Tag: CASH MANAGEMENT

Lululemon Athletica raised its revenue guidance for the current fiscal year following better-than-expected third fiscal quarter earnings. Revenue jumped 30% year-on-year to $ 1.45 billion, including 28% growth in North America and 40% in other countries. The figure was better than the market forecast of $ 1.4 billion. Like-for-like sales in the last quarter increased by 27% yoy. Lululemon opened 18 new stores last quarter, bringing the number to 552. Adjusted profit for the fiscal quarter ended October 31 rose to $ 1.62 per share from $ 1.16 per share in the comparable period a year earlier. The market was expecting a net profit of $ 1.40 per share.

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In early November, Novartis announced its agreement to sell 53.3 million shares of Roche to its current shareholders for $ 20.7 billion. At the end of November, Roche shareholders voted to acquire this stake from Novartis. The cancellation of the repurchased shares will take place in January-February 2022. We are currently seeing several positives for Roche in this deal. First, it is beneficial for Roche as the company will pay the market price for these assets, which is permitted by Swiss law. Secondly, the pharmaceutical sector is trading at lower multiples, so Roche has chosen the right moment to close the deal. Third, Roche’s profits should accelerate in the coming years, as economic activity around the world recovers after the pandemic. Fourth, Roche gets more strategic freedom. The company will have to raise borrowed funds to finance the deal. However, taking into account the annual operating cash flow of 15 billion Swiss francs, Roche will be able to fully repay the debt financing within 1-2 years. Thus, the increase in the debt burden will be insignificant and will be temporary in nature.

Dick’s Sporting Goods in the third quarter of fiscal year 2021, which ended October 30, increased its net income by 78.6% year-on-year. Revenue rose 14% to $ 2.75 billion from $ 2.41 billion a year earlier, better than the consensus forecast of $ 2.50 billion. Net income for the quarter rose to $ 316.5 million, or $ 2.78 per share compared to from $ 177.2 million, or $ 1.84 per share, received in the comparable period last year. Adjusted earnings climbed to $ 3.19 per share, well above market expectations of $ 1.97 per share.

Gap, which owns a chain of clothing stores, has released disappointing quarterly earnings due to supply chain problems. Gap’s quarterly revenues declined to $ 3.94 billion from $ 3.99 billion last year, while market consensus expected the indicator to rise to $ 4.43 billion. Net loss in August-October was $ 152 million, or $ 0.40 per share, compared to net income of $ 95 million, or $ 0.25 per share, in the same period the previous year. It is noteworthy that the market expected the indicator to rise to $ 191 million. Adjusted profit after deducting debt restructuring costs amounted to $ 0.27 per share against market expectations of $ 0.5.

Applied Materials, one of the world’s largest chip makers, posted strong fiscal 4 quarter results, showing a 51% increase in net income and a 30% increase in revenues. Applied Materials’ quarterly revenues increased to $ 6.12 billion from $ 4.69 billion a year earlier, falling short of the consensus forecast of $ 6.39 billion. Net income for the quarter ended October 31 was $ 1.71 billion, up from $ 1.13 billion for the fourth quarter of the previous fiscal year. Earnings per share increased to $ 1.89 from $ 1.23. Adjusted earnings of $ 1.94 per share, slightly below the market estimate of $ 1.96 per share.

In mid-November, US plant-based meat substitute maker Beyond Meat released weak 3Q results. The company’s revenue grew by 12.7% yoy and reached $ 106.4 million versus $ 94.4 million a year earlier, which was below the consensus forecast at $ 109.2 million. The company’s net loss for the quarter ended October 2 was $ 54.816 million, or 87 cents per share, compared with $ 19.285 million, or 31 cents per share, in the comparable period last year. The result was significantly worse than market expectations at minus $ 0.3. The deterioration in financial performance occurred against the backdrop of an increase in the wage bill due to an increase in the number of personnel, an increase in marketing costs and transportation costs. The results of the company greatly disappointed investors, so the shares on the day of the release of the reports fell by almost 16% and continue to decline to the current day. Many global investment houses have downgraded their valuations of the issuer’s stock. We also revised our financial model and downgraded the share price from $ 101 to $ 79.

Target, which owns the second-largest chain of discount stores in the United States, increased its net profit in the third fiscal quarter by 48% and revenue by 13%. Target’s quarterly revenue rose to $ 25.65 billion from $ 22.63 billion a year earlier. The consensus forecast of analysts for this indicator was $ 24.61 billion. Growth in comparable sales of Target in the last quarter was 12.7% (forecast was 8.2%). Online sales increased by 29%. Net income for the quarter ended October 30 was $ 1.49 billion, up from $ 1.01 billion in the same period last year. Earnings per share increased to $ 3.04 from $ 2.01. Profit excluding one-off factors was $ 3.03 per share, beating the market average forecast of $ 2.82 per share.

Adidas, the world’s second-largest sportswear manufacturer, increased its third-quarter net income by 70.6% despite slowing revenue growth. Adidas’ revenues rose 3.4% to 5.75 billion euros, in line with the market forecast. Excluding changes in exchange rates, it increased by 3%. It should be noted that the pace of revenue growth slowed significantly compared to a 51.5% rise in the second quarter, due in part to a worsening sales situation in China. Excluding changes in currency exchange rates, the company’s revenue in China in the last quarter decreased by 11% (to 1.155 billion euros), in other countries of the Asia-Pacific region – by 9.6% (to 504 million euros). Meanwhile, it grew in North America by 6.6% (to 1.4 billion euros), in EMEA – by 8.1% (to 2.25 billion euros), in Latin America – 53.4% ​​(to 405 million Euro).