VF COMES UP SHORT
NEW YORK — VF Corp. narrowly missed fourth-quarter expectations and blamed “difficulties” with some of its recent acquisitions and weakness in Japan for the shortfall.
Net income for the quarter, including extraordinary items, fell 90 percent, to $10.2 million, or 8 cents a diluted share, compared to $97.2 million, or 81 cents, a year ago. Excluding restructuring costs and the impact of an accounting change for revenue recognition, VF said its net income would have reached $82 million, or 71 cents a basic share, down 15.6 percent from year-ago levels. Adjusted earnings per share fell 2 cents shy of Wall Street’s consensus estimates of 73 cents.
Sales for the period ended Dec. 30 rose 7.2 percent, to $1.46 billion, compared to $1.36 billion a year ago.
Mackey McDonald, chairman and chief executive, noted in a statement that, while the company’s core businesses were performing well, there were “difficulties in integrating several workwear acquisitions and operating losses from our Wrangler Japan business affected our bottom line.” He said “decisive actions” would be taken in 2001 in these areas.
Sales of domestic jeanswear, which include the Wrangler and Lee brands, grew 7 percent during the quarter and 5 percent for the year. Excluding the impact of foreign currency translation, European jeans sales were flat for the quarter and year but managed to generate higher profits.
U.S. intimate apparel sales fell 7 percent during the quarter and 9 percent for the year. Weak private label sales for the category pulled down the stronger department store brands. Knitwear sales rose 13 percent during the quarter and 5 percent for the year.
Unadjusted net income for 2000 decreased 28.9 percent, to $260.3 million, or $2.21 a diluted share, against $366.2 million, or $2.99, a year ago. Excluding the special items, net income was $343.8 million, or $2.98 a basic share, topping Wall Street’s anticipations of $2.96.
Sales for the year rose 3.5 percent, to $5.75 billion from $5.55 billion in 1999.