Levi’s (LEVI) studies Q1 2021 earnings


An worker holds a procuring bag whereas ringing up a buyer on the Levi Strauss & Co. flagship retailer in San Francisco, March 18, 2019.

David Paul Morris | Bloomberg | Getty Pictures

Levi Strauss & Co. on Thursday reported a double-digit gross sales decline for its fiscal first quarter, as ongoing retailer closures in Europe and lightened foot site visitors within the U.S. as a result of Covid pandemic weighed on outcomes.

However the denim maker boosted its gross sales and revenue outlook for the primary half of the yr, assuming the worldwide well being disaster does not turn out to be worse from right here. CFO Harmit Singh mentioned in an interview with CNBC that the corporate is anticipating gross sales will return to 2019, pre-pandemic ranges by the fourth quarter.

Its shares jumped greater than 6% in after-hours buying and selling.

“These outcomes level to actually good proof that we are going to emerge from the pandemic a stronger firm,” CEO Chip Bergh instructed CNBC. “We beat our personal expectations internally [and] beat exterior expectations, regardless of having a 3rd of our shops closed in Europe over the whole quarter.”

This is how the corporate did for its quarter ended Feb. 28, in contrast with what analysts had been anticipating, primarily based on a survey by Refinitiv:

  • Earnings per share: 34 cents adjusted vs. 25 cents anticipated
  • Income: $1.31 billion vs. $1.25 billion anticipated

Levi’s web earnings declined barely to $142.5 million, or 35 cents per share, from $152.7 million, or 37 cents per share, a yr earlier. Excluding one-time fees, the corporate earned 34 cents per share, higher than the 25 cents forecast by analysts, in keeping with Refinitiv.

Whole income fell about 13% to $1.31 billion from $1.51 billion a yr earlier. That got here in higher than the $1.25 billion forecast by analysts.

The retailer mentioned the double-digit drop in gross sales yr over yr was primarily as a result of lowered foot site visitors in its shops in the course of the pandemic, in addition to ongoing retailer closures in some markets the place Covid restrictions have remained in place. In Europe, for instance, greater than 40% of Levi’s shops presently are closed, with others working on lowered hours, the corporate mentioned.

Levi’s wholesale income fell 4% in the course of the newest quarter, marking an enchancment from the prior interval.

Direct-to-consumer gross sales had been down 26%, as a consequence of fewer clients visiting Levi’s shops and particularly in markets that depend on tourism. The decline was partially offset by a 25% enhance within the firm’s owned e-commerce gross sales in the course of the quarter, Levi’s mentioned. Whole on-line income, which incorporates digital gross sales from wholesale companions, was up 41%.

Although developments within the enterprise are bettering, earnings and gross sales are anticipated to proceed to be “considerably adversely impacted” a minimum of by way of the second quarter of 2021, Levi’s mentioned.

The corporate raised its outlook for each income and revenue within the first half of the yr, assuming that the pandemic does not worsen.

Gross sales are actually anticipated to develop 24% to 25%, and adjusted earnings are forecast to be in a spread of 41 cents to 42 cents, which means earnings of seven cents to eight cents in the course of the fiscal second quarter. Analysts had been calling for second-quarter earnings of 5 cents a share.

Levi’s shares are up practically 25% yr up to now. The corporate has a market cap of $10 billion.

Discover the total press launch from Levi’s right here.



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