COVID-19 continues to disrupt fashion, but the comeback is still on at VF Corp. — even if Wall Street is taking a wait-and-see approach.
The corporate parent to Supreme, Vans, The North Face and Timberland posted top and bottom line gains in the second quarter and stuck by its earnings outlook for the full fiscal year. VF continues to look for adjusted earnings per share of about $3.20, compared with EPS of $1.31 a year ago. About 25 cents of the company’s EPS this year is expected to come from Supreme, which it bought last year.
VF’s sales outlook did get a minor tweak, with the company now projecting annual revenue growth of 30 percent to “approximately $12 billion,” where the projection in July left more room open for upside and called for revenues of “at least $12 billion.”
Revenues for the second quarter ended Oct. 2 rose 22.6 percent to $3.2 billion from $2.6 billion a year earlier. Net income increased 81 percent to $464.1 million, or $1.18 a diluted share, compared with $256.7 million, or 66 cents a year ago, when the first coronavirus lockdowns took a big bite out of the business.
Adjusted earnings tallied $1.11 a share, coming in shy of the $1.15 analysts anticipated.
Investors were feeling cautious despite the gains and pushed VF shares down 7.9 percent to $74.07 in premarket trading.
“As we move through the halfway point of our fiscal year, I remain encouraged by the underlying momentum across the portfolio, and the broad-based nature of this strength gives me confidence that we are driving the right strategy to accelerate growth in the quarters ahead,” said Steve Rendle, chairman, president and chief executive officer. “While the recovery has been impacted by further pandemic-related disruptions, we continue to see accelerating demand signals across our business, and our ability to reaffirm our fiscal 2022 revenue and earnings outlook is a clear testament to the resiliency and optionality of our model.”
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