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Levi's Q4'07 net revenues up, to focus on product innovation

13 Feb '08

2 min read

Levi Strauss & Co. (LS&CO.) announced financial results for the fourth quarter and fiscal year ended November 25, 2007.

Net revenues for the fourth quarter improved 2 percent to $1.3 billion compared to the same period last year, and increased 4 percent to $4.4 billion for fiscal 2007 compared with the previous year on a reported basis. Excluding currency effects, net revenues decreased by 2 percent in the quarter compared with the same period in 2006, reflecting declining sales in North America.

For the fiscal year, net revenues increased 1 percent excluding currency effects compared to 2006, driven by sales growth in Asia-Pacific emerging markets, Europe and the U.S. Levi's brand.

Income before income tax increased 9 percent to $376 million for fiscal 2007 compared with $345 million in fiscal 2006. Net income increased in the fourth quarter by 179 percent or $171 million to $267 million compared to the same period last year.

For the full fiscal year, net income grew to $460 million, a 93 percent gain over the prior year. Increases in both periods were primarily driven by an approximately $215 million non-recurring, non-cash reversal of deferred tax asset valuation allowances in the fourth quarter.

The reversal was the result of improvements in business performance and revised income tax expectations as part of the ongoing review of open tax years with the IRS.

"In 2007 we continued to make good progress on growing the Levi's brand around the world, upgrading our Levi's and Dockers products, and expanding our retail network,” said John Anderson, president and chief executive officer. “I'm particularly pleased with the solid performance of our European business. Although the company had a challenging fourth quarter, we improved our financial strength in 2007.

“Looking ahead, we anticipate a difficult retail environment in several markets around the world. We will focus on product innovation, retail expansion and optimizing our global presence in more than 110 countries,” said Anderson.

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