Price Graph
Price
Yield
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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DELAWARE
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94-0905160
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(State or Other Jurisdiction of
Incorporation or Organization)
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(I.R.S. Employer
Identification No.)
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Large accelerated filer
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Accelerated filer
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Non-accelerated filer
þ
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Smaller reporting company
¨
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(Do not check if a smaller reporting company)
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Page
Number
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Item 1.
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Item 1A.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Item 1.
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CONSOLIDATED FINANCIAL STATEMENTS
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(Unaudited)
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August 25,
2013 |
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November 25,
2012 |
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(Dollars in thousands)
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ASSETS
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|||||||
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Current Assets:
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Cash and cash equivalents
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$
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382,328
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$
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406,134
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Trade receivables, net of allowance for doubtful accounts of $20,471 and $20,738
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419,788
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500,672
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Inventories:
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Raw materials
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4,689
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5,312
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Work-in-process
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6,583
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9,558
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Finished goods
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613,359
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503,990
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Total inventories
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624,631
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518,860
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Deferred tax assets, net
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126,398
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116,224
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Other current assets
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128,821
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136,483
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Total current assets
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1,681,966
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1,678,373
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Property, plant and equipment, net of accumulated depreciation of $771,344 and $782,766
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436,394
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458,807
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Goodwill
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240,658
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239,971
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Other intangible assets, net
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51,329
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59,909
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Non-current deferred tax assets, net
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618,747
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612,916
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Other non-current assets
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116,113
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120,101
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Total assets
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$
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3,145,207
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$
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3,170,077
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LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS’ EQUITY (DEFICIT)
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Current Liabilities:
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Short-term debt
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$
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38,153
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$
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59,759
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Current maturities of capital leases
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843
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1,760
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Accounts payable
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249,643
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225,726
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Other accrued liabilities
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186,700
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263,575
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Accrued salaries, wages and employee benefits
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186,883
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223,850
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Accrued interest payable
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32,886
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5,471
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Accrued income taxes
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72,700
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16,739
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Total current liabilities
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767,808
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796,880
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Long-term debt
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1,501,912
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1,669,452
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Long-term capital leases
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10,274
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262
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Postretirement medical benefits
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134,825
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140,958
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Pension liability
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465,737
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492,396
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Long-term employee related benefits
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67,804
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62,529
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Long-term income tax liabilities
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34,252
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40,356
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Other long-term liabilities
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58,390
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60,869
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Total liabilities
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3,041,002
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3,263,702
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Commitments and contingencies
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Temporary equity
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29,429
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7,883
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Stockholders’ Equity (Deficit):
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Levi Strauss & Co. stockholders’ equity (deficit)
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Common stock — $.01 par value; 270,000,000 shares authorized; 37,467,935 shares and 37,392,343 shares issued and outstanding
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375
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374
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Additional paid-in capital
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17,566
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33,365
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Retained earnings
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460,765
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273,975
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Accumulated other comprehensive loss
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(407,699
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)
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(414,635
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)
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Total Levi Strauss & Co. stockholders’ equity (deficit)
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71,007
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(106,921
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)
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Noncontrolling interest
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3,769
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5,413
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Total stockholders’ equity (deficit)
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74,776
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(101,508
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)
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Total liabilities, temporary equity and stockholders’ equity (deficit)
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$
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3,145,207
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$
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3,170,077
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Three Months Ended
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Nine Months Ended
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||||||||||||
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August 25,
2013 |
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August 26,
2012 |
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August 25,
2013 |
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August 26,
2012 |
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(Dollars in thousands)
(Unaudited)
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Net revenues
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$
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1,141,284
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$
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1,100,856
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$
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3,386,860
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$
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3,312,974
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Cost of goods sold
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568,448
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580,108
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1,673,435
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1,762,746
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Gross profit
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572,836
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520,748
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1,713,425
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1,550,228
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Selling, general and administrative expenses
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454,750
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433,961
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1,314,247
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1,307,600
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Operating income
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118,086
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86,787
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399,178
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242,628
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Interest expense
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(30,903
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)
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(32,160
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)
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(95,943
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)
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(103,144
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)
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Loss on early extinguishment of debt
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—
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—
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(689
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)
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(8,206
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)
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Other income (expense), net
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(10,661
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)
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(5,747
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)
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(5,425
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)
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6,122
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Income before income taxes
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76,522
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|
48,880
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297,121
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137,400
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Income tax expense
|
20,077
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23,802
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85,592
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49,782
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Net income
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56,445
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|
25,078
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|
211,529
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|
87,618
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Net loss attributable to noncontrolling interest
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630
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|
3,273
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|
715
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3,184
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Net income attributable to Levi Strauss & Co.
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$
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57,075
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$
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28,351
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$
|
212,244
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$
|
90,802
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Three Months Ended
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Nine Months Ended
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||||||||||||
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August 25,
2013 |
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August 26,
2012 |
|
August 25,
2013 |
|
August 26,
2012 |
||||||||
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(Dollars in thousands)
(Unaudited)
|
||||||||||||||
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Net income
|
$
|
56,445
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|
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$
|
25,078
|
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$
|
211,529
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|
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$
|
87,618
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|
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Other comprehensive income, net of related income taxes:
|
|
|
|
|
|
|
|
||||||||
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Pension and postretirement benefits
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3,718
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474
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|
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10,826
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|
|
1,091
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|
||||
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Net investment hedge (losses) gains
|
(8,329
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)
|
|
(1,006
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)
|
|
(5,928
|
)
|
|
14,839
|
|
||||
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Foreign currency translation gains (losses)
|
9,823
|
|
|
4,040
|
|
|
1,650
|
|
|
(13,604
|
)
|
||||
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Unrealized (loss) gain on marketable securities
|
(171
|
)
|
|
677
|
|
|
(541
|
)
|
|
1,496
|
|
||||
|
Total other comprehensive income
|
5,041
|
|
|
4,185
|
|
|
6,007
|
|
|
3,822
|
|
||||
|
Comprehensive income
|
61,486
|
|
|
29,263
|
|
|
217,536
|
|
|
91,440
|
|
||||
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Comprehensive loss attributable to noncontrolling interest
|
(451
|
)
|
|
(3,152
|
)
|
|
(1,644
|
)
|
|
(3,353
|
)
|
||||
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Comprehensive income attributable to Levi Strauss & Co.
