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2d ago

VF Corp. Narrows Q1 Loss to $56M and Expands Gross Margin in Turnaround

Outdoor labels delivered double-digit revenue growth under Darrell’s reset signaling a move from restructuring to growth.

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Shoes are seen for sale at a Vans store, a brand owned by VF Corporation, in Manhattan, New York City, U.S., May 20, 2022. REUTERS/Andrew Kelly/File photo
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Overview

  • VF Corp reported an adjusted operating loss of $56 million for Q1, beating its $110–125 million guidance and delivering a $0.24 loss per share versus analysts’ $0.34 estimate on flat $1.8 billion in sales.
  • The company expanded its adjusted gross margin by 290 basis points to 54.1% driven by cost reductions and portfolio rationalization.
  • The North Face and Timberland saw sales rise 6% ($557.4 million) and 11% ($255.1 million) respectively while Vans revenue fell 14% ($498 million) as the brand reorients its distribution.
  • VF ended the quarter with $642.4 million in cash, $2.14 billion in inventory and reinstated a quarterly dividend of $0.09 per share.
  • CEO Bracken Darrell said the transformation is on track as VF shifts from restructuring to growth and sees Q2 revenue falling 2–4% with higher adjusted operating income and cash flow year over year.