Textiles & Apparel / Garment
Levi Strauss & Co. (NYSE: LEVI) announced financial results for the first quarter ended February 26, 2023.
"We delivered strong growth in our international business and record-breaking revenue performance in our direct-to-consumer channel. As we celebrate the 150th anniversary of the iconic 501® jean, we are deepening connections with consumers and cementing loyalty with the next generation of Levi’s® fans. This past quarter in the U.S., we were the market share leader among the key 18- to 30-year-old consumer, and we continued to grow share in our women’s denim bottoms business, further narrowing the gap to number one."
Levi Strauss & Co. reports first-quarter 2023 financial results Q1 reported net revenues of $1.7B increased 6%, and 9% in constant-currency vs. Q1 2022 constant-currency revenue growth driven by dtc and international business Q1 diluted eps of $0.29 And adjusted diluted eps of $0.34 company reaffirms fy 2023 guidance
Financial Highlights for the First-Quarter
• Reported net revenues of $1.7 billion increased 6%, and 9% on a constant-currency basis versus Q1 2022, reflecting strong growth in the Direct-to-Consumer (DTC) channel, up 12%. Total DTC comprised 42% of first quarter net revenues. Net revenues related to the shift in wholesale shipments from Q2 to Q1 primarily due to the U.S. ERP implementation benefited Q1 by approximately $100 million or 6% of net revenues.
• Gross margin was 55.8%; Adjusted gross margin was 55.8%, 360 basis points below the record level of 59.4% in Q1 2022
• Operating margin was 9.3%; Adjusted EBIT margin was 11.0%, down from 14.9% in Q1 2022
• Net income was $115 million; Adjusted net income was $135 million, compared to $189 million in Q1 2022
• Diluted EPS was $0.29; Adjusted diluted EPS was $0.34, including an adverse currency exchange impact of $0.01
• Total inventories increased 33% on a dollar basis over prior year, representing 25 points of sequential improvement relative to Q4 2022
• The Company paid a dividend of $0.12 per share, up nearly 20% from prior year; approximately $56 million in capital returned to shareholders
"On top of 26% constant currency growth a year ago, the company achieved solid results in the first quarter," said Harmit Singh, chief financial and growth officer of Levi Strauss & Co. "Our teams also made significant progress reducing inventory levels, putting us in a stronger position as we move through the balance of the year. We are reaffirming our annual revenue and EPS guidance reflecting a cautious outlook on the macro- environment though we remain excited about the momentum in our DTC and international businesses."