VANCOUVER -- Shares of Lululemon Athletica Inc. jumped Thursday after the company reported better-than-expected earnings and announced plans to shutter most of its Ivivva brand stores.
The Vancouver, British Columbia-based company said it had profit of $31.2 million, or 23 cents per share. That includes restructuring costs of $17.7 million from its plan to close 40 of its 55 Ivivva stores, which sell activewear for girls.
About half of the remaining Ivivva stores will be converted to Lululemon stores, the company said. The Ivivva brand will mainly be an e-commerce business.
Excluding the restructuring costs, Lululemon's fiscal first-quarter earnings were 32 cents per share. The 17 analysts surveyed by Zacks Investment Research had expected earnings of 28 cents per share.
Lululemon's stock surged more than 15 per cent to $56.04 in after-hours trading on Thursday.
Lululemon CEO Laurent Potdevin said the positive trends that started near the end of the first quarter have continued into the second quarter.
"Our current outlook for the remainder of 2017 is strong, and I'm energized by the growth strategies taking shape," Potdevin said.
The athletic apparel maker posted revenue of $520.3 million in the period, also topping Street forecasts. Thirteen analysts surveyed by Zacks expected $512.7 million.
For the current quarter ending in August, Lululemon expects its adjusted per-share earnings to range from 33 cents to 35 cents.
The company said it expects revenue in the range of $565 million to $570 million for the fiscal second quarter. Analysts surveyed by Zacks had expected revenue of $563.2 million.
Lululemon expects full-year adjusted earnings in the range of $2.28 to $2.38 per share, with revenue ranging from $2.53 billion to $2.58 billion.
Through the end of regular-session trading Thursday, Lululemon shares have dropped 25 per cent since the beginning of the year.
