Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Aug. 27, 2017 | Oct. 04, 2017 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | LEVI STRAUSS & CO | |
Entity Central Index Key | 94,845 | |
Current Fiscal Year End Date | --11-26 | |
Entity Filer Category | Non-accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Aug. 27, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 37,521,447 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Aug. 27, 2017 | Nov. 27, 2016 |
Current Assets: | ||
Cash and cash equivalents | $ 491,289 | $ 375,563 |
Trade receivables, net of allowance for doubtful accounts of $12,766 and $11,974 | 446,701 | 479,018 |
Inventories: | ||
Raw materials | 4,708 | 2,454 |
Work-in-process | 3,094 | 3,074 |
Finished goods | 818,329 | 710,653 |
Total inventories | 826,131 | 716,181 |
Other current assets | 122,754 | 115,385 |
Total current assets | 1,886,875 | 1,686,147 |
Property, plant and equipment, net of accumulated depreciation of $936,260 and $856,588 | 388,652 | 393,605 |
Goodwill | 237,198 | 234,280 |
Other intangible assets, net | 42,912 | 42,946 |
Deferred tax assets, net | 553,092 | 523,101 |
Other non-current assets | 113,221 | 107,017 |
Total assets | 3,221,950 | 2,987,096 |
Current Liabilities: | ||
Short-term debt | 33,430 | 38,922 |
Accounts payable | 300,331 | 270,293 |
Accrued salaries, wages and employee benefits | 186,002 | 180,740 |
Restructuring liabilities | 1,508 | 4,878 |
Accrued interest payable | 17,846 | 5,098 |
Accrued income taxes | 36,059 | 9,652 |
Other accrued liabilities | 288,072 | 252,160 |
Total current liabilities | 863,248 | 761,743 |
Long-term debt | 1,035,845 | 1,006,256 |
Long-term capital leases | 15,360 | 15,360 |
Postretirement medical benefits | 93,403 | 100,966 |
Pension liability | 329,891 | 354,461 |
Long-term employee related benefits | 78,683 | 73,243 |
Long-term income tax liabilities | 17,634 | 20,150 |
Other long-term liabilities | 72,792 | 63,796 |
Total liabilities | 2,506,856 | 2,395,975 |
Commitments and contingencies | ||
Temporary equity | 90,844 | 79,346 |
Levi Strauss & Co. stockholders’ equity | ||
Common stock — $.01 par value; 270,000,000 shares authorized; 37,656,434 shares and 37,470,158 shares issued and outstanding | 377 | 375 |
Additional paid-in capital | 0 | 1,445 |
Retained earnings | 1,029,264 | 935,049 |
Accumulated other comprehensive loss | (409,382) | (427,314) |
Total Levi Strauss & Co. stockholders’ equity | 620,259 | 509,555 |
Noncontrolling interest | 3,991 | 2,220 |
Total stockholders’ equity | 624,250 | 511,775 |
Total liabilities, temporary equity and stockholders’ equity | $ 3,221,950 | $ 2,987,096 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Aug. 27, 2017 | Nov. 27, 2016 |
ASSETS | ||
Accumulated depreciation | $ 936,260 | $ 856,588 |
Current Assets: | ||
Allowance for doubtful accounts | $ 12,766 | $ 11,974 |
Levi Strauss & Co. stockholders’ equity | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 270,000,000 | 270,000,000 |
Common stock, shares issued | 37,656,434 | 37,470,158 |
Common stock, shares outstanding | 37,656,434 | 37,470,158 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 27, 2017 | Aug. 28, 2016 | Aug. 27, 2017 | Aug. 28, 2016 | |
Income Statement [Abstract] | ||||
Net revenues | $ 1,268,391 | $ 1,185,111 | $ 3,438,237 | $ 3,253,198 |
Cost of goods sold | 611,762 | 592,305 | 1,658,663 | 1,583,596 |
Gross profit | 656,629 | 592,806 | 1,779,574 | 1,669,602 |
Selling, general and administrative expenses | 510,309 | 448,525 | 1,462,263 | 1,349,039 |
Restructuring, net | 0 | (627) | 0 | 1,030 |
Operating income | 146,320 | 144,908 | 317,311 | 319,533 |
Interest expense | (14,476) | (19,170) | (52,305) | (54,483) |
Loss on early extinguishment of debt | 0 | 0 | (22,793) | 0 |
Other (expense) income, net | (14,734) | 4,679 | (32,413) | 6,755 |
Income before income taxes | 117,110 | 130,417 | 209,800 | 271,805 |
Income tax expense (benefit) | 27,631 | 32,713 | 42,477 | 76,750 |
Net income | 89,479 | 97,704 | 167,323 | 195,055 |
Net (income) loss attributable to noncontrolling interest | (1,487) | 614 | (1,672) | (176) |
Net income attributable to Levi Strauss & Co. | $ 87,992 | $ 98,318 | $ 165,651 | $ 194,879 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 27, 2017 | Aug. 28, 2016 | Aug. 27, 2017 | Aug. 28, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 89,479 | $ 97,704 | $ 167,323 | $ 195,055 |
Other comprehensive income (loss), before related income taxes: | ||||
Pension and postretirement benefits | 3,693 | 3,356 | 11,153 | 10,673 |
Net investment hedge losses | (27,930) | (804) | (57,570) | (1,718) |
Foreign currency translation gains (losses) | 18,051 | (33) | 46,638 | (1,731) |
Unrealized gains on marketable securities | 276 | 675 | 2,151 | 356 |
Total other comprehensive (loss) income, before related income taxes | (5,910) | 3,194 | 2,372 | 7,580 |
Income taxes benefit (expense) related to items of other comprehensive income | 9,287 | (1,356) | 15,460 | (4,994) |
Comprehensive income, net of income taxes | 92,856 | 99,542 | 185,155 | 197,641 |
Comprehensive (income) loss attributable to noncontrolling interest | (1,561) | 333 | (1,573) | (788) |
Comprehensive income attributable to Levi Strauss & Co. | $ 91,295 | $ 99,875 | $ 183,582 | $ 196,853 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Aug. 27, 2017 | Aug. 28, 2016 | |
Cash Flows from Operating Activities: | ||
Net income | $ 167,323 | $ 195,055 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 85,618 | 75,966 |
Unrealized foreign exchange losses | 36,717 | 17,702 |
Realized gain on settlement of forward foreign exchange contracts not designated for hedge accounting | (184) | (21,419) |
Employee benefit plans’ amortization from accumulated other comprehensive loss and settlement loss | 11,153 | 11,240 |
Loss on early extinguishment of debt | 22,793 | 0 |
Stock-based compensation | 21,910 | 6,045 |
Other, net | 4,146 | (595) |
Change in operating assets and liabilities: | ||
Trade receivables | 45,642 | 40,334 |
Inventories | (77,758) | (255,460) |
Other current assets | (4,947) | 248 |
Other non-current assets | (3,747) | (12,504) |
Accounts payable and other accrued liabilities | 23,022 | 77,355 |
Restructuring liabilities | (3,559) | (13,618) |
Income tax liabilities | 8,595 | 34,309 |
Accrued salaries, wages and employee benefits and long-term employee related benefits | (42,599) | (55,595) |
Other long-term liabilities | 326 | 3,756 |
Net cash provided by operating activities | 294,451 | 102,819 |
Cash Flows from Investing Activities: | ||
Purchases of property, plant and equipment | (75,793) | (74,844) |
Proceeds from sales of assets | 0 | 17,279 |
Proceeds on settlement of forward foreign exchange contracts not designated for hedge accounting | 184 | 21,419 |
Net cash used for investing activities | (75,609) | (36,146) |
Cash Flows from Financing Activities: | ||
Proceeds from issuance of long-term debt | 502,835 | 0 |
Repayments of long-term debt | (525,000) | 0 |
Proceeds from senior revolving credit facility | 0 | 180,000 |
Repayments of senior revolving credit facility | 0 | (249,000) |
Proceeds from short-term credit facilities | 23,898 | 24,905 |
Repayments of short-term credit facilities | (20,382) | (14,216) |
Other short-term borrowings, net | (10,255) | 3,274 |
Payment of debt extinguishment costs | (21,902) | 0 |
Payment of debt issuance costs | (10,110) | 0 |
Repurchase of common stock, including shares surrendered for tax withholdings on equity award exercises | (13,292) | (1,402) |
Dividend to stockholders | (35,000) | (60,000) |
Other financing, net | (3,196) | 782 |
Net cash used for financing activities | (112,404) | (115,657) |
Effect of exchange rate changes on cash and cash equivalents | 9,288 | 2,053 |
Net increase in cash and cash equivalents | 115,726 | (46,931) |
Beginning cash and cash equivalents | 375,563 | 318,571 |
Ending cash and cash equivalents | 491,289 | 271,640 |
Noncash Investing Activity: | ||
Property, plant and equipment acquired and not yet paid at end of period | 10,951 | 19,401 |
Property, plant and equipment additions due to build-to-suit lease transactions | 4,459 | 0 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest during the period | 29,570 | 34,667 |
Cash paid for income taxes during the period, net of refunds | $ 32,944 | $ 41,090 |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Aug. 27, 2017 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | SIGNIFICANT ACCOUNTING POLICIES Nature of Operations Levi Strauss & Co. (the "Company") is one of the world’s largest brand-name apparel companies. The Company designs, markets and sells – directly or through third parties and licensees – products that include jeans, casual and dress pants, tops, shorts, skirts, jackets, footwear and related accessories for men, women and children around the world under the Levi’s ® , Dockers ® , Signature by Levi Strauss & Co.™ and Denizen ® brands. The Company operates its business through three geographic regions: Americas, Europe and Asia. Basis of Presentation and Principles of Consolidation The unaudited consolidated financial statements of the Company and its wholly-owned and majority-owned foreign and domestic subsidiaries are prepared in conformity with generally accepted accounting principles in the United States ("U.S. GAAP") for interim financial information. In the opinion of management, all adjustments necessary for a fair statement of the financial position and the results of operations for the periods presented have been included. