Moody's may cut Limited Brands ratings

NEW YORK, Oct 13 (Reuters) - Moody's Investors Service on Monday placed Limited Brands ratings on review for a possible downgrade after the retailer announced an additional $250 million share buyback.

The timing of the program, which comes after a period of weak same-store sales, "signals that the company's financial policy has likely become more aggressive as it is being implemented just as the company is entering what will likely be a very challenging holiday selling environment," Moody's said in a statement.

The agency currently rates Limited Brands senior unsecured debt at "Baa3", or one notch above speculative, or 'junk' status.

Limited Brands, owner of Victoria's Secret and other specialty stores, makes about 60-70 percent of its operating income during the holiday season.

"A meaningful erosion in sales during this period could have a very notable negative impact on profitability," said the agency.

The review will focus on operating performance, and especially on the next few months of same-store sales, a key metric for retailers.

It will also focus on the company's financial policies and liquidity through a peak period for working capital, said the statement.

Reporting by Ciara Linnane; Editing by Chizu Nomiyama)