Lululemon Athletica says its 3Q profit rose 59 pct

AP News
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Posted: Dec 09, 2009 5:29 PM

Lululemon Athletica Inc., a maker of high-end workout clothes, said Wednesday its profit grew by 59 percent in the third quarter as its sales rose and the company improved its gross margin.

Its fourth-quarter profit outlook was in line with the average estimate from Wall Street analysts.

In the quarter that ended Nov. 1, the company's profit rose 59 percent to $14.1 million, 20 cents per share, beating a 19-cent-per-share prediction on average from analysts polled by Thomson Reuters.

A year earlier, it earned $8.8 million, or 13 cents per share.

CEO Christine Day said Lululemon's sales rose even as most retailers struggled. Day also said the company returned its gross margin to 50 percent of net revenue, which also increased.

Revenue rose 30 percent to $112.9 million from $87 million, beating an analyst estimate of $111 million.

Sales at stores open at least a year rose 10 percent, on a constant-currency basis. Sales at stores open at least a year is a key measure of retailer performance because it is not skewed by store openings and closings.

The company, based in Vancouver, British Columbia, Canada, also said its fourth-quarter profit would range from 26 cents per share to 28 cents. Analysts expect 27 cents per share.

Lululemon shares rose $1.48, or 5.5 percent, to $28.15 in after-hours trading Wednesday after closing at $26.67, up 3.2 percent from a day earlier.