Levi Strauss Investor Day Presentation Deck
RETURN ON
INVESTED CAPITAL
We define Return on invested capital ("ROIC") as the
trailing four quarters of Adjusted net income before interest.
and after taxes divided by the average trailing five quarters
of total invested capital. We define earnings before interest
and after taxes as Adjusted net income plus interest
expense and income tax expense less an income tax
adjustment. We define total invested capital as total debt
plus shareholders' equity less cash and short-term
investments. We believe ROIC is useful to investors as it
quantifies how efficiently we generated operating income
relative to the capital we have invested in the business.
Our calculation of ROIC is considered a non-GAAP
financial measure because we calculate ROIC using the
non-GAAP metric Adjusted net income. Although ROIC is
a standard financial metric, numerous methods exist for
calculating a company's ROIC. As a result, the method we
use to calculate our ROIC may differ from the methods
used by other companies. This metric is not defined by
GAAP and should not be considered as an alternative to
earnings measures defined by GAAP.
(1) Adjusted net income is reconciled from net income
(loss) which is the most comparable GAAP
measure. Refer to Adjusted net income table for
more information. Acquisition related charges
include the inventory markup above historical
carrying value associated with the Beyond Yoga
acquisition.
(2)
Tax impact calculated using the annual effective tax
rate, excluding discrete costs and benefits.
LEVI STRAUSS & CO.
(Dollars in millions)
Net income (loss)
NUMERATOR
Adjusted net income (1)
Interest expense
Income tax expense
Adjusted net income before interest and taxes
Income tax adjustment (2)
ADJUSTED NET INCOME BEFORE INTEREST
AND AFTER TAXES
(Dollars in millions)
Denominator
Total debt, including lease liabilities
Shareholders' equity
Cash and Short-term investments
TOTAL INVESTED CAPITAL
Net income (loss) to Total invested capital
Return on Invested Capital
2021
$153.0
600.9
72.9
26.7
700.5
(30.1)
$670.4
TRAILING FOUR QUARTERS
2021
2020
$56.7
$2,585.6
1,483.2
(1,470.8)
$2,598.0
5.9%
25.8%
83.6
82.2
(62.6)
103.2
(25.8)
$77.4
2020
2019
AVERAGE TRAILING FIVE QUARTERS
$2,464.2
1,299.5
(1,593.7)
$2,170.0
2.6%
3.6%
$395.0
456.2
66.2
82.6
605.0
(104.6)
$500.4
2019
$2,107.6
1,142.9
(866.9)
$2,383.6
16.6%
21.0%
©2022 Levi Strauss & Co. CONFIDENTIAL 168View entire presentation