountants

To the Board of Directors and
Shareholders of
Intimate Brands, Inc.

    We have reviewed the accompanying condensed consolidated balance sheets of Intimate Brands, Inc. and its subsidiaries (the "Company") as of April 29, 2000 and May 1, 1999, and the related condensed consolidated statements of income and cash flows for each of the thirteen-week periods ended April 29, 2000 and May 1, 1999. These financial statements are the responsibility of the Company's management.

    We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

    Based on our review, we are not aware of any material modifications that should be made to the accompanying condensed consolidated interim financial statements for them to be in conformity with generally accepted accounting principles.

    We previously audited in accordance with generally accepted auditing standards, the consolidated balance sheet as of January 29, 2000, and the related consolidated statements of income, shareholders' equity, and cash flows for the year then ended (not presented herein), and in our report dated February 16, 2000 we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of January 29, 2000, is fairly stated in all material respects in relation to the consolidated balance sheet from which it has been derived.

PricewaterhouseCoopers LLP
Columbus, Ohio
May 11, 2000, except for the information in Note 2 as to which the date is May 30, 2000.

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Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION

RESULTS OF OPERATIONS

    Net sales for the first quarter of 2000 were $1.0 billion, an increase of 15% from $877.8 million for the first quarter of 1999. Gross income increased 18% to $384.4 million from $326.6 million in 1999 and operating income increased 23% to $116.3 million from $94.7 million in 1999. Earnings per diluted share grew 30% to $0.13 per share, compared to $0.10 per share in 1999.

    Business highlights include the following:

•

Victoria's Secret strengthened its brand position with product introductions in the quarter and used all channels of distribution—stores, catalogue and e-commerce—to promote these products. Product initiatives included a relaunch of 'Body by Victoria,' the most successful launch in brand history and the introduction of Dream Angels Halo, the second new fragrance in the "Dream Angels" prestige fragrance collection. Victoria's Secret Stores' sales increased 18% to $499.1 million in 2000 with a comparable store sales increase of 14%. Operating profits grew 34%. Victoria's Secret Catalogue sales increased 5% to $203.8 million while operating profits grew 21%.



•

Bath & Body Works' sales increased 18% to $304.4 million, with a comparable store sales increase of 6%. Operating profits grew 19%. Overall, the brand experienced solid customer response to its new product offerings and continued strong sales of White Barn Candle Co. home fragrance products.



•

On May 2, 2000, the Company announced a two-for-one stock split of its outstanding common stock to shareholders of record as of May 12, 2000. All share and per share information throughout this report have been retroactively adjusted to reflect this split.



•

On May 2, 2000, the Company announced its intention to repurchase up to $200 million of its common stock on a proportionate basis from both the Company's public shareholders and The Limited, Inc.

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Financial Summary

    The following summarized financial data compares the thirteen week period ended April 29, 2000 to the comparable 1999 period:

				2000			1999			Change
Net Sales (millions):
Victoria's Secret Stores				$	499		$	423		18	%
Bath & Body Works					304			258		18	%
Other (principally Gryphon)					5			3		67	%
	Total retail sales				808			684		18	%
Victoria's Secret Catalogue					204			194		5	%
	Total net sales			$	1,012		$	878		15	%
Comparable Store Sales:
Victoria's Secret Stores					14	%		13	%
Bath & Body Works					6	%		13	%
	Total comparable store sales increase				11	%		13	%
Store Data:
Retail sales increase attributable to new and remodeled stores:
	Victoria's Secret Stores				4	%		4	%
	Bath & Body Works				12	%		13	%
Retail sales per average retail selling square foot:
	Victoria's Secret Stores			$	126		$	113		12	%
	Bath & Body Works			$	120		$	121		(1	%)
Retail sales per average store (thousands):
	Victoria's Secret Stores			$	558		$	504		11	%
	Bath & Body Works			$	247		$	239		3	%
Average store size at end of quarter (retail selling square feet):
	Victoria's Secret Stores				4,443			4,433		0	%
	Bath & Body Works				2,066			1,977		5	%
Retail selling square feet at end of quarter (thousands):
	Victoria's Secret Stores				3,972			3,764		6	%
	Bath & Body Works				2,582			2,177		19	%
Number of Stores:
Beginning of year					2,110			1,890
	Opened				38			61
	Closed				(4	)		(1	)
End of period					2,144			1,950

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			Number of Stores						Retail Selling Sq. Ft. (thousands)
			April 29, 2000		May 1, 1999		Change From Prior Period		April 29, 2000		May 1, 1999		Change From Prior Period
Victoria's Secret Stores			894		849		45		3,972		3,764		208
Bath & Body Works			1,250		1,101		149		2,582		2,177		405
Total stores and retail selling square feet			2,144		1,950		194		6,554		5,941		613

Net Sales

    Net sales for the first quarter of 2000 increased by 15% to $1.01 billion from $877.8 million in 1999. The increase was primarily due to an 11% increase in comparable store sales and the net addition of 194 new stores (613,000 retail selling square feet).

