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lululemon athletica inc. Announces Third Quarter Fiscal 2013 Results
For the thirteen weeks ended
-
Net revenue for the quarter increased 20% to
$379.9 million from$316.5 million in the third quarter of fiscal 2012. - Comparable stores sales for the third quarter increased by 5% on a constant dollar basis.
-
Direct to consumer revenue increased 37% to
$62.0 million , or 16.3% of total Company revenues, in the third quarter of fiscal 2013, an increase from 14.3% of total Company revenues in the third quarter of fiscal 2012. -
Gross profit for the quarter increased 17% to
$204.6 million , and as a percentage of net revenue gross profit decreased to 53.9% for the quarter from 55.4% in the third quarter of fiscal 2012. -
Income from operations for the quarter increased 14.6% to
$92.3 million , and as a percentage of net revenue was 24.3% compared to 25.5% of net revenue in the third quarter of fiscal 2012. - The tax rate for the quarter was 29.5% compared to 30.1% a year ago.
-
Diluted earnings per share for the quarter were
$0.45 on net income of$66.1 million , compared to diluted earnings per share of$0.39 on net income of$57.3 million in the third quarter of fiscal 2012.
For the thirty-nine weeks ended
-
Net revenue for the first three quarters of fiscal 2013 increased 21%
to
$1,070.2 million from$884.9 million in the same period of fiscal 2012. - Comparable stores sales for the first three quarters of fiscal 2013 increased by 7% on a constant dollar basis.
-
Direct to consumer revenue increased 39% to
$165.3 million , or 15.5% of total company revenues, in the first three quarters of fiscal 2013, an increase from 13.4% of total company revenues in the first three quarters of fiscal 2012. -
Gross profit for the first three quarters of fiscal 2013 increased 15%
to
$561.3 million , and as a percentage of net revenue gross profit was 52.4% for the first three quarters as compared to 55.2% in the same period of fiscal 2012. -
Income from operations for the first three quarters of fiscal 2013
increased 6% to
$237.2 million , and as a percentage of net revenue was 22.2% as compared to 25.3% of net revenue in the same period of fiscal 2012. - The effective tax rate for the first three quarters of fiscal 2013 was 29.7% compared to 28.7% a year ago.
-
Diluted earnings per share for the first three quarters of fiscal 2013
were
$1.16 on net income of$169.9 million , compared to diluted earnings per share of$1.11 on net income of$161.2 million the same period of fiscal 2012.
The Company ended the third quarter of fiscal 2013 with
Updated Outlook
For the fourth quarter of fiscal 2013, we expect net revenue to be in
the range of
For the full fiscal 2013, we now expect net revenue to be in the range
of
Conference Call Information
A conference call to discuss third quarter results is scheduled for
today, December 12, 2013, at
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.
The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. For more information on this non-GAAP financial measure, please see the table captioned "Reconciliation of Non-GAAP Financial Measure — Constant dollar changes" included in the accompanying financial tables, which includes more detail on the GAAP financial measure that is most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures.
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 the effect of shipments of
products that fail to comply with our technical specifications or that
fail to conform to our quality control standards, the duration of any
shortage of products available for sale in our stores or for delivery to
guests or our ability to obtain replacement products in a timely manner,
any expected loss of net revenue resulting from the inability to sell
those products and related increased administrative and shipping costs,
and our future financial condition or results of operations. 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: our reliance on
and limited control over third-party suppliers to provide fabrics for
and to produce our products; negative publicity regarding any of our
products or our the production methods of any of our suppliers or
manufacturers; the effects of shipments of products that fail to comply
with our technical specifications or that fail to conform to our quality
standards; the effects of a shortage of products available for sale in
our stores or for delivery to guests; an economic downturn or economic
uncertainty in our key markets; increasing product costs and decreasing
selling prices; our inability to anticipate consumer preferences and
successfully develop and introduce new, innovative and updated products;
our inability to accurately forecast customer demand for our products;
our inability to manage our growth and the increased complexity of our
business effectively; the fluctuating costs of raw materials; our highly
competitive market and increasing competition; an unforeseen disruption
of our information systems; our inability to deliver our products to the
market and to meet customer expectations due to problems with our
distribution system; our inability to cancel store leases if an existing
or new store is not profitable; increasing labor costs and other factors
associated with the production of our products 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 Weeks | Thirty-Nine | ||||||||||||||||||
Ended | Thirteen Weeks | Weeks Ended | Thirty-Nine | ||||||||||||||||
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Ended |
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Weeks Ended | ||||||||||||||||
2013 |
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2013 |
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(unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||||||
