VANCOUVER, Canada
--(BUSINESS WIRE)--
lululemon athletica inc.
(NASDAQ:LULU) today announced financial results
for the fourth quarter and fiscal year ended February 2, 2014.
For the fourth quarter ended February 2, 2014:
-
Net revenue for the quarter increased 7% to
$521.0 million
from
$485.5
million
in the fourth quarter of fiscal 2012. The fourth quarter of
fiscal 2013 consisted of 13 weeks while the fourth quarter of fiscal
2012 consisted of 14 weeks. Net sales for fiscal 2012 include the
additional week; however comparable stores sales calculations exclude
the 14th week.
-
Comparable stores sales for the fourth quarter decreased by 2% on a
constant dollar basis. Total comparable sales, including comparable
stores and direct to consumer, increased 4% for the fourth quarter on
a constant dollar basis.
-
Direct to consumer revenue increased 25% to
$97.8 million
, or 18.8% of
total Company revenues, in the fourth quarter of fiscal 2013, an
increase from 16.1% of total Company revenues in the fourth quarter of
fiscal 2012.
-
Gross profit for the quarter increased by 2% to
$278.8 million
, but as
a percentage of net revenue gross profit decreased to 53.5% for the
quarter from 56.5% in the fourth quarter of fiscal 2012.
-
Income from operations for the quarter increased by 1% to
$154.1
million
, and as a percentage of net revenue was 29.6% compared to
31.4% of net revenue in the fourth quarter of fiscal 2012.
-
The tax rate for the quarter was 29.5% compared to 29.0% a year ago.
-
Diluted earnings per share for the quarter were
$0.75
on net income of
$109.7 million
, compared to diluted earnings per share of
$0.75
on net
income of
$109.4 million
in the fourth quarter of fiscal 2012.
For the fiscal year ended February 2, 2014:
-
Net revenue for the fiscal year increased 16% to
$1.6 billion
from
$1.4 billion
in fiscal 2012. Fiscal 2013 consisted of 52 weeks while
fiscal 2012 consisted of 53 weeks. Net sales for fiscal 2012 include
the additional week; however, comparable stores sales and sales per
square foot calculations exclude the 53rd week.
-
Comparable stores sales for fiscal 2013 increased by 4% on a constant
dollar basis, resulting in
$1,894
annual sales per square foot for
comparable stores for fiscal 2013. Total comparable sales, including
comparable stores and direct to consumer, increased 9% on a constant
dollar basis for fiscal 2013.
-
Direct to consumer revenue increased 33% to
$263.1 million
, or 16.5%
of total Company revenues in fiscal 2013, from 14.4% of total Company
revenues in fiscal 2012.
-
Gross profit for fiscal 2013 increased by 10% to
$840.1 million
, from
$762.8 million
in fiscal 2012. As a percentage of net revenue, gross
profit decreased to 52.8% compared to 55.7% in fiscal 2012.
-
Income from operations increased by 4% to
$391.4 million
, from
$376.4
million
in fiscal 2012. As a percentage of net revenue, income from
operations decreased to 24.6% compared to 27.5% of net revenue in
fiscal 2012.
-
The tax rate for fiscal 2013 was 29.6% compared to 28.8% for fiscal
2012.
-
Diluted earnings per share for fiscal 2013 were
$1.91
on net income of
$279.5 million
, compared to diluted earnings per share of
$1.85
on net
income of
$270.6 million
in fiscal 2012.
The Company ended fiscal 2013 with
$698.6 million
in cash and cash
equivalents compared to
$590.2 million
at the end of fiscal 2012.
Inventory at the end of fiscal 2013 was
$186.1 million
compared to
$155.2 million
at the end of fiscal 2012. The Company ended the quarter
with 254 stores in
North America
and
Australia
.
Laurent Potdevin
, lululemon’s CEO, stated: "In my first days as CEO, I
have been inspired by the people at lululemon, and the passion that lies
behind our product and our brand."
Mr. Potdevin
continued: "As we move
into 2014, we are reflecting on our learnings with humility, and are
entirely focused on our future. 2014 is an investment year with an
emphasis on strengthening our foundation, reigniting our product engine,
and accelerating sustainable and controlled global
expansion. lululemon's magic has been built by creating technical
beautiful product and sharing our distinct culture with our communities.
The emotional connection that lululemon creates is at the heart of what
we stand for, and we are being relentless in our commitment to
delivering a distinct and authentic experience that is unlike any other."
