Greensboro, NC—VF Corp. reported today a 7% increase in fourth-quarter earnings and 8% in sales, but results missed analysts’ expectations.
For the three months ended Dec. 31, the apparel, footwear and accessories company reported a profit of $367.7 million, or 82 cents a share, up from $334.2 million, or 75 cents a share, a year earlier. Excluding Timberland acquisition-related costs, adjusted earnings rose to 82 cents from 77 cents, just missing analysts’ average estimate for 84 cents a share.
Kipling Up 33%
Revenue rose 8% to $3.3 billion, driven by double-digit growth in the group’s Outdoor & Action Sports, Sportswear, international and direct-to-consumer businesses, and high single-digit percentage growth in its Imagewear coalition. The sales were almost in line with analysts’ estimate for $3.34 billion
In VF’s Outdoor & Action Sports division, sales increased 12% to $1.9 billion with balanced growth across the U.S. and international markets as well as in wholesale and direct-to-consumer channels.
At Timberland, sales were up 13%; Vans posted 14% growth and The North Face sales rose 12%.
The Sportswear division reported 14% increase to $208 million in sales. Its Nautica brand grew 11% “with solid increases in both its wholesale and direct-to-consumer businesses.”
Kipling posted a 33% increase in sales in the United States, 28% increase internationally.
The Contemporary Brands division was up 1% to $108 million.
Gross margin improved 80 basis points in the period to 48.2%, compared with 47.4% in the same period of 2012. The increase reflected the continuing shift of its revenue mix toward higher margin businesses as well as lower year-over-year product costs, the company said.
“Among many noteworthy brand performances, two significant milestones included The North Face brand passing $2 billion in global revenues and the Vans brand surpassing the $1.7 billion revenue mark, becoming VF’s second largest brand,” said Eric Wiseman, chairman/ceo. “And with strong results from our direct-to-consumer and international businesses, supported by outstanding execution from our global supply chain, we’ve established excellent momentum that we expect to contribute to a strong year for VF in 2014.”
For the full year, VF Corp said it expects revenue to increase by 7% to 8%, and earnings to increase 11% to 13% to $3.05