Net revenue | $ | 379,900 | $ | 316,537 | $ | 1,070,195 | $ | 884,869 | |||||||||||
Costs of goods sold | 175,294 | 141,237 | 508,909 | 396,550 | |||||||||||||||
Gross profit | 204,606 | 175,300 | 561,286 | 488,319 | |||||||||||||||
As a percent of net revenue | 53.9 | % | 55.4 | % | 52.4 | % | 55.2 | % | |||||||||||
Selling, general and administrative expenses | 112,270 | 94,689 | 324,075 | 264,455 | |||||||||||||||
As a percent of net revenue | 29.6 | % | 29.9 | % | 30.2 | % | 29.9 | % | |||||||||||
Income from operations | 92,336 | 80,611 | 237,211 | 223,864 | |||||||||||||||
As a percent of net revenue | 24.3 | % | 25.5 | % | 22.2 | % | 25.3 | % | |||||||||||
Other income (expense), net | 1,453 | 1,424 | 4,249 | 3,500 | |||||||||||||||
Income before provision for income taxes | 93,789 | 82,035 | 241,460 | 227,364 | |||||||||||||||
Provision for income taxes | 27,678 | 24,655 | 71,605 | 65,308 | |||||||||||||||
Net income | 66,111 | 57,380 | 169,855 | 162,056 | |||||||||||||||
Net income attributable to non-controlling interest | — | 64 | — | 875 | |||||||||||||||
Net income attributable to lululemon athletica inc. | $ | 66,111 | $ | 57,316 | $ | 169,855 | $ | 161,181 | |||||||||||
Basic earnings per share | $ | 0.46 | $ | 0.40 | $ | 1.17 | $ | 1.12 | |||||||||||
Diluted earnings per share | $ | 0.45 | $ | 0.39 | $ | 1.16 | $ | 1.11 | |||||||||||
Basic weighted-average shares outstanding | 145,120 | 144,057 | 144,806 | 143,903 | |||||||||||||||
Diluted weighted-average shares outstanding | 146,014 | 145,748 | 145,967 | 145,750 | |||||||||||||||
lululemon athletica inc. |
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Condensed Consolidated Balance Sheets |
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Expressed in thousands |
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(unaudited) | (audited) | ||||||||
ASSETS | |||||||||
Current assets | |||||||||
Cash and cash equivalents | $ | 600,745 | $ | 590,179 | |||||
Inventories | 206,154 | 155,222 | |||||||
Other current assets | 73,692 | 41,652 | |||||||
Total current assets | 880,591 | 787,053 | |||||||
Property and equipment, net | 243,626 | 214,639 | |||||||
Goodwill and intangible assets, net | 28,991 | 30,201 | |||||||
Deferred income taxes and other non-current assets | 21,346 | 19,185 | |||||||
Total assets | $ | 1,174,554 | $ | 1,051,078 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||
Current liabilities | |||||||||
Accounts payable | $ | 4,783 | $ | 1,045 | |||||
Other current liabilities | 88,840 | 92,675 | |||||||
Income taxes payable | 991 | 39,637 | |||||||
Total current liabilities | 94,614 | 133,357 | |||||||
Non-current liabilities | 37,180 | 30,422 | |||||||
Stockholders' equity | 1,042,760 | 887,299 | |||||||
Total liabilities and stockholders' equity | $ | 1,174,554 | $ | 1,051,078 | |||||
lululemon athletica inc. | |||||||||
Condensed Consolidated Statements of Cash Flows |
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Expressed in thousands |
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Thirty-Nine Weeks | Thirty-Nine Weeks | ||||||||
Ended | Ended | ||||||||
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(unaudited) | (unaudited) | ||||||||
Cash flows from operating activities | |||||||||
Net income | $ | 169,855 | $ | 162,056 | |||||
Items not affecting cash | 61,039 | 36,342 | |||||||
Other, including net changes in other non-cash balances | (136,088 | ) | (85,158 | ) | |||||
Net cash provided by operating activities | 94,806 | 113,240 | |||||||
Net cash used in investing activities | (71,945 | ) | (72,041 | ) | |||||
Net cash provided by (used in) financing activities | 8,654 | (11,863 | ) | ||||||
Effect of exchange rate changes on cash | (20,949 | ) | 650 | ||||||
Increase in cash and cash equivalents | 10,566 | 29,986 | |||||||
Cash and cash equivalents, beginning of period | $ | 590,179 | $ | 409,437 | |||||
Cash and cash equivalents, end of period | $ | 600,745 | $ | 439,423 | |||||
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 | |||||||
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% Change | % Change | |||||||
Comparable-store sales (GAAP) | 2 | % | 18 | % | ||||
Adjustments due to foreign exchange rate changes | 3 | % | — | % | ||||
Comparable-store sales in constant dollars | 5 | % | 18 | % | ||||
lululemon athletica inc. | |||||||||||
Store Count and Square Footage1 |
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Thirty-Nine Weeks Ended |
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Square Footage Expressed in Thousands |
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Number of | Number of | Number of | |||||||||
Stores Open | Stores | Stores | Number of | ||||||||
at the | Opened | Closed | Stores Open | ||||||||
Beginning of | During the | During the | at the End of | ||||||||
the Quarter | Quarter(2) | Quarter | the Quarter | ||||||||
1st Quarter | 211 | 8 | 1 | 218 | |||||||
2nd Quarter | 218 | 8 | — | 226 | |||||||
3rd Quarter | 226 | 22 | 1 | 247 | |||||||
Total Gross | |||||||||||
Square Feet |
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Total Gross | ||||||||
at the | Feet Added | Feet Lost | Square Feet | ||||||||
Beginning of | During the | During the | at the End of | ||||||||
the Quarter | Quarter(2,3) | Quarter(3) | the Quarter | ||||||||
1st Quarter | 602 | 27 | 2 | 627 | |||||||
2nd Quarter | 627 | 27 | — | 654 | |||||||
3rd Quarter | 654 | 66 | 2 | 718 |
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 the quarter that are branded lululemon athletica and ivivva athletica.
3 Gross square feet added/lost during the quarter includes net square foot additions for corporate-owned stores which have been renovated or relocated in the quarter.
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