Updated Outlook
For the first quarter of fiscal 2014, we expect net revenue to be in the
range of
$377 million
to
$382 million
based on flat total combined
comparable sales on a constant dollar basis. Diluted earnings per share
are expected to be in the range of
$0.31
to
$0.33
for the quarter. This
guidance assumes 146.2 million diluted weighted-average shares
outstanding and a 30.0% tax rate.
For fiscal 2014, we expect net revenue to be in the range of
$1.770
billion
to
$1.820 billion
based on a total combined comparable sales
increase in the low to mid-single digits on a constant dollar basis.
Diluted earnings per share are expected to be in the range of
$1.80
to
$1.90
for the full year. This guidance assumes 146.3 million diluted
weighted-average shares outstanding and a 30.0% tax rate.
Conference Call Information
A conference call to discuss fiscal 2013 results is scheduled for today,
March 27, 2014, at
9:00 a.m. EST
. Those interested in participating in
the call are invited to dial 1-877-303-3203 approximately 10 minutes
prior to the start of the call. The conference call will also be webcast
live at www.lululemon.com.
The webcast will be accessible on our website for approximately 30 days
after the call.
About lululemon athletica inc.
lululemon athletica inc.
(NASDAQ:LULU) is a yoga-inspired athletic
apparel company that creates components for people to live longer,
healthier, fun lives. By producing products that help keep people active
and stress free, lululemon believes that the world will be a better
place. Setting the bar in technical fabrics and functional designs,
lululemon works with yogis and athletes in local communities for
continuous research and product feedback. For more information, visit www.lululemon.com.
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 our future financial
condition or results of operations and our prospects and strategies for
future growth. 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 ability to maintain the value and reputation of our brand, including
any negative publicity regarding our products or the production methods
of our suppliers or manufacturers; the acceptability of our products to
our guests, including receiving products that comply with our technical
specifications and quality standards; our reliance on and limited
control over third-party suppliers to provide fabrics for and to produce
our products; an economic downturn or economic uncertainty in our key
markets; our exposure to various types of litigation; increasing product
costs and decreasing selling prices; our ability to anticipate consumer
preferences and successfully develop and introduce new, innovative and
updated products; our ability to accurately forecast customer demand for
our products; any unforeseen disruption of our information systems; any
material disruption of our information systems; our ability to manage
our growth and the increased complexity of our business effectively; the
fluctuating costs of raw materials; our ability to expand
internationally in light of our limited operating experience and limited
brand recognition in new international markets; our highly competitive
market and increasing competition; our ability to deliver our products
to the market and to meet customer expectations if we have problems with
our distribution system; our ability to protect our intellectual
property rights; our ability 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
China
; our ability to
successfully open new store locations in a timely manner; our ability to
comply with trade and other regulations; the continued service of our
senior management; seasonality; fluctuations in foreign currency
exchange rates; the operations of many of our suppliers are subject to
international and other risks; our ability to source our merchandise
profitably or at all; and other risks and uncertainties set out in
filings made from time to time with the
United States Securities and
Exchange Commission
and available at www.sec.gov,
including, without limitation, our most recent reports on Form 10-K and
Form 10-Q. You are urged to consider these factors carefully in
evaluating the forward-looking statements contained herein and are
cautioned not to place undue reliance on such forward-looking
statements, which are qualified in their entirety by these cautionary
statements. The forward-looking statements made herein speak only as of
the date of this press release and we undertake no obligation to
publicly update such forward-looking statements to reflect subsequent
events or circumstances, except as may be required by law.
