lululemon athletica inc. (LULU) SEC Filing 10-Q Quarterly report for the period ending Sunday, October 28, 2018

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Exhibit 99.1
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LULULEMON ATHLETICA INC. ANNOUNCES THIRD QUARTER FISCAL 2018 RESULTS
Revenue up 21% to $748 million
Comparable sales increase 17%, or 18% on a constant dollar basis
Diluted EPS of $0.71, or adjusted diluted EPS of $0.75
Vancouver, British Columbia – December 6, 2018 – lululemon athletica inc. (NASDAQ:LULU) today announced financial results for the third quarter ended October 28, 2018.
The summary below provides both GAAP and adjusted non-GAAP financial measures. The adjusted financial measures exclude the tax expense recognized during the third quarter of fiscal 2018 related to the U.S. Tax Cuts and Jobs Act, and the costs and the related tax effects incurred in connection with the restructuring of the Company's ivivva operations in third quarter of fiscal 2017.
For the third quarter ended October 28, 2018:
Net revenue was $747.7 million, an increase of 21% compared to the third quarter of fiscal 2017. On a constant dollar basis, net revenue increased 22%.
Total comparable sales increased 17%, or increased 18% on a constant dollar basis.
Comparable store sales increased 6%, or increased 7% on a constant dollar basis.
Direct to consumer net revenue increased 44%, or increased 46% on a constant dollar basis.
Direct to consumer net revenue represented 25.3% of total net revenue compared to 21.2% for the third quarter of fiscal 2017.
Gross profit was $406.8 million, an increase of 26% compared to the third quarter of fiscal 2017. Gross profit increased 26% compared to adjusted gross profit for the third quarter of fiscal 2017.
Gross margin was 54.4%, an increase of 240 basis points compared to the third quarter of fiscal 2017. Gross margin increased 220 basis points compared to adjusted gross margin for the third quarter of fiscal 2017.
Income from operations was $135.9 million, an increase of 59% compared to the third quarter of fiscal 2017. Income from operations increased 26% compared to adjusted income from operations for the third quarter of fiscal 2017.
Operating margin was 18.2%, an increase of 440 basis points compared to the third quarter of fiscal 2017. Operating margin increased 80 basis points compared to adjusted operating margin for the third quarter of fiscal 2017.
Income tax expense was $43.5 million compared to $27.7 million in the third quarter of fiscal 2017 and the effective tax rate was 31.6% compared to 32.0%. The adjusted effective tax rate was 27.8% compared to 30.8% in the third quarter of fiscal 2017.
Diluted earnings per share were $0.71 compared to $0.43 in the third quarter of fiscal 2017. Adjusted diluted earnings per share were $0.75 compared to $0.56 for the third quarter of fiscal 2017.
The Company ended the third quarter of fiscal 2018 with $703.6 million in cash and cash equivalents compared to $650.1 million at the end of the third quarter of fiscal 2017. Inventories at the end of the third quarter of fiscal 2018 increased 25% to $496.0 million compared to $396.9 million at the end of the third quarter of fiscal 2017. The Company ended the quarter with 426 stores.
Calvin McDonald, Chief Executive Officer, commented: "lululemon has achieved a high level of success over the past year and has established a solid foundation to continue to build our future. It's been exciting to see guests around the world respond so strongly to our product offerings and improved digital experience. I look forward to what's ahead for our brand as we strive to exceed the expectations of our guests."
Stuart Haselden, Chief Operating Officer, also noted: "We're pleased with our Q3 results and the strong momentum we continue to see across our business. These results reflect the strategic investments we've made, and continue to make, to achieve our long-term growth objectives. I'd like to thank our educators and teams around the world whose passion and enthusiasm enable this ongoing standout performance."

1

The following information was filed by lululemon athletica inc. on Thursday, December 6, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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  • 18487869_302
    Other - Other
    An accounting policy is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact our consolidated financial statements.
  • 18487869_99
    Financial - Earnings
    The increase was primarily the result of increased gross profit of $32.3 million which was primarily due to increased net revenue and higher gross margin.
  • 18487869_109
    Financial - Earnings
    The increase was primarily the result of increased gross profit of $13.1 million which was primarily due to increased net revenue and higher gross margin.
  • 18487869_189
    Financial - Earnings
    The increase was primarily the result of increased gross profit of $110.5 million which was primarily due to increased net revenue and higher gross margin.
