Levi Strauss & Co.’s efforts to reduce its debt paid off Friday with Standard & Poor’s Ratings Services raising its credit rating and the rating on its senior unsecured debt one notch to “B” from “B minus.”
That leaves the San Francisco-based jeans and sportswear giant one tick shy of a “BB plus” rating, the highest speculative, or non-investment, grade in S&P’s rating lineup.
S&P credit analyst Linda Phelps said the move reflects the ratings agency’s view that the firm “could sustain its improved credit measures with lower debt levels and improved profitability. Adjusted debt levels declined because of debt reduction with operating cash flow and lower pension obligations.”
Long-term debt at Levi’s declined 9.9 percent to $1.5 billion during the fiscal year ended on Nov. 24. While fourth-quarter profits fell about two-thirds, the firm registered its most profitable year since 2008 with net income rising 59.3 percent to $229.2 million. Sales rose 1.6 percent to $4.68 billion.
Cash and cash equivalents rose to $478.3 million at yearend, up 20.5 percent from $406.1 million at the start of the year.
Phelps noted improvement in Levi’s profit margin for the year, with earnings before interest, taxes, depreciation and amortization rising to about 16 percent of revenues last year from about 14 percent a year earlier.
“We expect Levi Strauss’ operating performance to remain relatively constant, with steady performance at the core Levi’s brand and stable cotton prices,” she said. “Credit measures could improve with continued debt reduction with free cash flow. We will look for the company to maintain leverage below 3.5 times for a stable outlook.”
@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
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)
@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