Levi Strauss Shares Gain On Q3 Earnings, Lifting FY21 Outlook - Levi Strauss (NYSE:LEVI)

Levi Strauss & Co LEVI reported third-quarter FY21 sales growth of 41% year-on-year and 3% against Q3 FY19, to $1.498 billion, beating the analyst consensus of $1.48 billion.
Direct-to-Consumer sales rose 34% Y/Y and 4% versus Q3 2019. Global Wholesale revenues climbed 45% Y/Y and 3% compared to Q3 2019.
Revenues through all digital channels grew 10% Y/Y and 76% against Q3 2019.
Revenue in the Americas grew 52% Y/Y, Europe increased 27%, and Asia rose 34%.
The gross profit rose 49.4% Y/Y to $862 million, and the gross margin expanded 330 basis points Y/Y to 57.6%. Adjusted gross margin expanded 390 basis points to 57.5%.
The operating margin was 14.4%, and operating income for the quarter rose 134.7% to $216 million. Adjusted EBIT jumped 163% Y/Y to $222 million.
Adjusted EPS of $0.48 beat the analyst consensus of $0.37.
Levi Strauss held $1.4 billion in cash and equivalents as of August 29, 2021. Cash generated through operations for nine months in 2021 totaled $499 million, and the adjusted free cash flow amounted to $220 million.
The Board of Directors authorized a $200 million share repurchase program.
"We have taken pricing actions and believe we have the pricing power to mitigate inflationary pressures," said CFO Harmit Singh.
Outlook: Levi sees Q4 Adjusted EPS of $0.38 - $0.40, versus the consensus of $0.39.
The company raised the FY21 adjusted EPS outlook to $1.43 - $1.45 (prior view $1.29-$1.33) versus the consensus of $1.33.
Price Action: LEVI shares are trading higher by 4.13% at $25.24 in premarket on the last check Thursday.

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