By Alexandria Sage

SAN FRANCISCO, Nov 18 (Reuters) - Limited Brands,(LTD.N) owner of the Victoria's Secret and Bath & Body Works chains, posted a higher than expected quarterly profit on Wednesday 18 November and raised its full-year earnings view.

Shares rose 3.7 percent after hours.

Cost-cutting and more controlled inventory has helped offset sales declines at the company, whose products have proved dispensable to consumers in the economic downturn.

"They had very solid numbers," said Jefferies analyst Randal Konik, who cited stabilization at Victoria's Secret and momentum at Bath & Body Works.

He added that Wall Street expects them to continue beating expectations amid ongoing streamlining at the company: "The fourth-quarter outlook is still conservative."

The mall-based retailer, which has faced a prolonged slump in traffic to its stores, said third-quarter net profit was $14.85 million, or 5 cents per share, as compared to $4.12 million, or 1 cent per share, a year earlier.

Excluding the tax benefit, the company earned 2 cents per share. That was above the 1 cent per share loss expected, on average, by analysts, according to Thomson Reuters I/B/E/S.

As previously reported, revenue fell 3.5 percent to $1.78 billion. Same-store sales, a key gauge of retail strength, fell 2 percent.

Limited has struggled with sales for more than a year as U.S. consumers have cut their spending for nice-to-have items such as lingerie and bath products. But the company has cut costs and lowered inventory to compensate.

General, administrative and store operating costs fell by 6.5 percent in the quarter.

The company said in October that it hoped to return to a 15 percent operating margin by 2012 -- compared to its 2008 margin of 7.9 percent. But that will require sales to pick up and further cost-cutting, executives said.

Looking to the fourth quarter, Limited said it expects earnings per share to range between 71 cents to 86 cents, with full-year adjusted earnings between 93 cents to $1.08 per share.

In August, Limited said that adjusted earnings per share would range between 75 cents and 90 cents.

Shares, which have nearly tripled since a year low of $6.26 in March, rose 3.7 percent to $18.95 after closing at $18.27 on the New York Stock Exchange. (Reporting by Alexandria Sage, editing by Leslie Gevirtz)