|
$
|
61,937
|
|
|
$
|
32,415
|
|
|
$
|
219,180
|
|
|
$
|
94,793
|
|
|
|
Nine Months Ended
|
||||||
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|
August 25,
2013 |
|
August 26,
2012 |
||||
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|
(Dollars in thousands)
(Unaudited)
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||||||
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Cash Flows from Operating Activities:
|
|
|
|
||||
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Net income
|
$
|
211,529
|
|
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$
|
87,618
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Adjustments to reconcile net income to net cash provided by operating activities:
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|
|
|
||||
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Depreciation and amortization
|
86,600
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|
91,577
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|
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Asset impairments
|
1,917
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|
|
19,413
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Gain on disposal of assets
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(2,120
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)
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(303
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)
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Unrealized foreign exchange losses (gains)
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323
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(14,666
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)
|
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Realized loss (gain) on settlement of forward foreign exchange contracts not designated for hedge accounting
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2,547
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(3,559
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)
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Employee benefit plans’ amortization from accumulated other comprehensive loss
|
17,478
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|
|
1,175
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Employee benefit plans’ curtailment gain, net
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(815
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)
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(1,730
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)
|
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Noncash loss (gain) on extinguishment of debt
|
689
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(3,643
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)
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Amortization of deferred debt issuance costs
|
3,232
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|
|
3,268
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Stock-based compensation
|
6,303
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|
4,815
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|
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Allowance for doubtful accounts
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2,394
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|
|
5,243
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|
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Change in operating assets and liabilities:
|
|
|
|
||||
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Trade receivables
|
95,373
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|
|
187,520
|
|
||
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Inventories
|
(87,434
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)
|
|
16,919
|
|
||
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Other current assets
|
6,989
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|
|
28,056
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|
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Other non-current assets
|
873
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|
|
(3,554
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)
|
||
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Accounts payable and other accrued liabilities
|
(42,640
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)
|
|
83,469
|
|
||
|
Income tax liabilities
|
37,660
|
|
|
11,287
|
|
||
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Accrued salaries, wages and employee benefits and long-term employee related benefits
|
(75,322
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)
|
|
(102,991
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)
|
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Other long-term liabilities
|
8,845
|
|
|
5,437
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|
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Other, net
|
(605
|
)
|
|
423
|
|
||
|
Net cash provided by operating activities
|
273,816
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|
|
415,774
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|
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Cash Flows from Investing Activities:
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|
|
|
||||
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Purchases of property, plant and equipment
|
(63,002
|
)
|
|
(54,308
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)
|
||
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Proceeds from sale of assets
|
2,168
|
|
|
519
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|
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|
(Payments) proceeds on settlement of forward foreign exchange contracts not designated for hedge accounting
|
(2,547
|
)
|
|
3,559
|
|
||
|
Net cash used for investing activities
|
(63,381
|
)
|
|
(50,230
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)
|
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Cash Flows from Financing Activities:
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|
|
|
||||
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Proceeds from issuance of long-term debt
|
140,000
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|
|
385,000
|
|
||
|
Repayments of long-term debt and capital leases
|
(326,198
|
)
|
|
(407,651
|
)
|
||
|
Proceeds from senior revolving credit facility
|
—
|
|
|
50,000
|
|
||
|
Repayments of senior revolving credit facility
|
—
|
|
|
(250,000
|
)
|
||
|
Short-term borrowings, net
|
(13,815
|
)
|
|
1,633
|
|
||
|
Debt issuance costs
|
(2,557
|
)
|
|
(7,368
|
)
|
||
|
Restricted cash
|
123
|
|
|
671
|
|
||
|
Repurchase of common stock
|
(365
|
)
|
|
(479
|
)
|
||
|
Excess tax benefits from stock-based compensation
|
165
|
|
|
—
|
|
||
|
Dividend to stockholders
|
(25,076
|
)
|
|
(20,036
|
)
|
||
|
Net cash used for financing activities
|
(227,723
|
)
|
|
(248,230
|
)
|
||
|
Effect of exchange rate changes on cash and cash equivalents
|
(6,518
|
)
|
|
(7,088
|
)
|
||
|
Net (decrease) increase in cash and cash equivalents
|
(23,806
|
)
|
|
110,226
|
|
||
|
Beginning cash and cash equivalents
|
406,134
|
|
|
204,542
|
|
||
|
Ending cash and cash equivalents
|
$
|
382,328
|
|
|
$
|
314,768
|
|
|
|
|
|
|
||||
|
Supplemental disclosure of cash flow information:
|
|
|
|
||||
|
Cash paid during the period for:
|
|
|
|
||||
|
Interest
|
$
|
61,209
|
|
|
$
|
74,153
|
|
|
Income taxes
|
26,441
|
|
|
28,814
|
|
||
|
•
|
In July 2013, the FASB issued Accounting Standards Update No. 2013-11,
"Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or Tax Credit Carryforward Exists,"
("ASU 2013-11"). ASU 2013-11 requires entities to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward when settlement in this manner is available under the tax law. The Company does not anticipate that the adoption of this standard will have a material impact on its consolidated financial statements.
|
|
|
August 25, 2013
|
|
November 25, 2012
|
||||||||||||||||||||
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|
|
|
Fair Value Estimated
Using
|
|
|
|
Fair Value Estimated
Using
|
||||||||||||||||
|
|
Fair Value
|
|
Level 1 Inputs
(1)
|
|
Level 2 Inputs
(2)
|
|
Fair Value
|
|
Level 1 Inputs
(1)
|
|
Level 2 Inputs
(2)
|
||||||||||||
|
|
(Dollars in thousands)
|
||||||||||||||||||||||
|
Financial assets carried at fair value
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Rabbi trust assets
|
$
|
22,458
|
|
|
$
|
22,458
|
|
|
$
|
—
|
|
|
$
|
20,322
|
|
|
$
|
20,322
|
|
|
$
|
—
|
|
|
Forward foreign exchange contracts, net
(3)
|
13,641
|
|
|
—
|
|
|
13,641
|
|
|
5,792
|
|
|
—
|
|
|
5,792
|
|
||||||
|
Total
|
$
|
36,099
|
|
|
$
|
22,458
|
|
|
$
|
13,641
|
|
|
$
|
26,114
|
|
|
$
|
20,322
|
|
|
$
|
5,792
|
|
|
Financial liabilities carried at fair value
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Forward foreign exchange contracts, net
(3)
|
$
|
2,360
|
|
|
$
|
—
|
|
|
$
|
2,360
|
|
|
$
|
3,018
|
|
|
$
|
—
|
|
|
$
|
3,018
|
|
|
(1)
|
Fair values estimated using Level 1 inputs are inputs which consist of quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Rabbi trust assets consist of a diversified portfolio of equity, fixed income and other securities.
|
|
(2)
|
Fair values estimated using Level 2 inputs are inputs, other than quoted prices, that are observable for the asset or liability, either directly or indirectly and include among other things, quoted prices for similar assets or liabilities in markets that are active or inactive as well as inputs other than quoted prices that are observable. For forward foreign exchange contracts, inputs include foreign currency exchange and interest rates and, where applicable, credit default swap prices.
|
|
(3)
|
The Company’s over-the-counter forward foreign exchange contracts are subject to International Swaps and Derivatives Association, Inc. master agreements. These agreements permit the net-settlement of these contracts on a per-institution basis.
|
|
|
August 25, 2013
|
|
November 25, 2012
|
||||||||||||
|
|
Carrying
Value
|
|
Estimated Fair Value
(1)
|
|
Carrying
Value
|
|
Estimated Fair Value
(1)
|
||||||||
|
|
(Dollars in thousands)
|
||||||||||||||
|
Financial liabilities carried at adjusted historical cost
|
|
|
|
|
|
|
|
||||||||
|
Senior term loan due 2014
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
324,890
|
|
|
$
|
324,484
|
|
|
4.25% Yen-denominated Eurobonds due 2016
|
41,335
|
|
|
40,112
|
|
|
48,656
|
|
|
47,201
|
|
||||
|
7.75% Euro senior notes due 2018
|
409,256
|
|
|
437,303
|
|
|
387,433
|
|
|
416,422
|
|
||||
|
7.625% senior notes due 2020
|
536,231
|
|
|
573,637
|
|
|
526,223
|
|
|
572,161
|
|
||||
|
6.875% senior notes due 2022
|
546,975
|
|
|
581,110
|
|
|
386,838
|
|
|
404,163
|
|
||||
|
Short-term borrowings
|
38,399
|
|
|
38,399
|
|
|
59,861
|
|
|
59,861
|
|
||||
|
Total
|
$
|
1,572,196
|
|
|
$
|
1,670,561
|
|
|
$
|
1,733,901
|
|
|
$
|
1,824,292
|
|
|
(1)
|
Fair value estimate incorporates mid-market price quotes.
