Levi Strauss raises annual profit forecast following cost reductions; shares soar 7%

April 5, 2024

Levi Strauss increased its annual profit outlook on Wednesday, citing the apparel company’s recent cost reductions from workforce reductions and reduced markdowns on its jeans and denim apparel. This announcement boosted its shares by 7% in after-hours trading.

In an effort to reduce expenses, Levi’s has downsized its global corporate workforce and streamlined the number of senior leadership roles. Additionally, the company has consolidated its operations in Europe and discontinued lower-margin ventures, including its Denizen brand and European footwear business.

The apparel retailer recorded a restructuring charge of $116 million in the first quarter.

In the first quarter, Levi’s posted a loss of $10.6 million, equivalent to 3 cents per share, in contrast to a profit of $114.7 million, or 29 cents, recorded a year ago.

Continue Exploring: Levi’s revamps Kyoto store with NextGen concept, elevating denim shopping experience

However, during a call on Wednesday, Chief Financial Officer Harmit Singh expressed optimism, stating that the jeans maker is “feeling good” about a “more stable” U.S. consumer environment.

Sales of Levi’s clothing to consumers through its website and company-owned stores increased by 8% on a constant-currency basis, following a 10% rise in the previous quarter.

However, sales for Levi’s through its significant wholesale channels, including department stores like Macy’s and Kohl’s, as well as other retailers like Walmart, declined by 19% on a constant-currency basis. This decline was more pronounced compared to a 3% decrease in the fourth quarter.

Amid persistent inflation causing shoppers to spend less on clothing, many retailers carrying Levi’s jeans have reduced their orders to maintain leaner inventories.

According to Singh, Levi’s plans to implement similar measures and reduce its stock-keeping units.

“We’re getting ready to cut about 15% of our SKUs and concentrate on expanding products that are truly popular with customers,” Singh said. “Currently, the baggier fit and the low, loose assortment seem to be particularly resonating with customers.”

Increased full-price sales and decreased product costs resulted in Levi’s gross margins climbing by 240 basis points to 58.2% in the first quarter, up from 55.8% a year earlier.

However, the San Francisco-based company stated that it still anticipates full-year revenue growth to be in the range of 1% to 3%.

The denim manufacturer anticipates an adjusted profit ranging from $1.17 to $1.27 per share for 2024, an increase from its previous forecast of $1.15 to $1.25. Analysts had predicted a profit of $1.21 per share.

Its net revenue declined by approximately 7.8% to $1.56 billion for the quarter ended February 25, slightly surpassing the estimated $1.55 billion, as per LSEG data.

Continue Exploring: California lifestyle apparel brand Dockers makes big bet on Indian market, plans five store openings in first year

Former Starbucks CEO Howard Schultz acquires minority stake in Tony’s Chocolonely

SnackTeam

April 5, 2024

Former Starbucks CEO, Howard Schultz, has acquired a minority stake in the Dutch chocolate company, Tony’s Chocolonely.

Schultz made his investment “recently,” the company announced in a statement.

The support comes after a successful €20 million ($21.7 million) fundraising round last June, with continued backing from existing investors such as Verlinvest and JamJar Investment. Both investors increased their stakes in the group during this round.

Tony’s Chocolonely opted not to disclose the total amount of funds it has raised to date.

Continue Exploring: Starbucks reports robust 22% sales growth in the UK, plans to open 100 more stores

Regarding Schultz’s investment, Douglas Lamont, the CEO of Tony’s Chocolonely, stated, “We are proud to have Howard Schultz as an investor in our company and eagerly anticipate benefiting from his vast experience in building a global consumer brand and company.”

“Tony’s swift revenue growth, growing appeal among U.S. consumers, and heightened investor interest illustrate that creating a company that balances shareholder returns with its impact on people and the planet is not only the right thing to do but also a smart strategy for modern businesses.”

The group plans to utilize the recent investment to enhance its “U.S. production capabilities” at its Chicago factory, which commenced operations in June of last year.

Tony’s Chocolonely intends to use the funds to further the brand’s expansion in the U.S. and to support the growth of “Tony’s Open Chain,” their business-to-business bean-sourcing operation, the company stated.

The chocolate bar producer also owns a facility in Belgium, which it acquired in 2021.

When inquired about the business’s plans for growth in the U.S. in 2024, Tony’s indicated a focus on “local production” and highlighted their “first year partnering with Walmart.”

Tony’s Chocolonely bars are now available in over 4,000 Walmart stores across the U.S., marking a 20% increase in store presence compared to 2023, the group announced.

