As expected, the US clothing group Levi Strauss & Co. closed the second quarter of the 2022/23 financial year with meager results. The parent company of brands Levi’s, Dockers and Beyond Yoga also lowered its forecasts for the full year on Thursday evening.
Revenue for the three months ended May 28 was $1.34 billion, down 9 percent from the same quarter last year. The company justified the losses, among other things, with the postponement of delivery dates in the wholesale business and weak demand in the USA.
Despite a slightly higher gross margin and lower SG&A, operating income slipped 87 percent to $9.9 million. The bottom line was a net loss of $1.6 million, compared to a surplus of $49.7 million in the year-ago period. Adjusted for special effects, net income shrank by 87 percent to 15.2 million US dollars.
For the entire first half of the year, sales were $3.03 billion, down one percent year-on-year. Reported net income fell 54 percent to $113.1 million.
In view of the latest development, management is more cautious about the second half of the year. For the financial year as a whole, it now expects sales growth of only 1.5 to 2.5 percent. So far, an increase in the range of 1.5 to three percent had been targeted. Guidance for adjusted earnings per share was lowered to $1.10-$1.20 from $1.30-$1.40.