Companies

Weak first quarter at VF Corp

Aug 16, 2024 United States

The US-based footwear company has posted a 9% drop in revenue in the first quarter of its fiscal year, as compared to the same period of last year, and has seen its losses widen

“As I complete my first year at VF, I feel more energized than ever. While the business is still down, the rate of decline moderated quarter-over-quarter versus Q4 and across almost all our brands. We advanced further on the Reinvent transformation plan. We are on track to deliver our targeted cost savings and we have addressed one of our top financial priorities to strengthen the balance sheet with the announced sale of Supreme”, commented Bracken Darrell, President and CEO of VF Corp.

First Quarter Results

In the three months to the 29^th of June, the company’s revenue amounted to 1.9 billion US dollars, a decrease of 9% or 8% on a constant currency basis, as compared to the same period of last year.

In the first quarter of fiscal 2025, The North Face brand’s revenue declined by 3% (or 2% on a constant currency basis) to 524.2 million US dollars, on a comparable basis to the second quarter of the last fiscal year. Meanwhile, Vans reported a 21% year-over-year decline in revenue to 581.8 million US dollars, “a modest improvement relative to the previous quarter”, when revenue fell by 26% or 27% on constant dollars.

Timberland and Dickies brands also remain in the red. In the first quarter of the current fiscal year, Timberland’s revenue amounted to 229.4 million US dollars, down by 10% or 9% on a constant currency basis, and Dickies’ revenue amounted to 116.8 million US dollars, down by 15% or 14% on a constant currency basis, as compared to the same period of fiscal 2024. First quarter revenue from other brands increased by 8% or 10% on a constant currency basis to 455.0 million US dollars.

VF Corp’s first quarter gross margin contracted by 80 basis points to 52.0%, reflecting 60 basis points of unfavourable rate and 20 basis points of unfavourable mix.

The company’s profitability has not yet improved. The operating margin was negative 12.6%, a decrease of 1,220 basis points, as compared to the same period last year, and the adjusted operating margin was negative 4.0%, a decrease of 360 basis points, as compared to the same period last year.

At the end of June, the company reported a loss per share of 0.67 US dollars and an adjusted loss per share of 0.33 US dollars, as compared to a loss per share of 0.15 US dollars and an adjusted loss per share of 0.15 US dollars in the first quarter of fiscal 2024.

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United States Companies Footwear Quarter Results Results VF Corp