Continue Exploring: Starbucks CEO bullish on India’s coffee market, targets 1000 cafes by 2028

The company will now be available in 31,000 points of sale across the country, including retailers like Whole Foods Market, Safeway, CVS, and Target.

Regarding the U.S. expansion, Lamont remarked, “We are immensely proud of the progress we’ve made in the U.S. market… Our increased retail footprint, combined with strategic investments in production and our new investment partnerships, align with our broader goal to eradicate exploitation in the cocoa industry.”

Tony’s Chocolonely saw a 23% year-on-year growth in annual revenue in 2023, reaching $162 million.

Krispy Kreme teams up with KitKat and Aero to launch exclusive doughnut flavors in the UK

SnackTeam

April 5, 2024

Krispy Kreme is set to launch two special-edition doughnuts in the UK next week, in collaboration with the renowned chocolate brands KitKat and Aero.

The new ‘Krumbled’ doughnut boasts a KitKat-flavored chocolate filling and crumb topping, layered on a chocolate-iced doughnut, promising a decadent blend of “crunchy and creamy” textures.

Continue Exploring: McDonald’s and Krispy Kreme join forces to bring doughnuts to all US outlets

The “Bubbly” ring doughnut offering, on the other hand, has a peppermint chocolate filling and is covered in a mixture of Aero chocolate toppings. An Aero peppermint chocolate “bubble” serves as the “cherry on top.”

The KitKat and Aero doughnuts will be on sale from 11 April to 19 May at Krispy Kreme outlets, selected supermarket displays in Tesco, Sainsbury’s, and Morrison’s, as well as via third-party delivery services UberEats, JustEat, and Deliveroo.

Both doughnuts will be available for £3.25 each.

Continue Exploring: McDonald’s India teams up with Lotus Biscoff for delectable dessert delights!

Diageo raises the bar in India with the introduction of world’s finest tequila, Don Julio 1942

SnackTeam

April 5, 2024

Diageo, a leading name in the global alco-beverage sector, is delighted to introduce Don Julio 1942, an exceptional tequila brand, to the discerning Indian market. Esteemed by Hollywood and Bollywood luminaries such as Kylie Jenner, Kim Kardashian, Karan Johar, and Victoria Beckham, Don Julio 1942 is set to make a notable impact in India. Its recent spotlight at the Oscars has further heightened its appeal and anticipation. This launch reaffirms Diageo’s commitment to broadening its presence in the country. With its meticulous craftsmanship and rich heritage, this premium tequila embodies luxury, elegance, and unmatched flavor.

Don Julio 1942 Tequila is distinguished not just by its popularity but also by its meticulous craftsmanship. Every bottle is made from carefully chosen 100% Blue Weber Agave plants cultivated in the volcanic soils of Mexico’s Jalisco highlands. The agave is subjected to a 72-hour slow-roasting process in traditional masonry ovens, yielding a sophisticated flavor profile infused with hints of caramel, vanilla, and toasted oak.

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Each batch of Don Julio 1942 Tequila is distilled and matured for at least two and a half years in American oak barrels, ensuring its distinctive smoothness and rich character. Under the guidance of master distiller Enrique de Colsa, every sip promises an unforgettable sensory journey.

The establishment of the La Primavera distillery in the Mexican Jaliscan Highlands in 1942 marked the beginning of the Don Julio adventure. From tending to the agave fields to individually choosing each piña, Don Julio’s commitment to quality has been preserved by three generations of Jimador families. Don Julio 1942 Tequila was first produced to honour the distillery’s 60th anniversary. Since then, it has gained international acclaim for its exceptional quality and distinctive flavour. It is now available in select locations around India, giving discriminating customers a chance to experience its remarkable allure directly.

Prathmesh Mishra, Chief Commercial Officer of DIAGEO India, commented, “Don Julio 1942 is celebrated in the most exclusive cocktail bars, restaurants, and nightclubs worldwide. It’s the preferred choice of connoisseurs and the crème de la crème of society and celebrities. Crafted in small batches and matured for a minimum of two and a half years, Don Julio 1942 pays homage to the year Don Julio Gonzalez embarked on his tequila-making journey and promises to elevate India’s luxury drinking experience. As a longstanding favorite among luxury enthusiasts globally, we are excited to introduce this unmatched indulgence to India. Por amor!”

