By Billy Crosby
VF Corp.'s (VFC) second-quarter profit fell 11% as the
branded-apparel maker faced a tough comparison with a year-earlier
period that was propped up by gain on the sale of menswear brand
John Varvatos, while adjusted earnings and revenue climbed.
The company raised its adjusted earnings forecast for the year
by 10 cents to $10.85 a share, while affirming its revenue-growth
view.
VF, whose clothing brands include North Face, Wrangler and
Nautica, has seen revenue boosted by its 2011 acquisition of the
Timberland brand. VF and John Varvatos unveiled in March 2012 a
deal to sell the majority ownership interest in that brand to Lion
Capital LLP.
For the quarter, the company reported a profit of $138.3
million, or $1.24 a share, down from $155.3 million, or $1.40 a
share, a year earlier. Excluding items such as acquisition costs
and the year-earlier sale gain, earnings rose to $1.27 a share from
$1.11. Sales improved 3.7% to $2.19 billion.
Analysts surveyed by Thomson Reuters recently expected earnings
of $1.17 a share on revenue of $2.26 billion.
Gross margin widened to 48.5% from 46.1%.
Sales at the outdoor and action-sports segment, the largest
top-line contributor, rose 6.1% to $1.1 billion. In its jeanswear
business--its second-largest segment--sales increased 3%. Revenue
for Timberland fell 3% due to declining sales in Europe.
In June, Moody's Investors Service raised its outlook on VF to
stable from negative, citing improved leverage since the Timberland
acquisition.
Shares closed at $199.53 on Thursday and were inactive
premarket. The stock is up 31% in the past 12 months.
Write to Billy Crosby at William.Crosby@dowjones.com
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