Bath & Body Works forecast annual sales and profit below analysts’ expectations on Thursday as consumers scaled back spending on non-essential items like candles and fragrances, sending its shares down 9 percent in pre-market trading.

Amid high borrowing and rental costs in the US, specialty retailers including Estee Lauder and Macy’s saw shoppers restricting discretionary spending, and have revised their annual results below Wall Street expectations.

Consumer prices rose more than expected in January, while US government reports indicated a ten-month low in retail sales.

The beauty and skincare firm expects 2024 annual net sales to range between a decline of 3 percent to flat compared with analysts’ expectations of a 1.3 percent rise, as per LSEG data

The company forecasts annual adjusted earnings to range between $3.00 and $3.35 per diluted share, compared with analysts’ estimates of $3.35.

The Ohio-based company posted quarterly sales of $2.91 billion, while analysts on average expected $2.84 billion, according to LSEG.

By Annett Mary Manoj; Editing by Vijay Kishore

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Third Point Plans Proxy Contest at Bath & Body Works

Bath & Body Works said in a statement late on Wednesday, “The Board strongly disagrees with the views expressed in Third Point’s letter.” However, it said it would review and consider Third Point’s proposed board nominations.