Levi Strauss & Co Asia boosted operating income by 30 per cent in the latest quarter as sales rose 10 per cent and margins improved.
Asia proved to be the US-headquartered denim retailer’s best-performing of three geographical regions, even after excluding a $4 million unfavourable change in currency year on year.
In Europe, operating profit rose 25 per cent on sales up 17 per cent and in the US income rose just 4 per cent on sales up 9 per cent in the three months to August 26.
Levi Strauss & Co Asia sales increased across all channels – wholesale, retail and online – and the strong operating profit performance came despite increased direct-to-consumer investments across key markets.
Chip Bergh, president and CEO at Levi Strauss & Co, said the result marked the fourth consecutive quarter of double-digit sales growth, at 11 per cent worldwide, after adjusting for unfavourable currency movement.
“This growth was broad-based across virtually every part of our business, including all four brands, men’s, women’s, tops and bottoms, and all regions and channels, with results that put us among the top performers in the industry.”
The company had 65 more company-operated stores at the end of the third quarter of this year than it did a year ago. Wholesale revenues grew 8 per cent, reflecting improved sales in all regions.
Globally, Levi Strauss & Co’s gross margin for the quarter was 53.2 per cent of net revenues compared with 51.8 per cent in the same quarter of last year, reflecting the benefit from achieving more direct-to-consumer sales.
Operating income for the third quarter of US$159 million was up 8 per cent year on year.