Wrangler Maker VF Corp. Cuts Guidance as Sales Slow
October 24 2016 - 10:10AM
Dow Jones News
By Imani Moise
VF Corp. trimmed its guidance Monday as the apparel conglomerate
continued to cope with weak demand for denim and sportswear.
VF -- which owns brands like Wrangler, Timberland and North Face
-- now anticipates revenue to increase 2% this year, compared with
its previous guidance of 3%-to-4% growth. The company now expects
per-share earnings for the year at $3.13, down from its earlier
projection of $3.20.
Chief Executive Eric Wiseman said business suffered from
softness in demand in the Americas, the company's largest
market.
Shares fell 2% to $53.55 in premarket trading.
In the third quarter ended Oct. 1, VF said sales in its outdoor
and action sports segment rose 1.7% to $2.33 billion, led by a 7%
jump in sales for the Vans brand, which offset declines in North
Face and Timberland.
Sportswear sales slid 13% to $140.7 million as a shift toward
licensed women's sleepwear and men's underwear businesses hurt
Nautica brand revenue.
Meanwhile, the much larger jeanswear unit declined 6.2% to
$701.4 million.
Direct-to-consumer business, a bright spot for the company,
jumped 6% led by strength in e-commerce. The company now expects
full-year growth in this segment, which represents 23% of total
revenue, to be up by a percentage in the high single digits,
compared with its previous estimate in the low single digits.
In all for the quarter, VF posted a profit of $498.5 million, or
$1.19 a share, above the year-ago earnings of $459.8 million, or
$1.07 a share, and the average analyst of $1.15 a share on Thomson
Reuters.
Revenue fell 1.1% to $3.49 billion, below analysts' projection
for $3.63 billion.
Write to Imani Moise at imani.moise@wsj.com
(END) Dow Jones Newswires
October 24, 2016 09:55 ET (13:55 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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