Lululemon’s top executives are pitching in to help employees facing coronavirus-related hardships.
In a release yesterday, the athletic apparel retailer announced that members of its senior leadership team will see 20% reductions in their salaries for the next three months, while board directors will also forgo their retainers. This cash reservoir, it shared, would go to the company’s new “We Stand Together” Fund to assist workers who might have been impacted by coronavirus, which has now affected more than a million people worldwide.
Lululemon will also continue to pay employees through June 1, whether its stores reopen or remain closed. (The brand’s outposts in North America, Europe, Malaysia, Australia and New Zealand are still shuttered.)
“Our people are our top priority. These decisions enable us to support our teams and immediate business priorities, while balancing what is required to plan for the recovery and growth to follow,” CEO Calvin McDonald said in a statement. “We’re making the right commitments now as we navigate what’s ahead for the future.”
During its fourth-quarter conference call, the company noted that it was seeing “virus-related impact” on performance across its markets. It did not provide an outlook for the upcoming fiscal year, joining a roster of retailers — including Dick’s Sporting Goods and Skechers — that have either withdrawn or opted to not provide fiscal guidance over the past couple weeks.
Lululemon ended the fiscal year with $1.1 billion in cash, no long-term debt and a $400 million untapped revolver. During 2019, it saw revenues increase 21% to $4 billion, while earnings per share were $4.93, compared to the prior year’s $3.61.
The company said it would continue to monitor its supply chain and distribution network, as well as the safety of its employees. It has temporarily paused its share repurchase program amid the health crisis.
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