CANADA: Lululemon cuts outlook despite Q3 profit growth
- Q3 profit up 15.2% to $66.1m
- Revenue grows 20% to $379.9m
- Company lowers full-year sales guidance
Lululemon Athletica has blamed macro and execution issues for cutting its full-year sales guidance, despite recording a 15.2% increase in profit during the third quarter.
The Canadian sportswear brand today (12 December) said net profit reached US$66.1m for the 13 weeks to 3 November, up on $57.4m in the same period of last year.
Revenue increased 20% to $379.9m from $316.5m in the prior year, while comparable stores sales were up 5% on a constant dollar basis. Direct-to-consumer revenue jumped 37% to $62m.
Commenting on the company's performance, outgoing CEO Christine Day said: "We are proud of our third quarter results, with sales in line with our expectation and earnings ahead of our guidance and rebounding to a double digit growth rate.
"This so far has been a year of challenges, learning, and growth for Lululemon, and while our outlook for the fourth quarter is being impacted by both macro and execution issues, I believe that the investments we are making in the business combined with the team in place create a strong platform for growth in the years ahead."
Year-to-date net profit rose 4.8% to $169.9m from $162.1m in the previous year, while sales reached $1.07bn, up 20.9% on $884.9m last year.
The company expects full-year revenue to range from $1.61-$1.61bn, compared to its earlier guidance of $1.63-$1.64bn. For the fourth quarter, revenue is forecast to reach $535-$540m, based on flat comparable-store sales on a constant-dollar basis.
The lowered forecast comes just days after Lululemon Athletica founder and chairman Chip Wilson decided to step down as the Canadian sportswear brand appointed Laurent Potdevin as its new CEO.
Last month, Lululemon faced fresh complaints about the quality of its products, eight months after the brand was forced to pull a line of black Luon trousers from its stores after the fabric was found to be see-through.
What else is likely to be topping the apparel industry's software agenda this year? 3D product development and design, digital continuity of information and images, predictive analytics, Systems that ...
This report provides information, analysis and valuable insight on developments relating to the performance apparel industry in the following categories: acquisitions, divestments and mergers; corpora...
- Can Gap maintain its momentum minus Larsson?
- Patagonia's CSR commitments re-shaping the sector
- Brands back Cambodia industry-wide wage bargaining
- Can robotics redefine apparel manufacturing?
- Zalando: profit is so last season
- Unions agree proposed Cambodia minimum wage
- New CEO may focus on Ralph Lauren supply chain
- Nike collaborates on low-impact textile challenge
- Patagonia ramps up Fair Trade Certified apparel
- Old Navy's Larsson to replace Ralph Lauren as CEO
- The future market potential for smart garments and e-textiles
- Global Database of the Top 1000 Apparel Producers - Company Names, Financial Performance, and Contact Details
- Myanmar's Garment Sector in 2015 - now with updated members' directory
- Global market review of lingerie - forecasts to 2020
- Outdoor performance apparel: peaks, valleys, and green fields