Levi Strauss repays $185 million debt, reports $1 billion liquidity

By Lisa Kerner

Charlotte, N.C., April 9 - Levi Strauss & Co. reported cash and cash equivalents of $450 million and $574 million available under its revolving credit facility for total liquidity of more than $1 billion at the end of the fiscal first quarter on Feb. 24.

The San Francisco-based apparel maker ended the quarter with $1.2 billion of net debt, down from $1.3 billion at the end of 2012.

During the quarter, Levi Strauss prepaid $50 million of its senior term loan due 2014 and paid a $25 million dividend.

Subsequent to the quarter's close, the company completed an offering of $140 million of 6 7/8% senior notes due 2022. The proceeds, along with cash on hand, were used to prepay the remaining $275 million outstanding on the senior term loan due in 2014.

"Our cash flow and a successful debt refinancing we executed after the quarter closed have allowed us to pay down $185 million of our debt this year," president and chief executive officer Chip Bergh said.

Financial highlights

Cash from operating activities was up $38 million from the first quarter of 2012 at $143 million, reflecting a tax refund and lower pension plan funding, according to the company's earnings release.

First-quarter net income grew from the prior year by 117% to $107 million, driven by stronger gross margin and improved operating margin.

Gross profit in the first quarter increased to $592 million from $549 million for the same period in 2012.

Levi Strauss reported a 2% decline in net revenues for the quarter. Net revenues were flat in the Americas, higher in Europe and down in Asia Pacific.

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