Levi Strauss & Co. (NYSE:LEVI) beats analysts’ expectations

Levi Strauss & Co. (NYSE:LEVI) stock rose 0.30% (As on July 8, 11:29:30 AM UTC-4, Source: Google Finance) after the company reported quarterly revenue and earnings that came in above Wall Street expectations, as the clothing company known for its denim said it benefitted from Americans opting for more relaxed dress codes. The company has increased its quarterly dividend and stood by its guidance for the year. For the quarter, the company reported a net income of $49.7 million, compared $64.7 million in the year-ago period. Gross profit was $855 million, as compared to $750 million in the same quarter of the prior year. Gross margin was 58.1% of net revenues, as compared to 58.8% in the same quarter of the prior year. Adjusted EBIT, excluding Russia-Ukraine, COVID and acquisition-related charges, was $145 million compared to $115 million in the same quarter of the prior year due to higher net revenues partially offset by increased investments to support growth. Cash and cash equivalents were $602 million and short-term investments were $96 million, while total liquidity was approximately $1.5 billion.

LEVI in the second quarter of FY 22 has reported the adjusted earnings per share of 29 cents, beating the analysts’ estimates for the adjusted earnings per share of 23 cents, according to analysists by Refinitiv. The company had reported the adjusted revenue growth of 15 percent to $1.47 billion in the second quarter of FY 22, beating the analysts’ estimates for revenue of $1.43 billion. Levi Straus said its higher revenue in the quarter was fueled by both stronger direct-to-consumer and wholesale sales. DTC net revenues increased 16%, driven by company-operated stores. As a percentage of second quarter company net revenues, sales from DTC stores and e-commerce comprised 30% and 7%, respectively, for a total of 37%. Wholesale net revenues increased 15% reflecting strong demand for the Levi’s brand globally.  It said digital revenue rose 3% globally and accounted for 20% of sales in the quarter. Sales grew by 17% in the Americas, 3% in Europe and 16% in Asia compared to 2021. Levi’s other brands, Dockers and Beyond Yoga, saw an increase of 56% compared to last year.

For the full-year, the company stood by its guidance for revenue to grow 11% to 13% from a year ago. It still expects adjusted earnings of $1.50 to $1.56 per share.

The company hiked its quarterly dividend to 12 cents a share, up from 10 cents a share.

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