NEW YORK — VF Corp. kept the momentum going in the second quarter with a rebound in its Lee jeans business and double-digit gains from the Vans and The North Face brands.
VF Corp. on Wednesday reported its 11th consecutive quarter of record sales and earnings.
"[Our transformation] is playing out just as we outlined it two years ago," Mackey McDonald, chairman and chief executive officer, said during a conference call with analysts. "The even better news is we're achieving growth across most of our businesses."
For the three months ending in June, earnings for the Greensboro, N.C.-based apparel giant rose 2.4 percent to $99 million, or 88 cents a diluted share, compared with earnings of $96.7 million, or 85 cents a share, in the same period a year ago. Revenues for the quarter rose 7.9 percent to $1.57 billion from $1.45 billion. Sales rose 7.8 percent to $1.55 billion from $1.44 billion.
A turnaround in the struggling Lee business was a standout in the company's jeanswear division. Jeanswear revenues increased 6 percent to $638.2 million, spurred by strong domestic sales and double-digit gains in Latin America, Mexico and China.
"This was a great quarter for our jeanswear team," Eric Wiseman, president and chief operating officer, said during the call. "Our work to turn around the Lee brand in the U.S. is beginning to take hold, with revenues up 11 percent in the quarter, and we expect Lee to end the year up slightly versus 2005."
Wiseman said the boost was attributable to retailers stocking up on inventory based on the strength of new Lee products. While management expects Lee to continue growing through the rest of the year, Wiseman said it was unlikely that the brand would maintain a double-digit growth rate.
The outdoor segment, which includes the Vans, Reef and North Face brands, continues to propel sales, with revenues shooting up 23.5 percent to $371 million from $300.4 million a year ago. The Vans, JanSport, Reef and Kipling brands reported revenue increases in excess of 20 percent, while North Face revenues increased 16 percent in what is typically the brand's slowest time of the year. Vans, in particular, stole some of the limelight during the quarter, posting a 50 percent rise in comparable-store sales.
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