By Lisa Beilfuss
Apparel conglomerate VF Corp. said profit rose 8.3% in its
latest quarter, driven by sales in the company's outdoor-and-action
sports segment and despite the strong dollar's effect on sales.
The North Carolina company, more optimistic about its struggling
jeanswear and contemporary lines, again lifted its full-year view.
VF now predicts a 15% rise from a year earlier in currency-adjusted
earnings, up from an earlier estimate of 12% to 14% growth. That
translates to $3.54 in per-share earnings, topping the $3.21
average analyst estimate. On a reported basis, VF now expects to
post $3.22 a share this year, up from earlier guidance of
$3.20.
VF's outdoor segment, which represents more than half of the top
line, is home to brands including North Face and Nautica, and it
has driven results of late. In the most recent period, outdoor
sales grew 9% to $1.4 billion, helping to offset flat sales in
jeanswear and a 10% drop in contemporary brands.
Earlier this year, VF said it wrote down the value of the
once-hot denim brand Seven For All Mankind along with two other
contemporary lines by $396 million, eight years after the company
bought the Seven brand for $775 million. The jeans category, which
also includes Lee and Wrangler, has suffered as shoppers
increasingly opt for active wear over denim.
Analysts, according to FactSet, had expected outdoor revenue of
$1.28 billion. The jeanswear and contemporary businesses,
meanwhile, performed slightly better than analysts had
anticipated.
Overall, the company booked a profit of $170.8 million, or 40
cents a share, up from $157.7 million, or 36 cents, a year earlier.
Revenue rose 4.7% to $2.51 billion. Adjusted for currency
fluctuations, sales increased 10%, VF said.
Analysts had projected earnings of 36 cents a share on $2.46
billion in revenue, according to Thomson Reuters.
International revenue declined 1%, dragged by the strong dollar,
but rose 13% on an adjusted basis.
Shares in the company, up about 22% over the past year, rose
1.8% in light premarket trading.
Write to Lisa Beilfuss at lisa.beilfuss@wsj.com
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