  • 18487869_194
    Financial - Earnings
    The increase was primarily the result of increased gross profit of $118.9 million which was primarily due to increased net revenue and higher gross margin.
  • 18487869_199
    Financial - Earnings
    The increase was primarily the result of increased gross profit of $33.2 million which was primarily due to increased net revenue and higher gross margin.
  • 18487869_234
    Financial - Earnings
    Adjusted gross profit, gross margin, income from operations, operating margin, income tax expense, effective tax rates, and diluted earnings per share exclude the amounts recognized in connection with the U.S. tax reform and the costs and related tax effects recognized in connection with the restructuring of our ivivva operations.
  • 18487869_75
    Financial - Earnings
    Gross profit as a percentage of net revenue, or gross margin, increased 240 basis points to 54.4% in the third quarter of fiscal 2018 from 52.0% in the third quarter of fiscal 2017.
  • 18487869_165
    Financial - Earnings
    Gross profit as a percentage of net revenue, or gross margin, increased 320 basis points, to 54.1% in the first three quarters of fiscal 2018 from 50.9% in the first three quarters of fiscal 2017.
  • 18487869_116
    Financial - Income
    The increase was primarily due to an increase in net interest income, primarily due to higher rates of return on our cash and cash equivalents, including money market funds, treasury bills, and term deposits, and due to an increase in cash and cash equivalents in the third quarter of fiscal 2018 compared to third quarter of fiscal 2017.
  • 18487869_206
    Financial - Income
    The increase was primarily due to an increase in net interest income, primarily due to higher rates of return on our cash and cash equivalents, including money market funds, treasury bills, and term deposits, and due to an increase in cash and cash equivalents in the first three quarters of fiscal 2018 compared to the first three quarters of fiscal 2017.
  • 18487869_39
    Financial - Earnings
    It increased 80 basis points compared to adjusted operating margin for the third quarter of fiscal 2017.
  • 18487869_35
    Financial - Earnings
    It increased 220 basis points compared to adjusted gross margin for the third quarter of fiscal 2017.
  • 18487869_46
    Revenue - Product
    Management's Discussion and Analysis of Financial Condition and Results of Operations" for reconciliations between constant dollar changes in net revenue, total comparable sales, comparable store sales, and direct to consumer net revenue, and adjusted gross profit, gross margin, income from operations, operating margin, income tax expense, effective tax rates, and diluted earnings per share, and the most directly comparable measures calculated in accordance with GAAP.
  • 18487869_1
    Other - Other
    All statements, other than statements of historical facts, included or incorporated in this Form 10-Q are forward-looking statements, particularly statements which relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts, such as statements regarding our future financial condition or results of operations, our prospects and strategies for future growth, the development and introduction of new products, and the implementation of our marketing and branding strategies.
  • 18487869_242
    Other - Other
    The following tables reconcile the adjusted financial measures with the most directly comparable measures calculated in accordance with GAAP.
  • 18487869_58
    Revenue - Product
    The following contributed to the increase in net revenue from our company-operated stores segment: Net revenue from company-operated stores we opened or significantly expanded subsequent to October 29, 2017, and therefore not included in comparable store sales, contributed $41.3 million to the increase.
  • 18487869_146
    Revenue - Product
    The following contributed to the increase in net revenue from our company-operated stores segment: Net revenue from company-operated stores we opened or significantly expanded subsequent to October 29, 2017, and therefore not included in comparable store sales, contributed $134.5 million to the increase.
  • 18487869_90
    Financial - Expense
    This included costs of $1.2 million recognized in cost of goods sold, and asset impairment and restructuring costs totaling $21.0 million.
  • 18487869_180
    Financial - Expense
    This included costs of $8.8 million recognized in cost of goods sold, and asset impairment and restructuring costs totaling $36.5 million.
  • 18487869_263
    Other - Other
    Increased capital expenditures related to our company-operated stores also contributed to the increase in cash used in investing activities, primarily as a result of an increase in renovations and relocations of existing stores.
  • 18487869_79
    Financial - Earnings
    Excluding these charges from the comparatives for the third quarter of fiscal 2017, gross profit increased 26% and gross margin increased 220 basis points.
  • 18487869_169
    Financial - Earnings
    Excluding these charges from the comparatives for the first three quarters of fiscal 2017, gross profit increased 30% and gross margin increased 270 basis points.
