Levi’s clothes are seen on a store shelf in Miami, Florida.
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Levi Strauss & Co. reported on Wednesday that its total sales in the holiday quarter fell by 12%, marking an improvement from a drop of more than 20% in the previous period as weak buyer traffic to its stores was partially offset by double-digit online growth.
Shares recently increased by more than 1% in trading after the program, after initially decreasing by more than 4%.
Chief Executive Chip Bergh told CNBC that last quarter’s results exceeded the denim maker’s domestic expectations, almost meeting the “best scenario” Levi set when the Covid pandemic began to hit the United States and disrupt many companies. .
“It simply came to our notice then [direct to consumer] and especially e-commerce, “Bergh said in a telephone interview.” Our e-commerce business was profitable in the fourth quarter and profitable for the entire year. “
Levi’s global digital sales, which include online sales of its goods to wholesale partners, accounted for 23% of fourth-quarter sales, up from 15% in the previous year.
Here’s how Levi Strauss & Co. did it. during the fourth fiscal quarter compared to what analysts expected, using Finitive data:
- Earnings per share: 20 cents, adjusted, compared to 15 cents, expected
- Revenue: $ 1.39 billion compared to $ 1.34 billion, expected
For the three-month period ended Nov. 29, Levi earned $ 57 million or 14 cents a share, up from $ 96 million or 23 cents a share a year earlier. Excluding one-time taxes, it earned 20 cents a share, which was better than the 15 cents expected by analysts, using Refinitive data.
Net income fell 12% to $ 1.39 billion from $ 1.57 billion a year earlier. This was better than analysts’ $ 1.34 billion forecast.
Global digital sales have increased by 34%, which includes sales on its partner platforms such as Amazon.
Levi said revenues from its wholesale partners fell 15 percent in the quarter, while direct consumer revenues fell 5 percent due to lower visits to its stores.
As the coronavirus pandemic continues to disrupt normal business operations, the company said that currently about 40% of its stores in Europe and 17% globally, including locations operated by franchisees, are closed.
“The recent resurgence of the virus underscores that the final impact of the Covid-19 pandemic remains extremely uncertain,” Levi said in his statement. “The company expects its business … to continue to be significantly adversely affected at least in the first half of 2021 and the possibility of an additional inventory of Covid-19 and other taxes remains.”
Shares of Levi, at the close of the market on Wednesday, increased by just over 8% compared to a year ago. The company has a market cap of $ 8.8 billion.
Find here the full press release from Levi Strauss & Co.