Good afternoon. , and in many other countries globally. endstream endobj 1933 0 obj <>stream Total How much of a percentage of the assortment can this represent over time? As Calvin mentioned, sales trends remain positive with total digital comp up 4% in Q2. Is that the right way to think about this? Are the opt-in rates a little bit lower than what you expected? lululemon will use the information you provide to deliver you relevant information about our products and services, including offerings based on your preferences and purchase history. This year, we will likely achieve the goal we set to double our men's business, and we remain on track to quadruple our international business by 2023, if not sooner. , Exciting, thanks. Thank you so much. Sign Up. As you alluded, we're very happy with the overall growth in our men's business two-year CAGR of 31%. The summary below provides both GAAP and adjusted non-GAAP financial measures. The following tables reconcile adjusted financial measures with the most directly comparable measures calculated in accordance with GAAP. Best Growth Stock to Buy: Nike Stock vs. Lululemon Stock, This Hot Growth Stock Is Still a Buy After Enormous Gains, Buy the Dip in 2023 on These Potentially Explosive Stocks, 2 Reasons to Avoid a Roth 401(k) for Your Retirement Savings, Want $1 Million in Retirement? Oct 07, 2021. Comparable sales increase 20% Howard Tubin -- Vice President, Investor Relations. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. People Who Make Our Products: Achieve Fair Labor Association (FLA) accreditation, and make empowerment programs available to more than 100,000 makers across our supply chain by 2025. Before I open it up to questions, I wanted to take a look back on these results and the previous quarters and speak for a moment about the unique business model that drives their success, enables our strong performance, and allows us to navigate COVID-19 and the current headwinds impacting our supply chain. Thanks for signing up, youll soon start getting the inside scoop on the latest gear, our favourite workouts, events and much more. We had approximately $1.2 billion in cash and cash equivalents and nearly $400 million of available capacity under our revolving credit facility. So it is a reflection of the industry. Made for pre-workout warmups, neighborhood strolls, and rest days this is the technical and versatile gear designed for all aspects of life. The adjustments relate to the amounts recognized in connection with We disclose personal data when we believe doing so is reasonably necessary to comply with applicable law or legal process (including requests from authorities), to respond to claims (including inquiries by you in connection with your purchases from lululemon), or to protect the rights, property or personal safety of lululemon, our users, employees or the public. To learn more see our privacy policy. In closing, I'd like to thank the entire Lululemon family, especially our teams in stores and our guest education center, and in our distribution centers around the world. Three new styles feature innovative fabrics and construction. In general, we use your personal data to respond your requests, conduct your requested transactions, maintain and customize your account and our interactions with you and provide, maintain and improve our products and services. Foreign The underlying demand for our brand is strong. Joseph Teklits We've established plans to improve the planet that we're committed to. This includes operating results for MIRROR that excludes acquisition and integration-related costs. Since our holding company, subsidiaries and affiliates are located around the world, please note that these disclosures involve cross-border transfers of your personal data. Walmart Inc. (NYSE: WMT) hosted the virtual 2021 Investment Community Meeting on February 18, 2021. Our obsession with raw material and our investment in our product is what we do, is what we obsess about, and its really what drives why the guests feel different and continue to sort of be loyal to this product and brand. "When you compare that to other brands, that is very high," McDonald said. Our freshest gear. Tapestry Acceleration Program Infographic. Right. the Quarter, Number of It's made from a proprietary Ultralu fabric and expands our offering into the high-impact training category. A right to revoke your consent: When our processing is based on your consent, you have the right to revoke such consent at any time. Transfers to Canada are made pursuant to European Commission decision 2002/2/EC of 20 December 2001. Q. If we make material changes to this Privacy Policy, we will provide you with additional notice (such as adding a statement to our websites homepages or sending you a notification). Calvin McDonald -- Chief Executive Officer. We continue to expect to open 45 to 55 net new company-operated stores in 2021. The Motley Fool has a disclosure policy. Thank you so much for taking the question. We will be competitive to attract new members and we will continue to take a measured and responsible approach to the business. LULU stock fell about 2% in after-hours action. Electric vehicle maker Tesla hosted a 2023 investor day presentation in Austin, Texas, on Wednesday. Our success was our people, and honouring commitments to our landlords and vendors. Does it kind of push it out a little bit more? Oct 2021 - Present1 year 6 months. Feb. 18, 2021 | 7:00 AM US/Central. Results of this caliber enable us to now develop our next five-year growth plan, and we'll come back to you next year with an updated view of what the future can hold for Lululemon. Introducing new pant fabrics and styles that deliver athletic innovation for everyday life. Welcome to the Lululemon Athletica second-quarter 2021 earnings conference call. In Q3, we expect SG&A deleverage of approximately 