Lululemon profit rises as sales top $2B for first time last year

Lululemon Athletica Inc. on Wednesday reported fiscal fourth-quarter net income of $117.4 million.

Chain sold more than $2 billion worth of goods last year for first time ever

Lululemon sold more than $2 billion worth of yoga wear and apparel last year. (Lucas Jackson/Reuters)

Lululemon's fiscal fourth-quarter performance beat Wall Street's view, bolstered by strong holiday sales.

Its shares rose almost eight per cent in morning trading Wednesday.

For the period ended Jan. 31, the Canadian yoga-wear company earned $117.4 million, or 85 cents per share. A year earlier it earned $110.9 million, or 78 cents per share.

Analysts polled by FactSet had predicted 80 cents per share.

Revenue climbed to $704.3 million from $602.5 million, topping the $692.6 million that analysts expected.

Same store sales up

Sales at stores open at least a year, a key indicator of a retailer's health, increased 5 per cent on a constant dollar basis. This figure excludes results from stores recently opened or closed.

The company had 363 stores at the end of the year. On a constant dollar basis, same-store sales rose 4 per cent.

Lululemon chief executive Laurent Potdevin said Lululemon has boosted its customer experience to build business in the face of cheaper alternatives to its yogawear.

"In 2015, we made bold moves across the organization, elevating design and innovation and developing our infrastructure to position us for the future," Potdevin said in a statement.

Lululemon Athletica Inc. reported a full-year adjusted profit of $1.86 per share on revenue of $2.06 billion, the first time sales have moved above that benchmark.

Stronger outlook

Looking ahead, the chain anticipates first-quarter profit between 28 cents and 30 cents per share on revenue in a range of $483 million to $488 million. Lululemon expects fiscal 2016 profit between $2.05 and $2.15 per share on revenue in a range of $2.29 billion to $2.34 billion.

Wall Street is looking for a first-quarter profit of 37 cents per share on revenue of $486.1 million and fiscal 2016 profit $2.16 per share on revenue of $2.32 billion.

Lululemon shares rose $4.73, or 7.8 per cent, to $65.97 in morning trading Wednesday. Its shares are up almost 2 per cent over the past year.

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