World Footwear

Companies

Another disappointing quarter for VF Corp

Feb 8, 2024 United States
Another disappointing quarter for VF Corp
The parent company of Vans and The North Face posted a 16% year-over-year decline in revenue in the third quarter of fiscal 2024, largely due to a “shift in the timing of wholesale deliveries”
Our third quarter top-line performance was disappointing”, stated Bracken Darrell, President and CEO. “However, we are confident the actions we are implementing as part of Reinvent will enable VF to stabilize and then grow revenue and improve operational performance across brands and regions. We have already begun to see the impact of our efforts to right-size the company’s cost structure and improve its inventory position, resulting in stronger-than-expected cash flow and expanded gross margin in the quarter (…) As we approach the end of this fiscal year, my confidence in VF’s future is rising”, he concluded.


Third Quarter Results

VF Corp reported a revenue of 3.0 billion euros in the three months to the 30th of December, a decrease of 16% (or 17% on a constant currency basis), as compared to the same period of the previous fiscal year. The company said its performance was “impacted by a shift in the timing of wholesale deliveries, which was most pronounced for The North Face® and the EMEA region”.

In contrast to the previous quarter, The North Face's performance deteriorated in the third quarter of fiscal 2024, with revenue decreasing by 10% (or 11% on a constant currency basis) to 1.19 billion US dollars, on a comparable basis to the same quarter of the prior fiscal year.

Looking at other top brands, Vans’ revenue totalled 668.2 million US dollars, down by 28% (or 29% on a constant currency basis) year-over-year, Timberland’s revenue amounted to 473.0 million US dollars, down by 21% (or 22% on a constant currency basis) year-over-year, and Dickies’ revenue reached 147.9 million US dollars, down by 16% (or 17% on a constant currency basis) year-over-year.

In the third quarter of its fiscal year, the company’s revenue in the Americas region’ fell sharply by 24% (or 25% on a constant currency basis) to 1.59 billion US dollars and by 7% (or 12% on a constant currency basis) in the EMEA region to 912.3 million euros, as compared to a similar period of fiscal 2023. On the other hand, in the APAC region, VF’s revenue amounted to 461.5 million US dollars, up by 2% (or 3% on a constant currency basis) year-over-year.

The US-based company posted a loss per share of 0.11 US dollars in the third quarter of the current fiscal year, against earnings per share of 1.31 US dollars in the same quarter of the previous fiscal year.


Strategic Portfolio Review

As it continues to implement its Reinvent transformation plan, VF Corp announced that it “has initiated an in-depth strategic review of the brand assets within the portfolio” to “ensure the company owns the brands that it believes create the greatest long-term value”.


Image Credits: feature.com

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