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company for the year ended November 27, 2016 , included in the Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on February 9, 2017. The unaudited consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany transactions have been eliminated. Management believes the disclosures are adequate to make the information presented herein not misleading. The results of operations for the three and nine months ended August 27, 2017 may not be indicative of the results to be expected for any other interim period or the year ending November 26, 2017 . The Company’s fiscal year ends on the last Sunday of November in each year, although the fiscal years of certain foreign subsidiaries end on November 30. Each quarter of both fiscal years 2017 and 2016 consists of 13 weeks. All references to years relate to fiscal years rather than calendar years. Subsequent events have been evaluated through the issuance date of these financial statements. Out-of-period Adjustments For the three and nine months ended August 27, 2017, the Company’s results include an out-of-period adjustment, which increased selling, general and administrative expenses by approximately $9.5 million and $8.3 million and decreased net income by $5.8 million and $5.1 million , respectively. This item, which originated in prior years, relates to the correction of the periods used for the recognition of stock-based compensation expense associated with employees eligible to vest awards after retirement. The Company has evaluated the effects of this out-of-period adjustment, both qualitatively and quantitatively, and concluded that the correction of this amount was not material to the current period or the periods in which they originated, including quarterly reporting. Reclassification Certain amounts in Note 13 "Business Segment Information" have been conformed to the August 27, 2017 presentation. Effective as of the beginning of 2017, certain of our global expenses that support all of our regional segments, including global e-commerce infrastructure and global brand merchandising, marketing and design, previously recorded centrally in our Americas region segment and Corporate expenses, have now been allocated to our three regional business segments, and reported in their operating results. Business segment information for the prior-year period has been revised to reflect this change in presentation. Certain insignificant amounts on the Statements of Cash Flows have been conformed to the August 27, 2017 presentation. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the related notes to the consolidated financial statements. Estimates are based upon historical factors, current circumstances and the experience and judgment of the Company’s management. Management evaluates its estimates and assumptions on an ongoing basis and may employ outside experts to assist in its evaluations. Changes in such estimates, based on more accurate future information, or different assumptions or conditions, may affect amounts reported in future periods. Changes in Accounting Principle • In March 2016, the FASB issued Accounting Standards Update ("ASU") 2016-09, Compensation – Stock Compensation (Topic 718) . ASU 2016-09 identifies areas for simplification involving several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, an option to recognize gross stock compensation expense with actual forfeitures recognized as they occur, as well as certain classifications on the statement of cash flows. The Company elected to early adopt all provisions of this new accounting standard in the first quarter of 2017 and will maintain the current forfeiture policy to estimate forfeitures expected to occur to determine stock-based compensation expense. Subsequent to the adoption, exercises of stock awards during the nine-month period ended August 27, 2017 resulted in a $6.0 million income tax benefit. • In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230) Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 designates the appropriate cash flow classification for debt prepayment or extinguishment costs, the maturing of a zero coupon bond, the settlement of contingent liabilities arising from a business combination, proceeds from insurance settlements, distributions from certain equity method investees and beneficial interests obtained in a financial asset securitization. In certain circumstances, transactions may require bifurcation to appropriately allocate components among operating, investing and financing activities. The Company adopted this standard in the second quarter of 2017. Recently Issued Accounting Standards There have been no developments to recently issued accounting standards, including the expected dates of adoption and estimated effects on the Company’s consolidated financial statements and footnote disclosures, from those disclosed in the Company’s 2016 Annual Report on Form 10-K, except for the following, which have been grouped by their effective dates for the Company: First Quarter of 2019 • In March 2017, the FASB issued ASU 2017-07, Compensation-Retirement Benefits (Topic 715) Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU 2017-07 changes the income statement presentation of defined benefit plan expense by requiring separation between operating expense (service cost component) and non-operating expense (all other components, including interest cost, amortization of prior service cost, curtailments and settlements, etc.). The operating expense component is reported with similar compensation costs while the non-operating components are reported in Other Income and Expense. In addition, only the service cost component is eligible for capitalization as part of an asset such as inventory or property, plant and equipment. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements. • In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718) Scope of Modification Accounting. ASU 2017-09 provides clarification on when modification accounting should be used for changes to the terms or conditions of a share-based payment award. This ASU does not change the accounting for modifications but clarifies that modification accounting guidance should only be applied if there is a change to the value, vesting conditions, or award classification and would not be required if the changes are considered non-substantive. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements. • In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). ASU 2014-09 outlines a new, single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry specific guidance. This new revenue recognition model provides a five-step analysis in determining when and how revenue is recognized. The new model will require revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date . The amendment in this update defers the effective date of ASU 2014-09 for all entities by one year. Additional ASUs have been issued that are part of the overall new revenue guidance including: ASU 2016-08: Principal versus Agent Considerations (Reporting Revenue Gross versus Net) , ASU 2016-10: Identifying Performance Obligations and Licensing and ASU 2016-12: Narrow Scope Improvements and Practical Expedients. The Company is currently assessing the impact that adopting these new revenue accounting standards will have on its consolidated financial statements. First Quarter of 2020 • In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842 ) which requires the identification of arrangements that should be accounted for as leases by lessees. In general, for operating or financing lease arrangements exceeding a twelve month term, a right-of-use asset and a lease obligation will be recognized on the balance sheet of the lessee while the income statement will reflect lease expense for operating leases and amortization/interest expense for financing leases. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements. • In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815) Targeted Improvements to Accounting for Hedging Activities . ASU 2017-12 refines and expands hedge accounting for both financial and commodity risks. This ASU creates more transparency around how economic results are presented, both on the face of the financial statements and in the footnotes. In addition, this ASU makes certain targeted improvements to simplify the application of hedge accounting guidance. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements. First Quarter of 2021 • In January 2017, the FASB issued ASU 2017-04, Intangibles-Goodwill and Other (Topic 350) Simplifying the Test for Goodwill Impairment. ASU 2017-04 eliminates the two-step process that required identification of potential impairment and a separate measure of the actual impairment. The annual assessment of goodwill impairment will be determined by using the difference between the carrying amount and the fair value of the reporting unit. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Aug. 27, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | FAIR VALUE OF FINANCIAL INSTRUMENTS The following table presents the Company’s financial instruments that are carried at fair value: August 27, 2017 November 27, 2016 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 $ 29,912 $ 29,912 $ — $ 27,131 $ 27,131 $ — Forward foreign exchange contracts, net (3) 3,982 — 3,982 23,267 — 23,267 Total $ 33,894 $ 29,912 $ 3,982 $ 50,398 $ 27,131 $ 23,267 Financial liabilities carried at fair value Forward foreign exchange contracts, net (3) $ 30,916 $ — $ 30,916 $ 5,533 $ — $ 5,533 _____________ (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. The following table presents the carrying value, including related accrued interest, and estimated fair value of the Company’s financial instruments that are carried at adjusted historical cost: August 27, 2017 November 27, 2016 Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value (Dollars in thousands) Financial liabilities carried at adjusted historical cost 6.875% senior notes due 2022 (1)(2) $ — $ — $ 527,102 $ 550,700 5.00% senior notes due 2025 (1) 491,343 515,504 483,735 480,121 3.375% senior notes due 2027 (1)(2) 561,547 579,016 — — Short-term borrowings 33,689 33,689 39,009 39,009 Total $ 1,086,579 $ 1,128,209 $ 1,049,846 $ 1,069,830 _____________ (1) Fair values are estimated using Level 1 inputs and incorporate mid-market price quotes. 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. (2) On February 28, 2017 , the Company issued €475 million in aggregate principal amount of 3.375% senior notes due 2027. On March 3, 2017 , the Company completed a cash tender offer for $370.3 million of the 6.875% senior notes due 2022 and the remaining $154.7 million was called on March 31, 2017 for redemption on May 1, 2017 . See Note 4 for additional information. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 9 Months Ended |
