Lululemon Athletica, a Canadian athletic apparel company, has reported a 30 per cent increase in net revenue to $8.1 billion in fiscal 2022 (FY22), representing a 32 per cent increase on a constant dollar basis, compared to FY21. Furthermore, the company’s net revenue increased by 29 per cent in North America and 35 per cent internationally.

Total comparable sales also increased by 25 per cent, or 28 per cent on a constant dollar basis, while direct-to-consumer net revenue saw a 33 per cent increase, or 35 per cent on a constant dollar basis. Furthermore, direct-to-consumer net revenue represented 46 per cent of total net revenue, up from 44 per cent in FY21. The company opened 81 net new company-operated stores during the year, ending with a total of 655 stores.

However, the gross margin in FY22 decreased by 230 basis points to 55.4 per cent, with an adjusted gross margin decrease of 150 basis points to 56.2 per cent. Income from operations remained consistent at $1.3 billion, but adjusted income from operations increased by 30 per cent to $1.8 billion. Operating margin decreased to 16.4 per cent from 21.3 per cent in FY21, but adjusted operating margin increased 10 basis points to 22.1 per cent, the company said in a press release.

Lululemon Athletica reported a 30 per cent increase in net revenue to $8.1 billion in FY22, with a 29 per cent increase in North America and 35 per cent internationally.
The company opened 81 net new stores and had a 25 per cent increase in comparable sales.
For Q1 FY23, the company expects net revenue to be in the range of $1.89 billion to $1.93 billion.

In the fourth quarter (Q4) of FY22, Lululemon Athletica also saw a 30 per cent increase in net revenue to $2.8 billion, or 33 per cent on a constant dollar basis. Comparable store sales increased by 15 per cent, or 17 per cent on a constant dollar basis, while direct-to-consumer net revenue increased by 37 per cent, or 39 per cent on a constant dollar basis. The company opened 32 net new company-operated stores during the quarter, ending with a total of 655 stores.

Despite the strong financial results, Lululemon Athletica reported a decrease in gross margin of 300 basis points to 55.1 per cent year-on-year (YoY) in Q4 FY22, with an adjusted gross margin decrease of 70 basis points to 57.4 per cent. Income from operations decreased by 47 per cent YoY to $314.4 million, but adjusted income from operations increased by 33 per cent to $785.3 million. Operating margin decreased to 11.3 per cent from 27.7 per cent in the fourth quarter of FY21, but adjusted operating margin increased by 50 basis points to 28.3 per cent.

For the first quarter of fiscal 2023, the company expects net revenue to be in the range of $1.890 billion to $1.930 billion, representing growth of approximately 18 per cent YoY. Diluted earnings per share are expected to be in the range of $1.93 to $2 for the quarter.

For fiscal 2023, Lululemon Athletica expect net revenue to be in the range of $9.3 billion to $9.410 billion, representing growth of approximately 15 per cent. Diluted earnings per share are expected to be in the range of $11.50 to $11.72 for the year, the release added.

“We are pleased with our performance in the fourth quarter, which remained balanced across product category, channel, and regions. Our ability to exceed our annual revenue target in a dynamic operating environment is a testament to the enduring strength of the lululemon brand. Looking ahead, we remain optimistic regarding our ability to deliver sustained growth and long-term value for all our stakeholders,” said Meghan Frank, chief financial officer.

Fibre2Fashion News Desk (DP)