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  • Lululemon warns of demand risks from potential virus resurgence

    Lululemon warns of demand risks from potential virus resurgence

    Lululemon Athletica on Tuesday warned of more store closures and risks to demand from a potential resurgence in COVID-19 cases, even as it forecast first-quarter revenue above analysts’ estimates.

    The company said any surge in cases, including the new variants, could hamper demand and disrupt the supply chain at a time its stores are struggling with capacity restrictions, sending its shares down 1.6% in extended trading.

    The company’s stock, however, has gained 64% over the past 12 months, as Lululemon saw a surge in demand for its leggings and sports bras from stuck-at-home consumers looking for comfortable apparel.

    “Regardless of vaccines, the sense of comfort will continue to sell and Lululemon has found a very strong assortment in between comfort and activewear,” said Jessica Ramirez, retail analyst at Jane Hali & Associates.

    The company is also banking on its home fitness startup acquisition, Mirror, to provide an additional revenue stream this year, and expects its top line to rise as much as 65% to $275 million in 2021 on the booming demand for online workout classes.

    Lululemon said it would ramp up investments in the startup, which offers subscriptions for live workout classes on mirror-like video monitors, to sustain its growth. The Canadian company forecast first-quarter revenue of $1.10 billion to $1.13 billion, above analysts’ estimate of $999.5 million, according to IBES data from Refinitiv. It expects first-quarter adjusted earnings per share of 86 cents to 90 cents, above estimates of 82 cents.

    Lululemon’s full-year earnings per share expectations of $6.30 to $6.45, however, were below estimates of $6.72.

    Net revenue rose 24% to $1.73 billion in the fourth quarter, beating estimates of $1.66 billion, as online sales jumped 92% on a comparable basis.

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  • Avon 2018 sales dip, culls sales reps globally

    Avon 2018 sales dip, culls sales reps globally

    Avon reported its fiscal 2018 results earlier in the month, saying revenues declined as the beauty giant continued to cull it sales representatives across the globe. The London-headquartered company said total revenue decreased 2% for the twelve months, while like-for-like revenues decreased 3% in constant dollars. The number of Active Representatives declined 5% with decreases reported in all segments, said Avon, with Ending Representatives declining 8% with decreases reported in all segments.

    On a positive note, Avon’s average order increased 10%, while on a like-for-like basis, average orders increased 2%, primarily driven by increases in South Latin America, North Latin America and Asia Pacific, said Avon in a press release.

    Avon reinforced the positives of its “Open Up Avon” strategic plans, addressing falling levels of its representatives.

    “We are in the initial stages of our turn-around plan with fourth-quarter results showing sequential improvement in revenue trends in 4 of our top 5 markets, as well as some early signs of progress against our core strategies,” said Avon’s CEO, Jan Zijderveld.

    “As we look over the course of 2018, we are seeing tangible signs of increased productivity by our Representatives, with sequential increases in Average Representative Sales, Net Price Per Unit and e-commerce.”

    Avon made several cost-reducing decisions in 2018, including the announced sale of its China manufacturing facility. The cosmetic giant more recently announced its intention to reduce the global workforce by an additional 10% in 2019, on top of its already completed 8% reduction in 2018.

    “We have begun to identify repeatable business models in training and recruiting, while reducing our cost structure and taking steps to simplify our business infrastructure,” added Zijderveld.

    Avon reported a diluted loss per share of $0.10. Like-for-like diluted earnings per share was $0.01, compared with $0.06 for 2017.

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  • Cle de Peau Beaute debuts in Thailand

    Cle de Peau Beaute debuts in Thailand

    Japanese luxury skincare brand Cle de Peau Beaute has opened its first location in Thailand. Launching in the Helix building, Emquartier, the new store expects to cater to the brand’s cult following in the market. The venue is designed to reflect the luxurious lifestyle of modern women, with a ‘Radiance Wall’ illuminating the entire retail space and a gallery with storied details of selected products.

    The launch is being marked with the announcement of the brand’s new influencer, actress, artist and director Manasnan Panlertwongskul, and the unveiling of its latest lipstick.