US: Costs push Levi Strauss Q2 earnings down
- Q2 earnings dropped to US$11m
- Gross margin narrow to 49%
- Sales fall 2%
Jeans giant Levi saw its earnings plummet in the second quarter
Jeans giant Levi Strauss & Co saw its earnings plummet in the second quarter, hurt by restructuring and debt extinguishment-related charges, as well as lower wholesale revenues in the Americas.
In the three months ended 25 May, earnings declined to US$11m from $48m a year earlier. The company recorded $28m in restructuring and other charges related to Levi's global productivity initiative, and a debt extinguishment charge of $11m.
Gross margin also declined in the quarter, to 49% of revenues compared with 49.9% in the year-ago quarter. The decline reflected an unfavourable sales mix and product investment costs.
Sales were down 2% to $1.08bn on a reported basis and 1% on a constant-currency basis, reflecting lower sales at wholesale in the Americas, partially offset by an improved performance in Europe and Asia.
"While we are encouraged by business improvements in Europe and Asia, ongoing traffic declines and an increasingly promotional environment continue to pressure our Americas region," said CEO Chip Bergh.
"We will continue to focus on what's within our control - from cost structure, to conversion in our stores, to engaging consumers with great product and innovation - in order to drive long-term profitable growth."
Global market review of denim and jeanswear – forecasts to 2020
Whether we buy for functionality, authenticity or fashionability, our love affair with denim continues. In this latest edition of the denim and jeanswear report, just-style has combined the idea of fa...read more
Levi Strauss & Co. - SWOT Analysis company profile is the essential source for top-level company data and information. Levi Strauss & Co. - SWOT Analysis examines the company’s key business structu......
MarketLine's Company Mergers & Acquisitions (M&A), Partnerships & Alliances and Investments reports offer a comprehensive breakdown of the organic and inorganic growth activity undertaken by an organi...
Levi Strauss & Co. - Strategic SWOT Analysis Review provides a comprehensive insight into the company’s history, corporate strategy, business structure and operations. The report contains a detailed S...
Levis Strauss France faces a difficult time in its development in France, as in addition to growing production costs, there is Increasing competition from retailers positioned in the economy segment, ...
- 2014: Year in review - Sourcing winners and losers
- 2014: Year in review - Brand winners and losers
- 2014: Year in review - Retail winners and losers
- Bangladesh: Raising the bar on apparel exports?
- Bangladesh: The business benefits of compliance
- Report urges overhaul of Cambodia factory safety
- Bangladesh factory improvements “will take years”
- Bangladesh knitting worker killed by faulty lift
- North Face debuts locally-grown "backyard" hoodie
- Tommy Hilfiger launches solar-powered jacket