VF Corp., parent to apparel brands including Vans, North Face and Dickies, reported sales that beat expectations, a sign that its transformation plan is showing results.
Vans
Revenue climbed 2% to $2.8 billion during the company’s fiscal third quarter ended December 28, the company said in a presentation, beating analyst estimates compiled by Bloomberg. Sales for the Timberland brand rose 11% during the period.
Shares rose 2.5% at 7:44 a.m. in Wednesday premarket trading in New York. The stock has gained more than 50% over the past 12 months while the S&P Small Cap 600 Index grew 11%.
VF Corp. raised its full-year free cash flow guidance to $440 million, up from $425 million previously. For the fourth quarter, the company expects revenue to fall 4% to 6%.
VF Corp. is challenged with bringing off a turnaround in its Americas operations while retailers and brands are faced with shoppers who remain squeezed by stubbornly high prices. A number of consumer companies announced holiday sales earlier this month. While some, like Lululemon, were able to find a bright spot, others, such as Macy’s Inc. issued downbeat guidance.
The company introduced its turnaround program shortly after Chief Executive Officer Bracken Darrell assumed the top role in July 2023. The strategy includes $300 million in cost reductions and a reorganization of its leadership team in pursuit of a revitalization of its brands, which also include Altra, Eastpack, Icebreaker and Jansport.
VF Corp. has struggled to turn its plans into reality. Last quarter, the company saw sales declines begin to moderate at North Face, Vans, Timberland and Dickies. The company also paid down a $1 billion loan.
The company sold the Supreme brand, which it acquired in 2020, in a $1.5 billion cash deal last year.
