Weak sales in the U.S. and skyrocketing costs sent Levi Strauss & Co.'s earnings tumbling during the second quarter.
For the three months ended May 25, earnings sank 98.5 percent to $701,000 from net income of $45.7 million in the same period a year ago. Revenues fell 7.9 percent to $936.3 million from $1.02 billion, while sales slid 8.2 percent to $915.1 million from $997.3 million.
"We expected the second quarter to be tough, and it was," said John Anderson, president and chief executive officer. "The retail environment in the United States remained challenging. In addition, our transition to a new enterprise resource planning system in the United States negatively affected our results."
Revenues for the Americas plunged 19.3 percent to $477 million compared with revenues of $591 million in the same period a year ago. Management chalked up the bulk of the declines to challenges encountered implementing the planning system and a substantial slowdown in U.S. Dockers sales. The Levi's and Signature by Levi Strauss businesses both turned in smaller declines.
European revenues increased 9.8 percent to $268 million compared with revenues of $244 million a year ago. However, without the benefit of currency exchange, revenues fell 4 percent. Management cited weak performance on the wholesale side of the business, offset by sales growth in company-owned stores.
Asia Pacific revenues rose 5.5 percent to $191 million from $181 million. Again, excluding the positive effect of currency exchange, revenues fell 1 percent. While developing markets in the region continue to perform, problems persist in mature markets like South Korea and Japan, Levi’s said.
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
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@heriethpaul and @gracebol have a moment on the @victoriassecret fashion show 2017. See every look from the runway on WWD.com. Link in bio. (📷: @giovanni_giannoni_photo) #wwdfashion #victoriassecret #VSFashionShow
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia