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lululemon athletica inc. Announces Third Quarter Fiscal 2010 Results
Third Quarter Net Revenue Increases 56% to
Third Quarter Diluted EPS of
Run Dash L/S
For the thirteen weeks ended
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Net revenue for the quarter increased 56% to
$175.8 million from$112.9 million in the third quarter of fiscal 2009. Net revenue from corporate-owned stores was$143.2 million for the quarter, an increase of 46% from$98.1 million in the third quarter of fiscal 2009, and comparable-store sales increased by 29% on a constant-dollar basis. -
Gross profit for the quarter increased by 72% to
$96.8 million , and as a percentage of net revenue gross profit increased to 55% for the quarter from 50% in the third quarter of fiscal 2009. -
Income from operations for the quarter increased by 103% to
$42.4 million , and as a percentage of net revenue was 24% compared to 19% of net revenue in the third quarter of fiscal 2009. -
Diluted earnings per share for the quarter was
$0.36 on net income of$25.7 million , compared to diluted earnings per share of$0.20 on net income of$14.1 million in the third quarter of fiscal 2009. - The tax rate for the quarter was 39% versus 33% a year ago. The tax rate has been increased to take into account the additional deferred income tax liability for estimated future taxes attributable to undistributed earnings of the Canadian operating subsidiary.
For the thirty-nine weeks ended
-
Net revenue for the first three quarters increased 60% to
$466.3 million from$292.3 million in the same period of fiscal 2009. Net revenue from corporate-owned stores was$388.2 million for the first three quarters of fiscal 2010, an increase of 52% from$256.1 million in the first three quarters of fiscal 2009. Year to date comparable-store sales increased by 31% on a constant-dollar basis. -
Gross profit for the first three quarters increased by 84% to
$251.5 million from$136.5 million in the same period of fiscal 2009. As a percentage of net revenue, gross profit increased to 54% for the first three quarters of fiscal 2010 from 47% in the same period of fiscal 2009. -
Income from operations for the first three quarters increased by 142%
to
$109.1 million , and as a percentage of net revenue was 23% compared to 15% of net revenue in the same period of fiscal 2009. -
Diluted earnings per share on a year to date basis was
$0.93 on net income of$67.1 million , compared to diluted earnings per share of$0.42 on net income of$29.8 million in the same period of fiscal 2009. - The tax rate for the first three quarters of fiscal 2010 was 40% versus 34% for the same period in the prior year. The tax rate has been increased to take into account the additional deferred income tax liability for estimated future taxes attributable to undistributed earnings of the Canadian operating subsidiary.
The Company ended the third quarter of fiscal 2010 with
Updated Outlook
For the fourth quarter of fiscal 2010, we expect net revenue to be in
the range of
Conference Call Information
A conference call to discuss third quarter results is scheduled for
today,
About lululemon athletica inc.
Non-GAAP Financial Measure
Constant-dollar net revenue changes, which exclude the impact of changes in foreign exchange rates, is not a United States Generally Accepted Accounting Principle ("GAAP") performance measure. We provide constant-dollar net revenue changes because we use the measure to understand the underlying growth rate of revenue excluding the impact on a quarter-by-quarter basis of changes in foreign exchange rates, which are not under management's direct control. We believe that disclosing net revenue changes on a constant-dollar basis is useful to investors because it enables them to better understand the level of growth of our business.
Forward-Looking Statements:
This press release contains "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Exchange Act of 1934 that involve risks, uncertainties
and assumptions, such as statements regarding our future financial
condition or results of operations, our prospects and strategies for
future growth, the development and introduction of new products, and the
implementation of our marketing and branding strategies. In many cases,
you can identify forward-looking statements by terms such as "may,"
"will," "should," "expects," "plans," "anticipates," "outlook,"
"believes," "intends," "estimates," "predicts," "potential" or the
negative of these terms or other comparable terminology. These
forward-looking statements are based on management's current
expectations but they involve a number of risks and uncertainties.