|
|
|
August 25, 2013
|
|
November 25, 2012
|
||||||||||||||||||||
|
|
Assets
|
|
(Liabilities)
|
|
Derivative Net Carrying Value
|
|
Assets
|
|
(Liabilities)
|
|
Derivative Net Carrying Value
|
||||||||||||
|
|
Carrying
Value
|
|
Carrying
Value
|
|
|
Carrying
Value
|
|
Carrying
Value
|
|
||||||||||||||
|
|
(Dollars in thousands)
|
||||||||||||||||||||||
|
Derivatives not designated as hedging instruments
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Forward foreign exchange contracts
(1)
|
$
|
19,319
|
|
|
$
|
(5,678
|
)
|
|
$
|
13,641
|
|
|
$
|
7,131
|
|
|
$
|
(1,339
|
)
|
|
$
|
5,792
|
|
|
Forward foreign exchange contracts
(2)
|
889
|
|
|
(3,249
|
)
|
|
(2,360
|
)
|
|
5,183
|
|
|
(8,201
|
)
|
|
(3,018
|
)
|
||||||
|
Total
|
$
|
20,208
|
|
|
$
|
(8,927
|
)
|
|
|
|
$
|
12,314
|
|
|
$
|
(9,540
|
)
|
|
|
||||
|
Non-derivatives designated as hedging instruments
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
4.25% Yen-denominated Eurobonds due 2016
|
$
|
—
|
|
|
$
|
(23,656
|
)
|
|
|
|
$
|
—
|
|
|
$
|
(28,135
|
)
|
|
|
||||
|
7.75% Euro senior notes due 2018
|
—
|
|
|
(400,680
|
)
|
|
|
|
—
|
|
|
(386,520
|
)
|
|
|
||||||||
|
Total
|
$
|
—
|
|
|
$
|
(424,336
|
)
|
|
|
|
$
|
—
|
|
|
$
|
(414,655
|
)
|
|
|
||||
|
(1)
|
Included in “Other current assets” or “Other non-current assets” on the Company’s consolidated balance sheets.
|
|
(2)
|
Included in “Other accrued liabilities” on the Company’s consolidated balance sheets.
|
|
|
Gain or (Loss)
Recognized in AOCI
(Effective Portion)
|
|
Gain or (Loss) Recognized in Other
Income (Expense), net (Ineffective
Portion and Amount Excluded from
Effectiveness Testing)
|
||||||||||||||||||||
|
|
As of
|
|
As of
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||
|
August 25,
2013 |
November 25,
2012 |
August 25,
2013 |
|
August 26,
2012 |
|
August 25,
2013 |
|
August 26,
2012 |
|||||||||||||||
|
|
(Dollars in thousands)
|
||||||||||||||||||||||
|
Forward foreign exchange contracts
|
$
|
4,637
|
|
|
$
|
4,637
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
4.25% Yen-denominated Eurobonds due 2016
|
(21,806
|
)
|
|
(26,285
|
)
|
|
$
|
(661
|
)
|
|
$
|
(79
|
)
|
|
$
|
3,243
|
|
|
$
|
2,444
|
|
||
|
7.75% Euro senior notes due 2018
|
(23,611
|
)
|
|
(9,451
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
|
Cumulative income taxes
|
15,999
|
|
|
12,246
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Total
|
$
|
(24,781
|
)
|
|
$
|
(18,853
|
)
|
|
|
|
|
|
|
|
|
||||||||
|
|
Gain or (Loss)
|
||||||||||||||
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
August 25,
2013 |
|
August 26,
2012 |
|
August 25,
2013 |
|
August 26,
2012 |
||||||||
|
|
(Dollars in thousands)
|
||||||||||||||
|
Forward foreign exchange contracts:
|
|
|
|
|
|
|
|
||||||||
|
Realized
|
$
|
3,650
|
|
|
$
|
1,029
|
|
|
$
|
(2,547
|
)
|
|
$
|
3,559
|
|
|
Unrealized
|
2,664
|
|
|
(16,413
|
)
|
|
8,833
|
|
|
(12,862
|
)
|
||||
|
Total
|
$
|
6,314
|
|
|
$
|
(15,384
|
)
|
|
$
|
6,286
|
|
|
$
|
(9,303
|
)
|
|
|
|
August 25,
2013 |
|
November 25,
2012 |
|
||||
|
|
|
(Dollars in thousands)
|
|
||||||
|
|
|
|
|
||||||
|
|
Long-term debt
|
|
|
|
|
||||
|
|
Unsecured:
|
|
|
|
|
||||
|
|
Senior term loan due 2014
|
$
|
—
|
|
|
$
|
324,424
|
|
|
|
|
4.25% Yen-denominated Eurobonds due 2016
|
40,786
|
|
|
48,508
|
|
|
||
|
|
7.75% Euro senior notes due 2018
|
400,680
|
|
|
386,520
|
|
|
||
|
|
7.625% senior notes due 2020
|
525,000
|
|
|
525,000
|
|
|
||
|
|
6.875% senior notes due 2022
|
535,446
|
|
|
385,000
|
|
|
||
|
|
Total unsecured
|
1,501,912
|
|
|
1,669,452
|
|
|
||
|
|
Total long-term debt
|
$
|
1,501,912
|
|
|
$
|
1,669,452
|
|
|
|
|
Short-term debt
|
|
|
|
|
||||
|
|
Short-term borrowings
|
$
|
38,153
|
|
|
$
|
59,759
|
|
|
|
|
Total short-term debt
|
$
|
38,153
|
|
|
$
|
59,759
|
|
|
|
|
Total long-term and short-term debt
|
$
|
1,540,065
|
|
|
$
|
1,729,211
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Pension Benefits
|
|
Postretirement Benefits
|
||||||||||||
|
|
Three Months Ended
|
|
Three Months Ended
|
||||||||||||
|
|
August 25,
2013 |
|
August 26,
2012 |
|
August 25,
2013 |
|
August 26,
2012 |
||||||||
|
|
(Dollars in thousands)
|
||||||||||||||
|
Net periodic benefit cost (income):
|
|
|
|
|
|
|
|
||||||||
|
Service cost
|
$
|
2,052
|
|
|
$
|
2,215
|
|
|
$
|
94
|
|
|
$
|
99
|
|
|
Interest cost
|
12,918
|
|
|
14,364
|
|
|
1,239
|
|
|
1,658
|
|
||||
|
Expected return on plan assets
|
(14,105
|
)
|
|
(12,901
|
)
|
|
—
|
|
|
—
|
|
||||
|
Amortization of prior service benefit
|
(24
|
)
|
|
(20
|
)
|
|
(122
|
)
|
|
(4,089
|
)
|
||||
|
Amortization of actuarial loss
|
3,810
|
|
|
3,154
|
|
|
1,691
|
|
|
1,290
|
|
||||
|
Curtailment gain
|
(305
|
)
|
|
(735
|
)
|
|
—
|
|
|
—
|
|
||||
