Five-year growth plan aims to “double men’s,
double digital, and quadruple international” revenues
Building upon a year of considerable growth in 2018 and having
already delivered on several of its key 2020 goals, the Company is
meeting with investors and analysts today to outline its growth
strategy for the next five years. The Company plans to fuel
growth through its Power of Three strategic plan to drive
product innovation, create integrated Omni guest experiences, and
to expand deeper in key markets around the world.
The growth strategy includes a plan to double men’s and digital
revenues, and to quadruple international revenues. The Company’s
core women’s business and its agile store formats in North America
will also remain focus areas and are expected to generate revenue
growth in the low double digits annually for the next five
years.
“We’re ready to build upon our success and embark on the next
phase of growth at lululemon to realize the full potential of our
brand,” said CEO Calvin McDonald. “We believe lululemon has a
unique opportunity to push beyond traditional expectations to
develop innovative products and become a fully experiential brand
that creates compelling experiences for guests who want to
completely live into the sweatlife.”
The Power of Three strategic plan also includes contributions
from new product categories and offerings, such as its membership
program which is currently in pilot, as the Company further
leverages its position as an experiential brand for guests across
channels.
Power of Three Growth
Strategy
The Company’s three priorities to drive revenue growth over the
next five years are:
- Product innovation– The Company
expects to more than double the size of its men’s revenues by 2023.
In addition, its plans call for continued expansion in the women’s
and accessories businesses. Both existing and new product
categories are planned to grow, with lines supporting yoga, running
and training. The Company also plans to continue its product
collaborations, expand its popular Office/Travel/Commute category,
and pursue new opportunities, such as selfcare.
- Omni guest experiences – The
Company expects to more than double its digital revenues by 2023.
The Company will focus on offering an integrated guest experience
across channels which are intended to inspire, provoke and
celebrate guests who live a healthy and mindful lifestyle across
multiple experiences – such as events, dynamic new store formats,
and its innovative membership program that fosters connections
among guests.
- Market expansion– The Company
plans to quadruple its international revenues by 2023. The
Company’s recent success in its international markets demonstrates
that the sweatlife translates across cultures and geographies and
presents considerable growth potential for the brand. Expanding
across China, as well as the APAC and EMEA regions, will be
continued areas of focus for the Company. The Company also believes
that considerable growth potential remains in both the U.S. and
Canada and it plans to leverage its agile store formats, digital
experience, and community connection.
A Truly Experiential
Brand
The Company also is sharing its vision -- to be the experiential
brand that ignites a community of people living the sweatlife
through sweat, grow and connect -- which it believes speaks to
guests who want flexibility and choice as they lead a healthy,
mindful lifestyle.
“lululemon is purpose-driven and is positioned well to continue
to inspire guests living the sweatlife across multiple
experiences,” McDonald added. “We believe we are operating from a
position of strength as we invest in creating dynamic experiential
moments for our communities to connect and come together.”
The Company created and hosted more than 4,000 local events last
year and demonstrated success with larger-scale experiences such as
the SeaWheeze half-marathon in Vancouver and 10K runs in Edmonton
and Toronto. The Company’s run clubs and yoga partnerships have
long been a staple of the Company’s community-based foundations and
success.
To embody its experiential brand ambitions, the Company
announced it will open a 25,000 square-foot experiential store in
Lincoln Park in Chicago in July 2019, complete with yoga studios,
meditation space, healthy juice and food, and areas for community
gatherings.
Financial Plan
In addition to more than doubling men’s and digital, and
quadrupling international revenues, other key financial drivers of
the Company’s Power of Three strategic plan include the
following:
- Total annual revenue growth in the low
teens for the next five years;
- Modest gross margin expansion
annually;
- Modest SG&A leverage annually;
- Operating income growth to exceed
revenue growth annually;
- EPS growth to equal or exceed operating
income growth annually;
- Annual capital expenditures of 6-8% of
revenues; and
- Annual square footage growth in the low
double-digits.
“Our new five-year strategic plan reflects the potential we see
across several areas of our business. The three main growth pillars
are consistent with our prior plan, and we will continue to
grow our core business while expanding into new categories to drive
earnings growth and shareholder return.” said PJ Guido, the
Company’s Chief Financial Officer.
