Iconic jeans brand Levi's reported a net revenue increase of 4 percent for the first quarter of 2012.
The US jeans and sportswear giant realized a net income of $49 million (over €37 million or Rs 252 crores) compared with $41 million (€31 million or Rs 211 crores) over the same period last year.
Higher net income was a result of revenue growth and lower advertising costs, which were offset by lower gross margins caused by an increase in cotton prices. "We had a good start to the fiscal year. We're pleased with our performance in the first quarter, and we delivered these results despite the pressure of high-priced cotton," said Levi's president and CEO Chip Bergh. The company has had to increase its own prices in response to the rise of cotton costs.
Bergh said that 'conditions remain challenging in some parts of the world'. Net revenues in Europe dropped 7 per cent to $289 million (over €220 million or Rs 1,502 crores). The company attributed the decrease to lower volume of sales to both franchisee stores and traditional wholesale channels, as a result of a tough retail environment, particularly in southern Europe. Meanwhile, net revenues were up 9 per cent in the Americas and 5 per cent in the Asia Pacific region.