300 to 350 basis points relative to 2019. Goldman Sachs DTC/Digital Apparel Pop-up Conference Featuring Joanne Crevoiserat and Noam Paransky. In Analysts had been looking for Lululemon to . I would also note that markdowns declined relative to 2019. The cost of profitability therefrom MIRROR is very much within our control, and we're investing behind the strength and momentum of that -- in that business as well as our overall financial strength, and we'll share more as we move through the peak holiday season and into '22. That's helpful. The membership test gave us access to thousands of guests that were behaving in this way in MIRROR, at the end of this year is going to give us access to hundreds of thousands. Productivity in stores returned to 2019 levels, representing continued improvement versus 88% productivity we realized in Q1 of this year. Brunswick Group For all other inquiries, please contact gec.emea@lululemon.com. Investors. 1-604-732-6124 We continue to expect gross margin for the year to expand between 150 to 200 basis points compared to the modest increase we saw in 2020. Our ABC and Commission styles bring you elevated everydaythe lululemon way. `F9HKb>*DpV Bva}d_uY)so6.~J6@&,xg+[ 0 Please review these policies before you disclose any personal data when visiting such third-party websites. So overall, what's very exciting is the balance of growth across all international markets, meaning they are all contributing significant growth and into our goal of quadrupling our international business by '23. Welcome to our Investors page. It seems like most of this is cyclical and much of this can be recovered fairly quickly as the supply chain begins to open up. The next question comes from John Kernan with Cowen. are compared to the 52 weeks ended Feet Lost So I think the -- I know the TAM has been impacted by those macro trends. We ensure, with the signature of Standard Contractual Clauses adopted by the European Commission, that personal data transferred outside the EEA and Switzerland is maintained with at least the same level of security and protection for personal data that is required under applicable law. A paid membership program focused on sweat. The next question comes from Brooke Roach with Goldman Sachs. So it's pretty fluid, Matt, and we're comfortable -- sorry, Jay, very fluid and we're comfortable with sort of how we're positioned today in addressing it, but all and any pricing changes would be in Meghan's guidance and there's nothing of significant plan or that you should expect. Please go ahead. February 3, 2019 ET. The direct-to-consumer channel, including e-commerce and mobile sales, made up 54% of total revenue. To opt-in for investor email alerts, please enter your email address in the field below and select at least one alert option. . The acquisition will strengthen lululemons omni guest experiences through digital sweat. The Company repurchased 1.1 million shares of its own common stock at an average cost of. And we're pleased, I would say, overall with that relative to 2020 performance. We recently opened our second production studio in New York, allowing us to double the number of live classes, and MIRROR will launch a new e-commerce site in time for the holiday season this year. And can you remind us what is it about Lululemon that continues to allow you to be a leader when a lot of other companies are going to become a big resource -- they are going to be making investments in this category? inc. We are committed to serving the best interests of our shareholders. Hi. After many real and impactful conversations with their underrepresented employees and greater community, lululemon's Senior Leadership Team made the following commitments to stand up and fund Inclusion, Diversity, Equity, and Action within the organization to support meaningful, lasting change in . We continue to be pleased with the performance of MIRROR, and let me highlight several initiatives we have on track for this year. Please read this Notice before entering the Promotion to make sure you understand how we process your personal data in connection with the Promotion. And then, secondly, for Meghan, on the second quarter comment, you called out an open-store productivity back at 2019 levels, how are you planning that for the back half? Sign up to our emails to join The lululemon Community and enjoy 10% off your next order. , we temporarily closed all of our retail locations in Mainland China. lululemon Quarterly Financial Supplements PDF. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. We saw strong performance in our nonscrubs business, which increased 59%. So in terms of Vietnam, we source approximately 30% of our finished goods. But those brands that have been acquired have been in the market, we've competed against them before and we've always liked our unique and differentiation within what has been a crowded marketplace and yet we continue to put up the results we've put up in the past number of years. 7. lululemon.org: Establish a lululemon centre of excellence for social impact to support wellbeing by 2021. At the end of Dec. 1994, Nike stock traded at a P/E of 54, not quite as high as Lululemon's current 64 P/E but still frothy. Thank you for standing by, this is the conference operator. We are so grateful for everyone's hard work and dedication. In 2020, it fell by 48 per cent. Thank you, Calvin. We've recently announced that we will raise the minimum base pay for our store and guest education center roles in North America, taking our new base pay to $15 to $17 per hour, depending on the location and roll, plus all levels are eligible for a monthly bonus on top of base pay. Reconciliation of Non-GAAP Financial Measures Comparable 10% WELCOME OFFER: Fair Processing Notice. Strong guests' response to our merchandise offering and improving store trends and continued strength