VF Corp: earnings up, primarily through Outdoor & Action Sports
Following an impressive second quarter (up 16% from last year), VF Corp’s Outdoor and Action Sports division slowed down for its third quarter ending in September. For its largest segment, the American group nevertheless saw sales grow by 11% to 1.706 billion euros (2.181 billion US dollars).
While the gains have been lower, the segment’s three leading brands, however, continue to show healthy growth. The North Face rose by 9%, Vans improved by 12% and Timberland was up by 15%.
For the group overall, the gains were slightly offset by stable sales at 587 million euros for its jeans segment, which, like the sector overall, is suffering from unfavorable trends in the Americas. The trends are especially negative in terms of contemporary, premium denim brands. The segment saw sales fall by 5% to 77 million euros.
Imagewear (+3%) and Sportswear (+5%) represented respectively 229 and 128 million euros.
Finally, the group, which includes thirty or so brands, generated a turnover of 2.754 billion euros for the quarter (3.520 billion dollars), up 7%.
The company has been able to rely on its direct-to-consumer business. Overall, it posted revenues up 16%, thanks to a strategy focused on store openings.
And VF Corp’s profitability is improving, once more driven by Outdoor and Action Sports. At 478 million euros, profits before tax increased by 9%. The operating income of Outdoor and Action Sports, meanwhile, was 372 million, up 13%.
For the entirety of its fiscal year, the American giant saw growth of 8% with a turnover of over 10 billion euros, with an operating margin of more than 15% of turnover.
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