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Lululemon hikes forecasts on strong holiday sales

Lululemon Athletica Inc. is raising its sales and earnings guidance for its fourth quarter.

The retailer says it now expects net revenue will be in the range of $905-million to $915-million for the quarter based on a total comparable sales increase in the high single digits on a constant dollar basis.

The revised forecast compares with its earlier guidance for net revenue in the range of $870-million to $885-million for the fourth quarter based on a total comparable sales increase in the mid-single digits on a constant dollar basis.

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Lululemon also says it now expects diluted earnings per share of $1.24 to $1.26 for the fourth quarter. Excluding the impact of the restructuring of its Ivivva operations, it expects adjusted diluted earnings per share in the range of $1.25 to $1.27.

That is up from earlier guidance for diluted earnings per share of $1.18 to $1.21, or $1.19 to $1.22 excluding the Ivivva restructuring.

The guidance did not include the impact of the U.S. tax reform which was enacted late last year. The company says it expects to recognize a significant income tax expense in the fourth quarter related to the one-time deemed repatriation tax on accumulated foreign earnings.

"We are thrilled with our performance this holiday season that reflects an accelerating trend across all parts of our business, and we look forward to continued momentum in 2018 and beyond," Lululemon CEO Laurent Potdevin said in a statement.

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