Actual 2007	Estimated 2012	Actual 2012
Net sales or Net Revenue	?	?	?
Gross profit %	?	?	?
Operating profit %	?	?	?
Profit margin %	?	?	?
EBITDA % (Note that you have to do some extra detective work here to track down the depreciation and amortization amounts) Note that these EBITDA percentages are worth 2 marks each.	?	?	?

When you compare the estimated results for 2012 to the actual results for 2012, do you think the IPO would have been under or overpriced? Why?

lululemon athletica inc. and Subsidiaries CONSOLIDATED STATEMENTS OF CASH FLOWS February 3, 2008 $ 30,842,439 8,340,732 5,947,097 1,798,882 (334,220) (8,504,366) 38,090,564 (29,675,940) (5,559,179) (35,235,119) Fiscal Year Ended January 31, January 31, 2006 2007 Cash flows from operating activities Net income $ 1,394,104 $ 7,666,331 Items not affecting cash Depreciation and amortization 2,466,298 4,618,512 Stock-based compensation 2,699,916 2,829,572 Deferred income taxes (174,901) (3,076,876) Loss on property and equipment 229,950 Non-controlling interest 10,000 (111,865) Other, including net changes in other non-cash balances (17,379,431) 13,293,190 (10,984,014) 25.448.814 Cash flows from investing activities Purchase of property and equipment (7,144,319) (12,837,820) Acquisition of franchises (460,567) (511,850) (7,604,886) (13,349,670 Cash flows from financing activities Funds received from principal stockholder loan 7,831,694 222,440 Distribution to principal stockholder (69,005,127) Funds repaid on principal stockholder loan (11,143,141) Amounts received from joint venture partner Proceeds from credit facility Repayment of credit facility Repayment of long-term debt (634,467) Cash received on exercise of stock options Capital stock issued for cash 93,036,851 446,419 Payment of initial public offering costs 20,085,810 668,859 Effect of exchange rate changes on cash (271,667) (616,486) Increase in cash and cash equivalents 1,225,243 12,151,517 Cash and cash equivalents, beginning of year 2,651,774 3,877,017 Cash and cash equivalents, end of year $ 3,877,017 $ 16,028,534 See accompanying notes to the consolidated financial statements 564,397 1,454,775 (1,454,775) 54,649 38,349,817 (6,992,309) 31,976,554 2,478,793 37,310,792 16,028,534 $ 53,339,326 CONSOLIDATED BALANCE SHEETS January 29, January 30, 2012 2011 (Amounts in thousands, except per share amounts) ASSETS Current assets Cash and cash equivalents Accounts receivable Inventories Prepaid expenses and other current assets Property and equipment, net Goodwill and intangible assets, net Deferred income taxes Other non-current assets $409,437 5,202 104,097 8,357 527,093 162,941 31,872 8,587 4,141 $734,634 $316,286 9,116 57,469 6,408 389,279 70,954 27,112 7,894 4,063 $499,302 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable Accrued liabilities Accrued compensation and related expenses Income taxes payable Unredeemed gift card liability $ 14,536 34,535 22,875 8,720 22,773 103,439 25,014 128,453 $ 6,659 25,266 16,872 18,399 18,168 85,364 19,645 105,009 Other non-current liabilities Stockholders' equity Undesignated preferred stock, $0.01 par value, 5,000 shares authorized, none issued and outstanding Exchangeable stock, no par value, 60,000 shares authorized, issued and outstanding 33,412 and 35,636 Special voting stock, $0.000005 par value, 60,000 shares authorized, issued and outstanding 33,412 and 35,636 Common stock, $0.005 par value, 400,000 shares authorized, issued and outstanding 110,135 and 106,756 Additional paid-in capital Retained earnings Accumulated other comprehensive income 551 205,557 373,719 21,549 601,376 4,805 $734,634 534 179,870 189,656 20,329 390,389 3,904 $499,302 on-controlling interest CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY Other Exchangeable Special Voting Stock Stock Common Stock Additional Non- Retained Comprehensive Controlling Par Par Par Paid in Shares Value Shares Value Shares Value Capital Earnings Income (Loss) Total Interest (Amounts in thousands) 39,034 S - 39,034 S. 100,844 S 504 $ 155,961 S 9,528 S (11,151) S154,842 $ Total S154,842 58,281 58,281 58,281 17,018 17,018 75,299 17,018 75,299 5,616 5,616 5,616 (3,858) (3,858) (3,858) (268) (268) 1 268 (1) 30 1.110 1,203 102,252 S511 S 158,921 5 67,809 S 38,766 5 - 38,766 5 - $ 67,809 