|
Net settlement loss
|
415
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
Net periodic benefit cost (income)
|
4,761
|
|
|
6,077
|
|
|
2,902
|
|
|
(1,042
|
)
|
||||
|
Changes in accumulated other comprehensive loss:
|
|
|
|
|
|
|
|
||||||||
|
Actuarial gain
|
—
|
|
|
(451
|
)
|
|
—
|
|
|
—
|
|
||||
|
Amortization of prior service benefit
|
24
|
|
|
20
|
|
|
122
|
|
|
4,089
|
|
||||
|
Amortization of actuarial loss
|
(3,810
|
)
|
|
(3,154
|
)
|
|
(1,691
|
)
|
|
(1,290
|
)
|
||||
|
Curtailment (loss) gain
|
(12
|
)
|
|
192
|
|
|
—
|
|
|
—
|
|
||||
|
Net settlement (loss) gain
|
(406
|
)
|
|
18
|
|
|
—
|
|
|
—
|
|
||||
|
Total recognized in accumulated other comprehensive loss
|
(4,204
|
)
|
|
(3,375
|
)
|
|
(1,569
|
)
|
|
2,799
|
|
||||
|
Total recognized in net periodic benefit cost (income) and accumulated other comprehensive loss
|
$
|
557
|
|
|
$
|
2,702
|
|
|
$
|
1,333
|
|
|
$
|
1,757
|
|
|
|
Pension Benefits
|
|
Postretirement Benefits
|
||||||||||||
|
|
Nine Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
August 25,
2013 |
|
August 26,
2012 |
|
August 25,
2013 |
|
August 26,
2012 |
||||||||
|
|
(Dollars in thousands)
|
||||||||||||||
|
Net periodic benefit cost (income):
|
|
|
|
|
|
|
|
||||||||
|
Service cost
|
$
|
6,548
|
|
|
$
|
6,709
|
|
|
$
|
282
|
|
|
$
|
298
|
|
|
Interest cost
|
38,978
|
|
|
43,212
|
|
|
3,718
|
|
|
4,975
|
|
||||
|
Expected return on plan assets
|
(42,065
|
)
|
|
(39,018
|
)
|
|
—
|
|
|
—
|
|
||||
|
Amortization of prior service benefit
|
(61
|
)
|
|
(61
|
)
|
|
(366
|
)
|
|
(12,267
|
)
|
||||
|
Amortization of actuarial loss
|
12,241
|
|
|
9,457
|
|
|
5,074
|
|
|
3,868
|
|
||||
|
Curtailment gain
|
(815
|
)
|
|
(1,730
|
)
|
|
—
|
|
|
—
|
|
||||
|
Net settlement loss
|
1,044
|
|
|
417
|
|
|
—
|
|
|
—
|
|
||||
|
Net periodic benefit cost (income)
|
15,870
|
|
|
18,986
|
|
|
8,708
|
|
|
(3,126
|
)
|
||||
|
Changes in accumulated other comprehensive loss:
|
|
|
|
|
|
|
|
||||||||
|
Actuarial gain
|
—
|
|
|
(381
|
)
|
|
—
|
|
|
—
|
|
||||
|
Amortization of prior service benefit
|
61
|
|
|
61
|
|
|
366
|
|
|
12,267
|
|
||||
|
Amortization of actuarial loss
|
(12,241
|
)
|
|
(9,457
|
)
|
|
(5,074
|
)
|
|
(3,868
|
)
|
||||
|
Curtailment gain
|
497
|
|
|
191
|
|
|
—
|
|
|
—
|
|
||||
|
Net settlement loss
|
(590
|
)
|
|
(178
|
)
|
|
—
|
|
|
—
|
|
||||
|
Total recognized in accumulated other comprehensive loss
|
(12,273
|
)
|
|
(9,764
|
)
|
|
(4,708
|
)
|
|
8,399
|
|
||||
|
Total recognized in net periodic benefit cost (income) and accumulated other comprehensive loss
|
$
|
3,597
|
|
|
$
|
9,222
|
|
|
$
|
4,000
|
|
|
$
|
5,273
|
|
|
|
|
August 25,
2013 |
|
November 25,
2012 |
|
||||
|
|
|
(Dollars in thousands)
|
|
||||||
|
|
Pension and postretirement benefits
|
$
|
(320,135
|
)
|
|
$
|
(330,961
|
)
|
|
|
|
Net investment hedge losses
|
(24,781
|
)
|
|
(18,853
|
)
|
|
||
|
|
Foreign currency translation losses
|
(53,773
|
)
|
|
(55,423
|
)
|
|
||
|
|
Unrealized gain on marketable securities
|
473
|
|
|
1,014
|
|
|
||
|
|
Accumulated other comprehensive loss
|
(398,216
|
)
|
|
(404,223
|
)
|
|
||
|
|
Accumulated other comprehensive income attributable to noncontrolling interest
|
9,483
|
|
|
10,412
|
|
|
||
|
|
Accumulated other comprehensive loss attributable to Levi Strauss & Co.
|
$
|
(407,699
|
)
|
|
$
|
(414,635
|
)
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
||||||||||||
|
|
|
August 25,
2013 |
|
August 26,
2012 |
|
August 25,
2013 |
|
August 26,
2012 |
|
||||||||
|
|
|
(Dollars in thousands)
|
|
||||||||||||||
|
|
Foreign exchange management gains (losses)
(1)
|
$
|
6,314
|
|
|
$
|
(15,384
|
)
|
|
$
|
6,286
|
|
|
$
|
(9,303
|
)
|
|
|
|
Foreign currency transaction (losses) gains
(2)
|
(18,210
|
)
|
|
8,518
|
|
|
(18,728
|
)
|
|
11,722
|
|
|
||||
|
|
Interest income
|
357
|
|
|
345
|
|
|
1,138
|
|
|
1,153
|
|
|
||||
|
|
Investment income
|
214
|
|
|
99
|
|
|
3,019
|
|
|
326
|
|
|
||||
|
|
Other
|
664
|
|
|
675
|
|
|
2,860
|
|
|
2,224
|
|
|
||||
|
|
Total other income (expense), net
|
$
|
(10,661
|
)
|
|
$
|
(5,747
|
)
|
|
$
|
(5,425
|
)
|
|
$
|
6,122
|
|
|
|
(1)
|
Gains and losses on forward foreign exchange contracts primarily resulted from currency fluctuations relative to negotiated contract rates. Losses on forward foreign exchange contracts in 2012 primarily resulted from unfavorable currency fluctuations relative to negotiated contract rates on positions to sell the Swedish Krona, Mexican Peso, and Australian Dollar.
|
|
(2)
|
Foreign currency transaction gains and losses reflect the impact of foreign currency fluctuation on the Company's foreign currency denominated balances. Losses in 2013 were primarily due to the weakening of various currencies against the U.S. Dollar.