  • 18487869_276
    Other - Other
    Our cash from operations may be negatively impacted by a decrease in demand for our products as well as the other factors described in Item 1 of Part II of this Quarterly Report on Form 10-Q.
  • 18487869_33
    Financial - Earnings
    It increased 26% compared to adjusted gross profit for the third quarter of fiscal 2017.
  • 18487869_268
    Financial - Shares / Equity
    On December 1, 2016, our board of directors approved a program to repurchase shares of our common stock up to an aggregate value of $100.0 million.
  • 18487869_270
    Financial - Shares / Equity
    On November 29, 2017, our board of directors approved a program to repurchase shares of our common stock up to an aggregate value of $200.0 million.
  • 18487869_91
    Financial - Income
    Excluding these charges from the comparatives for the third quarter of fiscal 2017, income from operations increased 26% and operating margin increased 80 basis points.
  • 18487869_181
    Financial - Income
    Excluding these charges from the comparatives for the first three quarters of fiscal 2017, income from operations increased 53% and operating margin increased 350 basis points.
  • 18487869_88
    Financial - Earnings
    Operating margin increased 440 basis points to 18.2% compared to 13.8% in the third quarter of fiscal 2017.
  • 18487869_178
    Financial - Earnings
    Operating margin increased 610 basis points to 17.7% compared to 11.6% in the first three quarters of fiscal 2017.
  • 18487869_37
    Financial - Income
    It increased 26% compared to adjusted income from operations for the third quarter of fiscal 2017.
  • 18487869_104
    Financial - Earnings
    The increase was primarily the result of increased gross profit of $38.3 million which was primarily due to increased net revenue.
  • 18487869_235
    Other - Other
    We believe these adjusted financial measures are useful to investors as the adjustments do not directly relate to our ongoing business operations and therefore do not contribute to a meaningful evaluation of the trend in our operating performance.
  • 18487869_38
    Financial - Earnings
    Operating margin increased 440 basis points to 18.2%.
  • 18487869_238
    Other - Other
    A reconciliation of the non-GAAP financial measures follows, which includes more detail on the GAAP financial measure that is most directly comparable to each non-GAAP financial measure, and the related reconciliations between these financial measures.
  • 18487869_266
    Other - Other
    Cash used in financing activities increased $305.7 million to $406.4 million for the first three quarters of fiscal 2018 compared to $100.7 million for the first three quarters of fiscal 2017.
  • 18487869_230
    Revenue - Product
    Constant dollar changes in net revenue, total comparable sales, comparable store sales, and direct to consumer net revenue, and the adjusted financial results are non-GAAP financial measures.
  • 18487869_34
    Financial - Earnings
    Gross margin increased 240 basis points to 54.4%.
  • 18487869_129
    Other - Other
    Excluding the above tax adjustments, the adjusted effective tax rate was 27.8% compared to 30.8% for the third quarter of fiscal 2017.
  • 18487869_219
    Other - Other
    Excluding the above tax adjustments, the adjusted effective tax rate was 29.0% for the first three quarters of fiscal 2018 compared to 30.5% for the first three quarters of fiscal 2017.
  • 18487869_166
    Financial - Earnings
    The increase in gross margin was primarily the result of: an increase in product margin of 230 basis points, which was primarily due to lower product costs, a favorable mix of higher margin product, lower markdowns, and lower inventory provision expense; a decrease in occupancy and depreciation costs as a percentage of revenue of 50 basis points; and the costs incurred in the first three quarters of fiscal 2017 in connection with the restructuring of our ivivva operations, which reduced gross margin in that quarter by 50 basis points.
  • 18487869_130
    Financial - Income
    The decrease in the adjusted effective tax rate was primarily due to the lower U.S. federal income tax rate as a result of the U.S. tax reform, partially offset by the amounts recognized for global intangible low-taxed income ("GILTI") taxes.
  • 18487869_118
    Other - Other
    We repaid the outstanding balance on our revolving credit facility during the third quarter of fiscal 2018 and had no borrowings outstanding under this credit facility as of October 28, 2018.
  • 18487869_208
    Other - Other
    We repaid the outstanding balance on our revolving credit facility during the third quarter of fiscal 2018 and had no borrowings outstanding under this credit facility as of October 28, 2018.