1,209 5,867 5233,108 S 121,847 1.209 S233,108 121,847 121,847 14,462 14,462 136,309 7,273 14,462 136,309 7,273 7,273 7,863 7,863 7,863 Balance at February 1, 2009 Comprehensive income: Net income attributable to lululemon athletica inc. Foreign currency translation adjustment Comprehensive income Stock-based compensation Excess tax benefit from stock-based compensation Common stock issued upon exchange of exchangeable shares Restricted stock issuance Stock option exercises Balance at January 31, 2010 Net income attributable to lululemon athletica inc. Foreign currency translation adjustment Comprehensive income Stock-based compensation Excess tax benefit from stock-based compensation Common stock issued upon exchange of exchangeable shares Restricted stock issuance Stock option exercises Non-controlling interest: Non-controlling interests recognized on acquisition Net income attributable to non-controlling interests Balance at January 30, 2011 Net income attributable to lululemon athletica inc. Foreign currency translation adjustment Comprehensive income Stock-based compensation Excess tax benefit from stock-based compensation Common stock issued upon exchange of exchangeable shares Restricted stock issuance Stock option exercises Non-controlling interest: Net income attributable to non-controlling interests Balance at January 29, 2012 (3,130) - (3,130) 16 (16) 3,130 12 1,362 7 5,829 5,836 5,836 3,554 3,554 35,636 S 35,636 S 106,756 S 534 S 179,870 S 189,656 S 20,329 $390,389S 350 350 3,904 S394,293 184.063 184,063 184,063 1,220 1,220 185,283 10,340 1,220 185,283 10,340 10,340 5,750 5,750 5,750 (2,224) (2,224) 11 (11) 2.224 4 1,151 6 9,608 9,614 9,614 33.412 S 33,412 110,135 S 551 S 205,557 S 373,719 S $ 2,549 21,549 S601,376 901 901 4,805 S606,181 See accompanying notes to the consolidated financial statements CONSOLIDATED STATEMENTS OF CASH FLOWS Fiscal Year Ended January 30, January 31, January 29, 2012 2010 2011 (Amounts in thousands) $ 58,281 $ 184,063 901 184,964 $121,847 350 122,197 58,281 30,259 10,340 (1,775) 20,832 5,616 379 (2,183) 387 3,858 (693) (5,750) Cash flows from operating activities Net income attributable to lululemon athletica inc Net income attributable to non-controlling interest Net income Items not affecting cash Depreciation and amortization Stock-based compensation Provision for impairment and lease exit costs Derecognition of unredeemed gift card liability Deferred income taxes Excess tax benefits from stock-based compensation Gain on investment Other, including net changes in other non-cash balances Net cash provided by operating activities Cash flows from investing activities Purchase of property and equipment Investment in and advances to franchise Acquisition of franchises Net cash used in investing activities Cash flows from financing activities Proceeds from exercise of stock options Excess tax benefits from stock-based compensation Net cash provided by (used in) financing activities Effect of exchange rate changes on cash Increase in cash and cash equivalents Cash and cash equivalents, beginning of year Cash and cash equivalents, end of year 24,614 7,273 1,772 (1,406) 11,234 (7,863) (1,792) 23,966 179,995 (13,730) 203,615 30,790 117,960 (116,657) (30,357) (15,497) (810) (5,654) (122,311) (12,482) (42,839) (16,307) 9,614 5,750 15,364 (3,517) 93,151 $ 316,286 $ 409,437 5,836 1,209 7,863 (3,858) 13,699 (2,649) 5,858 3,772 156,713 102,776 $159,573 $ 56,797 $316,286 $159,573 CONSOLIDATED STATEMENTS OF OPERATIONS Fiscal Year Ended January 30, January 31, January 29, 2012 2011 2010 (Amounts in thousands, except per share amounts) $1,000,839 $711,704 $452,898 431,569 316,757 229,812 569,270 394,947 223,086 282,312 Net revenue Cost of goods sold Gross profit Operating expenses: Selling, general and administrative expenses Provision for impairment and lease exit costs Income from operations Other income (expense), net Income before provision for income taxes Provision for income taxes Net income Net income attributable to non-controlling interest Net income attributable to lululemon athletica inc. Net basic earnings per share Net diluted earnings per share Basic weighted average number of shares outstanding Diluted weighted-average number of shares outstanding 212,784 1,772 180,391 