Macro challenges dull Levi’s shine
The third quarter ended August 28, 2022, revealed a less buoyant trading period at US denim and casualwear group Levi Strauss & Co, particularly when viewed against the double-digit rise in net revenues reported for the quarter previous.
Instead, the most recent three months resulted in year-on-year growth of only 1%, achieving net revenues of $1.517 billion. President and chief executive Chip Bergh described “a more challenging environment”, which he said the business expected to remain unpredictable for several more quarters.
In view of the macroeconomic situation, group chief financial officer Harmit Singh commented that the company had already taken “swift and decisive action” to navigate what he called the industry’s near-term challenges. Obstacles encountered over the quarter included a 19% year-on-year decrease in European net revenues, which the business largely attributed to the ongoing conflict in Ukraine.
Meanwhile, net revenues for the Americas rose by 3% year on year, very much overshadowed by a 36% increase in Asian net revenues versus the comparative period. Local analysts suggested to Reuters that inflation levels and the spectre of recession had dampened consumer sentiment in the US, reflected in the group’s results.
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