  • 18487869_50
    Revenue - Product
    On a constant dollar basis, assuming the average exchange rates for the third quarter of fiscal 2018 remained constant with the average exchange rates for the third quarter of fiscal 2017, net revenue increased $138.0 million, or 22%.
  • 18487869_138
    Revenue - Product
    On a constant dollar basis, assuming the average exchange rates for the first three quarters of fiscal 2018 remained constant with the average exchange rates for the first three quarters of fiscal 2017, net revenue increased $397.9 million, or 23%.
  • 18487869_42
    Other - Other
    The adjusted effective tax rate was 27.8% compared to 30.8% in the third quarter of fiscal 2017.
  • 18487869_261
    Other - Other
    Cash used in investing activities increased $45.9 million to $165.9 million for the first three quarters of fiscal 2018 from $120.1 million for the first three quarters of fiscal 2017.
  • 18487869_232
    Revenue - Product
    We provide constant dollar changes in net revenue, total comparable sales, comparable store sales, and direct to consumer net revenue because we use these measures to understand the underlying growth rate of net revenue excluding the impact of changes in foreign exchange rates.
  • 18487869_51
    Revenue - Product
    The increase in net revenue was primarily due to increased direct to consumer net revenue, increased company-operated store net revenue, including from new company-operated stores as well as an increase in comparable store sales, and an increase in net revenue from our other retail locations.
  • 18487869_271
    Financial - Shares / Equity
    On June 6, 2018, the board of directors approved an increase to this stock repurchase program, authorizing the repurchase of up to a total of $600.0 million of our common shares on the open market or in privately negotiated transactions.
  • 18487869_62
    Revenue - Product
    The increase in comparable store sales was primarily a result of increased store traffic and improved conversion rates.
  • 18487869_150
    Revenue - Product
    The increase in comparable store sales was primarily a result of increased store traffic and improved conversion rates.
  • 18487869_277
    Financial - Shares / Equity
    In addition, we may make discretionary capital improvements with respect to our stores, distribution facilities, headquarters, or systems, or we may repurchase shares under an approved stock repurchase program, which we would expect to fund through the use of cash, issuance of debt or equity securities or other external financing sources to the extent we were unable to fund such capital expenditures out of our cash and cash equivalents and cash generated from operations.
  • 18487869_280
    Other - Other
    Borrowings under the revolving credit facility may be made, in U.S. Dollars, Euros, Canadian Dollars, and in other currencies, subject to the approval of the administrative agent and the lenders.
  • 18487869_60
    Revenue - Product
    A comparable store sales increase of 6% in the third quarter of fiscal 2018 compared to the third quarter of fiscal 2017 resulted in a $16.7 million increase to net revenue.
  • 18487869_148
    Revenue - Product
    A comparable store sales increase of 8% in the first three quarters of fiscal 2018 compared to the first three quarters of fiscal 2017 resulted in a $75.4 million increase to net revenue.
  • 18487869_3
    Other - Other
    The forward-looking statements contained in this Form 10-Q and any documents incorporated herein by reference reflect our current views about future events and are subject to risks, uncertainties, assumptions, and changes in circumstances that may cause events or our actual activities or results to differ significantly from those expressed in any forward-looking statement.
  • 18487869_229
    Revenue - Product
    The comparable sales measures we report may not be equivalent to similarly titled measures reported by other companies.
  • 18487869_161
    Revenue - Product
    This increase was primarily the result of an increase in net revenue from new and existing outlets during the first three quarters of fiscal 2018 compared to the first three quarters of fiscal 2017.
  • 18487869_52
    Revenue - Product
    Total comparable sales, which includes comparable store sales and direct to consumer, increased 17% in the third quarter of fiscal 2018 compared to the third quarter of fiscal 2017.
  • 18487869_140
    Revenue - Product
    Total comparable sales, which includes comparable store sales and direct to consumer, increased 19% in the first three quarters of fiscal 2018 compared to the first three quarters of fiscal 2017.
  • 18487869_284
    Other - Other
    The principal amount outstanding under the credit agreement, if any, will be due and payable in full on December 15, 2021, subject to provisions that permit us to request a limited number of one year extensions annually.
  • 18487869_233
    Other - Other
    We believe that disclosing these measures on a constant dollar basis is useful to investors because it enables them to better understand the level of growth of our business.
