Levi’s holiday-quarter sales fall 12%, despite online gains

Levi’s garments are seen on a retailer shelf in Miami, Florida.

Joe Raedle | Getty Images

Levi Strauss & Co. reported Wednesday its whole holiday-quarter sales dropped 12%, marking an enchancment from a greater than 20% decline within the prior interval, as weak shopper visitors at its shops was partially offset by double-digit development online.

Shares had been just lately up greater than 1% in after-hours buying and selling after initially falling greater than 4%.

Chief Executive Chip Bergh instructed CNBC that the outcomes for the most recent quarter topped the denim maker’s inner expectations, practically assembly the “best-case scenario” that Levi laid out again when the Covid pandemic first began to hit the United States and disrupt many companies.

“We pivoted very hard to [direct to consumer] and especially to e-commerce,” Bergh mentioned in a cellphone interview. “Our e-commerce business was profitable in the fourth quarter, and profitable for the full year.”

Levi’s world digital sales, which embrace the online sales of its merchandise at wholesale companions, made up 23% of fourth-quarter sales, up from 15% within the prior-year interval.

Here’s how Levi Strauss & Co. did throughout its fiscal fourth quarter in contrast with what analysts had been anticipating, utilizing Refinitiv knowledge:

  • Earnings per share: 20 cents, adjusted, vs. 15 cents, anticipated
  • Revenue: $1.39 billion vs. $1.34 billion, anticipated

For the three-month interval ended Nov. 29, Levi earned $57 million, or 14 cents per share, in contrast with $96 million, or 23 cents per share, a yr earlier. Excluding one-time fees, it earned 20 cents per share, which was higher than the 15 cents anticipated by analysts, utilizing Refinitiv knowledge.

Net income fell 12% to $1.39 billion from $1.57 billion a yr earlier. That was higher than the $1.34 billion forecast by analysts.

Digital sales globally had been up 34%, which incorporates sales made on its companion platforms like Amazon.

Levi mentioned income from its wholesale companions dropped 15% through the quarter, whereas its direct-to-consumer income was down 5%, as a consequence of decrease visits to its shops.

As the coronavirus pandemic continues to disrupt regular enterprise operations, the corporate mentioned that at present roughly 40% of its shops in Europe, and 17% globally together with franchisee-operated areas, are closed.

“The recent resurgence of the virus underscores that the ultimate impact of the Covid-19 pandemic remains highly uncertain,” Levi mentioned in its earnings launch. “The company expects that its business … will continue to be significantly adversely impacted for at least the first half of 2021, and there remains the possibility of additional Covid-19 related inventory and other charges.”

Levi shares, as of Wednesday’s market shut, are up a little bit greater than 8% from a yr in the past. The firm has a market cap of $8.Eight billion.

Find the complete press launch from Levi Strauss & Co. right here.

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