Lululemon Three Quarter Sales Grew 14% Year On Year

According to the world clothing and shoe net, Canada, December 6th.

Manufacturer

Released in the third quarter of this fiscal year, the core financial data: store and online sales performance is good, boosted sales growth of 14% over the same period, but affected by the restructuring of the Ivivva girl business line, profits are still declining.

After the earnings announcement, the company's stock rose more than 8% in after hours trading, breaking through this year's record highs.

Analysts worry about "Sports"

(athleisure) the cooling down of the boom does not seem to be a reality.

In the three months ended October 29, 2017, the core financial data of Lululemon were as follows:

Net sales grew 14%, to $619 million, up from the previous estimate of $615 million.

Total comparable sales increased by 8% over the same period last year, compared with 2% year-on-year sales and 26% increase in online sales.

Net profit fell 13.7% to $58 million 940 thousand.

Gross profit increased 16% over the same period last year, to $322 million.

Gross profit margin was 52%, an increase of 90 basis points compared to the same period last year.

Operating profit fell 8% to $85 million 600 thousand a year ago.

Operating profit margin was 13.8%, down 330 basis points compared with the same period last year.

Diluted earnings per share were $0.43, compared with $0.5 a year ago.

The Company repurchased 100 thousand common shares at an average price of $60.27, and completed a $100 million stock Buyback program starting in December 2016.

(Figure 2017: core financial data for the third quarter of fiscal year Lululemon and the first three quarters)

Due to excellent sales in the third quarter, Lululemon raised its fourth quarter and full year expectations for the 2017 fiscal year:

It is estimated that sales in the fourth quarter of fiscal year 2017 will be US $870 million ~8.85 billion and diluted earnings per share will be US $1.18 ~1.21 US dollars.

It is estimated that net sales in fiscal year 2017 will be US $2 billion 590 million ~26.05 billion and diluted earnings per share will be US $2.2 ~2.23 US dollars.

Announcing the third quarter financial results, Lululemon also announced a new share repurchase program, which said it would buy back two hundred million US dollars at the market price. The actual amount of repurchase and the specific repurchase time would depend on market conditions and other factors. However, according to the request of the securities and Exchange Commission, the buyback plan will be completed within two years.

Earlier this year, Lululemon said that it would close 40 Ivivva stores, and the Ivivva girl business line will be adjusted to the main business in the future.

In the first quarter, Lululemon spent $22 million 200 thousand on restructuring the Ivivva girl business. The total cost of Ivivva brand restructuring is expected to reach 5000 million.

Lululemon CEO Laurent Potdevin said: "the growth of e-commerce business is strong. At the end of this quarter, we launched a new website. In retailing, we also improved store design and operation, creating a social space for offline stores, providing services such as" store yoga ".

At the same time, the chaos of retail industry also brings many opportunities. Lululemon will strive to lead the pformation of retail industry and continue to achieve the goal of exceeding US $4 billion in sales in 2020.

According to Laurent Potdevin estimates, by 2020, when sales exceeded $4 billion, the international sales volume will exceed 10 billion under the promotion of the Chinese market, and the sales of e-commerce and men's clothing are expected to reach US $1 billion respectively.

Laurent Potdevin also said that Lululemon began to perform well in the fourth quarter Christmas holiday peak season, especially on the "black Friday" and "network Monday".

He also revealed that the company plans to open 22 "seasonal shops" in different regions to meet the needs of more consumers.

Lululemon's COO and CFO Stuart Haselden said: "the trend of retail trade in North America is improving recently, and the volume of passenger traffic has increased in the fourth quarter."

Since last year, Lululemon has been expanding its retail business. During that time, the company added 26 stores in the United States, opened 4 new businesses in Canada, added 4 in Europe, added 3 in Australia and New Zealand, and added 10 in China, and the company plans to expand further in the Chinese market.

In response to the Chinese market, Laurent Potdevin also mentioned: "the number of Chinese millennials has reached 450 million. They are becoming more and more interested in the positive lifestyle. They begin to know the brand of Lululemon," we recently opened a store in Shanghai.

Our products even cover the cover of fashion magazines. Similar things have never happened in the North American market. "

Recently, some changes have taken place in the leadership of Lulelemon.

Last month, Lee Holman Holman, executive vice president and creative director of Lululemon, announced that he would be officially leaving in early 2018 for personal reasons.

Laurent Potdevin has confirmed for the first time that the company will find new people to take over the post of creative director, but because the position is very important, it is not easy for the company to find a successor quickly.

In addition, the departure of Lee Holman will not have any impact on the original strategy of Lululemon in design or marketing.

But according to WWD's report last month, R mi Paringaux will join Lululemon as the creative director of the brand. R e mi Paringaux has rich experience in digital media. After taking office, she will focus on the creative marketing content and experience of the brand.

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