Lululemon Athletica Inc. on Wednesday posted an almost 60 percent gain in third-quarter profits, boosted by the performance of its yoga and running lines.
For the three months ended Nov. 1, income was up 59.2 percent to $14.1 million, or 20 cents a diluted share, from $8.8 million, or 13 cents, a year ago. Revenues rose 29.7 percent to $112.9 million from $87 million. Revenue from company-owned stores advanced 26.4 percent to $98.1 million from $77.6 million, with same-store sales rising 10 percent on a constant-dollar basis.
The company increased its gross profit for the third quarter by 34.4 percent to $56.3 million as gross profit grew to 49.9 percent of sales from 48.1 percent in the year-ago quarter.
Straddling analysts’ consensus estimate, the company said it expects earnings of between 26 cents and 28 cents a diluted share in the fourth quarter with same-store sales rising in the midteens on a constant-dollar basis. The third-quarter profit was 1 cent better than consensus.
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“Sales momentum continued to build in the third quarter as consumers responded to our distinctive product, community connections and in-store guest experience,” said Christine Day, chief executive officer.
Day noted that the company also “made significant progress in improving our gross margin with a return to the 50 percent level, and [we] are very pleased to deliver these results in a challenging retail environment.”
Day said on a call with Wall Street analysts that the company achieved its sales results “without changing our promotion cadence.”
She said the yoga line was a driver of sales in the quarter, and there was “incredible” reaction to the brand’s running line. The company’s e-commerce site carries its full line of product, and free shipping was offered starting in October.
For the nine months, income was up 4.9 percent to $29.8 million, or 42 cents a diluted share, from $28.4 million, or 40 cents. Sales rose 17.1 percent to $292.3 million from $249.6 million.