    In the first quarter of 2000, retail sales increased 18% to $808.5 million from $683.9 million a year ago. Bath & Body Works' sales increased 18% to $304.4 million. The sales increase was primarily attributable to the net addition of 149 new stores (405,000 retail selling square feet), as well as a 6% increase in comparable store sales. Victoria's Secret Stores' sales increased 18% to $499.1 million. The increase was primarily due to a 14% increase in comparable store sales, with the remaining increase coming from the addition of 45 new stores (208,000 retail selling square feet).

    Victoria's Secret Catalogue net sales for the first quarter of 2000 increased 5% to $203.8 million from $194.0 million a year ago. The sales increase was primarily driven by strength in the clothing category and positive intimate apparel sales.

Gross Income

    The first quarter of 2000 gross income rate, expressed as a percentage of net sales, increased to 38.0% from 37.2% for the same period in 1999. The majority of the rate increase was driven by a decrease in buying and occupancy costs. The buying and occupancy expense rate decrease was due to sales leverage at both Victoria's Secret Stores and Bath & Body Works, which together represented 79% of total Company net sales in 2000.

General, Administrative and Store Operating Expenses

    The general, administrative and store operating expense rate, expressed as a percentage of net sales, increased to 26.5% in the first quarter of 2000 from 26.4% for the same period in 1999. The slight rate increase was primarily due to national advertising investment for the Victoria's Secret brand.

Operating Income

    The operating income rate, expressed as a percentage of net sales, increased to 11.5% in the first quarter of 2000 from 10.8% in 1999. The improvement was primarily driven by the increase in gross income rate.

Interest Expense and Other Income

    The Company incurred $5.4 million in interest expense in the first quarter of 2000 compared to $8.9 million for the same period in 1999. Interest expense relates to term debt and the payable to The Limited, Inc. The decrease in interest expense is primarily due to the payment of $100 million in term debt in August 1999.

    The Company earned $2.3 million in other income in 2000 compared to $2.0 million for the same period in 1999. The other income was primarily interest income earned from excess net cash from

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operations managed through The Limited's centralized cash management system (see Note 7 to the Consolidated Financial Statements).

FINANCIAL CONDITION

    The Company's consolidated balance sheet as of April 29, 2000 provides evidence of financial strength and flexibility. A more detailed discussion of liquidity, capital resources and capital requirements follows.

Liquidity and Capital Resources

    Cash provided from operating activities and borrowings from The Limited, Inc. provide the resources to support operations, including projected growth, seasonal requirements and capital expenditures.

    A summary of the Company's working capital position and capitalization follows (thousands):

    Net cash used in operating activities totaled $107.8 million for the thirteen weeks ended April 29, 2000 versus $96.9 million for the same period in 1999. The increase in cash used for operations was primarily driven by an increase in inventories and decreases in accounts and income taxes payable.

    Investing activities were all for capital expenditures, which were primarily for new and remodeled stores.

    Financing activities included the quarterly cash dividend payment of $0.07 per share and a $98 million net increase in The Limited's intercompany cash management account payable (see Note 7 to the Consolidated Financial Statements).

    Non-cash financing activities include a two-for-one stock split in the form of a stock dividend to stockholders of record on May 12, 2000 and payable on May 30, 2000. Shareholders' equity has been restated as of April 29, 2000 to reflect the reclassification of an amount equal to the par value of the increase in issued common shares ($2.7 million) from paid in capital to the common stock.

    In addition, in May 2000, the Company announced authorization by its Board of Directors to repurchase up to $200 million of its common stock on a proportionate basis from both the open market and The Limited, Inc.

Capital Expenditures

    Capital expenditures, primarily for new and remodeled stores, totaled $22.2 million for the thirteen weeks ended April 29, 2000, compared to $33.2 million for the comparable period of 1999. The Company anticipates spending $260—$290 million in 2000 for capital expenditures, of which $225—$250 million will be for new stores, the relocation and expansion of existing stores and related improvements for the retail business.

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    The Company intends to add approximately 800,000 selling square feet in 2000, which will represent a 12% increase over year-end 1999. It is anticipated the increase will result from the addition of approximately 250 net new stores and the expansion of approximately 50 stores. The Company expects that capital expenditures will be funded principally by net cash provided by operating activities.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

    The Company cautions that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this Form 10-Q or made by management of the Company involve risks and uncertainties and are subject to change based on various important factors, many of which may be beyond the Company's control. Accordingly, the Company's future performance and financial results may differ materially from those expressed or implied in any such forward-looking statements. The following factors, among others, in some cases have affected and in the future could affect the Company's financial performance and actual results and could cause actual results for 2000 and beyond to differ materially from those expressed or implied in any forward-looking statements included in this Form 10-Q or otherwise made by management: changes in consumer spending patterns, consumer preferences and overall economic conditions, the impact of competition and pricing, changes in weather patterns, political stability, currency and exchange risks and changes in existing or potential duties, tariffs or quotas, postal rate increases and charges, paper and printing costs, availability of suitable store locations at appropriate terms, ability to develop new merchandise and ability to hire and train associates.