Aug. 27, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES As of August 27, 2017 , the Company had forward foreign exchange contracts to buy $746.3 million and to sell $314.6 million against various foreign currencies. These contracts are at various exchange rates and expire at various dates through February 2019 . The table below provides data about the carrying values of derivative instruments and non-derivative instruments: August 27, 2017 November 27, 2016 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) $ 3,989 $ (7 ) $ 3,982 $ 30,160 $ (6,893 ) $ 23,267 Forward foreign exchange contracts (2) 6,117 (37,033 ) (30,916 ) 1,481 (7,014 ) (5,533 ) Total $ 10,106 $ (37,040 ) $ 31,641 $ (13,907 ) Non-derivatives designated as hedging instruments Euro senior notes $ — $ (560,405 ) $ — $ — _____________ (1) Included in “Other current assets” or “Other non-current assets” on the Company’s consolidated balance sheets. (2) Included in “Other accrued liabilities” or "Other long-term liabilities" on the Company’s consolidated balance sheets. 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 and are offset accordingly. The table below presents the gross and net amounts of these contracts recognized on the Company's consolidated balance sheets by type of financial instrument: August 27, 2017 November 27, 2016 Gross Amounts of Recognized Assets / (Liabilities) Gross Amounts Offset in the Balance Sheet Net Amounts of Assets / (Liabilities) Presented in the Balance Sheet Gross Amounts of Recognized Assets / (Liabilities) Gross Amounts Offset in the Balance Sheet Net Amounts of Assets / (Liabilities) Presented in the Balance Sheet (Dollars in thousands) Over-the-counter forward foreign exchange contracts Financial assets $ 6,335 $ (6,124 ) $ 211 $ 29,240 $ (8,374 ) $ 20,866 Financial liabilities (34,786 ) 6,124 (28,662 ) (10,365 ) 8,374 (1,991 ) Total $ (28,451 ) $ 18,875 Embedded derivative contracts Financial assets $ 3,771 $ — $ 3,771 $ 2,401 $ — $ 2,401 Financial liabilities (2,254 ) — (2,254 ) (3,542 ) — (3,542 ) Total $ 1,517 $ (1,141 ) The table below provides data about the amount of gains and losses related to derivative instruments and non-derivative instruments designated as net investment hedges included in "Accumulated other comprehensive loss" ("AOCI") on the Company’s consolidated balance sheets, and in "Other income (expense), net" in the Company's consolidated statements of income: 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 27, November 27, August 27, August 28, August 27, August 28, (Dollars in thousands) Forward foreign exchange contracts $ 4,637 $ 4,637 Yen-denominated Eurobonds (19,811 ) (19,811 ) $ — $ (2,546 ) $ — $ (5,441 ) Euro-denominated senior notes (73,321 ) (15,751 ) — — — — Cumulative income taxes 34,347 12,168 Total $ (54,148 ) $ (18,757 ) The table below provides data about the amount of gains and losses related to derivatives not designated as hedging instruments included in "Other income (expense), net" in the Company's consolidated statements of income: Three Months Ended Nine Months Ended August 27, August 28, August 27, August 28, (Dollars in thousands) Forward foreign exchange contracts: Realized (loss) gain $ (3,894 ) $ 4,531 $ 184 $ 21,418 Unrealized loss (15,253 ) (12,763 ) (44,705 ) (27,032 ) Total $ (19,147 ) $ (8,232 ) $ (44,521 ) $ (5,614 ) |
Debt
Debt | 9 Months Ended |
Aug. 27, 2017 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT The following table presents the Company's debt: August 27, November 27, (Dollars in thousands) Long-term debt 6.875% senior notes due 2022 $ — $ 524,396 5.00% senior notes due 2025 483,219 481,860 3.375% senior notes due 2027 552,626 — Total long-term debt $ 1,035,845 $ 1,006,256 Short-term debt Short-term borrowings $ 33,430 $ 38,922 Total debt $ 1,069,275 $ 1,045,178 Issuance of Senior Notes due 2027 and Tender and Redemption of Senior Notes due 2022 Principal, interest, and maturity. On February 28, 2017 , the Company issued €475 million in aggregate principal amount of 3.375% senior notes due 2027 (the "Senior Notes due 2027") to qualified institutional buyers and to purchasers outside the United States, which were later exchanged for new notes in the same principal amount with substantially identical terms, except that the new notes were registered under the Securities Act. The notes are unsecured obligations that rank equally with all of the Company’s other existing and future unsecured and unsubordinated debt. The Senior Notes due 2027 will mature on March 15, 2027. Interest on the notes is payable semi-annually in arrears on March 15 and September 15, commencing on September 15, 2017. The Company may redeem some or all of the Senior Notes due 2027 prior to March 15, 2022, at a price equal to 100% of the principal amount, plus accrued and unpaid interest, if any, to the date of redemption, and a "make-whole" premium; on or after this date, the Company may redeem all or any portion of the notes, at once or over time, at redemption prices specified in the indenture governing the notes, plus accrued and unpaid interest, if any, to the date of redemption. In addition, at any time prior to March 15, 2020, the Company may redeem up to a maximum of 40% of the aggregate principal amount of the Senior Notes due 2027 with the proceeds of certain equity offerings at a redemption price of 103.375% of the principal amount plus accrued and unpaid interest, if any, to the date of redemption. Costs of approximately $8.0 million associated with the issuance of the notes, representing underwriting fees and other expenses, were capitalized and will be amortized to interest expense over the term of the notes. Covenants. The indenture contains covenants that limit, among other things, the Company’s and certain of the Company’s subsidiaries’ ability to incur additional debt, pay dividends or make other restricted payments, consummate specified asset sales, enter into transactions with affiliates, incur liens, impose restrictions on the ability of its subsidiaries to pay dividends or make payments to the Company and its restricted subsidiaries, merge or consolidate with another person, and sell, assign, transfer, lease convey or otherwise dispose of all or substantially all of the Company’s assets or the assets or its subsidiaries. The indenture provides for customary events of default (subject in certain cases to customary grace and cure periods), which include payment failures, failure to comply with covenants, failure to satisfy other obligations under the agreement or related documents, defaults in respect of other indebtedness, bankruptcy, insolvency and ability to pay debts when due, material judgments, pension plan terminations or specified underfunding, and substantial stock ownership changes. Generally, if an event of default occurs, the trustee under the indenture or holders of the Senior Notes due 2027 may declare all the Senior Notes due 2027 to be due and payable immediately. Upon the occurrence of a change in control (as defined in the indenture), each holder of notes may require the Company to repurchase all or a portion of the notes in cash at a price equal to 101% of the principal amount of notes to be repurchased, plus accrued and unpaid interest, if any, thereon to the date of purchase. Use of Proceeds and Loss on Early Extinguishment of Debt. On March 3, 2017 , the Company completed a cash tender offer for $370.3 million of the 6.875% Senior Notes due 2022 and the remaining $154.7 million was called on March 31, 2017 for redemption on May 1, 2017 . The tender offer and redemption, as well as underwriting fees associated with the new issuance, were primarily funded with the proceeds from the issuance of the Senior Notes due 2027, as well as cash on hand. The Company recorded a $22.8 million loss on early extinguishment of debt. The loss includes $21.9 million of tender and call premiums on the retired debt. Senior Revolving Credit Facility On May 23, 2017, the Company further amended its senior secured revolving credit facility to extend the term through May 2022. The terms of the amended and restated credit facility are similar to the terms under the previous version of the credit facility. The interest rate for borrowings under the credit facility was reduced from LIBOR plus 125 – 200 basis points to LIBOR plus 125 – 175 basis points, depending on borrowing base availability and the rate for undrawn availability was reduced from 25 – 30 basis points to 20 basis points. All other terms of the original credit agreement, including, without limitation, guarantees and security, covenants, events of default, have not been materially changed as a result of the amended and restated credit agreement and remain in full force and effect. Costs of approximately $2.4 million associated with the amendment of the revolving credit facility, representing underwriting fees and other expenses, were capitalized and will be amortized to interest expense over the term of the facility. The C ompany's unused availability under its senior secured revolving credit facility was $680.5 million at August 27, 2017 , as the Company's total availability of $726.1 million was reduced by $45.6 million of letters of credit and other credit usage allocated under the credit facility. Interest Rates on Borrowings The Company’s weighted-average interest rate on average borrowings outstanding during the three and nine months ended August 27, 2017 was 5.04% and 5.80% , respectively, as compared to 6.22% and 6.30% , respectively, in the same periods of 2016 . |
Employee Benefit Plans
Employee Benefit Plans | 9 Months Ended |
Aug. 27, 2017 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS The following tables summarize the components of net periodic benefit cost and the changes recognized in "Accumulated other comprehensive loss" for the Company’s defined benefit pension plans and postretirement benefit plans: Pension Benefits Postretirement Benefits Three Months Ended Three Months Ended August 27, August 28, August 27, August 28, (Dollars in thousands) Net periodic benefit cost: Service cost $ 2,510 $ 2,064 $ 43 $ 50 Interest cost 9,233 9,453 787 805 Expected return on plan assets (12,162 ) (12,105 ) — — Amortization of prior service benefit (16 ) (15 ) — — Amortization of actuarial loss 3,365 3,005 318 742 Curtailment loss (gain) 41 (361 ) — — Net settlement loss 19 21 — — Net periodic benefit cost 2,990 2,062 1,148 1,597 Changes in accumulated other comprehensive loss: Actuarial loss (7 ) — — — Amortization of prior service benefit 16 15 — — Amortization of actuarial loss (3,365 ) (3,005 ) (318 ) (742 ) Curtailment gain — 396 — — Net settlement loss (19 ) (21 ) — — Total recognized in accumulated other comprehensive loss (3,375 ) (2,615 ) (318 ) (742 ) Total recognized in net periodic benefit cost and accumulated other comprehensive loss $ (385 ) $ (553 ) $ 830 $ 855 Pension Benefits Postretirement Benefits Nine Months Ended Nine Months Ended August 27, August 28, August 27, August 28, (Dollars in thousands) Net periodic benefit cost: Service cost $ 7,452 $ 6,194 $ 129 $ 150 Interest cost 27,601 28,415 2,361 2,417 Expected return on plan assets (36,399 ) (36,401 ) — — Amortization of prior service benefit (46 ) (46 ) — — Amortization of actuarial loss 10,123 9,040 953 2,225 Curtailment loss (gain) 108 (361 ) — — Net settlement loss 113 21 — — Net periodic benefit cost 8,952 6,862 3,443 4,792 Changes in accumulated other comprehensive loss: Actuarial (gain) loss (10 ) 170 — — Amortization of prior service benefit 46 46 — — Amortization of actuarial loss (10,123 ) (9,040 ) (953 ) (2,225 ) Curtailment gain — 396 — — Net settlement loss (113 ) (21 ) — — Total recognized in accumulated other comprehensive loss (10,200 ) (8,449 ) (953 ) (2,225 ) Total recognized in net periodic benefit cost and accumulated other comprehensive loss $ (1,248 ) $ (1,587 ) $ 2,490 $ 2,567 |
