Monday, March 30, 2020
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Lululemon (LULU) reports Q4 2019 earnings beat

Lululemon introduced Thursday fiscal fourth-quarter outcomes that topped expectations, as its same-store gross sales surged 20% in the course of the interval, thanks, partly, to extra males purchasing in its shops and on-line. 

However, because of the uncertainty from the coronavirus pandemic, the yoga pants maker stated it is not going to be offering a fiscal 2020 outlook presently. Its inventory fell about 2% in after-hours buying and selling. 

Here’s how the corporate did in the course of the fourth quarter in contrast with what analysts have been anticipating, based mostly on Refinitiv knowledge: 

  • Earnings per share: $2.28 vs. $2.24 anticipated
  • Revenue: $1.40 billion vs. $1.38 billion anticipated

Net earnings rose to $298 million, or $2.28 per share, from $218.5 million, or $1.65 a share, a yr in the past. That was higher than the $2.24 per share analysts have been anticipating it to earn, based mostly on Refinitiv knowledge. 

Net income grew roughly 20% to $1.40 billion from $1.17 billion a yr in the past. Analysts have been calling for $1.38 billion in income.

Same-store gross sales total have been up 20%, the corporate stated. Digital gross sales surged 41% in the course of the quarter. Men’s income was up 32%, and girls’s was up 17%. 

“The strength of our brand and strong financial position will help us manage through the day-to-day, while continuing to effectively plan for and invest in our future,” CEO Calvin McDonald stated in a press release. 

In February, due to the heightened unfold of COVID-19, Lululemon closed all of its shops briefly in mainland China. It stated Thursday that each one however considered one of these outlets have since reopened. Earlier this month, Lululemon briefly closed all of its shops in North America, Europe, Malaysia and New Zealand because of the virus. It additionally has briefly closed a distribution heart in Sumner, Washington. 

Based on learnings from China, McDonald advised analysts Thursday that he has confidence the enterprise “will bounce back.” He stated gross sales in China aren’t but again to their ranges previous to shops within the area closing. But quantity is enhancing “week by week,” he stated. 

Lululemon shops within the U.S., Canada and different markets can be reopening on a “market by market basis,” the CEO stated, based mostly on native info. “Our stores will reopen. … Lululemon is in a very healthy position.” But he cautioned that the corporate is planning for shops in North America to be closed for longer than they have been in China. 

Lululemon, meantime, has confidence that even when consumers aren’t trying to purchase leggings and sports activities bras at present, the retailer doesn’t have to fret about placing objects on sale, sooner or later, to maneuver them off cabinets. 

Much of Lululemon’s merchandise is “less seasonal in nature,” in contrast with different attire classes, McDonald defined. “Styles can be held for future use.” 

“We do not believe [the coronavirus] will change the trend toward people wanting to live active and healthy lifestyles,” he added. 

In managing bills, Lululemon stated it is going to be scaling again on retailer openings and remodels within the close to time period. 

Lululemon shares closed Thursday up about 3.7%. The inventory is down about 15% this yr. The firm has a market cap of about $26.2 billion. 

Read the full press release here. 


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