Actual results and the timing of events could differ materially from
those anticipated in the forward-looking statements as a result of risks
and uncertainties, which include, without limitation: the possibility
that we may not be able to manage operations at our current size or
manage growth effectively; risks that consumer spending may continue to
decline and that U.S. and global macroeconomic conditions may worsen;
the possibility that levels of comparable-store sales or average sales
per square foot will decline; the possibility that we may not be able to
successfully expand in
lululemon athletica inc. | ||||||||
Condensed Consolidated Statements of Operations |
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Expressed in thousands, except per share amounts |
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Thirteen | Thirteen | Thirty-Nine | Thirty-Nine | |||||
Weeks | Weeks | Weeks | Weeks | |||||
Ended |
Ended | Ended | Ended | |||||
October 31, | November 1, | October 31, | November 1, | |||||
2010 | 2009 | 2010 | 2009 | |||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||
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Net revenue | $175,800 | $112,891 | $466,305 | $292,292 | ||||
Costs of goods sold | 78,968 | 56,553 | 214,818 | 155,766 | ||||
Gross profit | 96,832 | 56,338 | 251,487 | 136,526 | ||||
As a percent of net revenue | 55.1% | 49.9% | 53.9% | 46.7% | ||||
Selling, general and administrative expenses | 54,456 | 35,412 | 142,394 | 91,415 | ||||
As a percent of net revenue | 31.0% | 31.4% | 30.5% | 31.3% | ||||
Income from operations |
42,376 | 20,926 | 109,093 | 45,111 | ||||
As a percent of net revenue | 24.1% | 18.5% | 23.4% | 15.4% | ||||
Other income (expense), net | 91 | (3) | 2,345 | 98 | ||||
Income before provision for income taxes | 42,467 | 20,923 | 111,438 | 45,209 | ||||
Provision for income taxes | 16,532 | 6,855 | 44,207 | 15,379 | ||||
Net Income | 25,935 | 14,068 | 67,231 | 29,830 | ||||
Net income attributable to non-controlling interest |
234 | - | 150 | - | ||||
Net income attributable to lululemon athletica inc. | $25,701 | $14,068 | $67,081 | $29,830 | ||||
Basic earnings per share | $0.36 | $0.20 | $0.95 | $0.42 | ||||
Diluted earnings per share | $0.36 | $0.20 | $0.93 | $0.42 | ||||
Basic weighted-average shares outstanding | 70,938 | 70,279 | 70,786 | 70,205 | ||||
Diluted weighted-average shares outstanding | 71,835 | 71,100 | 71,782 | 70,759 | ||||
lululemon athletica inc. |
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Condensed Consolidated Balance Sheets |
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Expressed in thousands |
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October 31, | January 31, | |||
2010 | 2010 | |||
(unaudited) | (audited) | |||
ASSETS | ||||
Current assets | ||||
Cash and cash equivalents | $224,775 | $159,573 | ||
Inventories | 73,023 | 44,070 | ||
Other current assets | 13,919 | 12,767 | ||
Total current assets | 311,717 | 216,410 | ||
Property and equipment, net | 67,457 | 61,591 | ||
Intangible assets, net | 26,488 | 8,050 | ||
Deferred income taxes and other assets | 13,310 | 21,207 | ||
Total assets | $418,972 | $307,258 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
Current liabilities | ||||
Accounts payable | $9,275 | $11,027 | ||
Other current liabilities | 49,483 | 39,909 | ||
Income taxes payable | 5,518 | 7,742 | ||
Total current liabilities | 64,276 | 58,678 | ||
Deferred income taxes and other non-current liabilities | 28,023 | 15,472 | ||
Stockholders' equity | 326,673 | 233,108 | ||
Total liabilities and stockholders' equity | $418,972 | $307,258 | ||
lululemon athletica inc. | ||||
Condensed Consolidated Statements of Cash Flows |
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Expressed in thousands |
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Thirty-Nine Weeks Ended | Thirty-Nine Weeks Ended | |||
October 31, 2010 | November 1, 2009 | |||
(unaudited) | (unaudited) | |||
Cash flows from operating activities | ||||
Net income | $67,231 | $29,830 | ||
Items not affecting cash | 36,201 | 21,109 | ||
Other, including net changes in other non-cash balances | (15,515) | 834 | ||
Net cash provided by operating activities | 87,917 | 51,773 | ||
Net cash used in investing activities | (34,433) | (10,214) | ||
Net cash provided by financing activities | 7,945 | (27) | ||
Effect of exchange rate changes on cash | 3,773 | 3,503 | ||
Increase in cash and cash equivalents | 65,202 | 45,035 | ||
Cash and cash equivalents, beginning of period | $159,573 | $56,797 | ||
Cash and cash equivalents, end of period | $224,775 | $101,832 | ||
lululemon athletica inc. | ||||||||
Store Count and Square Footage1 |
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Year ended January 30, 2011 |
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Square Footage Expressed in Thousands |
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Number of | ||||||||
Number of | Stores | Number of | ||||||
Stores Open | Opened / | Stores | Number of | |||||
at the | Acquired | Closed | Stores Open | |||||
Beginning of | During the | During the | at the End of | |||||
the Quarter |
Quarter2 |
Quarter | the Quarter | |||||
1st Quarter | 110 | 4 | 0 | 114 | ||||
2nd Quarter | 114 | 12 | 0 | 126 | ||||
3rd Quarter | 126 | 4 | 0 | 130 | ||||
Gross Square | ||||||||
Total Gross | Feet Lost | |||||||
Square Feet | Gross Square | due to Store | Total Gross | |||||
at the | Feet Added | Closures | Square Feet | |||||
Beginning of | During the | During the | at the End of | |||||
the Quarter |
Quarter2,3 |
Quarter | the Quarter | |||||
1st Quarter | 316 | 9 | 0 | 325 | ||||
2nd Quarter | 325 | 25 | 0 | 350 | ||||
3rd Quarter | 350 | 14 | 0 | 364 | ||||
1 Store count and square footage summary includes corporate-owned stores which are branded lululemon athletica and ivivva athletica.
2 Number of stores opened during fiscal 2010 are branded
lululemon athletica and include nine locations repurchased from our
Australian franchise operator and one reacquired franchise in
3 Gross square feet added during the quarter includes net square foot additions for corporate-owned stores which have been renovated or relocated in the quarter.
lululemon athletica inc. | ||||
Reconciliation of Non-GAAP Financial Measure |
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Constant-dollar changes |
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(unaudited) |
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Thirteen Weeks | Thirteen Weeks | |||
Ended | Ended | |||
October 31, 2010 | November 1, 2009 | |||
% Change | % Change | |||
Comparable-store sales (GAAP) | 32% | 11% | ||
Increase (decrease) due to foreign exchange rate changes | (3)% | (1)% | ||
Comparable-store sales in constant dollars | 29% | 10% | ||
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