Net revenues at Levi Strauss & Co grew 13 percent on a reported basis and 11 percent excluding favourable 22 million dollars favourable currency translation to 1,466 million dollars in the fourth quarter ended November 27, 2017. For the full year, reported revenue grew 8 percent and 7 percent in constant currency, excluding 11 million dollars in favourable currency translation to 4,904 million dollars. Fourth quarter net income of 116 million dollars grew 20 percent, while full-year net income declined 3 percent due to a 23 million dollars loss.
"Our growth and momentum accelerated in Q4 capping the strongest revenue year the company has had in more than a decade," said Chip Bergh, the company’s President and CEO in a press release, adding, "Our strategies are working and the investments that we’ve made to diversify our business over the past few years are paying off, best demonstrated by the strength of the Levi’s brand globally."
Highlights of Q4 and FY17 performance
On a reported basis, gross margin for the fourth quarter was 53.4 percent of revenues compared with 50.7 percent in the same quarter of fiscal 2016, reflecting the margin benefit from revenue growth in the direct-to-consumer channel and international business. Operating income of 150 million dollars in the quarter was up from 143 million dollars in the same quarter of 2016, primarily reflecting higher gross profit, partially offset by higher SG&A.
In the Americas, net revenues grew 7 percent on a reported and constant currency basis in the fourth quarter, reflecting higher revenues across both wholesale and direct-to-consumer channels in the US, Canada and Mexico. In Europe, excluding favourable currency effects of 18 million dollars, net revenues grew 21 percent. In Asia, net revenues grew 13 percent on a reported and constant currency basis, reflecting direct-to-consumer expansion and performance.
On a reported basis, gross margin for the fiscal year was 52.3 percent compared with 51.2 percent in fiscal 2016, reflecting strong growth in international and retail revenues, favourable transaction impact of currency and sourcing savings. Operating income of 467 million dollars for the fiscal year was up from 462 million dollars in 2016.
In the Americas, full year net revenues grew 3 percent on a reported and constant currency basis, primarily reflecting the performance and expansion of our company-operated retail network and strong performance in Signature and Denizen brands offset by lower wholesale revenues in the United States in Dockers brand. In Europe, excluding favourable currency effects of 13 million dollars, net revenues grew 19 percent reflecting broad-based growth across all markets and channels. In Asia, excluding unfavourable currency effects of 2 million dollars, net revenues grew 5 percent, reflecting direct-to-consumer expansion and performance.