Home / Knowledge / News / Apparel/Garments / Jeans maker Levi Strauss faces high cotton prices in Q4
Jeans maker Levi Strauss faces high cotton prices in Q4
08
Feb '12
Levi Strauss & Co announced financial results for the fourth quarter and fiscal year ended November 27, 2011.

The company's net revenues grew in each geographic region in fiscal year 2011, primarily due to the strength of the Levi's brand and its global store network. Fourth-quarter net revenues were up 4 percent on a reported basis compared to the same period in the prior year and full-year net revenues were up 8 percent on a reported basis from the prior year. Fourth quarter net income decreased from the prior year due to the company's lower gross margin in the fourth quarter of 2011 and a $32 million increase in income taxes, primarily reflecting a $34 million tax benefit recorded in the fourth quarter of 2010.

“In the face of stiff cost and economic headwinds, Levi Strauss & Co. grew the top-line for the second year in a row,” said Chip Bergh, president and chief executive officer of Levi Strauss & Co. “As we move forward, we need to build on this momentum and on our global scale, strong brands and innovation pipeline, while improving profitability and cash flow to deliver sustainable long-term growth.”

Fourth Quarter 2011 Highlights

- Gross profit in the fourth quarter was $624 million compared with $647 million for the same period in 2010. Gross margin for the fourth quarter was 46 percent of net revenues compared with 50 percent of net revenues in the fourth quarter of 2010. The decline in gross margin resulted from the adverse impact of higher priced-cotton, which was not fully offset by the company's price increases, and increased sales to the discount channel to manage inventory.

- Selling, general and administrative (SG&A) expenses for the fourth quarter increased to $532 million compared with $528 million in the same period of 2010, primarily reflecting expenses associated with organizational changes and the company's investment in information technology.

- Operating income for the fourth quarter decreased to $92 million compared with $119 million for the same period of 2010, due primarily to the decline in gross margin.

- Higher net revenues in the Americas primarily resulted from price increases and continued growth in the Levi's retail business, which offset a decline in the U.S. Dockers brand.

- Net revenues grew in Europe from expansion of the company-operated retail network.

- Net revenues in Asia Pacific increased for the Levi's and Denizen brands, including the expansion of the company's brand-dedicated retail network. The growth in the region was partially offset by lower net revenues in Japan.

“Our fiscal 2011 results reflect the impact of higher cotton prices and the difficult economic environment,” said Blake Jorgensen, chief financial officer of Levi Strauss & Co. “We are focused on operating our business with discipline and improving our cash flow to help us navigate the challenges ahead.”

Must ReadView All

Apparel/Garments | On 28th May 2017

Over 45% US retailers to use AI in next 3 years: Report

Over 45 per cent retailers in the US plan to utilise artificial...

Neelesh Hundekari speaking at the event. Courtesy: Subir Ghosh

Textiles | On 27th May 2017

Fabric of Change initiative announces €250000 scaling fund

The Fabric of Change initiative of Ashoka and the C&A Foundation is...

Apparel/Garments | On 28th May 2017

Naked Brand, Bendon sign agreement to reorganise

Naked Brand Group, a fashion and lifestyle brand, and Bendon Limited, ...

Interviews View All

Deepak Jain
Baggout

We are using Facebook and Instagram to promote ourselves

Nuno Venda
ROQ

‘There has been an increase in demand for water based inks, rather than...

Sunil Kumar Sharma
Loknayak JPNSSSG Ltd

'The blend of cotton–linen yarn has high demand in the domestic and...

Silke Brand-Kirsch
Schlegel und Partner

Silke Brand-Kirsch, executive partner of Schlegel und Partner, a leading...

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Mohammad Hassan
Biax Fiberfilm

About one in every 20 patients picks up an infection while hospitalised....

Igor Chapurin
Chapurin

"Now we can see the Russian trend in international fashion. And Russian...

Silvia Venturini Fendi
Fendi s.r.l

"Yes, my confidence and positive attitude are my strengths and should be...

Tony Ward
Tony Ward

"You have to truly understand what your client wants, know her needs, what ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

news category


Related Categories:
May 2017

May 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search