Restructuring
Restructuring | 9 Months Ended |
Aug. 27, 2017 | |
Restructuring Liabilities Disclosures [Abstract] | |
Restructuring | RESTRUCTURING In 2016, the Company completed a global productivity initiative designed to streamline operations and fuel long-term profitable growth. The Company does not anticipate any significant additional costs associated with the global productivity initiative. For the three and nine months ended August 28, 2016 , the Company recognized net restructuring reversals of $0.6 million and charges of $1.0 million , respectively, and related charges of $1.3 million and $5.8 million , respectively. The net restructuring charges were recorded in "Restructuring, net" in the Company's consolidated statements of income. The related charges, which consist primarily of consulting fees for the Company's centrally-led cost-savings, productivity projects and transition-related projects, represented costs incurred associated with ongoing operations and thus were recorded in "Selling, general and administrative expenses" in the Company's consolidated statements of income. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Aug. 27, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Forward Foreign Exchange Contracts The Company uses over-the-counter derivative instruments to manage its exposure to foreign currencies. The Company is exposed to credit loss in the event of nonperformance by the counterparties to the forward foreign exchange contracts. However, the Company believes that its exposures are appropriately diversified across counterparties and that these counterparties are creditworthy financial institutions. See Note 3 for additional information. Other Contingencies Litigation. In the ordinary course of business, the Company has various pending cases involving contractual matters, facility and employee-related matters, distribution matters, product liability claims, trademark infringement and other matters. The Company does not believe any of these pending legal proceedings will have a material impact on its financial condition, results of operations or cash flows. |
Dividend
Dividend | 9 Months Ended |
Aug. 27, 2017 | |
Dividends [Abstract] | |
DIVIDEND | DIVIDEND In the first quarter of 2017, the Company's Board of Directors declared a cash dividend of $70 million , payable in two $35 million installments. The Company paid the first installment in the first quarter of 2017 . The second installment of $35 million is expected to be paid in the fourth quarter of 2017 based on the holders of record on October 6, 2017, and was recorded in "Other accrued liabilities" in the Company's consolidated balance sheets. The Company does not have an established dividend policy. The Company will continue to review its ability to pay cash dividends at least annually, and dividends may be declared at the discretion of the Company's Board of Directors depending upon, among other factors, the Company's financial condition and compliance with the terms of the Company's debt agreements. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 9 Months Ended |
Aug. 27, 2017 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | ACCUMULATED OTHER COMPREHENSIVE LOSS The following is a summary of the components of "Accumulated other comprehensive loss," net of related income taxes: August 27, November 27, (Dollars in thousands) Pension and postretirement benefits $ (244,982 ) $ (252,027 ) Net investment hedge losses (54,148 ) (18,757 ) Foreign currency translation losses (104,208 ) (149,065 ) Unrealized gains on marketable securities 3,290 1,968 Accumulated other comprehensive loss (400,048 ) (417,881 ) Accumulated other comprehensive income attributable to noncontrolling interest 9,334 9,433 Accumulated other comprehensive loss attributable to Levi Strauss & Co. $ (409,382 ) $ (427,314 ) No material amounts were reclassified out of "Accumulated other comprehensive loss" into net income other than those that pertain to the Company's pension and postretirement benefit plans. See Note 5 for additional information. These amounts are included in "Selling, general and administrative expenses" in the Company's consolidated statements of income. |
Other Income (Expense), Net
Other Income (Expense), Net | 9 Months Ended |
Aug. 27, 2017 | |
Other Income and Expenses [Abstract] | |
OTHER INCOME (EXPENSE), NET | OTHER INCOME (EXPENSE), NET The following table summarizes significant components of "Other income (expense), net": Three Months Ended Nine Months Ended August 27, August 28, August 27, August 28, (Dollars in thousands) Foreign exchange management losses (1) $ (19,147 ) $ (8,232 ) $ (44,521 ) $ (5,614 ) Foreign currency transaction gains (2) 1,163 9,496 7,216 5,690 Interest income 895 368 2,206 858 Investment income 287 268 629 976 Other, net 2,068 2,779 2,057 4,845 Total other income (expense), net $ (14,734 ) $ 4,679 $ (32,413 ) $ 6,755 _____________ (1) Gains and losses on forward foreign exchange contracts primarily result from currency fluctuations relative to negotiated contract rates. Losses in the three-month and nine-month periods ended August 27, 2017 were primarily due to unfavorable currency fluctuations relative to negotiated contract rates on positions to sell the Mexican Peso, the Euro and the Canadian dollar. (2) Foreign currency transaction gains and losses reflect the impact of foreign currency fluctuation on the Company's foreign currency denominated balances. Gains in the nine-month period ended August 27, 2017 were primarily due to the strengthening of the Mexican Peso and Euro against the US dollar. |
Income Taxes
Income Taxes | 9 Months Ended |
Aug. 27, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The effective income tax rate was 20.2% for the nine months ended August 27, 2017 , compared to 28.2% for the same period ended August 28, 2016 . The decrease in the effective tax rate in 2017 as compared to 2016 was primarily due to a discrete tax benefit related to the release of a valuation allowance on deferred tax assets of a foreign subsidiary, and a discrete tax benefit attributable to excess tax benefits on equity compensation. |
Related Parties
Related Parties | 9 Months Ended |
Aug. 27, 2017 | |
Related Party Transactions [Abstract] | |
RELATED PARTIES | RELATED PARTIES Charles V. Bergh, President and Chief Executive Officer, Peter E. Haas Jr., a director of the Company, and Kelly McGinnis, Senior Vice President of Corporate Affairs and Chief Communications Officer, are board members of the Levi Strauss Foundation, which is not a consolidated entity of the Company. Seth R. Jaffe, Senior Vice President and General Counsel, is Vice President of the Levi Strauss Foundation. During the three-month and nine-month periods ended August 27, 2017 , the Company donated $0.2 million and $6.9 million , respectively, to the Levi Strauss Foundation as compared to $0.3 million and $6.5 million for the same prior-year periods. |
Business Segment Information
Business Segment Information | 9 Months Ended |
Aug. 27, 2017 | |
Segment Reporting [Abstract] | |
BUSINESS SEGMENT INFORMATION | BUSINESS SEGMENT INFORMATION The Company manages its business according to three regional segments: the Americas, Europe and Asia. The Company considers its chief executive officer to be the Company’s chief operating decision maker. The Company’s chief operating decision maker manages business operations, evaluates performance and allocates resources based on the regional segments’ net revenues and operating income. Effective as of the beginning of 2017, certain of the Company's global expenses that support all regional segments, including global e-commerce infrastructure and global brand merchandising, marketing and design, previously recorded centrally in the Americas region segment and Corporate expenses, have now been allocated to the three regional business segments, and reported in operating results. Business segment information for the prior-year periods has been revised to reflect the change in presentation. Business segment information for the Company is as follows: Three Months Ended Nine Months Ended August 27, August 28, August 27, August 28, (Dollars in thousands) Net revenues: Americas $ 738,687 $ 723,853 $ 1,918,657 $ 1,884,349 Europe 348,016 282,525 938,719 799,637 Asia 181,688 178,733 580,861 569,212 Total net revenues $ 1,268,391 $ 1,185,111 $ 3,438,237 $ 3,253,198 Operating income: Americas (1) $ 155,652 $ 156,388 $ 347,873 $ 341,251 Europe (2) 61,536 46,725 160,778 124,169 Asia 11,246 13,556 56,655 63,991 Regional operating income 228,434 216,669 565,306 529,411 Corporate: Restructuring, net — (627 ) — 1,030 Restructuring-related charges — 1,295 — 5,826 Other corporate staff costs and expenses (3) 82,114 71,093 247,995 203,022 Corporate expenses 82,114 71,761 247,995 209,878 Total operating income 146,320 144,908 317,311 319,533 Interest expense (14,476 ) (19,170 ) (52,305 ) (54,483 ) Loss on early extinguishment of debt — — (22,793 ) — Other (expense) income, net (14,734 ) 4,679 (32,413 ) 6,755 Income before income taxes $ 117,110 $ 130,417 $ 209,800 $ 271,805 _____________ (1) Included in Americas' operating income for the three and nine month periods ended August 28, 2016 is the recognition of approximately $7.0 million benefit from resolution of a vendor dispute and related reversal of liabilities recorded in a prior period. (2) Included in Europe's operating income for the nine month period ended August 28, 2016 is a gain of $6.1 million related to the sale-leaseback of the Company's distribution center in the United Kingdom in the second quarter of 2016. (3) Included in Corporate expenses for the three and nine month periods ended August 27, 2017 is the recognition of approximately $9.5 million and $8.3 million stock-based compensation expense related to prior periods, for the correction of the periods used for the recognition of expense associated with employees eligible to vest awards after retirement. |