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
||||||||||||
|
|
|
August 25,
2013 |
|
August 26,
2012 |
|
August 25,
2013 |
|
August 26,
2012 |
|
||||||||
|
|
|
(Dollars in thousands)
|
|
||||||||||||||
|
|
Net revenues:
|
|
|
|
|
|
|
|
|
||||||||
|
|
Americas
|
$
|
710,212
|
|
|
$
|
679,098
|
|
|
$
|
2,023,253
|
|
|
$
|
1,931,561
|
|
|
|
|
Europe
|
275,211
|
|
|
265,922
|
|
|
824,915
|
|
|
809,271
|
|
|
||||
|
|
Asia Pacific
|
155,861
|
|
|
155,836
|
|
|
538,692
|
|
|
572,142
|
|
|
||||
|
|
Total net revenues
|
$
|
1,141,284
|
|
|
$
|
1,100,856
|
|
|
$
|
3,386,860
|
|
|
$
|
3,312,974
|
|
|
|
|
Operating income:
|
|
|
|
|
|
|
|
|
||||||||
|
|
Americas
|
$
|
125,228
|
|
|
$
|
136,509
|
|
|
$
|
376,598
|
|
|
$
|
287,470
|
|
|
|
|
Europe
|
45,914
|
|
|
48,152
|
|
|
145,549
|
|
|
129,781
|
|
|
||||
|
|
Asia Pacific
|
22,666
|
|
|
(4,719
|
)
|
|
104,233
|
|
|
55,193
|
|
|
||||
|
|
Regional operating income
|
193,808
|
|
|
179,942
|
|
|
626,380
|
|
|
472,444
|
|
|
||||
|
|
Corporate expenses
(1)
|
75,722
|
|
|
93,155
|
|
|
227,202
|
|
|
229,816
|
|
|
||||
|
|
Total operating income
|
118,086
|
|
|
86,787
|
|
|
399,178
|
|
|
242,628
|
|
|
||||
|
|
Interest expense
|
(30,903
|
)
|
|
(32,160
|
)
|
|
(95,943
|
)
|
|
(103,144
|
)
|
|
||||
|
|
Loss on early extinguishment of debt
|
—
|
|
|
—
|
|
|
(689
|
)
|
|
(8,206
|
)
|
|
||||
|
|
Other income (expense), net
|
(10,661
|
)
|
|
(5,747
|
)
|
|
(5,425
|
)
|
|
6,122
|
|
|
||||
|
|
Income before income taxes
|
$
|
76,522
|
|
|
$
|
48,880
|
|
|
$
|
297,121
|
|
|
$
|
137,400
|
|
|
|
(1)
|
Included in corporate expenses for the
three- and nine-month periods
ended
August 26, 2012
, is an $18.8 million impairment charge related to the Company's decision in the
third
quarter of 2012 to outsource distribution in Japan to a third-party and close its owned distribution center in that country.
|
|
Item 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
|
|
•
|
Net revenues.
Compared to the
third
quarter of
2012
, consolidated net revenues increased on a reported and constant-currency basis by
4%
and
3%
, respectively. The increase primarily reflected higher sales in the Americas, both at our company-operated retail network and to certain wholesale customers.
|
|
•
|
Operating income
. Compared to the
third
quarter of
2012
, consolidated operating income increased by
36%
and operating margin rose to
10%
, primarily reflecting charges of approximately $44 million that we took in the third quarter of 2012 related to strategic choices relating to operations in our Asia Pacific region. The increase in operating income was partially offset by higher SG&A in 2013.
|
|
•
|
Cash flows.
Cash flows provided by operating activities were
$274 million
for the
nine-month period
in
2013
as compared to
$416 million
for the same period in
2012
; the decrease reflected higher payments to vendors, our higher inventory levels and our lower beginning accounts receivable balance.
|
|
•
|
Net revenues is primarily comprised of sales of products to wholesale customers, including franchised stores, and direct sales to consumers at our company-operated and online stores and at our company-operated shop-in-shops located within department stores. It includes discounts, allowances for estimated returns and incentives. Net revenues also includes royalties earned from the use of our trademarks by third-party licensees in connection with the manufacturing, advertising and distribution of trademarked products.
|
|
•
|
Cost of goods sold is primarily comprised of product costs, labor and related overhead, sourcing costs, inbound freight, internal transfers, and the cost of operating our remaining manufacturing facilities, including the related depreciation expense.
|
|
•
|
Selling costs include, among other things, all occupancy costs and depreciation associated with our company-operated stores and commissions associated with our company-operated shop-in-shops.
|
|
•
|
We reflect substantially all distribution costs in selling, general and administrative expenses, including costs related to receiving and inspection at distribution centers, warehousing, shipping to our customers, handling, and certain other activities associated with our distribution network.
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||||||||||||
|
|
August 25,
2013 |
|
August 26,
2012 |
|
%
Increase
(Decrease)
|
|
August 25,
2013 |
|
August 26,
2012 |
|
August 25,
2013 |
|
August 26,
2012 |
|
%
Increase
(Decrease)
|
|
August 25,
2013 |
|
August 26,
2012 |
||||||||||||||
|
|
|
|
% of Net
Revenues
|
|
% of Net
Revenues
|
|
|
|
% of Net
Revenues
|
|
% of Net
Revenues
|
||||||||||||||||||||||
|
|
(Dollars in millions)
|
||||||||||||||||||||||||||||||||
|
Net revenues
|
$
|
1,141.3
|
|
|
$
|
1,100.9
|
|
|
3.7
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
$
|
3,386.9
|
|
|
$
|
3,313.0
|
|
|
2.2
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
Cost of goods sold
|
568.5
|
|
|
580.2
|
|
|
(2.0
|
)%
|
|
49.8
|
%
|
|
52.7
|
%
|
|
1,673.5
|
|
|
1,762.8
|
|
|
(5.1
|
)%
|
|
49.4
|
%
|
|
53.2
|
%
|
||||
|
Gross profit
|
572.8
|
|
|
520.7
|
|
|
10.0
|
%
|
|
50.2
|
%
|
|
47.3
|
%
|
|
1,713.4
|
|
|
1,550.2
|
|
|
10.5
|
%
|
|
50.6
|
%
|
|
46.8
|
%
|
||||
|
Selling, general and administrative expenses
|
454.7
|
|
|
433.9
|
|
|
4.8
|
%
|
|
39.8
|
%
|
|
39.4
|
%
|
|
1,314.2
|
|
|
1,307.6
|
|
|
0.5
|
%
|
|
38.8
|
%
|
|
39.5
|
%
|
||||
|
Operating income
|
118.1
|
|
|
86.8
|
|
|
36.1
|
%
|
|
10.3
|
%
|
|
7.9
|
%
|
|
399.2
|
|
|
242.6
|
|
|
64.5
|
%
|
|
11.8
|
%
|
|
7.3
|
%
|
||||
|
Interest expense
|
(30.9
|
)
|
|
(32.2
|
)
|
|
(3.9
|
)%
|
|
(2.7
|
)%
|
|
(2.9
|
)%
|
|
(96.0
|
)
|
|
(103.1
|
)
|
|
(7.0
|
)%
|
|
(2.8
|
)%
|
|
(3.1
|
)%
|
||||
|
Loss on early extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.7
|
)
|
|
(8.2
|
)
|
|
(91.6
|
)%
|
|
—
|
|
|
(0.2
|
)%
|
||||
|
Other income (expense), net
|
(10.7
|
)
|
|
(5.7
|
)
|
|
85.5
|
%
|
|
(0.9
|
)%
|
|
(0.5
|
)%
|
|
(5.4
|
)
|
|
6.1
|
|
|
(188.6
|
)%
|
|
(0.2
|
)%
|
|
0.2
|
%
|
||||
|
Income before income taxes
|
76.5
|
|
|
48.9
|
|
|
56.6
|
%
|
|
6.7
|
%
|
|
4.4
|
%
|
|
297.1
|
|
|
137.4
|
|
|
116.2
|
%
|
|
8.8
|
%
|
|
4.1
|
%
|
||||
|
Income tax expense
|
20.1
|
|
|
23.8
|
|
|
(15.6
|
)%
|
|
1.8
|
%
|
|
2.2
|
%
|
|
85.6
|
|
|
49.8
|
|
|
71.9
|
%
|
|
2.5
|
%
|
|
1.5
|
%
|
||||
|
Net income
|
56.4
|
|
|
25.1
|
|
|
125.1
|
%
|
|
4.9
|
%
|
|
2.3
|
%
|
|
211.5
|
|
|
87.6
|
|
|
141.4
|
%
|
|
6.2
|
%
|
|
2.6
|
%
|
||||
|
Net loss attributable to noncontrolling interest
|
0.7
|
|
|
3.3
|
|
|
(80.8
|
)%
|
|
0.1
|
%
|
|
0.3
|
%
|
|
0.7
|
|
|
3.2
|
|
|
(77.5
|
)%
|
|
—
|
|
|
0.1
|
%
|
||||
|
Net income attributable to Levi Strauss & Co.
