Lululemon Athletica Inc. (LULU - Get Report) shares traded at a fresh record high Wednesday after the athletic wear group unveiled a new group strategy that it says will boost digital revenues and quadruple its international sales over the next five years.
The group's 'Power of Three' strategy will also focus on increasing sales of men's clothing, which is hopes will more than double by 2023, alongside the continued expansion of its women's line and associated accessories. Lululemon also said it sees overall group revenues rising by a "low teen" percentage over the next five years, with modest profit margin expansion and a capital expenditure target of between 6% and 8% of sales.
"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."
Lululemon shares were marked 1% higher at the start of trading Wednesday to change hands at a record high $178.65 each after rising 44% so far this year to value the Vancouver, British Columbia group at around $24 billion.
Last month, the sports apparel group posted solid fourth quarter earnings and said accelerating online sales would drive better-than-expected full year profits. Lululemon said at the time it sees full-year earnings in the range of $4.48 to $4.55 per share, nearly a $1 ahead of the high end of analysts' forecasts.
"Our strategic investments in the business to support our digital expansion and supply chain improvements delivered impressively on both our top and bottom line," McDonald told investors on a conference call at the time. "All of this combined with our significant growth outside North America allowed us to achieve a high level of results for our employees and shareholders."
"When looking at our digital ecosystem, we are still in the early stages of our development with so much potential ahead," he added. "We've just begun speaking to our guests in a more personalized way, but we are ready to accelerate our capabilities in this area in the coming quarters."