Significant Accounting Polici20
Significant Accounting Policies (Policies) | 9 Months Ended |
Aug. 27, 2017 | |
Accounting Policies [Abstract] | |
Basis of accounting | The unaudited consolidated financial statements of the Company and its wholly-owned and majority-owned foreign and domestic subsidiaries are prepared in conformity with generally accepted accounting principles in the United States ("U.S. GAAP") for interim financial information. |
Consolidated entities policy | The unaudited consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany transactions have been eliminated. |
Fiscal period | The Company’s fiscal year ends on the last Sunday of November in each year, although the fiscal years of certain foreign subsidiaries end on November 30. Each quarter of both fiscal years 2017 and 2016 consists of 13 weeks. All references to years relate to fiscal years rather than calendar years. |
Subsequent events | Subsequent events have been evaluated through the issuance date of these financial statements. |
Reclassifications | Certain amounts in Note 13 "Business Segment Information" have been conformed to the August 27, 2017 presentation. Effective as of the beginning of 2017, certain of our global expenses that support all of our regional segments, including global e-commerce infrastructure and global brand merchandising, marketing and design, previously recorded centrally in our Americas region segment and Corporate expenses, have now been allocated to our three regional business segments, and reported in their operating results. Business segment information for the prior-year period has been revised to reflect this change in presentation. |
Use of estimates | The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the related notes to the consolidated financial statements. Estimates are based upon historical factors, current circumstances and the experience and judgment of the Company’s management. Management evaluates its estimates and assumptions on an ongoing basis and may employ outside experts to assist in its evaluations. Changes in such estimates, based on more accurate future information, or different assumptions or conditions, may affect amounts reported in future periods. |
New accounting pronouncements | There have been no developments to recently issued accounting standards, including the expected dates of adoption and estimated effects on the Company’s consolidated financial statements and footnote disclosures, from those disclosed in the Company’s 2016 Annual Report on Form 10-K, except for the following, which have been grouped by their effective dates for the Company: First Quarter of 2019 • In March 2017, the FASB issued ASU 2017-07, Compensation-Retirement Benefits (Topic 715) Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU 2017-07 changes the income statement presentation of defined benefit plan expense by requiring separation between operating expense (service cost component) and non-operating expense (all other components, including interest cost, amortization of prior service cost, curtailments and settlements, etc.). The operating expense component is reported with similar compensation costs while the non-operating components are reported in Other Income and Expense. In addition, only the service cost component is eligible for capitalization as part of an asset such as inventory or property, plant and equipment. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements. • In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718) Scope of Modification Accounting. ASU 2017-09 provides clarification on when modification accounting should be used for changes to the terms or conditions of a share-based payment award. This ASU does not change the accounting for modifications but clarifies that modification accounting guidance should only be applied if there is a change to the value, vesting conditions, or award classification and would not be required if the changes are considered non-substantive. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements. • In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). ASU 2014-09 outlines a new, single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry specific guidance. This new revenue recognition model provides a five-step analysis in determining when and how revenue is recognized. The new model will require revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date . The amendment in this update defers the effective date of ASU 2014-09 for all entities by one year. Additional ASUs have been issued that are part of the overall new revenue guidance including: ASU 2016-08: Principal versus Agent Considerations (Reporting Revenue Gross versus Net) , ASU 2016-10: Identifying Performance Obligations and Licensing and ASU 2016-12: Narrow Scope Improvements and Practical Expedients. The Company is currently assessing the impact that adopting these new revenue accounting standards will have on its consolidated financial statements. First Quarter of 2020 • In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842 ) which requires the identification of arrangements that should be accounted for as leases by lessees. In general, for operating or financing lease arrangements exceeding a twelve month term, a right-of-use asset and a lease obligation will be recognized on the balance sheet of the lessee while the income statement will reflect lease expense for operating leases and amortization/interest expense for financing leases. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements. • In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815) Targeted Improvements to Accounting for Hedging Activities . ASU 2017-12 refines and expands hedge accounting for both financial and commodity risks. This ASU creates more transparency around how economic results are presented, both on the face of the financial statements and in the footnotes. In addition, this ASU makes certain targeted improvements to simplify the application of hedge accounting guidance. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements. First Quarter of 2021 • In January 2017, the FASB issued ASU 2017-04, Intangibles-Goodwill and Other (Topic 350) Simplifying the Test for Goodwill Impairment. ASU 2017-04 eliminates the two-step process that required identification of potential impairment and a separate measure of the actual impairment. The annual assessment of goodwill impairment will be determined by using the difference between the carrying amount and the fair value of the reporting unit. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements. |
Fair Value of Financial Instr21
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Aug. 27, 2017 | |
Fair Value Disclosures [Abstract] | |
Financial assets and liabilities carried at fair value | The following table presents the Company’s financial instruments that are carried at fair value: August 27, 2017 November 27, 2016 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 $ 29,912 $ 29,912 $ — $ 27,131 $ 27,131 $ — Forward foreign exchange contracts, net (3) 3,982 — 3,982 23,267 — 23,267 Total $ 33,894 $ 29,912 $ 3,982 $ 50,398 $ 27,131 $ 23,267 Financial liabilities carried at fair value Forward foreign exchange contracts, net (3) $ 30,916 $ — $ 30,916 $ 5,533 $ — $ 5,533 _____________ (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. |
Financial liabilities carried at adjusted historical cost | The following table presents the carrying value, including related accrued interest, and estimated fair value of the Company’s financial instruments that are carried at adjusted historical cost: August 27, 2017 November 27, 2016 Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value (Dollars in thousands) Financial liabilities carried at adjusted historical cost 6.875% senior notes due 2022 (1)(2) $ — $ — $ 527,102 $ 550,700 5.00% senior notes due 2025 (1) 491,343 515,504 483,735 480,121 3.375% senior notes due 2027 (1)(2) 561,547 579,016 — — Short-term borrowings 33,689 33,689 39,009 39,009 Total $ 1,086,579 $ 1,128,209 $ 1,049,846 $ 1,069,830 _____________ (1) Fair values are estimated using Level 1 inputs and incorporate mid-market price quotes. 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. |
Derivative Instruments and He22
Derivative Instruments and Hedging Activities (Tables) | 9 Months Ended |
Aug. 27, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Carrying values of derivative instruments and non-derivative instruments | The table below provides data about the carrying values of derivative instruments and non-derivative instruments: August 27, 2017 November 27, 2016 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) $ 3,989 $ (7 ) $ 3,982 $ 30,160 $ (6,893 ) $ 23,267 Forward foreign exchange contracts (2) 6,117 (37,033 ) (30,916 ) 1,481 (7,014 ) (5,533 ) Total $ 10,106 $ (37,040 ) $ 31,641 $ (13,907 ) Non-derivatives designated as hedging instruments Euro senior notes $ — $ (560,405 ) $ — $ — _____________ (1) Included in “Other current assets” or “Other non-current assets” on the Company’s consolidated balance sheets. (2) Included in “Other accrued liabilities” or "Other long-term liabilities" on the Company’s consolidated balance sheets. |
Offsetting assets and liabilities | 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 and are offset accordingly. The table below presents the gross and net amounts of these contracts recognized on the Company's consolidated balance sheets by type of financial instrument: August 27, 2017 November 27, 2016 Gross Amounts of Recognized Assets / (Liabilities) Gross Amounts Offset in the Balance Sheet Net Amounts of Assets / (Liabilities) Presented in the Balance Sheet Gross Amounts of Recognized Assets / (Liabilities) Gross Amounts Offset in the Balance Sheet Net Amounts of Assets / (Liabilities) Presented in the Balance Sheet (Dollars in thousands) Over-the-counter forward foreign exchange contracts Financial assets $ 6,335 $ (6,124 ) $ 211 $ 29,240 $ (8,374 ) $ 20,866 Financial liabilities (34,786 ) 6,124 (28,662 ) (10,365 ) 8,374 (1,991 ) Total $ (28,451 ) $ 18,875 Embedded derivative contracts Financial assets $ 3,771 $ — $ 3,771 $ 2,401 $ — $ 2,401 Financial liabilities (2,254 ) — (2,254 ) (3,542 ) — (3,542 ) Total $ 1,517 $ (1,141 ) |
