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Levi Strauss & Co. (LEVI) reports that it exceeded revenue in the second quarter of 2021 – News


Levi Strauss & Company Thursday said shoppers are hoarding jeans New size and style In the United States and China, they come out of their homes during a pandemic.

Momentum both in-store and online exceeded analysts’ expectations, boosting revenue and revenue in the second quarter. Sales are still down 3% from 2019, but retailers expect third-quarter sales to be well on their way to pre-pandemic top levels.That was something Levi didn’t do before Achieved until Q4..

Levi’s share price soared about 3% in news after-hours trading.

Levi raised its earnings and profit outlook for the rest of the year, but warned that the company expects Covid’s pandemic not to worsen around the world.

“There are a lot of things we can’t handle, such as pandemics, Delta variants, and what’s next,” CEO Chipberg said in a telephone interview. “But the team has shown a lot of agility and responsiveness.”

Here’s a report from the company for the quarter ended May 30, compared to what Wall Street expected, based on an analyst survey by Refinitiv:

  • Earnings per share: Adjusted 23 cents vs. expected 9 cents
  • Revenue: $ 1.28 billion vs. expected $ 1.21 billion

Levi said it turned from a net loss of $ 364 million (91 cents per share) in the year-ago quarter to a profit of $ 65 million (16 cents per share). Excluding the one-off adjustment, Levi earned 23 cents per share, above analysts’ estimate of 9 cents.

Levi’s revenue increased 156% from $ 489 million in the previous year to $ 1.28 billion. That exceeded the $ 1.21 billion forecast.

Sales in the US and China were above 2019 levels, but remained down on a two-year basis in Europe due to continued store closures associated with the health crisis. Approximately one-third of Levi’s European stores and 17% of the world’s stores were closed during this period.

According to the company, 92% of stores are currently reopening.

Higher prices, savings in procured materials and reduced promotional activities contributed to higher profits. Recorded the highest profit margin ever. Levi said it had already adjusted most of its product costs by the first half of 2022 to account for very low single-digit inflation.

New denim cycle This helps drive sales momentum. In recent months, tight-fitting trousers have become obsolete, and instead shoppers are flocking to loose, wide-leg flared jeans. Many consumers feel the need to completely refresh their wardrobe. Levi is also looking at the growth of top businesses.

“There’s good evidence of a new denim cycle driven by a looser, buggy fit we led, which gives us a lot of optimism about the second half of the year,” Berg told CNBC. It was.

About 50% of Levi’s women’s and men’s sales in the last quarter were jeans buggy fits. During the pandemic, about 35% of US consumers changed their waist size up and down, Berg said.

Levi also said he is working to strengthen the wholesale business by investing in relationships with key partners such as: Nordstrom, And escape from the store, which is synonymous with price cuts. Wholesale sales for the most recent period increased 167% year-on-year.

In addition, the company continues to grow its digital business, with global e-commerce sales up 75% year-over-year, accounting for about 23% of total sales.

Levi expects adjusted revenue per share to be $ 1.29 to $ 1.33 for fiscal year 2021. Analysts were looking for a profit of $ 1.15 per share.

Levi forecasts sales in the second half to increase 28% to 29% year-on-year and 4% to 5% year-on-year. The company doesn’t provide a concrete quote for the whole year, but said sales should be close to 2019 levels. Analysts expect sales growth of 24.6% for the full year starting in 2020.

“Most markets are recovering faster than expected and are out of the pandemic with sustainable and improved structural economics,” Chief Financial Officer Hermit Singh said in a news release.

Levi raised its third-quarter dividend by 2 cents per share to 8 cents.

Levi’s share price has risen nearly 40% year-to-date. The company has a market capitalization of approximately $ 11.2 billion.

Click here for the full Levi’s press release.

Levi Strauss & Co. (LEVI) reports that it exceeded revenue in the second quarter of 2021

Source link Levi Strauss & Co. (LEVI) reports that it exceeded revenue in the second quarter of 2021

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