Shares of Lululemon Athletica Inc. rose 6.1 percent Thursday following a fourth-quarter report that was better than analysts expected and the disclosure of an international infrastructure plan for overseas expansion.
For the three months ended Feb. 2, net income rose 0.3 percent to $109.7 million, or 75 cents a diluted share, from $109.4 million, or 75 cents, a year ago. The consensus estimate was 72 cents. Net revenue gained 7.3 percent to $521 million from $485.5 million. Analysts were expecting $515.1 million for the quarter. Comparable-store sales fell 2 percent in the period, but total comps including direct-to-consumer rose 4 percent.
For the year, net income rose 3.3 percent to $279.5 million, or $1.91 a diluted share, on a net revenue gain of 16.1 percent to $1.59 billion.
Laurent Potdevin, chief executive officer, said in a conference call to Wall Street analysts that 2014 is an “investment year with an emphasis on strengthening our foundation, reigniting our product engine and accelerating sustainable and controlled global expansion.”
He said that he intends to “accelerate our global expansion. We see clear evidence of demand both in Asia and Europe with several countries ready for stores.”
In a telephone interview Potdevin said the company’s general manager in Asia has been checking out locations for expansion and that the firm is doing similar scouting for European sites.
Lululemon will open its first U.K. unit today in the former Jack Wolfskin space on Long Acre in London’s Covent Garden.
Spanning 3,000 square feet, the shopfit is similar to that of Lululemon stores worldwide — with a British twist. It features works by local artists Tobias Hall and Christine Kawasaki-Chan and is decorated with small wooden crates sourced from nearby Covent Garden Market. There is also a column covered in green tiles with a pub-style beer tap.
The Covent Garden location will also offer free yoga classes on the weekends in addition to the classes it hosts at Lululemon showrooms in Chelsea, Islington and Richmond.
The shop will carry men’s and women’s apparel and accessories, including jackets, trousers, tops and yoga mats. Prices range from 10 pounds, or $16 at current exchange, for a headband, to 198 pounds, or $328, for a jacket.
On the merchandising side of the business, Potdevin said the company is going back to its “design-led” roots. “The company’s incredible design and technological innovation came together really well. When it [started] focusing on supply-chain quality and turning around its product, its lost a little bit of that mind-set, which was the strength of the foundation. We’re really getting back to the amazing tension between design, fashion, style and innovation,” Potdevin said.
The company’s chief financial officer John Currie noted on the call that regions where there are new stores were trending better than older stores as the consumer is still “establishing her core wardrobe.”
Even though retail comps were down, Potdevin disputed whether that meant sales of yoga apparel were declining. “In those markets, [customers in our] more mature stores are focused on core product, and our core product has not grown as quickly as our seasonal product,” he said.
For the first quarter of fiscal 2014, the company guided diluted earnings per share to be in the range of 31 cents to 33 cents, on expected net revenues of $377 million to $382 million. For fiscal year 2014, diluted EPS is expected at between $1.80 and $1.90, on a net revenue range of $1.77 billion to $1.82 billion.
EXCLUSIVE: @tomford is opening its first-ever beauty store. The boutique, which opens November 20 in London’s Covent Gardens, was designed with the over-the-top glam Ford is known for. Read the full story on WWD.com, link in bio. #wwdbeauty #wwdnews (📷: Simon Wagner) #TomFordBeauty
New York-based DJ @harleyvnewton threw a party to celebrate the holiday collection of her dress and pajama line @hvn at the Ladurée Beverly Hills. It Girls @katebosworth, @rashidajones and more joined in on the fun, which included cocktails, croque monsieur sandwiches and a photo booth. #wwdfashion (📷: Owen Kolasinski/BFA.com)
For the holidays, @Burberry partnered with 20-year-old artist @blondeymccoy on a series of three outdoor murals in downtown Manhattan. The murals are McCoy’s interpretation of a Christmas eve party, the idea of charity and the spirit of family. His third mural, pictured here, is the most personal. The image depicts McCoy’s grandparents and father in London’s Trafalgar Square in the Seventies. “My work often features lots of sentimental objects.” #wwdeye
For spring 2018, designers applied bold colors and cartoonish motifs on everything from sneakers and belts to key chains. See all the top men’s accessories trends on WWD.com. #wwdtrends (📷: George Chinsee; Prop Styling by @rnasti; Market Editor: @luiscampuzano)
The @dior-sponsored @guggenheim international gala pre-party has a history of drawing cool-girl musical acts to serenade the crowd –– and last night was no exception. @haimtheband performed songs both new and old, and lured a star-studded audience with the likes of Rebecca Hall, Kate Mara, Mamoudou Athie and more. #wwdeye (📷: @lexieblacklock)
In a partnership between the @metopera and the @englishnationalopera, “Marnie” was born. The opera, with costumes sponsored by @mrporterlive, is an adaptation of the 1961 thriller by Winston Graham. Arianne Phillips, who created the costumes, is no rookie: She’s styled Madonna for her tours and created costumes for a myriad of films in the past. Read WWD’s interview with Phillips, where she talks about her inspiration for the opera’s costumes on WWD.com #wwdfashion
@barneysnyc took a different approach to their holiday windows this year. Instead of Christmas decor, Barneys tapped @thehaasbrothers to tell a story of positivity, gratitude and inclusivity via heartwarming silliness and humor. “It’s about kids and it’s about coming together and being family and loving each other,” said Simon Haas. #wwdfashion (📷: @joshuascottphoto)
Beauty influencer @kandeejohnson makes her foray into hair care with a collaboration with @ogx_beauty — making it the first time that OGX has teamed up for a product creation. The collab includes shampoos and conditioners in three scents. At 39 and a mom, Johnson is a different profile than the emerging social media stars, but is considered one of the pioneers of the digital beauty influencer world. Read WWD’s interview with her on wwd.com, including the strangest beauty product she’s ever tried #wwdbeauty