Whether enjoyed neat, on the rocks, or as the centerpiece in exquisite cocktails, Don Julio 1942 Tequila promises to captivate the senses and leave a lasting impression. As India welcomes this iconic spirit, it joins prestigious global venues that admire and indulge in the timeless elegance of Don Julio 1942 Tequila. Diageo aims to position 1942 as the quintessential celebratory drink, synonymous with festive occasions and joyful gatherings.

Continue Exploring: Diageo launches Tequila Don Julio 1942 at Mumbai Airport’s duty-free store

Ferns Estates acquires 75-room luxury hotel in Goa for INR 175 Crore; plans expansion with additional 75 suites

SnackTeam

April 5, 2024

Ferns Estates, a Bengaluru-based hospitality company, has acquired a 75-room luxury hotel located in the tourism hotspot of Goa from a local developer for INR 175 crore. As part of the deal, they have also obtained a 2-acre adjacent plot with plans to develop an additional 75 suite rooms.

Errol Fernandes, Chairman & Managing Director of Rosetta Resorts and Holiday Homes, said, “The organisation received a project loan of INR 150 crore from Bajaj Finance with a 10-year term to fund their acquisition.” “We want to construct opulent luxury suites next to the hotel in order to capitalise on the robust market demand for such high-end lodging. It is expected that in the long run, this strategic decision would increase the company’s profitability.”

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“The concentration of hotels in Goa, a renowned vacation hotspot in India, is larger than in almost every other part of the country due to the large number of visitors the state attracts throughout the year,” he said.

Ferns Estates, the company behind the Rosetta Resorts and Holiday Homes brand, intends to grow its resort portfolio by adding approximately 1,000 rooms over the next 3-5 years. The company has pinpointed potential properties in various locations for this expansion.

“This strategic decision will not only increase its capacity to serve a broad spectrum of travellers, but also strengthen its market position through a combination of lease and company-owned properties acquired to enrich its portfolio of assets,” Fernandes stated.

According to a JLL analysis, hotel investments in India reached $401 million in 2023, nearly quadrupling the data from 2022. In 2023, financial institutions and high net worth individuals (HNIs) accounted for the highest proportion of hotel investment activities, at 31%.

Continue Exploring: Hotel investments in India surged to $401 Million in 2023, reveals JLL Report

Vegetarian thali prices surge 7% in March on onion, tomato, potato costs; non-veg thalis drop 7%: Crisil Report

SnackTeam

April 5, 2024

In March, the price of a vegetarian thali increased by 7 percent, mainly driven by the surge in onion, tomato, and potato prices, as reported by a division of the domestic rating agency Crisil. Conversely, a decrease in poultry prices resulted in a 7 percent reduction in the cost of non-vegetarian thalis, according to Crisil Market Intelligence and Analysis in its monthly “Roti Rice Rate” report.

According to the report, the price of a vegetable thali, which includes roti, onions, tomatoes, potatoes, rice, dal, curd, and salad, rose to INR 27.3 per serving in March from INR 25.5 in the same period last year. However, it was lower than the price of INR 27.4 in February 2024.

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The report stated that the price hike in the vegetable thali was attributed to significant increases of 40 percent, 36 percent, and 22 percent in the prices of onions, tomatoes, and potatoes, respectively, compared to the previous year. This surge was influenced by reduced arrivals of onions and potatoes and a low base from the last fiscal year for tomatoes.

Additionally, the report highlighted that lower arrivals resulted in a 14 percent increase in rice prices and a 22 percent increase in pulses compared to the same period last year.

For the non-vegetarian thali, where only dal is replaced by chicken, the price dropped to INR 54.9 from INR 59.2 in the previous year, but it was higher than the INR 54 per thali recorded in February.

Continue Exploring: Vegetarian thali prices dip in February, non-veg thali costs rise: Crisil Report

The main reason for the year-on-year decline in the cost of non-vegetarian thali was a 16 percent decrease in broiler prices, which carry a 50 percent weight in the overall price, according to the report.

The report mentioned that compared to February, broiler prices increased by 5 percent due to the onset of the holy month of Ramadan and heightened demand.

Swiggy and Gurugram Traffic Police team up for road safety workshop

SnackTeam

April 5, 2024

Swiggy has collaborated with the Gurugram Traffic Police to organize a road safety and traffic awareness workshop for its delivery partners in Gurugram as part of its “Delivering Safely” road safety initiative.