| lululemon athletica inc. |
Condensed Consolidated Statements of Operations |
Expressed in thousands, except per share amounts |
|
|
|
|
|
|
|
|
|
|
|
Thirteen Weeks Ended
February 2, 2014
|
|
Fourteen Weeks Ended
February 3, 2013
|
|
Fifty-Two Weeks Ended
February 2, 2014
|
|
Fifty-Three Weeks Ended
February 3, 2013
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
Net revenue
|
|
$
|
520,993
|
|
|
$
|
485,489
|
|
|
$
|
1,591,188
|
|
|
$
|
1,370,358
|
|
|
Costs of goods sold
|
|
242,203
|
|
|
210,982
|
|
|
751,112
|
|
|
607,532
|
|
|
Gross profit
|
|
278,790
|
|
|
274,507
|
|
|
840,076
|
|
|
762,826
|
|
| As a percent of net revenue |
|
53.5 |
% |
|
56.5 |
% |
|
52.8 |
% |
|
55.7 |
% |
|
Selling, general and administrative expenses
|
|
124,643
|
|
|
121,932
|
|
|
448,718
|
|
|
386,387
|
|
| As a percent of net revenue |
|
23.9 |
% |
|
25.1 |
% |
|
28.2 |
% |
|
28.2 |
% |
|
Income from operations
|
|
154,147
|
|
|
152,575
|
|
|
391,358
|
|
|
376,439
|
|
| As a percent of net revenue |
|
29.6 |
% |
|
31.4 |
% |
|
24.6 |
% |
|
27.5 |
% |
|
Other income (expense), net
|
|
1,519
|
|
|
1,457
|
|
|
5,768
|
|
|
4,957
|
|
|
Income before provision for income taxes
|
|
155,666
|
|
|
154,032
|
|
|
397,126
|
|
|
381,396
|
|
|
Provision for income taxes
|
|
45,974
|
|
|
44,657
|
|
|
117,579
|
|
|
109,965
|
|
|
Net income
|
|
109,692
|
|
|
109,375
|
|
|
279,547
|
|
|
271,431
|
|
|
Net income attributable to non-controlling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
875
|
|
|
Net income attributable to lululemon athletica inc.
|
|
$
|
109,692
|
|
|
$
|
109,375
|
|
|
$
|
279,547
|
|
|
$
|
270,556
|
|
|
Basic earnings per share
|
|
$
|
0.75
|
|
|
$
|
0.76
|
|
|
$
|
1.93
|
|
|
$
|
1.88
|
|
|
Diluted earnings per share
|
|
$
|
0.75
|
|
|
$
|
0.75
|
|
|
$
|
1.91
|
|
|
$
|
1.85
|
|
|
Basic weighted-average shares outstanding
|
|
145,235
|
|
|
144,285
|
|
|
144,913
|
|
|
144,000
|
|
|
Diluted weighted-average shares outstanding
|
|
146,035
|
|
|
145,846
|
|
|
146,043
|
|
|
145,806
|
|
| lululemon athletica inc. |
Condensed Consolidated Balance Sheets |
Expressed in thousands |
|
|
|
|
|
|
|
February 2, 2014
|
|
February 3, 2013
|
| ASSETS |
|
|
|
|
|
Current assets
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
698,649
|
|
|
$
|
590,179
|
|
Inventories
|
|
186,090
|
|
|
155,222
|
|
Other current assets
|
|
58,100
|
|
|
41,652
|
|
Total current assets
|
|
942,839
|
|
|
787,053
|
|
Property and equipment, net
|
|
255,603
|
|
|
214,639
|
|
Goodwill and intangible assets, net
|
|
28,201
|
|
|
30,201
|
|
Other non-current assets
|
|
23,045
|
|
|
19,185
|
|
Total assets
|
|
$
|
1,249,688
|
|
|
$
|
1,051,078
|
| LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
Accounts payable
|
|
$
|
12,647
|
|
|
$
|
1,045
|
|
Other current liabilities
|
|
100,098
|
|
|
92,675
|
|
Income taxes payable
|
|
769
|
|
|
39,637
|
|
Total current liabilities
|
|
113,514
|
|
|
133,357
|
|
Non-current liabilities
|
|
39,492
|
|
|
30,422
|
|
Stockholders’ equity
|
|
1,096,682
|
|
|
887,299
|
|
Total liabilities and stockholders’ equity
|
|
$
|
1,249,688
|
|
|
$
|
1,051,078
|
| lululemon athletica inc. |
Condensed Consolidated Statements of Cash Flows |
Expressed in thousands |
|
|
|
|
|
|
|
Fifty-Two Weeks Ended
February 2, 2014
|
|
Fifty-Three Weeks Ended
February 3, 2013
|
|
Cash flows from operating activities
|
|
|
|
|
|
Net income
|
|
$
|
279,547
|
|
|
$
|
271,431
|
|
|
Items not affecting cash
|
|
48,863
|
|
|
40,940
|
|
|
Other, including net changes in other non-cash balances
|
|
(50,071
|
)
|
|
(32,258
|
)
|
|
Net cash provided by operating activities
|
|
278,339
|
|
|
280,113
|
|
|
Net cash used in investing activities
|
|
(106,408
|
)
|
|
(93,229
|
)
|
|
Net cash provided by (used in) financing activities
|
|
8,907
|
|
|
(5,491
|
)
|
|
Effect of exchange rate changes on cash
|
|
(72,368
|
)
|
|
(651
|
)
|
|
Increase in cash and cash equivalents
|
|
108,470
|
|
|
180,742
|
|
|
Cash and cash equivalents, beginning of year
|
|
$
|
590,179
|
|
|
$
|
409,437
|
|
|
Cash and cash equivalents, end of year
|
|
$
|
698,649
|
|
|
$
|
590,179
|
|
| lululemon athletica inc. |
Reconciliation of Non-GAAP Financial Measure |
Constant-dollar changes in comparable store sales |
(unaudited) |
|
|
|
|
Thirteen Weeks
Ended
February 2, 2014
|
|
Thirteen Weeks
Ended
January 27, 2013
1
|
|
Fifty-Two Weeks
Ended
February 2, 2014
|
|
Fifty-Two
Weeks Ended
January 27, 2013
2
|
|
|
% Change |
|
Comparable store sales (GAAP)
|
|
(5
|
)%
|
|
11
|
%
|
|
2
|
%
|
|
16
|
%
|
|
Adjustments due to foreign exchange rate changes
|
|
3
|
%
|
|
(1
|
)%
|
|
2
|
%
|
|
—
|
%
|
|
Comparable store sales in constant dollars
|
|
(2
|
)%
|
|
10
|
%
|
|
4
|
%
|
|
16
|
%
|
1The fourteenth week’s sales of the fourth quarter of fiscal
2012 are not included in the calculation of the comparable store sales
changes.