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PART II—OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

    The Company is a defendant in a variety of lawsuits arising in the ordinary course of business.

    On January 13, 1999, two complaints were filed against the Company's parent, The Limited, and one of its subsidiaries, as well as other defendants, including many national retailers. Both complaints relate to labor practices allegedly employed on the island of Saipan, Commonwealth of the Northern Mariana Islands, by apparel manufacturers unrelated to The Limited (some of which have sold goods to The Limited) and seek injunctions, unspecified monetary damages, and other relief. One complaint, on behalf of a class of unnamed garment workers, filed in the United States District Court for the Central District of California, Western Division, alleges violations of federal statutes, the United States Constitution, and international law. On April 12, 1999, a motion to dismiss that complaint for failure to state a claim upon which relief can be granted was filed, and it remains pending. On September 29, 1999, the United States District Court for the Central District of California, Western Division, transferred the case to the United States District Court for the District of Hawaii. The Limited, along with certain other defendants filed a petition for a writ of mandamus from the Ninth Circuit Court of Appeals seeking an order holding that the transfer of the case to the United States District Court for the District of Hawaii was in error and ordering that the case be transferred to the United States District Court on Saipan. That petition has been denied. A first amended complaint was filed on April 28, 2000, which adds additional defendants but does not otherwise substantively alter the claims alleged or relief sought. The second complaint, filed by a national labor union and other organizations in the Superior Court of the State of California, San Francisco County, and which alleges unfair business practices under California law, remains pending.

    Although it is not possible to predict with certainty the eventual outcome of any litigation, in the opinion of management, the foregoing proceedings are not expected to have a material adverse effect on the Company's financial position or results of operations.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

    The Company held its Annual Meeting of Stockholders on May 15, 2000. The matters voted upon and the results of the voting were as follows:

    Cynthia A. Fields and E. Gordon Gee were elected to the Board of Directors for a term of three years. Of the 39,505,622 Class A shares and 209,799,538 Class B shares (representing 629,398,614 votes) present in person or represented by proxy at the meeting, the number of votes for and the number of votes as to which authority to vote in the election was withheld, were as follows with respect to each of the nominees:

    In addition, directors whose term of office continued after the Annual Meeting were: Kenneth B. Gilman, William E. Kirwan, Beth M. Pritchard, Leslie H. Wexner, Roger D. Blackwell, Grace A. Nichols, and Donald B. Shackelford.

Item 5. OTHER INFORMATION

    The Company's Certificate of Incorporation includes provisions relating to potential conflicts of interest that may arise between the Company and The Limited. Such provisions were adopted in light

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of the fact that the Company and The Limited and its subsidiaries are engaged in retail businesses and may pursue similar opportunities in the ordinary course of business. Among other things, these provisions generally eliminate the liability of directors and officers of the Company with respect to certain matters involving The Limited and its subsidiaries, including matters that may constitute corporate opportunities of The Limited, its subsidiaries or the Company. Any person purchasing or acquiring an interest in shares of capital stock of the Company will be deemed to have consented to such provisions relating to conflicts of interest and corporate opportunities, and such consent may restrict such person's ability to challenge transactions carried out in compliance with such provisions. Investors should review the Company's Certificate of Incorporation before making any investment in shares of the Company's capital stock.

Item 6. EXHIBITS AND REPORTS ON FORM 8-K

    (a) Exhibits

15.

Letter re: Unaudited Interim Financial Information to Securities and Exchange Commission re: Incorporation of Independent Accountants' Report.



27.

Financial Data Schedule.

    (b) Reports on Form 8-K.

None.

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SIGNATURE

    Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		INTIMATE BRANDS, INC. (Registrant)
		By		/s/ V. ANN HAILEY    V. Ann Hailey, Executive Vice President and Chief Financial Officer of The Limited, Inc.*

Date: June 9, 2000

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*

Ms. Hailey is the principal financial officer of The Limited, Inc. and has been duly authorized to sign on behalf of the Registrant.

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SIGNATURE

    Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		INTIMATE BRANDS, INC. (Registrant)
		By		V. Ann Hailey, Executive Vice President and Chief Financial Officer of The Limited, Inc.*

Date: June 9, 2000

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*

Ms. Hailey is the principal financial officer of The Limited, Inc. and has been duly authorized to sign on behalf of the Registrant.

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INTIMATE BRANDS, INC. TABLE OF CONTENTS
PART I—FINANCIAL INFORMATION
INTIMATE BRANDS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Thousands except per share amounts) (Unaudited)
INTIMATE BRANDS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Thousands)
INTIMATE BRANDS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Thousands) (Unaudited)
PART II—OTHER INFORMATION
SIGNATURE
SIGNATURE

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