Levi Strauss announces strategic review of Dockers brand including sale

(Reuters) -Levi Strauss & Co on Wednesday announced that it has initiated a strategic review of its underperforming Dockers brand, which could include a possible sale.

Shares of the denim maker were down nearly 8% in after-market trading.

Levi is in the midst of a cost-cutting plan and has already exited lower margin businesses such as the Denizen brand and footwear category in some regions. The company has also reduced its corporate workforce and consolidated operations in Europe.

The company said it has retained Bank of America as its financial adviser for reviewing the Dockers Brand’s strategic options and has not set a deadline or definitive time table for its completion.

Levi has flagged that the higher-end consumer was seeing incremental signs of pressure in the U.S. and that consumers in Europe were also being highly cautious, hurting sales of its apparel – mainly in the Dockers brand, known for its chinos and khakis.

Sales of Dockers saw a 15% decline in the third quarter. Levi’s (NYSE:LEVI) quarterly net revenue rose to $1.52 billion from $1.51 billion a year earlier. Analysts had expected $1.55 billion, according to data compiled by LSEG.