|
$
|
57.1
|
|
|
$
|
28.4
|
|
|
101.3
|
%
|
|
5.0
|
%
|
|
2.6
|
%
|
|
$
|
212.2
|
|
|
$
|
90.8
|
|
|
133.7
|
%
|
|
6.3
|
%
|
|
2.7
|
%
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||||||
|
|
|
|
|
|
% Increase
(Decrease)
|
|
|
|
|
|
% Increase
(Decrease)
|
||||||||||||||||
|
|
August 25,
2013 |
|
August 26,
2012 |
|
As
Reported
|
|
Constant
Currency
|
|
August 25,
2013 |
|
August 26,
2012 |
|
As
Reported
|
|
Constant
Currency
|
||||||||||||
|
|
(Dollars in millions)
|
||||||||||||||||||||||||||
|
Net revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Americas
|
$
|
710.2
|
|
|
$
|
679.1
|
|
|
4.6
|
%
|
|
4.4
|
%
|
|
$
|
2,023.3
|
|
|
$
|
1,931.6
|
|
|
4.7
|
%
|
|
4.6
|
%
|
|
Europe
|
275.2
|
|
|
265.9
|
|
|
3.5
|
%
|
|
(1.2
|
)%
|
|
824.9
|
|
|
809.3
|
|
|
1.9
|
%
|
|
0.1
|
%
|
||||
|
Asia Pacific
|
155.9
|
|
|
155.9
|
|
|
—
|
|
|
6.0
|
%
|
|
538.7
|
|
|
572.1
|
|
|
(5.8
|
)%
|
|
(2.4
|
)%
|
||||
|
Total net revenues
|
$
|
1,141.3
|
|
|
$
|
1,100.9
|
|
|
3.7
|
%
|
|
3.3
|
%
|
|
$
|
3,386.9
|
|
|
$
|
3,313.0
|
|
|
2.2
|
%
|
|
2.3
|
%
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||
|
|
August 25,
2013 |
|
August 26,
2012 |
|
%
Increase
(Decrease)
|
|
August 25,
2013 |
|
August 26,
2012 |
|
%
Increase
(Decrease)
|
||||||||||
|
|
(Dollars in millions)
|
||||||||||||||||||||
|
Net revenues
|
$
|
1,141.3
|
|
|
$
|
1,100.9
|
|
|
3.7
|
%
|
|
$
|
3,386.9
|
|
|
$
|
3,313.0
|
|
|
2.2
|
%
|
|
Cost of goods sold
|
568.5
|
|
|
580.2
|
|
|
(2.0
|
)%
|
|
1,673.5
|
|
|
1,762.8
|
|
|
(5.1
|
)%
|
||||
|
Gross profit
|
$
|
572.8
|
|
|
$
|
520.7
|
|
|
10.0
|
%
|
|
$
|
1,713.4
|
|
|
$
|
1,550.2
|
|
|
10.5
|
%
|
|
Gross margin
|
50.2
|
%
|
|
47.3
|
%
|
|
|
|
50.6
|
%
|
|
46.8
|
%
|
|
|
||||||
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||||||||||||
|
|
August 25,
2013 |
|
August 26,
2012 |
|
%
Increase
(Decrease)
|
|
August 25,
2013 |
|
August 26,
2012 |
|
August 25,
2013 |
|
August 26,
2012 |
|
%
Increase
(Decrease)
|
|
August 25,
2013 |
|
August 26,
2012 |
||||||||||||||
|
|
|
|
% of Net
Revenues
|
|
% of Net
Revenues
|
|
|
|
% of Net
Revenues
|
|
% of Net
Revenues
|
||||||||||||||||||||||
|
|
(Dollars in millions)
|
||||||||||||||||||||||||||||||||
|
Selling
|
$
|
172.5
|
|
|
$
|
166.0
|
|
|
3.9
|
%
|
|
15.1
|
%
|
|
15.1
|
%
|
|
$
|
523.3
|
|
|
$
|
516.4
|
|
|
1.3
|
%
|
|
15.5
|
%
|
|
15.6
|
%
|
|
Advertising and promotion
|
60.6
|
|
|
51.9
|
|
|
16.7
|
%
|
|
5.3
|
%
|
|
4.7
|
%
|
|
148.5
|
|
|
144.5
|
|
|
2.7
|
%
|
|
4.4
|
%
|
|
4.4
|
%
|
||||
|
Administration
|
101.1
|
|
|
79.1
|
|
|
27.8
|
%
|
|
8.9
|
%
|
|
7.2
|
%
|
|
291.3
|
|
|
272.9
|
|
|
6.7
|
%
|
|
8.6
|
%
|
|
8.2
|
%
|
||||
|
Other
|
120.5
|
|
|
136.9
|
|
|
(12.0
|
)%
|
|
10.6
|
%
|
|
12.4
|
%
|
|
351.1
|
|
|
373.8
|
|
|
(6.1
|
)%
|
|
10.4
|
%
|
|
11.3
|
%
|
||||
|
Total SG&A
|
$
|
454.7
|
|
|
$
|
433.9
|
|
|
4.8
|
%
|
|
39.8
|
%
|
|
39.4
|
%
|
|
$
|
1,314.2
|
|
|
$
|
1,307.6
|
|
|
0.5
|
%
|
|
38.8
|
%
|
|
39.5
|
%
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
||||||||||||||||||||||||||||||
|
|
August 25,
2013 |
|
August 26,
2012 |
|
%
Increase
(Decrease)
|
|
August 25,
2013 |
|
August 26,
2012 |
|
|
August 25,
2013 |
|
August 26,
2012 |
|
%
Increase
(Decrease)
|
|
August 25,
2013 |
|
August 26,
2012 |
|
||||||||||||||
|
|
|
|
% of Net
Revenues
|
|
% of Net
Revenues
|
|
|
|
|
% of Net
Revenues
|
|
% of Net
Revenues
|
|
||||||||||||||||||||||
|
|
(Dollars in millions)
|
|
|||||||||||||||||||||||||||||||||
|
Operating income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Americas
|
$
|
125.2
|
|
|
$
|
136.5
|
|
|
(8.3
|
)%
|
|
17.6
|
%
|
|
20.1
|
%
|
|
|
$
|
376.6
|
|
|
$
|
287.4
|
|
|
31.0
|
%
|
|
18.6
|
%
|
|
14.9
|
%
|
|
|
Europe
|
45.9
|
|
|
48.1
|
|
|
(4.6
|
)%
|
|
16.7
|
%
|
|
18.1
|
%
|
|
|
145.6
|
|
|
129.8
|
|
|
12.1
|
%
|
|
17.6
|
%
|
|
16.0
|
%
|
|
||||
|
Asia Pacific
|
22.7
|
|
|
(4.7
|
)
|
|
580.3
|
%
|
|
14.5
|
%
|
|
(3.0
|
)%
|
|
|
104.2
|
|
|
55.2
|
|
|
88.9
|
%
|
|
19.3
|
%
|
|
9.6
|
%
|
|
||||
|
Total regional operating income
|
193.8
|
|
|
179.9
|
|
|
7.7
|
%
|
|
17.0
|
%
|
*
|
16.3
|
%
|
*
|
|
626.4
|
|
|
472.4
|
|
|
32.6
|
%
|
|
18.5
|
%
|
*
|
14.3
|
%
|
*
|
||||
|
Corporate expenses
|
75.7
|
|
|
93.1
|
|
|
(18.7
|
)%
|
|
6.6
|
%
|
*
|
8.5
|
%
|
*
|
|
227.2
|
|
|
229.8
|
|
|
(1.1
|
)%
|
|
6.7
|
%
|
*
|
6.9
|
%
|
*
|
||||
|
Total operating income
|
$
|
118.1
|
|
|
$
|
86.8
|
|
|
36.1
|
%
|
|
10.3
|
%
|
*
|
7.9
|
%
|
*
|
|
$
|
399.2
|
|
|
$
|
242.6
|
|
|
64.5
|
%
|
|
11.8
|
%
|
*
|
7.3
|
%
|
*
|
|
Operating margin
|
10.3
|
%
|
|
7.9
|
%
|
|
|
|
|
|
|
|
|
11.8
|
%
|
|
7.3
|
%
|
|
|
|
|
|
|
|
||||||||||
|
|
|
Nine Months Ended
|
|
||||||
|
|
|
August 25,
2013 |
|
August 26,
2012 |
|
||||
|
|
|
(Dollars in millions)
|
|
||||||
|
|
Cash provided by operating activities
|
$
|
273.8
|
|
|
$
|
415.8
|
|
|
|
|
Cash used for investing activities
|
(63.4
|
)
|
|
(50.2
|
)
|
|
||
|
|
Cash used for financing activities
|
(227.7
|
)
|
|
(248.2
|
)
|
|
||
|
|
Cash and cash equivalents
|
382.3
|
|
|
314.8
|
|
|
||
|
•
|
