- Prachi Singh |
VF Corporation, reporting its financial results for three-month transition period ended March 31, 2018, said revenue increased 22 percent or 17 percent currency neutral to 3 billion dollars, including a 233 million dollars revenue contribution from the Williamson-Dickie acquisition. Excluding the Williamson-Dickie acquisition, revenue increased 12 percent or 8 percent currency neutral, driven by international and direct-to-consumer platforms and outdoor & action sports coalition.
Hover over the graph to learn more.
“VF's transition period results were strong as the broad-based growth acceleration that began in the second half of 2017 continued,” said Steve Rendle, VF's Chairman, President and CEO in a statement, adding, “Our core growth engines are driving strong global momentum as we begin to enter the acceleration phase of our 2021 strategy.”
VF posts 20 basis point improvement in gross margin
Gross margin improved 20 basis points to 50.5 percent, as benefits from a mix-shift toward higher margin businesses and changes in foreign currency were partially offset by the impact of the Williamson-Dickie acquisition. On an adjusted basis, gross margin increased 50 basis points to 50.8 percent. Excluding the impact of the Williamson-Dickie acquisition, adjusted gross margin increased 160 basis points to 51.9 percent. Changes in foreign currency positively impacted gross margin by 20 basis points on a reported basis.
Operating income on a reported basis was 311 million dollars, and on an adjusted basis, operating income increased 14 percent to 330 million dollars, including a 16 million dollars contribution from the Williamson-Dickie acquisition. Operating margin on a reported basis decreased 140 basis points to 10.2 percent, while adjusted operating margin declined 80 basis points to 10.8 percent. Adjusted operating margin, excluding the Williamson-Dickie acquisition, declined 40 basis points to 11.2 percent.
Earnings per share were 0.65 dollar on a reported basis, while on an adjusted basis, earnings per share increased 30 percent or 22 percent currency neutral) to 0.67 dollar, including a 0.03 dollar contribution from the Williamson-Dickie acquisition.
VF’s expects full year revenue growth of 9 to 10 percent
For the fiscal year 2019, the company expects revenue to be in the range of 13.45 billion dollars to 13.55 billion dollars, reflecting growth of approximately 9 percent to 10 percent. By coalition, revenue for outdoor & action sports is expected to increase 8 percent to 10 percent; revenue for jeanswear is expected to be about flat compared to prior year; and imagewear revenue is expected to increase more than 35 percent.
International revenue is expected to increase 13 percent to 15 percent. By geographic region, European revenue is expected to increase 13 percent to 15 percent. In the Asia Pacific region, revenue is expected to increase 15 percent to 17 percent. And, in the Americas (non-US) region, revenue is expected to increase 10 percent to 12 percent. Direct-to-consumer revenue is expected to increase 8 percent to 10 percent, including more than 25 percent growth in digital.
Gross margin is expected to be about 51 percent and operating margin to increase 50 basis points to about 13.2 percent. Adjusted earnings per share is expected to be in the range of 3.48 dollars to 3.53 dollars, reflecting growth between 11 percent and 13 percent.
VF’s board of directors has declared a quarterly dividend of 0.46 dollars per share, payable on June 18, 2018 to shareholders of record on June 8, 2018.
Picture:Facebook/The North Face