Speaking to investors today at the Company’s first analyst day
in five years are: Calvin McDonald, Chief Executive Officer; Sun
Choe, Chief Product Officer; Celeste Burgoyne, EVP of Americas and
Global Guest Innovation; Stuart Haselden, Chief Operating Officer
and EVP, International; and PJ Guido, Chief Financial Officer.
Conference Call Information
The presentations will be broadcast live over the internet
beginning at 9:30 AM ET and can be accessed and viewed on
the investor relations section of Company’s website,
www.lululemon.com. Those interested in listening to the call are
invited to dial 1-800-319-4610 or 1-604-638-5340, if
internationally, approximately 10 minutes prior to the start.
About lululemon athletica inc.
lululemon athletica inc. (NASDAQ:LULU) is a healthy lifestyle
inspired athletic apparel company for yoga, running, training, and
most other sweaty pursuits, creating transformational products and
experiences which enable people to live a life they love. Setting
the bar in technical fabrics and functional designs, lululemon
works with yogis and athletes in local communities for continuous
research and product feedback. For more information, visit
www.lululemon.com.
Forward-Looking Statements:
This press release includes estimates, projections, statements
relating to our business plans, objectives, and expected operating
results that are "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995, Section 27A
of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. In many cases, you can identify
forward-looking statements by terms such as "may," "will,"
"should," "expects," "plans," "anticipates," "outlook," "believes,"
"intends," "estimates," "predicts," "potential" or the negative of
these terms or other comparable terminology. These forward-looking
statements also include our guidance and outlook statements. These
statements are based on management's current expectations but they
involve a number of risks and uncertainties. Actual results and the
timing of events could differ materially from those anticipated in
the forward-looking statements as a result of risks and
uncertainties, which include, without limitation: our ability to
maintain the value and reputation of our brand; the acceptability
of our products to our guests; our highly competitive market and
increasing competition; our reliance on and limited control over
third-party suppliers to provide fabrics for and to produce our
products; an economic downturn or economic uncertainty in our key
markets; increasing product costs and decreasing selling prices;
our ability to anticipate consumer preferences and successfully
develop and introduce new, innovative and updated products; our
ability to accurately forecast guest demand for our products; our
ability to safeguard against security breaches with respect to our
information technology systems; any material disruption of our
information systems; our ability to have technology-based systems
function effectively and grow our e-commerce business globally;
changes in consumer shopping preferences and shifts in distribution
channels; the fluctuating costs of raw materials; our ability to
expand internationally in light of our limited operating experience
and limited brand recognition in new international markets; our
ability to deliver our products to the market and to meet guest
expectations if we have problems with our distribution system;
imitation by our competitors; our ability to protect our
intellectual property rights; changes in tax laws or unanticipated
tax liabilities; our ability to source our merchandise profitably
or at all if new trade restrictions are imposed or existing trade
restrictions become more burdensome; our ability to manage our
growth and the increased complexity of our business effectively;
our ability to cancel store leases if an existing or new store is
not profitable; increasing labor costs and other factors associated
with the production of our products in South and South East Asia;
the operations of many of our suppliers are subject to
international and other risks; our ability to successfully open new
store locations in a timely manner; our ability to comply with
trade and other regulations; the service of our senior management;
seasonality; fluctuations in foreign currency exchange rates;
conflicting trademarks and the prevention of sale of certain
products; our exposure to various types of litigation; actions of
activist stockholders; anti-takeover provisions in our certificate
of incorporation and bylaws; and other risks and uncertainties set
out in filings made from time to time with the United States
Securities and Exchange Commission and available at www.sec.gov,
including, without limitation, our most recent reports on Form 10-K
and Form 10-Q. You are urged to consider these factors carefully in
evaluating the forward-looking statements contained herein and are
cautioned not to place undue reliance on such forward-looking
statements, which are qualified in their entirety by these
cautionary statements. The forward-looking statements made herein
speak only as of the date of this press release and we undertake no
obligation to publicly update such forward-looking statements to
reflect subsequent events or circumstances, except as may be
required by law.
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version on businesswire.com: https://www.businesswire.com/news/home/20190424005350/en/
Investor Contact:lululemon athletica inc.Howard
Tubin1-604-732-6124orICR, Inc.Joseph Teklits/Caitlin
Churchill1-203-682-8200Media Contact:lululemon athletica
inc.Erin Hankinson1-604-732-6124orBrunswick GroupBlake
Sonnenshein1-212-333-3810
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