VANCOUVER, British Columbia
--(BUSINESS WIRE)--
lululemon athletica
inc. (NASDAQ:LULU) today announced that the Company
is updating its net revenue and earnings guidance for the fourth quarter
of fiscal 2017 ending
January 28, 2018
.
For the fourth quarter, we now anticipate that net revenue will be in
the range of
$905 million
to
$915 million
based on a total comparable
sales increase in the high single digits on a constant dollar basis.
This compares to our previous guidance of net revenue in the range of
$870 million
to
$885 million
for the fourth quarter based on a total
comparable sales increase in the mid-single digits on a constant dollar
basis.
We also now expect diluted earnings per share will be in the range of
$1.24
to
$1.26
for the fourth quarter. Excluding the impact of the
restructuring of our ivivva operations, we expect adjusted diluted
earnings per share to be in the range of $1.25 to
$1
.27 for the quarter.
The previous diluted earnings per share guidance for the fourth quarter
was a range of
$1.18
to
$1.21
, or
$1.19
to
$1.22
excluding the impact of
the ivivva restructuring. This guidance does not reflect potential
future repurchases of the Company's shares and continues to assume 135.6
million diluted weighted-average shares outstanding.
This guidance also continues to assume a 30.4% tax rate and does not
reflect the impact of the
U.S.
tax reform which was enacted on
December
22, 2017
. We are assessing the impact that the tax reform will have, but
expect to recognize a significant income tax expense in the fourth
quarter of fiscal 2017 related to the one-time deemed repatriation tax
on accumulated foreign earnings. We believe that the impact of the tax
reform will be favorable to the Company's effective tax rate in fiscal
2018.
"We are thrilled with our performance this holiday season that reflects
an accelerating trend across all parts of our business, and we look
forward to continued momentum in 2018 and beyond," said
Laurent
Potdevin
, CEO,
lululemon
.
Management will be meeting with analysts and investors and presenting at
the
ICR Conference
in
Orlando, Florida
on
Monday January 8, 2018
. The
audio portion of the presentation will be webcast live at www.lululemon.com.
The webcast can be found in the investor relations section of the
Company's website.
About
lululemon athletica
inc.
lululemon athletica
inc. (NASDAQ:LULU) is a healthy lifestyle inspired
athletic apparel company for yoga, running, training, and most other
sweaty pursuits, with products that create transformational experiences
for people to live happy, healthy, fun lives. 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 Measures
A constant dollar change in total comparable sales and adjusted diluted
earnings per share are non-GAAP financial measures.
A constant dollar basis assumes the average foreign exchange rates for
the period remained constant with the average foreign exchange rates for
the same period of the prior year. We provide the constant dollar change
in total comparable sales because we use this measure to understand the
underlying growth rate of net revenue excluding the impact of changes in
foreign exchange rates. We believe that disclosing this measure on a
constant dollar basis is useful to investors because it enables them to
better understand the level of growth of our business.
Adjusted diluted earnings per share excludes the costs recognized in
connection with the restructuring of our ivivva operations and its
related tax effects. We believe this adjusted financial measure is
useful to investors as the adjustments do not directly relate to our
ongoing business operations and therefore do not contribute to a
meaningful evaluation of the trend in our operating performance.
Furthermore, we do not believe the adjustments are reflective of our
expectations of our future operating performance and believe this
non-GAAP measure is useful to investors because of its comparability to
our historical information.
The presentation of this financial information is not intended to be
considered in isolation or as a substitute for, or with greater
prominence to, the financial information prepared and presented in
accordance with GAAP. For more information on these non-GAAP financial
measures, please see the section captioned "Reconciliation of Non-GAAP
Financial Measures" included in the accompanying financial tables, which
includes more detail on the GAAP financial measure that is most directly
comparable to the non-GAAP financial measure, 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 also include
our guidance and outlook statements. These 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 changes in tax laws,
such as
U.S.
tax reform enacted in
December 2017
, or unanticipated tax
liabilities, as well as other risks and uncertainties including, without
limitation: our ability to maintain the value and reputation of our
brand; the acceptability of our products to our guests; our highly
competitive market and increasing competition; 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; 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 guest demand for our products; our ability to
safeguard against security breaches with respect to our information
technology systems; any material disruption of our information systems;
our ability to have technology-based systems function effectively and
grow our e-commerce business globally; 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 ability to deliver our products to the market and to meet
guest expectations if we have problems with our distribution system;
imitation by our competitors; our ability to protect our intellectual
property rights; our ability to manage our growth and the increased
complexity of our business effectively; our ability to cancel store
leases if an existing or new store is not profitable; our ability to
source our merchandise profitably or at all if new trade restrictions
are imposed or existing trade restrictions become more burdensome;
increasing labor costs and other factors associated with the production
of our products in South and
South East Asia
; our ability to comply with
trade and other regulations; fluctuations in foreign currency exchange
rates; higher than anticipated costs and our ability to realize the
benefits associated with the restructuring of our ivivva business;
conflicting trademarks and the prevention of sale of certain products;
our exposure to various types of litigation; 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.
Reconciliation of Non-GAAP Financial Measures
Unaudited
This guidance also continues to assume a 30.4% tax rate and does not
reflect the impact of the
U.S.
tax reform which was enacted on
December
22, 2017
. We are assessing the impact that the tax reform will have, but
expect to recognize a significant income tax expense in the fourth
quarter of fiscal 2017 related to the one-time deemed repatriation tax
on accumulated foreign earnings. We believe that the impact of the tax
reform will be favorable to the Company's effective tax rate in fiscal
2018.
|
|
|
|
|
|
|
|
|
Quarter Ending
January 28, 2018
|
|
Expected diluted earnings per share range, current expectation
|
|
|
|
$1.24
to
$1.26
|
|
Non-GAAP adjustments1
|
|
|
|
0.01
|
|
Adjusted expected diluted earnings per share range, current
expectation
|
|
|
|
$1.25
to
$1.27
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ending
January 28, 2018
|
|
Expected diluted earnings per share range, previous expectation
|
|
|
|
$1.18
to
$1.21
|
|
Non-GAAP adjustments1
|
|
|
|
0.01
|
|
Adjusted expected diluted earnings per share range, previous
expectation
|
|
|
|
$1.19
to
$1.22
|
|
|
|
|
|
__________
1 These adjustments relate to the restructuring of our ivivva
operations. Please refer to Note 6 to the unaudited interim consolidated
financial statements included in Item 1 of Part I of our Report on Form
10-Q filed with the
SEC
on
December 6, 2017
for further explanation as
to the nature of these items.
View source version on businesswire.com: http://www.businesswire.com/news/home/20180108005679/en/
Investors:
ICR, Inc
Joseph Teklits
/
Caitlin Morahan
203-682-8200
or
Media:
Brunswick
Laura
Buchanan
/
Ash Spiegelberg
+44 797 498 2492/ 214-205-6805
or
lululemon
athletica
Allison Reid
, +44 7983 026340
VP Corporate
Communications
Source:
lululemon athletica
inc.