2,886 183,277 61,080 122,197 350 $121,847 $ 0.86 $ 0.85 141,720 143,858 136,161 379 86,546 164 86,710 28,429 58,281 286,958 2,500 289,458 104,494 184,964 901 $ 184,063 1.29 $ 1.27 143,196 145,278 $ 58,281 $ 0.41 $ 0.41 140,502 141,898 lululemon athletica inc. and Subsidiaries CONSOLIDATED STATEMENTS OF CASH FLOWS February 3, 2008 $ 30,842,439 8,340,732 5,947,097 1,798,882 (334,220) (8,504,366) 38,090,564 (29,675,940) (5,559,179) (35,235,119) Fiscal Year Ended January 31, January 31, 2006 2007 Cash flows from operating activities Net income $ 1,394,104 $ 7,666,331 Items not affecting cash Depreciation and amortization 2,466,298 4,618,512 Stock-based compensation 2,699,916 2,829,572 Deferred income taxes (174,901) (3,076,876) Loss on property and equipment 229,950 Non-controlling interest 10,000 (111,865) Other, including net changes in other non-cash balances (17,379,431) 13,293,190 (10,984,014) 25.448.814 Cash flows from investing activities Purchase of property and equipment (7,144,319) (12,837,820) Acquisition of franchises (460,567) (511,850) (7,604,886) (13,349,670 Cash flows from financing activities Funds received from principal stockholder loan 7,831,694 222,440 Distribution to principal stockholder (69,005,127) Funds repaid on principal stockholder loan (11,143,141) Amounts received from joint venture partner Proceeds from credit facility Repayment of credit facility Repayment of long-term debt (634,467) Cash received on exercise of stock options Capital stock issued for cash 93,036,851 446,419 Payment of initial public offering costs 20,085,810 668,859 Effect of exchange rate changes on cash (271,667) (616,486) Increase in cash and cash equivalents 1,225,243 12,151,517 Cash and cash equivalents, beginning of year 2,651,774 3,877,017 Cash and cash equivalents, end of year $ 3,877,017 $ 16,028,534 See accompanying notes to the consolidated financial statements 564,397 1,454,775 (1,454,775) 54,649 38,349,817 (6,992,309) 31,976,554 2,478,793 37,310,792 16,028,534 $ 53,339,326 CONSOLIDATED BALANCE SHEETS January 29, January 30, 2012 2011 (Amounts in thousands, except per share amounts) ASSETS Current assets Cash and cash equivalents Accounts receivable Inventories Prepaid expenses and other current assets Property and equipment, net Goodwill and intangible assets, net Deferred income taxes Other non-current assets $409,437 5,202 104,097 8,357 527,093 162,941 31,872 8,587 4,141 $734,634 $316,286 9,116 57,469 6,408 389,279 70,954 27,112 7,894 4,063 $499,302 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable Accrued liabilities Accrued compensation and related expenses Income taxes payable Unredeemed gift card liability $ 14,536 34,535 22,875 8,720 22,773 103,439 25,014 128,453 $ 6,659 25,266 16,872 18,399 18,168 85,364 19,645 105,009 Other non-current liabilities Stockholders' equity Undesignated preferred stock, $0.01 par value, 5,000 shares authorized, none issued and outstanding Exchangeable stock, no par value, 60,000 shares authorized, issued and outstanding 33,412 and 35,636 Special voting stock, $0.000005 par value, 60,000 shares authorized, issued and outstanding 33,412 and 35,636 Common stock, $0.005 par value, 400,000 shares authorized, issued and outstanding 110,135 and 106,756 Additional paid-in capital Retained earnings Accumulated other comprehensive income 551 205,557 373,719 21,549 601,376 4,805 $734,634 534 179,870 189,656 20,329 390,389 3,904 $499,302 on-controlling interest CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY Other Exchangeable Special Voting Stock Stock Common Stock Additional Non- Retained Comprehensive Controlling Par Par Par Paid in Shares Value Shares Value Shares Value Capital Earnings Income (Loss) Total Interest (Amounts in thousands) 39,034 S - 39,034 S. 100,844 S 504 $ 155,961 S 9,528 S (11,151) S154,842 $ Total S154,842 58,281 58,281 58,281 17,018 17,018 75,299 17,018 75,299 5,616 5,616 5,616 (3,858) (3,858) (3,858) (268) (268) 1 268 (1) 30 1.110 1,203 102,252 S511 S 158,921 5 67,809 S 38,766 5 - 38,766 5 - $ 67,809 1,209 5,867 5233,108 S 121,847 1.209 S233,108 121,847 121,847 14,462 14,462 136,309 7,273 14,462 136,309 7,273 7,273 7,863 7,863 7,863 Balance at February 1, 2009 Comprehensive income: Net income attributable to lululemon athletica