changes in the level of consumer spending for apparel in view of general economic and environmental conditions and pricing trends, and our ability to plan for and respond to the impact of those changes;
|
|
•
|
consequences of impacts to the businesses of our wholesale customers caused by factors such as lower consumer spending, pricing changes, general economic conditions and changing consumer preferences;
|
|
•
|
our ability to mitigate the variability of costs related to manufacturing, sourcing, and raw materials supply and to manage consumer response to such mitigating actions;
|
|
•
|
our effectiveness in increasing productivity and efficiency in our operations and our ability to implement organizational changes intended to optimize operations without business disruption or mitigation to such disruptions;
|
|
•
|
our and our wholesale customers’ decisions to modify strategies and adjust product mix, and our ability to manage any resulting product transition costs;
|
|
•
|
our ability to gauge and adapt to changing U.S. and international retail environments and fashion trends and changing consumer preferences in product, price-points, as well as in-store and online shopping experiences;
|
|
•
|
our ability to respond to price, innovation and other competitive pressures in the apparel industry, on our key customers and in our key markets;
|
|
•
|
our ability to increase the number of dedicated stores for our products, including through opening and profitably operating company-operated stores;
|
|
•
|
consequences of foreign currency exchange rate fluctuations;
|
|
•
|
the impact of the variables that affect the net periodic benefit cost and future funding requirements of our postretirement benefits and pension plans;
|
|
•
|
our dependence on key distribution channels, customers and suppliers;
|
|
•
|
our ability to utilize our tax credits and net operating loss carryforwards;
|
|
•
|
ongoing or future litigation matters and disputes and regulatory developments;
|
|
•
|
changes in or application of trade and tax laws; and
|
|
•
|
political, social and economic instability in countries where we do business.
|
|
Item 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
|
Item 4.
|
CONTROLS AND PROCEDURES
|
|
Item 1.
|
LEGAL PROCEEDINGS
|
|
Item 1A.
|
RISK FACTORS
|
|
Item 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
|
•
|
76,923 of the SARs, referred to as the service-vested SARs, were granted with the following vesting schedule: 25% percent of the SAR grant vests on the day prior to the one-year anniversary of the date of grant, with the remaining 75% balance vesting monthly over 36 months commencing on such anniversary, at a rate of 2.08% per month;
|
|
•
|
51,282 of the SARs, referred to as the base-performance SARs, will vest in full upon determination by the board that the Company has achieved certain operating income and net revenue growth goals over fiscal years 2013, 2014 and 2015, such board determination to occur on or before March 1, 2016;
|
|
•
|
25,640 of the SARs, referred to as the stretch-performance SARs, have the same vesting term and conditions as the base-performance SARs but also require as a condition to vesting that the Company's common stock have a fair market value of not less than Fifty Dollars ($50) per share at the time of the board's performance determination.
|
|
Item 3.
|
DEFAULTS UPON SENIOR SECURITIES
|
|
Item 4.
|
MINE SAFETY DISCLOSURES
|
|
Item 5.
|
OTHER INFORMATION
|
|
Item 6.
|
EXHIBITS
|
|
31.1
|
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
|
|
|
|
|
|
31.2
|
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
|
|
|
|
|
|
32
|
|
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Furnished herewith.
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document. Filed herewith.
|
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document. Filed herewith.
|
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document. Filed herewith.
|
|
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document. Filed herewith.
|
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document. Filed herewith.
|
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document. Filed herewith.
|
|
Date:
|
October 4, 2013
|
|
LEVI STRAUSS & Co.
|
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ HEIDI L. MANES
|
|
|
|
|
Heidi L. Manes
Vice President and Controller
(Principal Accounting Officer)
|
|
31.1
|
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
|
|
|
|
|
|
31.2
|
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
|
|
|
|
|
|
32
|
|
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Furnished herewith.
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document. Filed herewith.
|
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document. Filed herewith.
|
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document. Filed herewith.
|
|
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document. Filed herewith.
|
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document. Filed herewith.
|
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document. Filed herewith.
