VANCOUVER – Lululemon Athletica Inc. (TSX:LLL) says it had a US$109-million profit in the fourth quarter, a big increase from the same time a year earlier and slightly ahead of analyst estimates.
However, the company also revealed that a previously announced recall of a batch of black Luon pants will cut into sales and profit — pushing its outlook for the current quarter below preliminary analyst forecasts.
The company, which reports in U.S. currency, said Thursday it expects to lose between $12 million and $17 million of revenue in the first quarter because of the recall and earnings will be reduced by 11 to 12 cents per share.
Overall, Lululemon is expecting to be profitable in the first quarter with between 28 and 30 cents per share of earnings and between $333 million and $343 million of revenue.
However, that’s below a pre-announcement consensus estimate of 44 cents per share of earnings and $352 million of revenue, according to figures compiled by Thomson Reuters.
In the fourth quarter, which ended before the recall, Lululemon did slightly better than the consensus estimate.
On a per-share basis, Lululemon had 75 cents of net income in the fourth quarter — a penny above the consensus estimate of 74 cents per share.
The clothing company’s revenue during the key holiday shopping period was also up, rising by 31 per cent year-to-year to US$485.5 million — in line with expectations.
During the comparable period last year, Lululemon — which reports in U.S. currency — had $371.5 million of revenue and $73.9 million or 51 cents per share of net income.