  • 18487869_139
    Revenue - Product
    The increase in net revenue was primarily due to increased direct to consumer net revenue, net revenue generated by new company-operated stores, and an increase in comparable store sales.
  • 18487869_26
    Revenue - Product
    For the third quarter of fiscal 2018, compared to the third quarter of fiscal 2017: Net revenue increased 21% to $747.7 million.
  • 18487869_40
    Financial - Income
    Income tax expense increased 57% to $43.5 million.
  • 18487869_119
    Financial - Income
    Income tax expense increased $15.8 million, or 57%, to $43.5 million for the third quarter of fiscal 2018 from $27.7 million for the third quarter of fiscal 2017.
  • 18487869_209
    Financial - Income
    Income tax expense increased $52.0 million, or 82%, to $115.6 million for the first three quarters of fiscal 2018 from $63.6 million for the first three quarters of fiscal 2017.
  • 18487869_257
    Other - Other
    Changes in operating assets and liabilities an increase of $46.3 million in the change in operating assets and liabilities, primarily due to the following: - an increase of $140.8 million related to accounts payable, primarily due to a change in our payment terms; - partially offset by an increase of $97.4 million related to inventory, primarily due to an increase in inventory purchases.
  • 18487869_295
    Other - Other
    As of October 28, 2018, aside from letters of credit of $1.2 million, we had no other borrowings outstanding under this credit facility.
  • 18487869_236
    Other - Other
    Furthermore, we do not believe the adjustments are reflective of our expectations of our future operating performance and believe these non-GAAP measures are useful to investors because of their comparability to our historical information.
  • 18487869_64
    Revenue - Product
    The increase in net revenue was partially offset by the closure of 48 of our ivivva branded company-operated stores as part of the restructuring of our ivivva operations.
  • 18487869_151
    Revenue - Product
    The increase in net revenue was partially offset by the closure of 48 of our ivivva branded company-operated stores as part of the restructuring of our ivivva operations.
  • 18487869_28
    Revenue - Product
    Total comparable sales, which includes comparable store sales and direct to consumer, increased 17%.
  • 18487869_29
    Revenue - Product
    On a constant dollar basis, total comparable sales increased 18%.
  • 18487869_53
    Revenue - Product
    Total comparable sales increased 18% on a constant dollar basis.
  • 18487869_141
    Revenue - Product
    Total comparable sales increased 19% on a constant dollar basis.
  • 18487869_101
    Financial - Income
    Income from operations as a percentage of company-operated stores net revenue increased 190 basis points due to higher gross margin and leverage on selling, general and administrative expenses.
  • 18487869_111
    Financial - Income
    Income from operations as a percentage of other net revenue increased 360 basis points due to higher gross margin and leverage on selling, general and administrative expenses.
  • 18487869_80
    Financial - Expense
    Selling, general and administrative expenses increased $55.5 million, or 26%, to $270.9 million in the third quarter of fiscal 2018 from $215.4 million in the third quarter of fiscal 2017.
  • 18487869_170
    Financial - Expense
    Selling, general and administrative expenses increased $133.3 million, or 21%, to $773.3 million in the first three quarters of fiscal 2018 from $640.0 million in the first three quarters of fiscal 2017.
  • 18487869_76
    Financial - Earnings
    The increase in gross margin was primarily the result of: an increase in product margin of 280 basis points, which was primarily due to lower product costs, a favorable mix of higher margin product, lower markdowns, and lower inventory provision expense; and the costs incurred in the third quarter of fiscal 2017 in connection with the restructuring of our ivivva operations, which reduced gross margin in that quarter by 20 basis points.
  • 18487869_27
    Revenue - Product
    On a constant dollar basis, net revenue increased 22%.
  • 18487869_30
    Revenue - Product
    - Comparable store sales increased 6%, or increased 7% on a constant dollar basis.
  • 18487869_31
    Revenue - Product
    - Direct to consumer net revenue increased 44%, or increased 46% on a constant dollar basis.
  • 18487869_49
    Revenue - Product
    Net revenue increased $128.6 million, or 21%, to $747.7 million for the third quarter of fiscal 2018 from $619.0 million for the third quarter of fiscal 2017.
  • 18487869_57
    Revenue - Product
    Net revenue from our company-operated stores segment increased $51.8 million, or 12%, to $476.9 million in the third quarter of fiscal 2018 from $425.1 million in the third quarter of fiscal 2017.