Continue Exploring: Swiggy launches ‘Delivering Safely’ campaign to ensure safety of delivery partners across India

The program was led by SH Virendra Vij, IPS, Deputy Commissioner of Traffic Police, with the aim to educate and empower over 100 delivery partners in the NCR about road safety and accident prevention. Additionally, SH Sukhbir Singh, HPS-ACP Traffic Police, and ASI Rajesh provided training on key topics such as traffic rules, helmet usage, case studies, the consequences of reckless driving, and proper parking etiquette.

This was followed by a session where helmets were distributed, along with a lively roadshow by Swiggy’s delivery partner fleet, demonstrating Swiggy’s dedication to promoting responsible driving practices.

“In India, road accidents are a major problem that have a severe impact on both the economy and human life. They also result in injuries and fatalities. Between 4 and 5% of the nation’s GDP is lost to these mishaps annually. Most of the individuals impacted are those who are in the productive working age group, such as motorcyclists, cyclists, and pedestrians. Swiggy is actively involved in raising awareness of road safety among our delivery partners in cooperation with law enforcement agencies, in keeping with our commitment to safety under the Delivering Safely programme. According to a Swiggy representative, “Our goal is to raise delivery staff members’ knowledge of traffic laws and ultimately improve their safety.”

Over time, Swiggy has organized campaigns in various cities throughout India, demonstrating its dedication to fostering a secure working atmosphere for its delivery team. Every Swiggy delivery partner is equipped with insurance coverage, ensuring their protection while navigating the roads.

Last year, Swiggy initiated an industry-first collaboration with Dial 4242, introducing on-demand, free, and expedited ambulance services for its delivery partners. Alongside this, Swiggy implemented Emergency Support Services (ESS), designed to address the needs of delivery partners during road emergencies or mishaps. The ESS package includes round-the-clock hotline numbers, specialized emergency cards for delivery partners, and direct access to local police and ambulance services via an SOS button integrated into the delivery partner app.

Swiggy places a high priority on the security and welfare of its delivery partners as well as the general public. Upon onboarding, each delivery partner completes a road safety guidance module. Additionally, the site runs safety campaigns all year long, providing help and direction.

Continue Exploring: IPO-bound Swiggy appoints Titan’s Suparna Mitra as independent director

HUL mulls independent ice-cream unit amid Unilever’s global spin-off, sale prospects loom large

SnackTeam

April 5, 2024

Hindustan Unilever Ltd (HUL) is considering the possibility of separating its ice-cream business into an independent unit, potentially as a step towards a future sale, according to sources familiar with the situation.

This comes after Unilever‘s recent decision to spin off its ice-cream division to focus on segments with a similar operating model and supply chain.

Continue Exploring: Unilever announces spin-off of ice cream business, 7,500 job cuts planned in cost-cutting effort

The ice-cream business demands a unique approach to both manufacturing and distribution.

For India’s largest consumer goods company, the ice-cream segment contributes approximately INR 2,000 crore, or about 3% of its total sales, featuring brands like Magnum and Kwality Wall’s. While HUL leads in the home and personal care categories, it lags behind Amul in the Indian ice-cream market.

In the market, HUL has faces off against a range of domestic and foreign brands, such as Baskin Robbins, Mother Dairy, Vadilal, CreamBell, Naturals, and Havmor.

“Given that ice-cream can be expanded in both mass and premium segments, it presents an appealing opportunity in India,” commented one of the executives mentioned earlier. “If HUL receives a high valuation, it may consider a potential sale. Otherwise, the current internal strategy is to rapidly grow the business as a distinct entity for 12-15 months before determining the next steps.”

Unilever is the world’s largest ice-cream producer, boasting brands like Ben & Jerry’s and Magnum. The €7.9 billion ice-cream business represents 16% of its global revenue and holds a leading market position in numerous countries.

Industry insiders suggest that an existing player in India is unlikely to acquire HUL’s ice-cream business, and a potential sale could be to a multinational company or private equity firms. Additionally, they mentioned that the strategy will be entirely influenced by Unilever’s decisions regarding its ice-cream business.

After Unilever’s announcement, the India unit stated that it is evaluating the next steps.

Continue Exploring: Hindustan Unilever evaluates options for ice cream business future amid global restructuring by parent company

“We are assessing the different options for the Indian ice-cream business following this announcement,” said an HUL spokesperson. “We plan to consult with the HUL board and Unilever management in the upcoming months. Once a decision is reached, we will provide further updates.”

The ice-cream business has unique characteristics compared to other products, including a cold-chain requirement, a specific go-to-market operating model, seasonality, and its own innovation cycle.

HUL expanded its ice-cream business through acquisitions, including Kwality in 1994 and Adityaa Milk in 2018.

