Home / Knowledge / News / Apparel/Garments / Levis Q1'FY14 net income plummets 53%
Levis Q1'FY14 net income plummets 53%
09
Apr '14
Levi Strauss & Co. announced financial results for the first quarter ended February 23, 2014.
 
Net revenues declined one percent on a reported basis and were flat on a constant-currency basis, reflecting lower sales at wholesale in the Americas, partially offset by improved performance in Asia and Europe.
 
First quarter net income declined 53 percent to $50 million, primarily reflecting restructuring and other charges related to the launch of a global productivity initiative. Excluding the global productivity initiative charges, adjusted EBIT declined nine percent to $159 million due to lower gross margin and higher retail costs.
 
First-Quarter 2014 Highlights
Gross profit in the first quarter declined to $576 million compared with $592 million for the same quarter of 2013. Gross margin for the first quarter was down slightly to 51.0 percent of revenues compared with 51.6 percent of revenues in the same quarter of 2013. The gross margin decline reflected higher discounted sales and inventory markdowns as well as product investment costs.
 
Selling, general and administrative expenses (SG&A) for the first quarter increased to $425 million from $410 million in the same quarter of 2013. The increase in SG&A was primarily driven by the retail network and $6 million in charges, primarily consulting fees for a centrally-led procurement project, associated with the first phase of a global productivity initiative.
 
Restructuring charges of $58 million were recorded in the first quarter of 2014 associated with the first phase of a global productivity initiative, primarily reflecting severance benefit costs associated with anticipated staffing reductions.
 
Operating income of $94 million in the first quarter was down from $181 million in the same quarter of 2013 due to the restructuring charges, higher SG&A and lower gross margin.
 
Net revenues in the Americas were down at wholesale, primarily due to lower sales of women’s products. Retail sales grew, primarily due to the timing of the Black Friday sales week, which occurred during the company’s first quarter. Operating income declined due to the region’s lower gross margin and net revenues.
 
Net revenues in Europe grew on a constant-currency basis due to performance and expansion of the company-operated retail network. Higher operating income reflected lower SG&A.
 
Net revenues in Asia grew on a constant-currency basis, reflecting improved product availability during the Chinese New Year sales season. Operating income declined, driven by the unfavorable impact of currency.


Must ReadView All

Apparel/Garments | On 26th May 2016

PM expects Parliament to pass GST bill this year

Prime Minister Narendra Modi expects Parliament to pass the...

Apparel/Garments | On 26th May 2016

Bangladesh garment exports up 10% in July-April

Continuing the steady growth witnessed over the past few months,...

Textiles | On 26th May 2016

Spun yarn production growth in FY16 slowest in 4 years

India’s cotton yarn production grew by 2 per cent to 4,136 million kg ...

Interviews View All

Smita Murarka
Amanté

Which fabrics will be in trend for lingerie in 2017? What aspects are...

Dharmendra Shah
Ozone PB Spintex Limited

How has the Indian spinning industry fared in the last two years? What...

Veronique Lee
Modavanti

Sustainable fashion is not necessarily pocket- friendly. Are consumers...

Kai Poehler
Voith Paper GmbH & Co. KG

<b><i>The glass mat industry is growing by five to eight per cent...

Silke Brand-Kirsch
Schlegel und Partner

<b><i>Silke Brand-Kirsch, executive partner of Schlegel und Partner, a...

Marten Alkhagen
Swerea IVF AB

<b><i>Marten Alkhagen, Senior Scientist - Nonwoven and Technical Textiles...

Karan Arora
Karan Arora

Bridal couture created with rich Indian heritage, exquisite craftsmanship...

Yash P. Kotak
Bombay Hemp Company

One of the directors of Bombay Hemp Company, Yash P. Kotak, speaks to...

Mike Hoffman
Gildan Activewear SRL

Gildan Activewear, a manufacturer and marketer of branded clothing and...

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
May 2016

F2F Magazine

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

SUBSCRIBE


Browse Our Archives

GO


Advanced Search