Lululemon Athletica Inc. (NASDAQ:LULU) Q2 2019 Earnings Conference Call Transcript

Sep 05, 2019 • 04:30 pm ET

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Lululemon Athletica Inc. (NASDAQ:LULU) Q2 2019 Earnings Conference Call Transcript

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Presentation
Executive
Calvin McDonald

Lincoln Park experiential store and the progress of our membership pilot. Then PJ will provide a detailed financial review as well as our guidance outlook. To wrap up our call, I'll provide a few closing comments and then we'll be happy to take your questions.

Looking at our second quarter results. Momentum in the business remains strong across product categories channels and regions. We're now two quarters into our 5-year vision, and I'm pleased with the strong execution and passion across the business to continue to deliver on our growth priorities.

In Quarter 2, total revenue grew 22%, constant dollar comps increased 17% on top of a 19% increase last year and earnings per share increased 35%. I'm also proud to share how we are living into our vision to be the experiential brand that ignites a community of people living the sweat life through sweat, grow and connect. In July, we opened our first experiential store in Chicago's Lincoln Park neighborhood and just a few weeks ago we hosted our Eighth Annual SeaWheeze Half Marathon in Sunset Festival in Vancouver. These are both fantastic examples of how we are bringing innovation to guest engagement and connecting with our community both inside and outside the four walls of our store. You will hear more specific details from Celeste shortly on these exciting initiatives.

I will now update you on our Power of Three growth pillars product innovation, omni-guest experience and market expansion. I'll speak to product and international and then Celeste will take you through the North America and omni-guest experience. As you will recall our 5-year vision details our path to grow our core business in the low double-digits annually, while doubling our men's, doubling our digital and quadrupling our international businesses between now and the end of 2023.

Within our product innovation pillar guest response to our merchandise offering was particularly strong across the board, as we continue to leverage our key core franchises, while always delivering new innovation through the Science of Feel. In women's comps grew 13% as bottoms remained strong, driven by both pants and short. Within the men's business comps grew 27% with ongoing strength in both tops and bottoms. Like women's, the men's side also saw strength in shorts. Across both men's and women's, we continue to innovate to serve our guests across key activities Yoga Run, OTC and Train.

Within Train this quarter, we launched our latest collaboration Stronger as One with Barry's. This dual gender collection was designed specifically for the type of work-outs that are popular Barry's bootcamp sweat classes, with fabrics that offer abrasion resistance, breathability and moisture wicking. The strong response to the collection provides a compelling proof point of the opportunities as we push further into the Train category in future seasons.

Now, I'll provide a quick update on self-care. We're thrilled with the initial guest response, as performance has exceeded our expectations. Look for several new additions to the line between now in the end of