UPDATE 2-Lululemon profit jumps but sees sales growth slowing
* 3rd-qtr profit 39 cents/share vs Street view 37 cents
* Revenue up 37 pct to $316.5 million
* Shares drop 4 pct in premarket trading
(Adds details on margins, inventory and forecasts.)
Dec 6 (Reuters) - Canada's Lululemon Athletica Inc said on Thursday sales growth in established yogawear stores would slow sharply, sending its shares lower in premarket trading even as it reported higher-than-expected quarterly profit and revenue.
The company expects same-store sales, an important measure for retailers, to rise "in the high single digits" in the current quarter. Lulu typically is conservative in its forecasts, but such a result would represent a big deceleration from a year earlier, when fourth-quarter same-store sales climbed 26 percent.
There were other worrisome signals in the Vancouver-based retailer's third-quarter report. Inventory rose and profit margins slipped, while Lulu's earnings and revenue forecasts for the fourth quarter fell short of analysts' expectations.
For the fourth quarter, Lulu expects revenue of $475 million to $480 million. Analysts, on average, had forecast $490.5 million, according to Thomson Reuters I/B/E/S. The company sees earnings per share of 71 to 73 cents, below the average estimate of 75 cents.
Lulu, with 201 stores in North America and Australia at the end of the third quarter, said inventory was $164.7 million at the end of the quarter, up from $129.2 million a year earlier.
Gross profit margin fell to 55.4 percent of revenue from 55.8 percent last year, and operating margin slipped to 25.5 percent from 25.9 percent.
Net income for the third quarter, ended Oct. 28, rose to $57.3 million, or 39 cents a share, from $38.8 million, or 27 cents a share, a year earlier. Analysts, on average, had expected 37 cents a share.
Net revenue rose 37 percent to $316.5 million, beating the average forecast of $305.3 million.
Same-store sales rose 18 percent on a constant-dollar basis.
Lulu's Nasdaq-listed shares fell 4.1 percent to $65.80 in premarket trading.
(Reporting by Allison Martell; Editing by Gerald E. McCormick and John Wallace)