inc. Foreign currency translation adjustment Comprehensive income Stock-based compensation Excess tax benefit from stock-based compensation Common stock issued upon exchange of exchangeable shares Restricted stock issuance Stock option exercises Balance at January 31, 2010 Net income attributable to lululemon athletica inc. Foreign currency translation adjustment Comprehensive income Stock-based compensation Excess tax benefit from stock-based compensation Common stock issued upon exchange of exchangeable shares Restricted stock issuance Stock option exercises Non-controlling interest: Non-controlling interests recognized on acquisition Net income attributable to non-controlling interests Balance at January 30, 2011 Net income attributable to lululemon athletica inc. Foreign currency translation adjustment Comprehensive income Stock-based compensation Excess tax benefit from stock-based compensation Common stock issued upon exchange of exchangeable shares Restricted stock issuance Stock option exercises Non-controlling interest: Net income attributable to non-controlling interests Balance at January 29, 2012 (3,130) - (3,130) 16 (16) 3,130 12 1,362 7 5,829 5,836 5,836 3,554 3,554 35,636 S 35,636 S 106,756 S 534 S 179,870 S 189,656 S 20,329 $390,389S 350 350 3,904 S394,293 184.063 184,063 184,063 1,220 1,220 185,283 10,340 1,220 185,283 10,340 10,340 5,750 5,750 5,750 (2,224) (2,224) 11 (11) 2.224 4 1,151 6 9,608 9,614 9,614 33.412 S 33,412 110,135 S 551 S 205,557 S 373,719 S $ 2,549 21,549 S601,376 901 901 4,805 S606,181 See accompanying notes to the consolidated financial statements CONSOLIDATED STATEMENTS OF CASH FLOWS Fiscal Year Ended January 30, January 31, January 29, 2012 2010 2011 (Amounts in thousands) $ 58,281 $ 184,063 901 184,964 $121,847 350 122,197 58,281 30,259 10,340 (1,775) 20,832 5,616 379 (2,183) 387 3,858 (693) (5,750) Cash flows from operating activities Net income attributable to lululemon athletica inc Net income attributable to non-controlling interest Net income Items not affecting cash Depreciation and amortization Stock-based compensation Provision for impairment and lease exit costs Derecognition of unredeemed gift card liability Deferred income taxes Excess tax benefits from stock-based compensation Gain on investment Other, including net changes in other non-cash balances Net cash provided by operating activities Cash flows from investing activities Purchase of property and equipment Investment in and advances to franchise Acquisition of franchises Net cash used in investing activities Cash flows from financing activities Proceeds from exercise of stock options Excess tax benefits from stock-based compensation Net cash provided by (used in) financing activities Effect of exchange rate changes on cash Increase in cash and cash equivalents Cash and cash equivalents, beginning of year Cash and cash equivalents, end of year 24,614 7,273 1,772 (1,406) 11,234 (7,863) (1,792) 23,966 179,995 (13,730) 203,615 30,790 117,960 (116,657) (30,357) (15,497) (810) (5,654) (122,311) (12,482) (42,839) (16,307) 9,614 5,750 15,364 (3,517) 93,151 $ 316,286 $ 409,437 5,836 1,209 7,863 (3,858) 13,699 (2,649) 5,858 3,772 156,713 102,776 $159,573 $ 56,797 $316,286 $159,573 CONSOLIDATED STATEMENTS OF OPERATIONS Fiscal Year Ended January 30, January 31, January 29, 2012 2011 2010 (Amounts in thousands, except per share amounts) $1,000,839 $711,704 $452,898 431,569 316,757 229,812 569,270 394,947 223,086 282,312 Net revenue Cost of goods sold Gross profit Operating expenses: Selling, general and administrative expenses Provision for impairment and lease exit costs Income from operations Other income (expense), net Income before provision for income taxes Provision for income taxes Net income Net income attributable to non-controlling interest Net income attributable to lululemon athletica inc. Net basic earnings per share Net diluted earnings per share Basic weighted average number of shares outstanding Diluted weighted-average number of shares outstanding 212,784 1,772 180,391 2,886 183,277 61,080 122,197 350 $121,847 $ 0.86 $ 0.85 141,720 143,858 136,161 379 86,546 164 86,710 28,429 58,281 286,958 2,500 289,458 104,494 184,964 901 $ 184,063 1.29 $ 1.27 143,196 145,278 $ 58,281 $ 0.41 $ 0.41 140,502 141,898