(Reuters) -Levi Strauss acknowledged on Wednesday it was considering a sale of its underperforming Dockers mannequin, acknowledged for its chinos and khaki garments.
Shares of the denim maker have been down virtually 8% in extended shopping for and promoting after the company missed quarterly revenue expectations and launched a strategic evaluation of Dockers.
Levi is throughout the midst of a way to perform with tighter assortment specializing in core denim mannequin and producing apparel and gear aligned with current shopper tendencies.
The company has already laid out worth decrease plans aimed to bolster revenue and eradicate corporations that haven’t fetched loads such as a result of the Denizen mannequin and its footwear class in some areas.
It had moreover decreased its firm workforce and consolidated operations in Europe as part of the related charge lowering efforts.
This helped the company publish third-quarter adjusted income of 33 cents per share, topping expectations of 31 cents apiece, in line with analysts’ estimates compiled by LSEG.
As part of the strategic evaluation course of, the company has retained Monetary establishment of America as its financial adviser and has not set a deadline or definitive timetable for its completion.
Levi has flagged that the higher-end shopper was seeing incremental indicators of stress throughout the U.S. and that prospects in Europe have been moreover being extraordinarily cautious, hurting product sales of its apparel – primarily throughout the Dockers mannequin.
Product sales of Dockers seen a 15% decline throughout the third quarter. The mannequin contributed about 5% to the reported quarter’s revenue of $1.52 billion, which missed analysts’ estimates of $1.55 billion.
“I really feel what Michelle Gass, the CEO of Levi’s (NYSE:) is doing is enhancing the think about the core mannequin that generates the overwhelming majority of of revenues,” acknowledged Dana Telsey of Telsey Advisory Group.
