lululemon athletica inc. announced on January 8, 2018 that the Company is updating its net revenue and earnings guidance for the fourth quarter of fiscal 2017 ending January 28, 2018.
For the fourth quarter, we now anticipate that net revenue will be in the range of CAD 905 million to CAD 915 million based on a total comparable sales increase in the high single digits on a constant dollar basis. This compares to our previous guidance of net revenue in the range of CAD 870 million to CAD 885 million for the fourth quarter based on a total comparable sales increase in the mid-single digits on a constant dollar basis.
We also now expect diluted earnings per share will be in the range of CAD 1.24 to CAD 1.26 for the fourth quarter. Excluding the impact of the restructuring of our ivivva operations, we expect adjusted diluted earnings per share to be in the range of 1.25 to CAD 1.27 for the quarter. The previous diluted earnings per share guidance for the fourth quarter was a range of CAD 1.18 to CAD 1.21, or CAD 1.19 to CAD 1.22 excluding the impact of the ivivva restructuring. This guidance does not reflect potential future repurchases of the Company’s shares and continues to assume 135.6 million diluted weighted-average shares outstanding.
This guidance also continues to assume a 30.4 % tax rate and does not reflect the impact of the U.S. tax reform which was enacted on December 22, 2017. We are assessing the impact that the tax reform will have, but expect to recognize a significant income tax expense in the fourth quarter of fiscal 2017 related to the one-time deemed repatriation tax on accumulated foreign earnings. We believe that the impact of the tax reform will be favorable to the Company’s effective tax rate in fiscal 2018.
“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,” said Laurent Potdevin, CEO, lululemon.