Lululemon's Cash Flow Statement: http://ca.hotstocked.com/companies/l/lululemon-athletica-inc-LLL-cash-flow-888.html
Summary:
The retailer company known as Lululemon sells yoga and running-wear materials. For their fourth period that has yet to end, Lululemon discovers that they are short of inventory due to an incredible jump in sales. This period has exceeded analyst expectations. Their profit for this quarter has doubled to a $55million and gone up 53% in revenue to the value of $245.4million. Due to such great demands, Lululemon has paid more for goods to be flown in. The cause of this sudden increase in sales may be because of our economy’s post-recession recovery where many people are finding themselves a little extra money to spend. Part of flying in the new goods also partook in negotiating agreements with multiple factories in Asia to uphold the sale needs. Undoubtedly, such profits will bring up the values of Lululemon’s shares in the stock market. To further expand their company, Lululemon is also planning on opening six new North American stores for this quarter. Lululemon is working to be more internationally known, such as becoming more aware online. So far, its’ online division has reeled a good 10% of their overall revenue. The company plans on creating options for country-specific selections and improving shipping internationally. Currently, Lululemon has a total of 137 stores already open in North America and Australia.
The retailer company known as Lululemon sells yoga and running-wear materials. For their fourth period that has yet to end, Lululemon discovers that they are short of inventory due to an incredible jump in sales. This period has exceeded analyst expectations. Their profit for this quarter has doubled to a $55million and gone up 53% in revenue to the value of $245.4million. Due to such great demands, Lululemon has paid more for goods to be flown in. The cause of this sudden increase in sales may be because of our economy’s post-recession recovery where many people are finding themselves a little extra money to spend. Part of flying in the new goods also partook in negotiating agreements with multiple factories in Asia to uphold the sale needs. Undoubtedly, such profits will bring up the values of Lululemon’s shares in the stock market. To further expand their company, Lululemon is also planning on opening six new North American stores for this quarter. Lululemon is working to be more internationally known, such as becoming more aware online. So far, its’ online division has reeled a good 10% of their overall revenue. The company plans on creating options for country-specific selections and improving shipping internationally. Currently, Lululemon has a total of 137 stores already open in North America and Australia.
Connection:
The first connection is found in Lululemon’s quarterly cash flow statement of January 2011, under operating activities. In their CFS, they have a “Decrease in Inventories” account of $7,956,000. A decrease in inventory means an increase in cash flow because Lululemon has sold the items in exchange for cash. Lululemon’s end cash for the January quarter is $316,365 and will most likely rise to a larger sum for the end of this current quarter. However, that value will be unknown until the quarter ends.
My second connection pertains to the six new North American stores that Lululemon plans on opening this quarter. I do not have numbers to provide because the quarter has not yet ended, but once it has, Lululemon’s CFS for the account “Purchase of Property, Plant, Equipment” under investing activities will increase compared to the previous quarter ended. It is an increase because the stores count as property bought, and will result in a decrease of cash flow because cash has to be exchanged for these properties.
The first connection is found in Lululemon’s quarterly cash flow statement of January 2011, under operating activities. In their CFS, they have a “Decrease in Inventories” account of $7,956,000. A decrease in inventory means an increase in cash flow because Lululemon has sold the items in exchange for cash. Lululemon’s end cash for the January quarter is $316,365 and will most likely rise to a larger sum for the end of this current quarter. However, that value will be unknown until the quarter ends.
My second connection pertains to the six new North American stores that Lululemon plans on opening this quarter. I do not have numbers to provide because the quarter has not yet ended, but once it has, Lululemon’s CFS for the account “Purchase of Property, Plant, Equipment” under investing activities will increase compared to the previous quarter ended. It is an increase because the stores count as property bought, and will result in a decrease of cash flow because cash has to be exchanged for these properties.
Reflection:
I think that Lululemon will be successful in Canada as long as the economy does not fall drastically. However, for United States and Australia, I am unsure because I do not live or shop in either countries. On the other hand, from blogging on this article, I would not be surprised to hear more about Lululemon in the future as the company continues to grow. With such demanding sales, there should be no problem in making sure their company is heard and known international-wide. They have nice numbers in profit and revenue each quarter, growing stock price values, as well as investing with the right idea: expansion for Lululemon. Perhaps I will considering checking their clothing brand the next time I go shopping due to their popularity.
