Interviews
News Flash
The Levi's brand is performing well
14 Jul '10
5 min read
• In May 2010, the company offered €300 million aggregate principal amount of 7.75% Senior Notes due 2018 and $525 million aggregate principal amount of 7.625% Senior Notes due 2020. Net proceeds were used to retire the outstanding 9.75% Senior Notes due 2015 and 8.625% Senior Notes due 2013. Additionally, the company repurchased ¥10.9 billion aggregate principal amount of 4.25% Yen-denominated Eurobonds due November 22, 2016, for total consideration of $100 million.
Regional Overview
• Higher net revenues in the Americas were primarily due to the contribution of the outlet stores acquired in 2009 and strong Levi's brand performance in men's, juniors' and boys' products in the wholesale channel. These improvements were partially offset by lower Signature and U.S. Dockers brand sales.
• Net revenues in Europe benefited from the impact of the acquisition of the footwear and accessories business during 2009 and expansion of the company-operated retail network across the region. Revenue gains were partially offset by lower sales in the wholesale channel, reflecting the continued difficult retail environment across the region.
• Net revenues in Asia Pacific increased on a reported basis and decreased on a constant currency basis. Growth in the company's developing markets in the region – driven by brand-dedicated retail store expansion – was more than offset by lower revenue performance in Japan.
The company ended the second quarter with cash and cash equivalents of $353 million, an increase of $82 million from November 29, 2009. Cash provided by operating activities was $146 million, compared with $159 million for the same period in 2009. Net debt was $1.46 billion at the end of the quarter, down from $1.58 billion at the end of 2009.
“We delivered solid operating results in the second quarter of 2010,” said Blake Jorgensen, chief financial officer. “Our cash flow is strong and we continued to build our liquidity position during the quarter. We also successfully completed the refinancing of our 2013 and 2015 debt maturities, as well as a portion of our 2016 Yen Eurobonds, extending our debt maturities and enabling us to focus on driving our growth strategies. As we continue to invest in the business, we remain focused on controlling costs and managing inventories.”
Regional Overview
• Higher net revenues in the Americas were primarily due to the contribution of the outlet stores acquired in 2009 and strong Levi's brand performance in men's, juniors' and boys' products in the wholesale channel. These improvements were partially offset by lower Signature and U.S. Dockers brand sales.
• Net revenues in Europe benefited from the impact of the acquisition of the footwear and accessories business during 2009 and expansion of the company-operated retail network across the region. Revenue gains were partially offset by lower sales in the wholesale channel, reflecting the continued difficult retail environment across the region.
• Net revenues in Asia Pacific increased on a reported basis and decreased on a constant currency basis. Growth in the company's developing markets in the region – driven by brand-dedicated retail store expansion – was more than offset by lower revenue performance in Japan.
The company ended the second quarter with cash and cash equivalents of $353 million, an increase of $82 million from November 29, 2009. Cash provided by operating activities was $146 million, compared with $159 million for the same period in 2009. Net debt was $1.46 billion at the end of the quarter, down from $1.58 billion at the end of 2009.
“We delivered solid operating results in the second quarter of 2010,” said Blake Jorgensen, chief financial officer. “Our cash flow is strong and we continued to build our liquidity position during the quarter. We also successfully completed the refinancing of our 2013 and 2015 debt maturities, as well as a portion of our 2016 Yen Eurobonds, extending our debt maturities and enabling us to focus on driving our growth strategies. As we continue to invest in the business, we remain focused on controlling costs and managing inventories.”
Levi Strauss & Co
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