Gains and losses included in AOCI | The table below provides data about the amount of gains and losses related to derivative instruments and non-derivative instruments designated as net investment hedges included in "Accumulated other comprehensive loss" ("AOCI") on the Company’s consolidated balance sheets, and in "Other income (expense), net" in the Company's consolidated statements of income: 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 27, November 27, August 27, August 28, August 27, August 28, (Dollars in thousands) Forward foreign exchange contracts $ 4,637 $ 4,637 Yen-denominated Eurobonds (19,811 ) (19,811 ) $ — $ (2,546 ) $ — $ (5,441 ) Euro-denominated senior notes (73,321 ) (15,751 ) — — — — Cumulative income taxes 34,347 12,168 Total $ (54,148 ) $ (18,757 ) |
Gains and losses included in statements of income | The table below provides data about the amount of gains and losses related to derivatives not designated as hedging instruments included in "Other income (expense), net" in the Company's consolidated statements of income: Three Months Ended Nine Months Ended August 27, August 28, August 27, August 28, (Dollars in thousands) Forward foreign exchange contracts: Realized (loss) gain $ (3,894 ) $ 4,531 $ 184 $ 21,418 Unrealized loss (15,253 ) (12,763 ) (44,705 ) (27,032 ) Total $ (19,147 ) $ (8,232 ) $ (44,521 ) $ (5,614 ) |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Aug. 27, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of long-term and short-term debt instruments | August 27, November 27, (Dollars in thousands) Long-term debt 6.875% senior notes due 2022 $ — $ 524,396 5.00% senior notes due 2025 483,219 481,860 3.375% senior notes due 2027 552,626 — Total long-term debt $ 1,035,845 $ 1,006,256 Short-term debt Short-term borrowings $ 33,430 $ 38,922 Total debt $ 1,069,275 $ 1,045,178 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 9 Months Ended |
Aug. 27, 2017 | |
Retirement Benefits [Abstract] | |
Schedule of defined benefit plans disclosures | The following tables summarize the components of net periodic benefit cost and the changes recognized in "Accumulated other comprehensive loss" for the Company’s defined benefit pension plans and postretirement benefit plans: Pension Benefits Postretirement Benefits Three Months Ended Three Months Ended August 27, August 28, August 27, August 28, (Dollars in thousands) Net periodic benefit cost: Service cost $ 2,510 $ 2,064 $ 43 $ 50 Interest cost 9,233 9,453 787 805 Expected return on plan assets (12,162 ) (12,105 ) — — Amortization of prior service benefit (16 ) (15 ) — — Amortization of actuarial loss 3,365 3,005 318 742 Curtailment loss (gain) 41 (361 ) — — Net settlement loss 19 21 — — Net periodic benefit cost 2,990 2,062 1,148 1,597 Changes in accumulated other comprehensive loss: Actuarial loss (7 ) — — — Amortization of prior service benefit 16 15 — — Amortization of actuarial loss (3,365 ) (3,005 ) (318 ) (742 ) Curtailment gain — 396 — — Net settlement loss (19 ) (21 ) — — Total recognized in accumulated other comprehensive loss (3,375 ) (2,615 ) (318 ) (742 ) Total recognized in net periodic benefit cost and accumulated other comprehensive loss $ (385 ) $ (553 ) $ 830 $ 855 Pension Benefits Postretirement Benefits Nine Months Ended Nine Months Ended August 27, August 28, August 27, August 28, (Dollars in thousands) Net periodic benefit cost: Service cost $ 7,452 $ 6,194 $ 129 $ 150 Interest cost 27,601 28,415 2,361 2,417 Expected return on plan assets (36,399 ) (36,401 ) — — Amortization of prior service benefit (46 ) (46 ) — — Amortization of actuarial loss 10,123 9,040 953 2,225 Curtailment loss (gain) 108 (361 ) — — Net settlement loss 113 21 — — Net periodic benefit cost 8,952 6,862 3,443 4,792 Changes in accumulated other comprehensive loss: Actuarial (gain) loss (10 ) 170 — — Amortization of prior service benefit 46 46 — — Amortization of actuarial loss (10,123 ) (9,040 ) (953 ) (2,225 ) Curtailment gain — 396 — — Net settlement loss (113 ) (21 ) — — Total recognized in accumulated other comprehensive loss (10,200 ) (8,449 ) (953 ) (2,225 ) Total recognized in net periodic benefit cost and accumulated other comprehensive loss $ (1,248 ) $ (1,587 ) $ 2,490 $ 2,567 |
Accumulated Other Comprehensi25
Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Aug. 27, 2017 | |
Equity [Abstract] | |
Schedule of accumulated other comprehensive loss | The following is a summary of the components of "Accumulated other comprehensive loss," net of related income taxes: August 27, November 27, (Dollars in thousands) Pension and postretirement benefits $ (244,982 ) $ (252,027 ) Net investment hedge losses (54,148 ) (18,757 ) Foreign currency translation losses (104,208 ) (149,065 ) Unrealized gains on marketable securities 3,290 1,968 Accumulated other comprehensive loss (400,048 ) (417,881 ) Accumulated other comprehensive income attributable to noncontrolling interest 9,334 9,433 Accumulated other comprehensive loss attributable to Levi Strauss & Co. $ (409,382 ) $ (427,314 ) |
Other Income (Expense), Net (Ta
Other Income (Expense), Net (Tables) | 9 Months Ended |
Aug. 27, 2017 | |
Other Income and Expenses [Abstract] | |
Schedule of other nonoperating income (expense) | The following table summarizes significant components of "Other income (expense), net": Three Months Ended Nine Months Ended August 27, August 28, August 27, August 28, (Dollars in thousands) Foreign exchange management losses (1) $ (19,147 ) $ (8,232 ) $ (44,521 ) $ (5,614 ) Foreign currency transaction gains (2) 1,163 9,496 7,216 5,690 Interest income 895 368 2,206 858 Investment income 287 268 629 976 Other, net 2,068 2,779 2,057 4,845 Total other income (expense), net $ (14,734 ) $ 4,679 $ (32,413 ) $ 6,755 _____________ (1) Gains and losses on forward foreign exchange contracts primarily result from currency fluctuations relative to negotiated contract rates. Losses in the three-month and nine-month periods ended August 27, 2017 were primarily due to unfavorable currency fluctuations relative to negotiated contract rates on positions to sell the Mexican Peso, the Euro and the Canadian dollar. (2) Foreign currency transaction gains and losses reflect the impact of foreign currency fluctuation on the Company's foreign currency denominated balances. Gains in the nine-month period ended August 27, 2017 were primarily due to the strengthening of the Mexican Peso and Euro against the US dollar. |
Business Segment Information (T
Business Segment Information (Tables) | 9 Months Ended |
Aug. 27, 2017 | |
Segment Reporting [Abstract] | |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | Business segment information for the Company is as follows: Three Months Ended Nine Months Ended August 27, August 28, August 27, August 28, (Dollars in thousands) Net revenues: Americas $ 738,687 $ 723,853 $ 1,918,657 $ 1,884,349 Europe 348,016 282,525 938,719 799,637 Asia 181,688 178,733 580,861 569,212 Total net revenues $ 1,268,391 $ 1,185,111 $ 3,438,237 $ 3,253,198 Operating income: Americas (1) $ 155,652 $ 156,388 $ 347,873 $ 341,251 Europe (2) 61,536 46,725 160,778 124,169 Asia 11,246 13,556 56,655 63,991 Regional operating income 228,434 216,669 565,306 529,411 Corporate: Restructuring, net — (627 ) — 1,030 Restructuring-related charges — 1,295 — 5,826 Other corporate staff costs and expenses (3) 82,114 71,093 247,995 203,022 Corporate expenses 82,114 71,761 247,995 209,878 Total operating income 146,320 144,908 317,311 319,533 Interest expense (14,476 ) (19,170 ) (52,305 ) (54,483 ) Loss on early extinguishment of debt — — (22,793 ) — Other (expense) income, net (14,734 ) 4,679 (32,413 ) 6,755 Income before income taxes $ 117,110 $ 130,417 $ 209,800 $ 271,805 _____________ (1) Included in Americas' operating income for the three and nine month periods ended August 28, 2016 is the recognition of approximately $7.0 million benefit from resolution of a vendor dispute and related reversal of liabilities recorded in a prior period. (2) Included in Europe's operating income for the nine month period ended August 28, 2016 is a gain of $6.1 million related to the sale-leaseback of the Company's distribution center in the United Kingdom in the second quarter of 2016. (3) Included in Corporate expenses for the three and nine month periods ended August 27, 2017 is the recognition of approximately $9.5 million and $8.3 million stock-based compensation expense related to prior periods, for the correction of the periods used for the recognition of expense associated with employees eligible to vest awards after retirement. |
Significant Accounting Polici28
Significant Accounting Policies Significant Accounting Policies (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 27, 2017USD ($) | Aug. 28, 2016USD ($) | Aug. 27, 2017USD ($)Regional_Segments | Aug. 28, 2016USD ($) | |
Accounting Policies [Abstract] | ||||
Number of operating segments | Regional_Segments | 3 | |||
Income tax benefit realized from exercise of stock options | $ 6,000 | |||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Selling, general and administrative expenses | $ 510,309 | $ 448,525 | 1,462,263 | $ 1,349,039 |
Net income | 87,992 | $ 98,318 | 165,651 | $ 194,879 |
Restatement Adjustment [Member] | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Selling, general and administrative expenses | 9,500 | 8,300 | ||
Net income | $ (5,800) | $ (5,100) |
Fair Value of Financial Instr29
Fair Value of Financial Instruments-Fair Value (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Aug. 27, 2017 | Nov. 27, 2016 | |
Financial assets carried at fair value | |||
Rabbi trust assets | $ 29,912 | $ 27,131 | |
Forward foreign exchange contracts, net | [1] | 3,982 | 23,267 |
Total | 33,894 | 50,398 | |
Financial liabilities carried at fair value | |||
Forward foreign exchange contracts, net | [1] | 30,916 | 5,533 |
Level 1 Inputs [Member] | |||
Financial assets carried at fair value | |||
Rabbi trust assets | [2] | 29,912 | 27,131 |
Forward foreign exchange contracts, net | [1],[2] | 0 | 0 |
Total | [2] | 29,912 | 27,131 |
Financial liabilities carried at fair value | |||
Forward foreign exchange contracts, net | [1],[2] | 0 | 0 |
Level 2 Inputs [Member] | |||
Financial assets carried at fair value | |||
Rabbi trust assets | [3] | 0 | 0 |
Forward foreign exchange contracts, net | [1],[3] | 3,982 | 23,267 |
Total | [3] | 3,982 | 23,267 |
Financial liabilities carried at fair value | |||
Forward foreign exchange contracts, net | [1],[3] | $ 30,916 | $ 5,533 |
[1] | 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. | ||
[2] | 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. | ||
[3] | 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. |
Fair Value of Financial Instr30