|
No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
| FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
|---|
| DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
|---|---|---|---|
Mr. Goldstein’s extensive experience in the hospitality and gaming industries, including as a senior executive officer of our Company (or its predecessors) since 1995, as well as his current position as our Chairman and Chief Executive Officer ("CEO"), led the Board to conclude he would be a valuable member of our Board. Experience Mr. Goldstein was appointed the Company’s Chairman and Chief Executive Officer on January 26, 2021. Prior to that, he had been the Company’s President and Chief Operating Officer and a member of the Board since January 2015. He previously served as the Company’s President of Global Gaming Operations from January 2011 until December 2014, the Company’s Executive Vice President from July 2009 until December 2014, and the Company’s Secretary from August 2016 to November 2016. He has held other senior executive positions at the Company and its subsidiaries since 1995. Additionally, Mr. Goldstein also currently serves as Chairman and, up until January 2024, served as Chief Executive Officer of our Company’s subsidiary, SCL, both of which since January 2021, having previously served as a member of its board since May 2014 and as its interim president from January 2015 through October 2015. From 1992 until joining the Company in December 1995, Mr. Goldstein was the executive vice president of marketing at the Sands Hotel in Atlantic City, as well as an executive vice president of the parent Pratt Hotel Corporation. He served on the board of Remark Media, Inc., a global digital media company, from May 2013 to March 2017. | |||
Mr. Dumont’s experience in management, development and corporate finance and his positions and tenure with the Company led the Board to conclude he would be a valuable member of our Board. Experience Mr. Dumont has been the Company's President and Chief Operating Officer since January 26, 2021 and prior to that had been the Company’s Executive Vice President and Chief Financial Officer since March 2016. He previously served as the Company’s Principal Financial Officer since February 2016 and Senior Vice President, Finance and Strategy from September 2013 through February 2016. From June 2010 until August 2013, Mr. Dumont served as the Company’s Vice President, Corporate Strategy. Mr Dumont is the son-in-law of Dr. Miriam Adelson who, with trusts and other entities for the benefit of the Adelson family members, controls more than 50 percent of the voting power of the Company’s Common Stock. Since December 2023, Mr. Dumont has also served as the governor of the Dallas Mavericks, a professional basketball team in the National Basketball Association in which the family owns a majority interest. | |||
MICKY PANT AGE: 70 DIRECTOR SINCE: 2025 COMMITTEES: • Compliance • Nominating and Governance INDEPENDENT | |||
Ms. Chau’s extensive and varied business experience, including as president and chief operating officer at Lucasfilm Ltd., and her experience as a director of other public companies led the Board to conclude she would be a valuable member of our Board. Experience Ms. Chau has been a director of the Company since October 2014. She served as the president, chief operating officer and executive director of Lucasfilm Ltd., a film and entertainment company, from 2003 to 2012 and as its chief financial officer from 1991 to 2003. Before that, Ms. Chau held other executive-level positions in various industries, including retail, restaurant, venture capital and financial services. She was a member of the board of Dolby Laboratories, Inc., an audio, imaging and communications company, from February 2013 to February 2024, and was a member of the board of Red Hat, Inc., a provider of open-source software solutions, from November 2008 to August 2012. | |||
MARK BESCA AGE: 65 DIRECTOR SINCE: 2025 COMMITTEES: • Audit • Compliance (Chair) INDEPENDENT | |||
LEWIS KRAMER AGE: 77 DIRECTOR SINCE: 2017 COMMITTEES: • Audit (Chair) • Compensation INDEPENDENT | |||
Mr. Chafetz’s extensive experience in the hospitality, trade show and convention businesses, as well as his experience as a former executive of our predecessor company, led the Board to conclude he would be a valuable member of our Board. Experience Mr. Chafetz has been a director of the Company since February 2005. He was a director of Las Vegas Sands, Inc. from February until July 2005. Mr. Chafetz is the president and a manager of The Interface Group, LLC, a Massachusetts limited liability company that controls Interface Group-Massachusetts, LLC. Mr. Chafetz has been associated with Interface Group-Massachusetts, LLC and its predecessors since 1972. From 1989 to 1995, Mr. Chafetz was a vice president and director of Interface Group-Nevada, Inc., which owned and operated trade shows, including COMDEX, and also owned and operated The Sands Expo and Convention Center. From 1989 to 1995, Mr. Chafetz was also vice president and a director of Las Vegas Sands, Inc. Mr. Chafetz has served on the boards of many charitable and civic organizations and is a former member of the dean’s advisory council at Boston University School of Management. | |||
Mr. Forman’s extensive experience in the hospitality, trade show and convention businesses led the Board to conclude he would be a valuable member of our Board. Experience Mr. Forman has been a director of the Company since August 2004. He has been a director of Las Vegas Sands, LLC (and its predecessor, Las Vegas Sands, Inc.) since March 2004. In addition, he has served as a member of the board of SCL, since May 2014. Mr. Forman served as chairman and chief executive officer of Centric Events Group, LLC, a trade show and conference business from April 2002 until his retirement upon the sale of the business in 2007. From 2000 to 2002, he served as a director of a private company and participated in various private equity investments. During 2000, he was executive vice president of international operations of Key3Media, Inc. From 1998 to 2000, he was chief legal officer of ZD Events Inc., a tradeshow business that included COMDEX. From 1995 to 1998, Mr. Forman was executive vice president, chief financial and legal officer of Softbank Comdex Inc. From 1989 to 1995, Mr. Forman was vice president and general counsel of Interface Group Nevada, Inc., a tradeshow and convention business that owned and operated COMDEX, and also owned and operated The Sands Expo and Convention Center. Mr. Forman was in private law practice from 1972 to 1988. From 2009 until 2023, Mr. Forman was a member of the board of trustees of The Dana-Farber Cancer Institute. | |||
ALAIN LI AGE: 64 DIRECTOR SINCE: 2024 COMMITTEES: • Audit • Compensation • Nominating and Governance (Chair) INDEPENDENT |
|
NAME AND PRINCIPAL
POSITION
|
YEAR
|
SALARY
($)
|
BONUS
($)
|
STOCK
AWARDS
($)
|
OPTION
AWARDS
($)
|
NON-EQUITY
INCENTIVE PLAN
COMPENSATION
($)
|
ALL OTHER
COMPENSATION
($)
|
TOTAL
($)
|
|
Robert G. Goldstein
Chairman of the Board
and Chief Executive
Officer
|
2024
|
$
3,000,000
|
$
—
|
$
11,212,488
|
$
—
|
$
5,460,000
|
$
2,179,285
|
$
21,851,773
|
|
2023
|
$
3,000,000
|
$
—
|
$
9,749,944
|
$
—
|
$
6,900,000
|
$
2,287,874
|
$
21,937,818
|
|
|
2022
|
$
3,000,000
|
$
—
|
$
—
|
$
—
|
$
6,000,000
|
$
2,410,263
|
$
11,410,263
|
|
|
Patrick Dumont
President and Chief
Operating Officer
|
2024
|
$
2,500,000
|
$
—
|
$
5,749,985
|
$
—
|
$
4,550,000
|
$
5,042,204
|
$
17,842,189
|
|
2023
|
$
2,500,000
|
$
—
|
$
4,999,964
|
$
—
|
$
5,750,000
|
$
4,174,814
|
$
17,424,778
|
|
|
2022
|
$
2,500,000
|
$
—
|
$
—
|
$
—
|
$
5,000,000
|
$
4,123,680
|
$
11,623,680
|
|
|
Randy Hyzak
Executive Vice President
and Chief Financial Officer
|
2024
|
$
1,200,000
|
$
—
|
$
1,724,990
|
$
—
|
$
1,638,000
|
$
174,151
|
$
4,737,141
|
|
2023
|
$
1,200,000
|
$
—
|
$
1,499,960
|
$
—
|
$
1,725,000
|
$
49,009
|
$
4,473,969
|
|
|
2022
|
$
1,200,000
|
$
—
|
$
—
|
$
—
|
$
1,500,000
|
$
26,692
|
$
2,726,692
|
|
|
D. Zachary Hudson
Executive Vice President,
Global General Counsel
and Secretary
|
2024
|
$
1,300,000
|
$
—
|
$
1,581,250
|
$
—
|
$
2,070,250
|
$
318,886
|
$
5,270,386
|
|
2023
|
$
1,100,000
|
$
—
|
$
1,374,997
|
$
7,949,993
|
$
1,581,250
|
$
41,836
|
$
12,048,076
|
|
|
2022
|
$
1,100,000
|
$
—
|
$
—
|
$
—
|
$
1,375,000
|
$
77,780
|
$
2,552,780
|
Customers
| Customer name | Ticker |
|---|---|
| The Gap, Inc. | GPS |
| Nordstrom, Inc. | JWN |
| Ross Stores, Inc. | ROST |
| The TJX Companies, Inc. | TJX |
Suppliers
| Supplier name | Ticker |
|---|---|
| Expeditors International of Washington, Inc. | EXPD |
| Eastman Chemical Company | EMN |
| Matson, Inc. | MATX |
Price
Yield
| Owner | Position | Direct Shares | Indirect Shares |
|---|---|---|---|
| Adelson Miriam | - | 11,156,000 | 321,581,000 |
| Forman Charles D | - | 205,984 | 0 |
| Chafetz Irwin | - | 91,966 | 0 |
| Hyzak Randy | - | 16,566 | 0 |
| Hudson D. Zachary | - | 13,735 | 0 |
| Pant Muktesh | - | 4,746 | 23,000 |
| Li Alain | - | 4,237 | 0 |
| Goldstein Robert G | - | 0 | 129,005 |
| Goldstein Robert G | - | 0 | 236,057 |