2The fifty-third week’s sales of fiscal 2012
are not included in the calculation of the comparable store sales
changes.
| Reconciliation of Non-GAAP Financial Measure |
Constant-dollar changes in total comparable sales |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Thirteen Weeks
Ended
February 2, 2014
|
|
Thirteen Weeks
Ended
January 27, 2013
1
|
|
Fifty-Two Weeks
Ended
February 2, 2014
|
|
Fifty-Two
Weeks Ended
January 27, 2013
2
|
|
|
% Change |
|
Total comparable sales (GAAP)3
|
|
2
|
%
|
|
17
|
%
|
|
7
|
%
|
|
24
|
%
|
|
Adjustments due to foreign exchange rate changes
|
|
2
|
%
|
|
(1
|
)%
|
|
2
|
%
|
|
—
|
%
|
|
Total comparable sales in constant dollars3
|
|
4
|
%
|
|
16
|
%
|
|
9
|
%
|
|
24
|
%
|
1The fourteenth week’s sales of the fourth quarter of fiscal
2012 are not included in the calculation of the total comparable sales
changes.
2The fifty-third week’s sales of fiscal 2012
are not included in the calculation of the total comparable sales
changes.
3Total comparable sales includes comparable
store sales and direct to consumer sales.
| lululemon athletica inc. |
Store Count and Square Footage1 |
Fifty-Two Weeks Ended February 2, 2014 |
|
|
|
|
|
|
|
|
|
|
|
Number of
Stores Open
at the
Beginning of
the Quarter
|
|
Number of
Stores
Opened
During the
Quarter2
|
|
Number of
Stores
Closed
During the
Quarter
|
|
Number of
Stores Open
at the End of
the Quarter
|
|
1st Quarter
|
|
211
|
|
8
|
|
1
|
|
218
|
|
2nd Quarter
|
|
218
|
|
8
|
|
—
|
|
226
|
|
3rd Quarter
|
|
226
|
|
22
|
|
1
|
|
247
|
|
4th Quarter
|
|
247
|
|
7
|
|
—
|
|
254
|
|
|
|
|
|
|
|
|
|
|
|
Total Gross
Square Feet
at the
Beginning of
the Quarter
|
|
Gross Square
Feet Added
During the
Quarter2,3
|
|
Gross Square
Feet Lost
During the
Quarter3
|
|
Total Gross
Square Feet
at the End of
the Quarter
|
|
1st Quarter
|
|
602
|
|
27
|
|
2
|
|
627
|
|
2nd Quarter
|
|
627
|
|
27
|
|
—
|
|
654
|
|
3rd Quarter
|
|
654
|
|
66
|
|
2
|
|
718
|
|
4th Quarter
|
|
718
|
|
22
|
|
—
|
|
740
|
1Store count and square footage summary includes
corporate-owned stores which are branded lululemon athletica and ivivva
athletica.
2Number of stores opened during the quarter
that are branded lululemon athletica and ivivva athletica.
3Gross
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.
ICR, Inc.
Investor:
Joseph Teklits
/
Jean Fontana
203-682-8200
Media:
Alecia
Pulman
203-682-8224
Source: lululemon athletica inc.