  • 18487869_61
    Revenue - Product
    Comparable store sales increased 7%, or $21.4 million on a constant dollar basis.
  • 18487869_67
    Revenue - Product
    Net revenue from our direct to consumer segment increased $58.2 million, or 44%, to $189.4 million in the third quarter of fiscal 2018 from $131.2 million in the third quarter of fiscal 2017.
  • 18487869_68
    Revenue - Product
    Direct to consumer net revenue increased 46% on a constant dollar basis.
  • 18487869_72
    Revenue - Product
    Net revenue from our other segment increased $18.7 million, or 30%, to $81.4 million in the third quarter of fiscal 2018 from $62.7 million in the third quarter of fiscal 2017.
  • 18487869_137
    Revenue - Product
    Net revenue increased $400.5 million, or 23%, to $2.121 billion for the first three quarters of fiscal 2018 from $1.720 billion for the first three quarters of fiscal 2017.
  • 18487869_145
    Revenue - Product
    Net revenue from our company-operated stores segment increased $178.2 million, or 15%, to $1.396 billion in the first three quarters of fiscal 2018 from $1.218 billion in the first three quarters of fiscal 2017.
  • 18487869_149
    Revenue - Product
    Comparable store sales increased 8%, or $74.5 million on a constant dollar basis.
  • 18487869_154
    Revenue - Product
    Net revenue from our direct to consumer segment increased $173.2 million, or 51%, to $514.6 million in the first three quarters of fiscal 2018 from $341.5 million in the first three quarters of fiscal 2017.
  • 18487869_155
    Revenue - Product
    Direct to consumer net revenue increased 50% on a constant dollar basis.
  • 18487869_160
    Revenue - Product
    Net revenue from our other segment increased $49.1 million, or 31%, to $209.9 million in the first three quarters of fiscal 2018 from $160.8 million in the first three quarters of fiscal 2017.
  • 18487869_224
    Revenue - Product
    We separately track comparable store sales, which reflect net revenue from company-operated stores that have been open for at least 12 months, or open for at least 12 months after being significantly expanded.
  • 18487869_226
    Revenue - Product
    Comparable store sales exclude sales from new stores that have not been open for at least 12 months, from stores which have not been in their significantly expanded space for at least 12 months, and from stores which have been temporarily relocated for renovations.
  • 18487869_241
    Revenue - Product
    Comparable store sales reflects net revenue from company-operated stores that have been open for at least 12 months, or open for at least 12 months after being significantly expanded.
  • 18487869_191
    Financial - Income
    Income from operations as a percentage of company-operated stores net revenue increased by 270 basis points, primarily due to an increase in gross margin and leverage on selling, general and administrative expenses.
  • 18487869_196
    Financial - Income
    Income from operations as a percentage of direct to consumer net revenue increased 400 basis points, primarily due to leverage on selling, general and administrative expenses and an increase in gross margin.
  • 18487869_201
    Financial - Income
    Income from operations as a percentage of other net revenue increased 680 basis points, primarily due to an increase in gross margin and leverage on selling, general and administrative expenses.
  • 18487869_249
    Financial - Expense
    Excluding the costs we incurred in connection with the ivivva restructuring, we generated approximately 51% of our operating profit during the fourth quarter of fiscal 2017.
  • 18487869_287
    Other - Other
    Additionally, a commitment fee of between 0.125%-0.200%, also determined by reference to the pricing grid, is payable on the average daily unused amounts under the revolving credit facility.
  • 18487869_32
    Financial - Earnings
    Gross profit increased 26% to $406.8 million.
  • 18487869_74
    Financial - Earnings
    Gross profit increased $84.8 million, or 26%, to $406.8 million for the third quarter of fiscal 2018 from $322.0 million for the third quarter of fiscal 2017.
  • 18487869_164
    Financial - Earnings
    Gross profit increased $271.4 million, or 31%, to $1.148 billion for the first three quarters of fiscal 2018 from $876.3 million for the first three quarters of fiscal 2017.
  • 18487869_41
    Other - Other
    Our effective tax rate for the third quarter of fiscal 2018 was 31.6% compared to 32.0% for the third quarter of fiscal 2017.
  • 18487869_128
    Other - Other
    The effective tax rate for the third quarter of fiscal 2018 was 31.6% compared to 32.0% for the third quarter of fiscal 2017.