Fair Value of Financial Instruments-Adjusted Historical Cost (Details) $ in Thousands, € in Millions | May 01, 2017USD ($) | Mar. 03, 2017USD ($) | Aug. 27, 2017USD ($) | Feb. 28, 2017EUR (€) | Nov. 27, 2016USD ($) | |
Senior notes [Member] | 6.875% senior notes due 2022 [Member] | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Stated interest rate | 6.875% | 6.875% | ||||
Extinguishment of debt | $ 154,700 | $ 370,300 | ||||
Senior notes [Member] | 5.00% Senior Notes, Due 2025 [Member] | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Stated interest rate | 5.00% | |||||
Senior notes [Member] | 3.375% Senior Notes Due 2027 [Member] | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Debt instrument, face amount | € | € 475 | |||||
Stated interest rate | 3.375% | 3.375% | ||||
Fair Value, Measurements, Recurring [Member] | Carrying Value [Member] | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Short-term debt carried at adjusted historical cost | $ 33,689 | $ 39,009 | ||||
Total financial liabilities carried at adjusted historical cost | 1,086,579 | 1,049,846 | ||||
Fair Value, Measurements, Recurring [Member] | Carrying Value [Member] | Senior notes [Member] | 6.875% senior notes due 2022 [Member] | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Long-term debt carried at adjusted historical cost | [1],[2] | 0 | 527,102 | |||
Fair Value, Measurements, Recurring [Member] | Carrying Value [Member] | Senior notes [Member] | 5.00% Senior Notes, Due 2025 [Member] | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Long-term debt carried at adjusted historical cost | [1] | 491,343 | 483,735 | |||
Fair Value, Measurements, Recurring [Member] | Carrying Value [Member] | Senior notes [Member] | 3.375% Senior Notes Due 2027 [Member] | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Long-term debt carried at adjusted historical cost | [1],[2] | 561,547 | 0 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value [Member] | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Short-term debt carried at adjusted historical cost | 33,689 | 39,009 | ||||
Total financial liabilities carried at adjusted historical cost | 1,128,209 | 1,069,830 | ||||
Fair Value, Measurements, Recurring [Member] | Fair Value [Member] | Senior notes [Member] | 6.875% senior notes due 2022 [Member] | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Long-term debt carried at adjusted historical cost | [1],[2] | 0 | 550,700 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value [Member] | Senior notes [Member] | 5.00% Senior Notes, Due 2025 [Member] | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Long-term debt carried at adjusted historical cost | [1] | 515,504 | 480,121 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value [Member] | Senior notes [Member] | 3.375% Senior Notes Due 2027 [Member] | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Long-term debt carried at adjusted historical cost | [1],[2] | $ 579,016 | $ 0 | |||
[1] | Fair values are estimated using Level 1 inputs and incorporate mid-market price quotes. 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. | |||||
[2] | On February 28, 2017, the Company issued €475 million in aggregate principal amount of 3.375% senior notes due 2027. On March 3, 2017, the Company completed a cash tender offer for $370.3 million of the 6.875% senior notes due 2022 and the remaining $154.7 million was called on March 31, 2017 for redemption on May 1, 2017. See Note 4 for additional information. |
Derivative Instruments and He31
Derivative Instruments and Hedging Activities-Balance Sheet (Details) - USD ($) $ in Thousands | Aug. 27, 2017 | Nov. 27, 2016 | |
Forward foreign exchange contracts [Member] | |||
Carrying Value, Balance Sheet Location By Contract Type, By Hedging Designation [Line Items] | |||
Derivative asset, gross asset | $ 6,335 | $ 29,240 | |
Derivative asset, gross liability | (6,124) | (8,374) | |
Derivative asset, net | 211 | 20,866 | |
Derivative liability, gross asset | 6,124 | 8,374 | |
Derivative Liability, gross liability | (34,786) | (10,365) | |
Derivative Liability, net | (28,662) | (1,991) | |
Derivative, Fair Value, Net | (28,451) | 18,875 | |
Embedded Derivative Financial Instruments [Member] | |||
Carrying Value, Balance Sheet Location By Contract Type, By Hedging Designation [Line Items] | |||
Derivative asset, gross asset | 3,771 | 2,401 | |
Derivative asset, gross liability | 0 | 0 | |
Derivative asset, net | 3,771 | 2,401 | |
Derivative liability, gross asset | 0 | 0 | |
Derivative Liability, gross liability | (2,254) | (3,542) | |
Derivative Liability, net | (2,254) | (3,542) | |
Derivative, Fair Value, Net | 1,517 | (1,141) | |
Carrying Value [Member] | Forward foreign exchange contracts [Member] | |||
Carrying Value, Balance Sheet Location By Contract Type, By Hedging Designation [Line Items] | |||
Derivative asset, net | 10,106 | 31,641 | |
Derivative Liability, net | (37,040) | (13,907) | |
Carrying Value [Member] | Other assets [Member] | Forward foreign exchange contracts [Member] | |||
Carrying Value, Balance Sheet Location By Contract Type, By Hedging Designation [Line Items] | |||
Derivative asset, gross asset | [1] | 3,989 | 30,160 |
Derivative asset, gross liability | [1] | (7) | (6,893) |
Derivative asset, Net Carrying Value | [1] | 3,982 | 23,267 |
Carrying Value [Member] | Other accrued liabilities [Member] | Forward foreign exchange contracts [Member] | |||
Carrying Value, Balance Sheet Location By Contract Type, By Hedging Designation [Line Items] | |||
Derivative liability, gross asset | [2] | 6,117 | 1,481 |
Derivative Liability, gross liability | [2] | (37,033) | (7,014) |
Derivative liability, Net Carrying Value | [2] | (30,916) | (5,533) |
Bonds [Member] | Yen-denominated Eurobonds [Member] | Carrying Value [Member] | |||
Carrying Value, Balance Sheet Location By Contract Type, By Hedging Designation [Line Items] | |||
Hedging assets | 0 | 0 | |
Hedging liabilities | 560,405 | $ 0 | |
Long [Member] | |||
Carrying Value, Balance Sheet Location By Contract Type, By Hedging Designation [Line Items] | |||
Forward foreign exchange contracts | 746,300 | ||
Short [Member] | |||
Carrying Value, Balance Sheet Location By Contract Type, By Hedging Designation [Line Items] | |||
Forward foreign exchange contracts | $ 314,600 | ||
[1] | Included in “Other current assets” or “Other non-current assets” on the Company’s consolidated balance sheets. | ||
[2] | Included in “Other accrued liabilities” or "Other long-term liabilities" on the Company’s consolidated balance sheets. |
Derivative Instruments and He32
Derivative Instruments and Hedging Activities-Income Statement (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Aug. 27, 2017 | Aug. 28, 2016 | Aug. 27, 2017 | Aug. 28, 2016 | Nov. 27, 2016 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Cumulative income taxes, gain or (loss) recognized in AOCI | $ 34,347 | $ 34,347 | $ 12,168 | ||
Total, gain or (loss) recognized in AOCI | (54,148) | (54,148) | (18,757) | ||
Forward foreign exchange contracts [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Forward foreign exchange contracts, gain of (loss) recognized in AOCI | 4,637 | 4,637 | 4,637 | ||
Yen-denominated Eurobonds [Member] | Bonds [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Non-derivative hedging instruments-gain or (loss) recognized in AOCI | (19,811) | (19,811) | (19,811) | ||
Non-derivative hedging instruments-gain or (loss) recognized in other income | 0 | $ (2,546) | 0 | $ (5,441) | |
Euro Senior Notes [Member] | Senior notes [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Non-derivative hedging instruments-gain or (loss) recognized in AOCI | (73,321) | (73,321) | $ (15,751) | ||
Non-derivative hedging instruments-gain or (loss) recognized in other income | $ 0 | $ 0 | $ 0 | $ 0 |
Derivative Instruments and He33
Derivative Instruments and Hedging Activities-Realized & Unrealized (Details) - Forward foreign exchange contracts [Member] - Other Income [Member] - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 27, 2017 | Aug. 28, 2016 | Aug. 27, 2017 | Aug. 28, 2016 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Realized | $ (3,894) | $ 4,531 | $ 184 | $ 21,418 |
Unrealized | (15,253) | (12,763) | (44,705) | (27,032) |
Total | $ (19,147) | $ (8,232) | $ (44,521) | $ (5,614) |
Debt-Table (Details)
Debt-Table (Details) - USD ($) $ in Thousands | Aug. 27, 2017 | Mar. 03, 2017 | Feb. 28, 2017 | Nov. 27, 2016 |
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Long-term Debt, Excluding Current Maturities | $ 1,035,845 | $ 1,006,256 | ||
Long-term debt | 1,035,845 | 1,006,256 | ||
Short-term debt | 33,430 | 38,922 | ||
Long-term and short-term debt | 1,069,275 | 1,045,178 | ||
6.875% senior notes due 2022 [Member] | Senior notes [Member] | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Long-term Debt, Excluding Current Maturities | $ 0 | 524,396 | ||
Stated interest rate | 6.875% | 6.875% | ||
5.00% Senior Notes, Due 2025 [Member] | Senior notes [Member] | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Long-term Debt, Excluding Current Maturities | $ 483,219 | 481,860 | ||
Stated interest rate | 5.00% | |||
3.375% Senior Notes Due 2027 [Member] | Senior notes [Member] | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Long-term Debt, Excluding Current Maturities | $ 552,626 | 0 | ||
Stated interest rate | 3.375% | 3.375% | ||
Short-term borrowings [Member] | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Short-term debt | $ 33,430 | $ 38,922 |
Debt-Textuals (Details)
Debt-Textuals (Details) $ in Thousands, € in Millions | Mar. 15, 2020 | May 23, 2017USD ($) | May 01, 2017USD ($) | Mar. 03, 2017USD ($) | Feb. 28, 2017USD ($) | Aug. 27, 2017USD ($) | Aug. 28, 2016USD ($) | Aug. 27, 2017USD ($) | Aug. 28, 2016USD ($) | Mar. 15, 2022 | Feb. 28, 2017EUR (€) |
Debt Instruments [Line Items] | |||||||||||
Loss on early extinguishment of debt | $ 0 | $ 0 | $ 22,793 | $ 0 | |||||||
Weighted-average interest rate | 5.04% | 6.22% | 5.80% | 6.30% | |||||||
Senior revolving credit facility [Member] | |||||||||||
Debt Instruments [Line Items] | |||||||||||
Debt issuance costs | $ 2,400 | ||||||||||
Rate for undrawn availability | 0.20% | ||||||||||
Unused availability | $ 680,500 | $ 680,500 | |||||||||
Total availability | 726,100 | 726,100 | |||||||||
Letters of credit and other credit usage | $ 45,600 | $ 45,600 | |||||||||
Senior revolving credit facility [Member] | Minimum [Member] | |||||||||||
Debt Instruments [Line Items] | |||||||||||
Rate for undrawn availability | 0.25% | ||||||||||