in e-commerce fueled our growth, and contributed to our increased outlook for the year, which I will take you through in a moment. lululemon athletica inc. For more information, visit www.lululemon.com. , In our store channel, sales increased 9% on a two-year CAGR basis, above our expectations of approximately flat. A right to data portability: In certain circumstances, you have the right to request that we provide the personal data which you provided to us in a structured, commonly used and machine-readable format, and you have the right to transmit such data to another controller without hindrance from lululemon. And the program was embraced by men at a higher rate than we were expecting. Lululemon Athletica Inc. was founded in 1998 and is based in Vancouver, Canada. And from that, some of the behaviors that we were able to observe was how it drove brand love, their connection to the community, both the brand as well as to each other, which is really important. The next question comes from Matthew Boss with J.P. Morgan. is just kind of what you thought? compared to A right to object to processing:You have the right to request that we stop processing personal data about you. I'll share some of the specific impacts of these issues with you as I take you through our Q2 financials and our guidance. *Average returns of all recommendations since inception. Speaking of the outlook, Lululemon reinstated a detailed annual forecast for the first time since the pandemic started. Thanks, Ike. On June 29, 2020, Lululemon announced its intention not to be left behind. At the end of the quarter, we had 245 million of availability remaining on our current share repurchase authorization. And we're excited about the ability to scale it. Combined, these give us a unique strength to keep growing MIRROR. Key Takeaways. This fair processing notice (Notice) explains how we process your personal data when you participate in the 10% Off Welcome Promotion (Promotion). The company is building a powerful brand built on grassroots initiatives and millions of loyal customers. Looking at our business over the course of the second quarter and the first half of the year, I continue to be excited about our day-to-day progress. are compared to the 13 weeks ended The highlight was standout performance from the direct-to-consumer channel where robust growth in e-commerce helped Lululemon report a small profit even with stores closed. tax reform and taxes on repatriation of foreign earnings. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Ike Boruchow -- Wells Fargo Securities -- Analyst. for further information on these adjustments. Relative to 2019, our gross margin is benefiting from a higher e-com penetration and leverage on occupancy and depreciation. lululemons Latest Jackets and Outerwear Collection Stretches Beyond Expectations, Super Fine Face Mist is the Newest Addition to lululemons Selfcare Category, Sorry, we don't ship to your country/region, lululemon athletica 1818 Cornwall Ave, Vancouver BC V6J 1C7, California Privacy Rights (Last Updated: 1/23/23). A reconciliation of GAAP to non-GAAP measures is included in our quarterly report on Form 10-Q and in today's earnings press release. This article is a transcript of this conference call produced for The Motley Fool. As Calvin mentioned, we continue to navigate industrywide challenges with COVID-related factory closures, slowdowns at the ports, and reduced airfreight capacity impacting our business as we move into the second half of the year. The learnings from our membership test are considerable. For 2022, our first full year as a public company, we delivered net revenue growth of over 20%. Gross profit for the second quarter were $843 million or 58.1% of net revenue, compared to 54.2% of net revenue in Q2 2020, and 55% of net revenue in Q2 2019. This growth rate continues to outpace our three-year CAGR of 19% leading up to the pandemic, and also represents an acceleration from the 25% two-year CAGR we reported in quarter 1 of this year. For the fourth quarter ended Earnings, U.S. Another wave of COVID-19 and related factory closures in Vietnam, ongoing issues at the ports, and reduced airfreight capacity are contributing to some disruptions within the supply chain, as well as increased costs. Caitlin Churchill 36. And I am pleased to now hand it over to Celeste, who will share some additional details with you on our stores and e-commerce business. Eleanor French We're so excited to welcome lululemon to the Fertifa family. In terms of gross margin, a 150 basis points to 200 basis points, expansion was where we guided for the full year. And when do some of the facilities that have currently been shuttered in Vietnam need to start ramping, which hits later holiday demand, as well as spring? This is below our expectations for a 25% to 30% increase due to our top-line outperformance coupled with industrywide supply chain disruptions. It is you who brings our brand to life every day and enables our strong financial results. Gotcha. We now expect our fiscal year 2021 adjusted diluted earnings per share to be in the range of $7.38 to $7.48. Our momentum continued in Q2 with our top and bottom-line results exceeding our expectations. I continue to be very encouraged with the usage numbers and engagement numbers that we're seeing with the MIRROR community. Here you will find key information and financial reports, putting the performance of lululemon athletica inc into perspective for you. But is the lower guidance a bad thing or a chance for investors to buy a stock on sale? During this call, we will present both GAAP and non-GAAP financial measures. If you have any questions about the security of personal data collected by lululemon contact us HERE. Turning to EPS. Consider that in fiscal 1994, Nikesales declined 3.6% to $3.79 billion. Unfortunately, the transmission