  • 18487869_218
    Other - Other
    The effective tax rate for the first three quarters of fiscal 2018 was 30.4% compared to 31.4% for the first three quarters of fiscal 2017.
  • 18487869_291
    Other - Other
    If an event of default occurs, the credit agreement may be terminated and the maturity of any outstanding amounts may be accelerated.
  • 18487869_110
    Financial - Earnings
    The increase in gross profit was partially offset by an increase in selling, general and administrative expenses, primarily due to increased employee costs, increased operating expenses including increases in professional fees, repairs and maintenance costs, security costs, and higher distribution costs and credit card fees as a result of higher net revenue, and higher community costs.
  • 18487869_36
    Financial - Income
    Income from operations increased 59% to $135.9 million.
  • 18487869_87
    Financial - Income
    Income from operations increased $50.3 million, or 59%, to $135.9 million in the third quarter of fiscal 2018 from $85.6 million in the third quarter of fiscal 2017.
  • 18487869_98
    Financial - Income
    Income from operations from our company-operated stores segment increased $20.8 million, or 21%, to $117.8 million for the third quarter of fiscal 2018 from $97.0 million for the third quarter of fiscal 2017.
  • 18487869_103
    Financial - Income
    Income from operations from our direct to consumer segment increased $26.2 million, or 52%, to $76.4 million for the third quarter of fiscal 2018 from $50.2 million for the third quarter of fiscal 2017.
  • 18487869_108
    Financial - Income
    Other income from operations increased $5.7 million, or 61%, to $15.0 million for the third quarter of fiscal 2018 from $9.3 million for the third quarter of fiscal 2017.
  • 18487869_133
    Financial - Earnings
    Net income increased $35.5 million, or 60%, to $94.4 million for the third quarter of fiscal 2018 from $58.9 million for the third quarter of fiscal 2017.
  • 18487869_177
    Financial - Income
    Income from operations increased $174.7 million, or 87%, to $374.4 million in the first three quarters of fiscal 2018 from $199.7 million in the first three quarters of fiscal 2017.
  • 18487869_188
    Financial - Income
    Income from operations from our company-operated stores segment increased $75.8 million, or 28%, to $343.0 million for the first three quarters of fiscal 2018 from $267.2 million for the first three quarters of fiscal 2017.
  • 18487869_193
    Financial - Income
    Income from operations from our direct to consumer segment increased $82.7 million, or 67%, to $205.7 million for the first three quarters of fiscal 2018 from $123.0 million for the first three quarters of fiscal 2017.
  • 18487869_198
    Financial - Income
    Other income from operations increased $20.3 million, or 106%, to $39.3 million for the first three quarters of fiscal 2018 from $19.1 million for the first three quarters of fiscal 2017.
  • 18487869_222
    Financial - Earnings
    Net income increased $126.4 million, or 91%, to $265.3 million for the first three quarters of fiscal 2018 from $138.9 million for the first three quarters of fiscal 2017.
  • 18487869_45
    Other - Other
    Refer to the non-GAAP reconciliation tables contained in the "Non-GAAP Financial Measures" section of this Item 2.
  • 18487869_115
    Financial - Income
    Other income, net increased $1.0 million, or 94%, to $2.0 million for the third quarter of fiscal 2018 from income of $1.1 million for the third quarter of fiscal 2017.
  • 18487869_205
    Financial - Income
    Other income, net increased $3.8 million, or 136%, to $6.6 million for the first three quarters of fiscal 2018 from income of $2.8 million for the first three quarters of fiscal 2017.
  • 18487869_283
    Revenue - Product
    Borrowings under the agreement may be prepaid and commitments may be reduced or terminated without premium or penalty (other than customary breakage costs).

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Exhibit 10.1 - M. CHOE EMPLOYMENT AGREEMENT

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Exhibit 31.1 - CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

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Exhibit 31.2 - CERTIFICATION OF PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER

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Exhibit 32.1 - CERT OF PRINCIPAL EXEC OFFICER AND PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER

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  • Form Type: Quarterly
  • Number of times amended: 0
  • Accession Number: 0001397187-18-000053
  • Submitted to the SEC: Thursday, December 6, 2018 4:15:01 PM EST
  • Accepted by the SEC: Thursday, December 6, 2018
  • Period ending: October 2018
  • Industry: Apparel And Other Finishd Prods Of Fabrics And Similar Matl