Lululemon Athletic Inc, the yogawear retailer forecast results lower than expected on Thursday for the first quarter, just the latest hit the Canada-based company has had in the past year after a product recall.
The retailer posted a profit for the quarter that was nearly unchanged for the same quarter last year. Shares dropped by 3.5% during premarket trading.
Lululemon earned just under $109.7 million equivalent to just over 75 cents a share during its fourth quarter that ended on February 2. That was nearly identical to the $109.4 million or 75 cents a share it earned for the same quarter 12 months previously.
Sales for stores that were established fell by 2% during the quarter, the first decline of such in 5 years. Total sales that were comparable including those online were up by 4%.
Profit for its first quarter was forecasted, by the company at between 31 cents and 33 cents a share with revenue estimated to be between $377 million and $383 million with flat total combined sales at comparable stores.
Analysts had estimated that profit in the first quarter would be 38 cents a share on revenues of more than $389 million.
For the 2014 fiscal year, Lululemon has forecast profits of between $1.80 and $1.90 a share with revenue between $1.76 billion and $1.81 billion. Those figures are based upon combined sales in same-stores increasing from between the low and mid single digits as a percentage.
Lululemon, which was able to carve out a very lucrative niche in the sales of fashionable workout clothes that are high-end, was forced in March of 2013 to recall a large proportion of its signature yoga pants that are black stretchy because they were manufactured too sheer.
Later during the year Lululemon acknowledged that sales were hit hard by the negative hit to its image over the recalled pants as well as when Chip Wilson the company founder said that products from Lululemon just do not work with certain women’s body shapes.