of information via the internet is not completely secure or private. Burgoyne becomes the first executive to serve at the President level in her role. , Chief Executive Officer, commented: "2019 was a strong year for We are monitoring this closely and leaning into the agility of our supply chain, the strength of our planning and allocations team, and the powerful partnerships with our vendors to help mitigate the risks where we can. Q2 spend relates primarily to store capital for new locations, relocation and renovations, supply chain investment, and technology spend to support our business growth. A conference call to discuss fiscal 2019 results is scheduled for today, The next question comes from Erin Murphy with Piper Sandler, please go ahead. Comps increased 4% on top of the 157% increase last year. That continues to differentiate the brand and its unique position as premium but through quality innovation. Invest better with The Motley Fool. lululemon athletica I wanted to focus on the men's business for a minute. We continue to expect capital expenditures to be approximately $365 million to $375 million in 2021. And if I could just follow up with a question for Meghan on the SG&A leverage outlook, there are a lot of moving pieces within the outlook, some investments in brand-building, higher wages. How should we think about this in terms of recovery? Anshul Ruparell quit the banking business to follow in his dad's entrepreneurial footsteps. The adjusted financial measures exclude the amounts recognized in connection with If investors had decided that Nike stock was overvalued and sold their shares, they would have missed a 4,000% gain over the next 25 years. The Motley Fool owns shares of and recommends Lululemon Athletica. Fostered and maintained various relationships with athletic/wellness influencers and business owners in order to promote products, create and execute community events, find and maintain brand ambassadors and increase social media engagement. the End of the 12. We prioritized our people and kept our teams intact by offering pay production, sick pay, and other key people investments. New Zealand So in terms of SG&A, we guided for Q3 the 300 to 350 basis points of deleverage relative to 2019. Cost basis and return based on previous market day close. Second, we saw further improvement in our brick-and-mortar channel with open stores generating productivity in line with 2019. In addition, our revenue increased across each of our major regions, up 26% in North America, and up 43% in our international markets, both on a two-year CAGR basis. E-com contributed $597 million of top-line or 41% of total revenue. Hi, Mark. Quarterly Infographic PDF. Company-operated store count and square footage summary excludes retail locations operated by third parties under license and supply arrangements. See active subscriptions. The Power 3 initiatives focusing on product, guest experience, and market expansion are still the key areas of focus that we will drive our innovation through. When you look at the full year, we've got 10 to 30 basis points of deleverage for -- relative to 2020 and that is better than the 30 to 50 basis points that we disclosed previously. Thanks and congrats on another great quarter. Quarter2, Total Gross Great. ~^C`llhH5vY]-#~0 b lululemon athletica inc. (NASDAQ:LULU) today announced financial results for the fourth quarter and fiscal year ended Actual results and the timing of events could differ materially from those anticipated in the forward-looking statements as a result of risks and uncertainties, which include, without limitation: our ability to maintain the value and reputation of our brand; the acceptability of our products to our guests; the recent COVID-19 coronavirus outbreak and related government, private sector, and individual consumer responsive actions; our highly competitive market and increasing competition; our reliance on and limited control over third-party suppliers to provide fabrics for and to produce our products; suppliers or manufacturers not complying with our Vendor Code of Ethics or applicable laws; the operations of many of our suppliers are subject to international and other risks; an economic downturn or economic uncertainty in our key markets; increasing product costs and decreasing selling prices; our ability to anticipate consumer preferences and successfully develop and introduce new, innovative and updated products; our ability to accurately forecast guest demand for our products; our ability to safeguard against security breaches with respect to our information technology systems; any material disruption of our information systems; our ability to have technology-based systems function effectively and grow our e-commerce business globally; changes in consumer shopping preferences and shifts in distribution channels; the fluctuating costs of raw materials; our ability to expand internationally in light of our limited operating experience and limited brand recognition in new international markets; global economic and political conditions and global events such as health pandemics; our ability to deliver our products to the market and to meet guest expectations if we have problems with our distribution system; imitation by our competitors; our ability to protect our intellectual property rights; our ability to source and sell our merchandise profitably or at all if new trade restrictions are imposed or existing trade restrictions become more burdensome; changes in tax laws or unanticipated tax liabilities; our ability to manage our growth and the increased complexity of our business effectively; our ability to cancel store leases if an existing or new store is not profitable; increasing labor costs and other factors associated with the production of our products in South and
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