Lululemon (LULU) Announces First Quarter 2020 Financial Results And Shares Fall

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Lululemon announced a 17% drop in sales in the first quarter as strong digital activity was not enough to compensate for losses due to the temporary store closings due to the coronavirus pandemic.As of June 10, the manufacturer of yoga pants and sports bras said 295 of its stores had reopened.

Lululemon shares fell more than 6% in trading after Thursday hours after publication.

Here’s how the company did during its first fiscal quarter ended May 3:

  • Earnings per share: 22 cents
  • Revenue: $ 651.96 million

Net income was $ 28.6 million, or 22 cents per share, compared to $ 96.6 million, or 74 cents per share, a year ago.

Total revenue fell 17% to $ 651.96 million from $ 782.3 million a year ago.

The company said its online sales totaled $ 352 million, or 54% of total revenue, compared to $ 209.8 million, or 26.8% of total revenue a year ago.

Analysts had expected the company to earn 23 cents a share on revenue of $ 688.4 million, according to estimates from Refinitiv. However, the impact of the Covid-19 crisis makes these estimates difficult to compare with real profits.

Its gross margin fell to 51.3% of sales, compared to 53.9% a year ago. Lululemon said the decrease was due, in part, to higher costs to manage its distribution centers as online orders increased.

Lululemon said its inventory jumped 41% to $ 625.8 million in the quarter.

The company currently offers no prospects for 2020.

Lululemon’s shares have risen more than 33% this year. The company has a market capitalization of $ 40.2 billion.

Find the full press release on the results here.

This is a developing story. Please check back for updates.

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