VF Corp sales, earnings dip on lacklustre Dickies, Vans revenues
U.S. apparel and footwear company VF Corporation announced on Tuesday a 3% decline in revenues for the third quarter to $3.5 billion, or up 3% in constant dollars, with its big four brands down 3% and the balance of its portfolio down 2%.
The Denver, Colorado-based company said its The North Face revenue grew 7% to $1.3 billion, while
Vans revenue fell 13% to $0.9 billion and Timberland sales remained flat at $595 million for the three months ending December 31. Dickies brand revenues plummeted 16% to $177 million and the company's other brand (namely, Supreme), fell 2% for the three months.
By region, VF Corp.'s EMEA and Americas regions decreased 2%, respectively, while its Asia Pacific region fell 7%, on Mainland China Covid-19 restriction woes.
The company recorded a "balanced performance" across both direct-to-consumer and wholesale channels and noted supply chain challenges remained persistent in the quarter "and are being addressed, with actions in place to return to full customer service at a normalized cost."
Quarterly net income fell to $507.8 million from $517.8 million, in the prior-year period.
"We are pleased to reaffirm the recently communicated full year 2023 EPS outlook with revenue growth at approximately 3%, after navigating an increasingly challenging fiscal Q3," said Benno Dorer, interim president and CEO.
"Spending the last few weeks with VF's dedicated and talented teams around the world has reinforced my belief in the tremendous opportunity ahead for our company. We are committed to improving execution through a sharpened focus on the biggest consumer opportunities and enhanced operational performance. Consistent with this objective, we are shifting resource priorities across the Company, including by reducing the dividend, exploring the sale of non-core assets, cutting costs and eliminating non-strategic spend, while enhancing the focus on the consumer through targeted investments.
"We are confident these actions will enable a return to profitable and sustainable growth and, with that, strong shareholder value creation," added Dorer.
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