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lululemon athletica inc. Reports Operating Results (10-Q)

December 06, 2012 | About:
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10qk

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lululemon athletica inc. (LULU) filed Quarterly Report for the period ended 2012-10-28.

Lululemon Athletica, Inc. has a market cap of $10.34 billion; its shares were traded at around $67.25 with a P/E ratio of 49.2 and P/S ratio of 10.3. Lululemon Athletica, Inc. had an annual average earning growth of 54.7% over the past 5 years.
This is the annual revenues and earnings per share of LULU over the last 10 years. For detailed 10-year financial data and charts, go to 10-Year Financials of LULU.


Highlight of Business Operations:

Throughout the first three quarters of fiscal 2012, we were able to grow our e-commerce business which has further increased our brand awareness and has made our product available in new markets, including those outside of North America. This sales channel offers a higher operating margin than our other segments and accounted for 13.4% of total revenue in the first three quarters of fiscal 2012 compared to 8.9% of total revenue in the same period of the prior year. Continuing increases in traffic and conversion rates on our e-commerce website lead us to believe that there is potential for our direct to consumer segment to become an increasingly substantial part of our business and we plan to continue to commit resources to further developing this channel.

We have three reportable segments: corporate-owned stores, direct to consumer and other. We report our segments based on the financial information we use in managing our businesses. While we receive financial information for each corporate-owned store, we have aggregated all of the corporate-owned stores into one reportable segment due to the similarities in the economic and other characteristics of these stores. Our direct to consumer segment accounted for 14% of our net revenue in third quarter of fiscal 2012, compared to 10% in the third quarter of fiscal 2011. Our other segment, consisting of franchise sales, wholesale accounts, sales from company-operated showrooms, warehouse sales and outlets, accounted for less than 10% of our net revenue in the third quarters of fiscal 2012 and fiscal 2011.

Other. Net revenue from our other segment increased $3.1 million, or 19%, to $19.4 million in the third quarter of fiscal 2012 from $16.3 million in the third quarter of fiscal 2011. A higher number of showrooms open during the third quarter of fiscal 2012 compared to the third quarter of fiscal 2011 contributed to the increase in net revenue from our other segment. Increased revenue from outlets, both through growth at existing locations and through the addition of a new location also contributed to the increase in net revenue from our other segment. The increase was partially offset by decreased revenue from wholesales. We continue to employ our other segment strategy to increase interest in our product in markets we have not otherwise entered with corporate-owned stores.

Other. Income from operations from our other segment increased $0.4 million, or 11%, to $4.0 million for the third quarter of fiscal 2012 from $3.7 million for the third quarter of fiscal 2011. Gross profit related to our other segment increased $1.6 million in the third quarter of fiscal 2012 from the third quarter of fiscal 2011. This increase was partially the result of a higher number of showrooms open during the third quarter of fiscal 2012 compared to the third quarter of fiscal 2011, as well as growth from our outlets. This increase was partially offset by decreased wholesales. We continue to employ our other segment strategy to increase interest in our product in markets we have not otherwise entered with corporate-owned stores.

Income from operations before general corporate expenses for the thirty-nine week periods ended October 28, 2012 and October 30, 2011 are expressed in dollar amounts as well as percentages, presented as a percentage of net revenue of their respective operating segments below.

Read the The complete Report

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