The North Face and Timberland Sales Fare Better, but Vans Struggle
- VF Corp’s Q3 revenues down due to underperformance of Vans
- The North Face revenue up by 7% to $1.3bn (£1.1m)
- Timberland sales remained flat at $596m (£494m)
- Operating income dropped 24% to $516m (£428m)
- Gross margin down by 120 basis points
- Revenue growth forecasted at 3% for FY23
- Adjusted gross margin expected to be down by 200 basis points
VF Corporation, the owner of Vans, has reported a 3% drop in revenue for Q3 ended December 31, 2022, mainly due to a 13% decline in sales from the footwear brand. Vans’ revenue fell to $927m (£768m) in the quarter and is expected to decrease by a high-single-digit percentage rate for the full year, previously forecasted as a mid-single-digit reduction. The North Face brand saw a 7% increase in revenue to $1.3bn (£1.1bn), while Timberland sales remained flat at $596m (£494m). Operating income dropped by 24% to $516m (£428m) and gross margin declined by 120 basis points, primarily due to increased promotional activity. The company expects revenues for FY23 to grow by 3% on a constant-currency basis within the previous outlook range but anticipates an adjusted gross margin drop of 200 basis points. Benno Dorer, interim president and CEO, expressed confidence in improving execution through resource prioritization, cost cutting, and strategic investments for sustainable growth and shareholder value creation.
Factuality Level: 8
Factuality Justification: The article provides accurate and objective information about VF Corporation’s financial performance, including revenue drops for Vans brand, increased promotional activity, and the company’s plans to improve execution and focus on consumer opportunities.
Noise Level: 3
Noise Justification: The article provides relevant information about VF Corporation’s financial performance and the company’s plans for improvement, but it lacks in-depth analysis or exploration of long-term trends or possibilities. It also does not delve into the consequences of decisions on those who bear the risks or provide actionable insights.
Financial Relevance: Yes
Financial Markets Impacted: VF Corporation’s stock price and the stocks of its subsidiaries (Vans, The North Face, Timberland) may be impacted by the revenue drop and adjusted gross margin change.
Financial Rating Justification: The article discusses a decrease in revenue for VF Corporation’s footwear brand Vans, which can affect the company’s financial performance and stock prices. Additionally, it mentions changes in operating income and adjusted gross margin, which can impact investor decisions.
Presence Of Extreme Event: No
Nature Of Extreme Event: Other
Impact Rating Of The Extreme Event: No
Extreme Rating Justification: There is no extreme event mentioned in the article.
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