Levi Strauss & Co. said it has a lot to celebrate in its second quarter financial results, thanks in part to people emerging from lockdown life and sticking with more casual styles in purchasing apparel.
"We generated strong momentum in the second quarter with the accelerated recovery of our revenues and delivered growth across all regions and channels," president and CEO Chip Bergh said in a statement. "This was underscored by the strength of our brands and our ability to capitalize on evolving denim trends and a continued shift to casualization."
The 168-year-old firm boasted net revenues of $1.3 billion in the quarter ending May 30 – up 156% over the same period last year. Levi saw strong growth in both the U.S. and China, and said it was able to sell more products at full price.
"We significantly exceeded our expectations on revenue, adjusted gross margin and adjusted [earnings before interest and taxes]," Levi CFO Harmit Singh said. "Revenues in most markets are recovering faster than anticipated, and we are emerging from the pandemic with sustainable and improved structural economics."
|LEVI||LEVI STRAUSS & CO.||24.42||-0.97||-3.82%|
"As we look forward, we’re raising our expectations for revenues and profits,' Singh continued, adding, "our balance sheet remains strong and we continue to return cash to shareholders, with dividends now back to pre-pandemic levels."
Along with its better-than-expected earnings, the company raised its quarterly dividend from 6 to 8 cents.
Levi brick-and-mortar stores remained closed due to COVID-19 in some areas, but the company said 92% of its stores are now open globally after more than a third of its European stores and 17% of the company's locations worldwide remained shut during the second quarter.
The firm also saw success with online sales last quarter, with net revenues through all digital channels spiking 75% compared to the same period in 2020. Singh said during an investor conference call that the company is currently doing roughly 40% of its sales directly to consumers, but wants to increase that to 60%.
Bergh added in a statement, "As we move into the second half of 2021, we are focused on emerging stronger with our strategic priorities of leading with our enduring brand, accelerating our direct-to-consumer connections, and diversifying across categories, channels and geographies."