Yoga maker reports lulu of a Q4
Outfitter tops profit forecasts, prompting biggest jump in shares in eight months
‘There is little doubt that this is best-inclass performance among women’s retailers.’
TAL WOOLLEY RBC Capital Markets
Shares of athletic wear retailer Lululemon vaulted 9.6 per cent in early trading Thursday, the most in eight months, after the Vancouverbased company reported stellar sales and surpassed analyst expectations for the fourth quarter.
The company, which began selling yoga clothes 10 years ago, has seen its popularity steadily increase as it diversified into running gear, outerwear and accessories. The momentum has accelerated as the economy has improved, chief executive offi- cer Christine Day said.
Profit rose to $28.5 million U.S., or 40 cents a share, for the three-month period ended Jan. 31, compared with $ 10.9 million, or 16 cents a share, a year ago. Analysts were expecting an average of 29 cents a share, according to Thomson Reuters.
Same-store sales, a key measure of retail performance, soared 29 per cent. Revenue hit $ 160.6 million compared with $103.9 million.
The company’s fourthquarter results were helped by strong sales during the Olympics in Vancouver. While not an official supplier, the company made sales — and headlines — marketing clothing, and a joke “tooth blackener as part of their “Cool Sporting Event That Takes Place in British Columbia Between 2009 & 2011 Edition.”
Full-year profit was $ 58.3 million, up from $39.4 million a year before. Revenue climbed 28 per cent to $452.9 million. Lululemon is predicting first-quarter earnings of 18 cents to 20 cents a share and same-store sales growth of 20 per cent. For the year, Lululemon is targeting per-share earnings of $1 to $1.05.
“ There is little doubt that this is best-in-class performance among women’s retailers,” said analyst Tal Woolley of RBC Capital Markets.
“It was a very, very strong quarter. It may have been one of the best quarters that we saw from the holidays. The same-store sales are some of the best in the industry if not the best,” added Sharon Zackfia, an analyst at William Blair & Co. in Chicago. “The outlook for same-store sales for the first quarter was for a similar cadence, so that implies that the momentum remains.”