Levi Strauss & Co. (NYSE: LEVI) reported positive fiscal third-quarter earnings and sales on Wednesday. The company is experiencing a rise in demand as people seek out a new wardrobe amid the back-to-school season and the return of regular social activities.
The stock rose over 2% in extended trading amid the News. Additionally, its board announced the approval of a USD200 Million share repurchase plan.
The American clothing company reported earnings of USD0.48 per share, compared to the expected USD0.37 a share. Revenue amounted to USD1.5 Billion, higher than analysts anticipated USD1.48 Billion.
Upon the ongoing coronavirus pandemic, many retailers have been affected by global supply chain issues. However, Levi has been able to manage due to its diversified manufacturing. According to the company, under 4% of its global merchandise is made in Vietnam, a positive as most production facilities in that location have been closed since the start of the pandemic.
“Our supply chain really is a source of competitive advantage,” Chief Executive Chip Bergh told CNBC. “We can move products around with a lot of agility. … We’ve been running the business against different scenarios for the last 18 months.”
Levi Strauss believes holiday-quarter revenue will rise 20% to 21%, in comparison to the previous year, though analysts predict a 22% increase. Furthermore, the company predicts fourth-quarter earnings will land anywhere between USD0.38 and USD0.40 per share, while analysts anticipate fourth-quarter earnings to come in at USD0.40 per share.
“Our expectation is that the holiday is going to be pretty good,” Bergh said. “We’re chasing demand right now, from a supply chain standpoint, to make sure that everybody can put Levi under their Christmas tree.”
Levi shares have risen 21% throughout the year and has a current market value of USD9.76 Billion.