In India, HUL integrated Kwality’s branding with its global label Wall’s, which was originally introduced in 1922 and is marketed in over 50 countries under various local names. The brand is known as Algida in Italy and Turkey, Langnese in Germany, Kibon in Brazil, Streets in Australia, and Ola in the Netherlands. Consequently, all these brand names, including Kwality Wall’s, are owned by Unilever.

“If an offer to acquire HUL’s ice-cream business arises, we will definitely consider it. The ice-cream category in India is appealing and offers substantial potential. However, the valuations must be realistic,” commented a senior executive from a major packaged foods company.

Continue Exploring: Unilever stays tight-lipped amidst private-equity interest in ice-cream business

In October of last year, Unilever revealed its plans to concentrate on 30 key brands responsible for 70% of its sales and to enhance gross margins.

A report from retail consulting firm Wazir Advisors projects that the Indian ice-cream market will surpass $5 billion in sales by FY25, rising from the current $3.4 billion.

Continue Exploring: From scoops to sundaes: Ice cream sales set to soar 15-20% this summer

United Spirits acquires 15% stake in alcohol beverage brand Pistola

SnackTeam

April 4, 2024

United Spirits, a leading player in the spirits industry, has acquired a 15% stake in Inspired Hospitality, the parent company of the alcohol beverage brand Pistola, for INR 5.65 crore, as announced in a BSE filing on Thursday.

As per the filing, “The Company plans to subscribe for 10 equity shares and 3,494 compulsory convertible preference shares (CCPS) of Pistola, which together account for approximately 15.0% of the company’s paid-up share capital (on a fully diluted basis).”

Pistola, an alcohol beverage company, specializes in the development, marketing, and sale of agave spirits. Unlike owning a bottling unit facility, Pistola has outsourced this operation to a third party.

With this investment, United Spirits aims to bolster its position in the premium craft segment.

Continue Exploring: United Spirits reports 63% YoY growth in Q3 net profit, reaches INR 350 Crore

The company also mentioned that if Pistola meets specific pre-agreed milestones within a set timeframe, United Spirits has the option to purchase the remaining shares held by other shareholders.

Established in 2010 by Rakshay Dhariwal and Radhika Dhariwal, Pistola has solidified its position as one of the burgeoning premium agave brands in India. The brand commenced its commercial operations in the agave spirits sector in December 2021.

Apart from India, Pistola distributes its products throughout the USA, Singapore, and Thailand.

Continue Exploring: Indian single malt whiskies outshine global brands in sales, achieving a landmark 53% market share in 2023

Delight Restaurant Group acquires 65 Wendy’s outlets across US

SnackTeam

April 4, 2024

The Delight Restaurant Group has substantially grown its portfolio by purchasing 65 Wendy’s restaurants in Pennsylvania, Ohio, and West Virginia, USA, from Primary Aim.

The agreement’s financial conditions remained undisclosed.

This strategic move establishes the Delight Restaurant Group as a prominent franchisee within the Wendy’s system.

Andrew Krumholz, the managing partner at Delight, said, “The Thompsons [owners of Primary Aim] have established a stellar reputation and business. We are enthusiastic about continuing to enhance their strong legacy and performance.”

Continue Exploring: Wendy’s reports strong Q4 2023 with nearly 14% rise in net income, reaching $46.9 Million

With this latest acquisition, the firm now oversees and runs 226 eateries, which includes Taco Bell, with $500 million in revenues spread over eight states.

The company plans to sustain its growth momentum through additional acquisitions and the establishment of new units.

The Delight Restaurant Group was founded by managing partners Andrew and Richard Krumholz in 2016.

“We are excited to bring in and integrate this exceptional team and portfolio of Wendy’s outlets to Delight,” said Krumholz.

“We have held the Thompson brothers in high regard since becoming part of the Wendy’s system seven years ago.”

In May 2021, the Delight Restaurant Group purchased 44 Wendy’s restaurants in Long Island and New York, USA, from The Wendy’s Company.

Continue Exploring: Wendy’s partners with PAR Technology to boost customer engagement through AI-powered loyalty program

The company intends to open several new Wendy’s locations in the region.

As part of the brand’s Image Activation initiative, the company also intends to renovate some of the acquired restaurants. The 44 restaurants included in the deal employ over 1,200 team members.

Prior to the 2021 acquisition in New York, NPC International’s bankruptcy sale procedure resulted in the purchase of 54 Wendy’s locations in Raleigh, North Carolina.

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