Senior revolving credit facility [Member] | Maximum [Member] | |||||||||||
Debt Instruments [Line Items] | |||||||||||
Rate for undrawn availability | 0.30% | ||||||||||
Senior revolving credit facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | |||||||||||
Debt Instruments [Line Items] | |||||||||||
Basis spread on variable rate | 1.25% | ||||||||||
Senior revolving credit facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | |||||||||||
Debt Instruments [Line Items] | |||||||||||
Basis spread on variable rate | 1.75% | ||||||||||
Senior revolving credit facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | Scenario, Previously Reported [Member] | |||||||||||
Debt Instruments [Line Items] | |||||||||||
Basis spread on variable rate | 2.00% | ||||||||||
3.375% Senior Notes Due 2027 [Member] | Senior notes [Member] | |||||||||||
Debt Instruments [Line Items] | |||||||||||
Debt instrument, face amount | € | € 475 | ||||||||||
Stated interest rate | 3.375% | 3.375% | 3.375% | 3.375% | |||||||
Debt issuance costs | $ 8,000 | ||||||||||
Redemption price as a result of a change in control (percent) | 101.00% | ||||||||||
3.375% Senior Notes Due 2027 [Member] | Senior notes [Member] | Scenario, Forecast [Member] | |||||||||||
Debt Instruments [Line Items] | |||||||||||
Issuance price percentage of face value if exercised | 100.00% | ||||||||||
Maximum potential redemption (percent) | 40.00% | ||||||||||
Redemption price (percent) | 103.375% | ||||||||||
6.875% senior notes due 2022 [Member] | Senior notes [Member] | |||||||||||
Debt Instruments [Line Items] | |||||||||||
Stated interest rate | 6.875% | 6.875% | 6.875% | ||||||||
Extinguishment of debt | $ 154,700 | $ 370,300 | |||||||||
Loss on extinguishment of debt, tender and call premiums | $ 21,900 | ||||||||||
5.00% Senior Notes, Due 2025 [Member] | Senior notes [Member] | |||||||||||
Debt Instruments [Line Items] | |||||||||||
Stated interest rate | 5.00% | 5.00% |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 27, 2017 | Aug. 28, 2016 | Aug. 27, 2017 | Aug. 28, 2016 | |
Pension Benefits [Member] | ||||
Net periodic benefit cost: | ||||
Service cost | $ 2,510 | $ 2,064 | $ 7,452 | $ 6,194 |
Interest cost | 9,233 | 9,453 | 27,601 | 28,415 |
Expected return on plan assets | (12,162) | (12,105) | (36,399) | (36,401) |
Amortization of prior service benefit | (16) | (15) | (46) | (46) |
Amortization of actuarial loss | 3,365 | 3,005 | 10,123 | 9,040 |
Curtailment loss (gain) | 41 | (361) | 108 | (361) |
Net settlement loss | 19 | 21 | 113 | 21 |
Net periodic benefit cost | 2,990 | 2,062 | 8,952 | 6,862 |
Changes in accumulated other comprehensive loss: | ||||
Actuarial loss | (7) | 0 | (10) | 170 |
Amortization of prior service benefit | 16 | 15 | 46 | 46 |
Amortization of actuarial loss | (3,365) | (3,005) | (10,123) | (9,040) |
Curtailment gain | 0 | 396 | 0 | 396 |
Net settlement loss | (19) | (21) | (113) | (21) |
Total recognized in accumulated other comprehensive loss | (3,375) | (2,615) | (10,200) | (8,449) |
Total recognized in net periodic benefit cost and accumulated other comprehensive loss | (385) | (553) | (1,248) | (1,587) |
Postretirement Benefits [Member] | ||||
Net periodic benefit cost: | ||||
Service cost | 43 | 50 | 129 | 150 |
Interest cost | 787 | 805 | 2,361 | 2,417 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Amortization of prior service benefit | 0 | 0 | 0 | 0 |
Amortization of actuarial loss | 318 | 742 | 953 | 2,225 |
Curtailment loss (gain) | 0 | 0 | 0 | 0 |
Net settlement loss | 0 | 0 | 0 | 0 |
Net periodic benefit cost | 1,148 | 1,597 | 3,443 | 4,792 |
Changes in accumulated other comprehensive loss: | ||||
Actuarial loss | 0 | 0 | 0 | 0 |
Amortization of prior service benefit | 0 | 0 | 0 | 0 |
Amortization of actuarial loss | (318) | (742) | (953) | (2,225) |
Curtailment gain | 0 | 0 | 0 | 0 |
Net settlement loss | 0 | 0 | 0 | 0 |
Total recognized in accumulated other comprehensive loss | (318) | (742) | (953) | (2,225) |
Total recognized in net periodic benefit cost and accumulated other comprehensive loss | $ 830 | $ 855 | $ 2,490 | $ 2,567 |
Restructuring-Textuals (Details
Restructuring-Textuals (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Aug. 27, 2017 | Aug. 28, 2016 | Aug. 27, 2017 | Aug. 28, 2016 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 0 | $ (627) | $ 0 | $ 1,030 |
Corporate and Other [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 0 | (627) | 0 | 1,030 |
Other general and administrative expense | $ 0 | $ 1,295 | $ 0 | $ 5,826 |
Dividend (Details)
Dividend (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Nov. 26, 2017USD ($) | Feb. 26, 2017USD ($)installment | Aug. 27, 2017USD ($) | Aug. 28, 2016USD ($) | |
Dividends Payable [Line Items] | ||||
Dividend declared | $ 70,000 | |||
Number of dividend installments | installment | 2 | |||
Dividend installments | $ 35,000 | |||
Dividend paid | $ 35,000 | $ 60,000 | ||
Scenario, Forecast [Member] | ||||
Dividends Payable [Line Items] | ||||
Dividend paid | $ 35,000 |
Accumulated Other Comprehensi39
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | Aug. 27, 2017 | Nov. 27, 2016 |
Equity [Abstract] | ||
Pension and postretirement benefits | $ (244,982) | $ (252,027) |
Net investment hedge losses | (54,148) | (18,757) |
Foreign currency translation losses | (104,208) | (149,065) |
Unrealized gains on marketable securities | 3,290 | 1,968 |
Accumulated other comprehensive loss | (400,048) | (417,881) |
Accumulated other comprehensive income attributable to noncontrolling interest | 9,334 | 9,433 |
Accumulated other comprehensive loss attributable to Levi Strauss & Co. | $ (409,382) | $ (427,314) |
Other Income (Expense), Net (De
Other Income (Expense), Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Aug. 27, 2017 | Aug. 28, 2016 | Aug. 27, 2017 | Aug. 28, 2016 | ||
Other Income and Expenses [Abstract] | |||||
Foreign exchange management gains (losses) | [1] | $ (19,147) | $ (8,232) | $ (44,521) | $ (5,614) |
Foreign currency transaction (losses) gains | [2] | 1,163 | 9,496 | 7,216 | 5,690 |
Interest income | 895 | 368 | 2,206 | 858 | |
Investment income | 287 | 268 | 629 | 976 | |
Other, net | 2,068 | 2,779 | 2,057 | 4,845 | |
Total other income (expense), net | $ (14,734) | $ 4,679 | $ (32,413) | $ 6,755 | |
[1] | Gains and losses on forward foreign exchange contracts primarily result from currency fluctuations relative to negotiated contract rates. Losses in the three-month and nine-month periods ended August 27, 2017 were primarily due to unfavorable currency fluctuations relative to negotiated contract rates on positions to sell the Mexican Peso, the Euro and the Canadian dollar. | ||||
[2] | Foreign currency transaction gains and losses reflect the impact of foreign currency fluctuation on the Company's foreign currency denominated balances. Gains in the nine-month period ended August 27, 2017 were primarily due to the strengthening of the Mexican Peso and Euro against the US dollar. |
Income Taxes (Details)
Income Taxes (Details) | 9 Months Ended | |
Aug. 27, 2017 | Aug. 28, 2016 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate | 20.20% | 28.20% |
Related Parties (Details)
Related Parties (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Aug. 27, 2017 | Aug. 28, 2016 | Aug. 27, 2017 | Aug. 28, 2016 | |
Levi Strauss Foundation [Member] | ||||
Related Party Transaction [Line Items] | ||||
Related Party Donations | $ 0.2 | $ 0.3 | $ 6.9 | $ 6.5 |
Business Segment Information (D
Business Segment Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Aug. 27, 2017USD ($) | Aug. 28, 2016USD ($) | Aug. 27, 2017USD ($)Regional_Segments | Aug. 28, 2016USD ($) | ||
Segment Reporting Information [Line Items] | |||||
Number of operating segments | Regional_Segments | 3 | ||||
Net revenues | $ 1,268,391 | $ 1,185,111 | $ 3,438,237 | $ 3,253,198 | |
Operating income | 146,320 | 144,908 | 317,311 | 319,533 | |
Restructuring charges | 0 | (627) | 0 | 1,030 | |
Interest expense | (14,476) | (19,170) | (52,305) | (54,483) | |
Loss on early extinguishment of debt | 0 | 0 | (22,793) | 0 | |
Other (expense) income, net | (14,734) | 4,679 | (32,413) | 6,755 | |
Income before income taxes | 117,110 | 130,417 | 209,800 | 271,805 | |
Benefit from resolution of vendor dispute and related reversal of liabilities recorded in prior period | 7,000 | 7,000 | |||
Restatement Adjustment [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Stock-based compensation expense related to prior periods | 9,500 | 8,300 | |||
Americas [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net revenues | 738,687 | 723,853 | 1,918,657 | 1,884,349 | |
Operating income | [1] | 155,652 | 156,388 | 347,873 | 341,251 |
Europe [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net revenues | 348,016 | 282,525 | 938,719 | 799,637 | |
Operating income | [2] | 61,536 | 46,725 | 160,778 | 124,169 |
Gain on sale-leaseback of distribution center | 6,100 | ||||
AMEA [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net revenues | 181,688 | 178,733 | 580,861 | 569,212 | |
Operating income | 11,246 | 13,556 | 56,655 | 63,991 | |
Regional operating income [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating income | 228,434 | 216,669 | 565,306 | 529,411 | |
Corporate and Other [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Restructuring charges | 0 | (627) | 0 | 1,030 | |
Other General and Administrative Expense | 0 | 1,295 | 0 | 5,826 | |
Other Selling, General and Administrative Expense | [3] | 82,114 | 71,093 | 247,995 | 203,022 |
Corporate Segment [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Corporate expenses | $ 82,114 | $ 71,761 | $ 247,995 | $ 209,878 | |
[1] | Included in Americas' operating income for the three and nine month periods ended August 28, 2016 is the recognition of approximately $7.0 million benefit from resolution of a vendor dispute and related reversal of liabilities recorded in a prior period. | ||||
[2] | Included in Europe's operating income for the nine month period ended August 28, 2016 is a gain of $6.1 million related to the sale-leaseback of the Company's distribution center in the United Kingdom in the second quarter of 2016. | ||||
[3] | Included in Corporate expenses for the three and nine month periods ended August 27, 2017 is the recognition of approximately $9.5 million and $8.3 million stock-based compensation expense related to prior periods, for the correction of the periods used for the recognition of expense associated with employees eligible to vest awards after retirement. |