VF Corp sees FY revenues jump 2% but warns Q1 earnings may halve
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VF Corporation, the owner of brands such as Vans, The North Face and Timberland, has reported a 2% increase in full-year revenues but has warned that it expects current-quarter revenue to more than halve due to the coronavirus outbreak.
In a trading update for the full-year ended March 28, 2020, it revealed revenues from continuing operations increased by 2% to $10.5bn (£8.6bn).
The firm also saw international revenues increase by 1% and by 10% in China.
However, during the fourth quarter of the year, when the current pandemic began impacting its performance, the group saw revenues decrease by 11% to $2.1bn (£1.7 bn).
During the quarter the company also reported a net loss of $483.8m (£398m) compared with a profit of $128.8m (£106m) during the same period a year prior.
Looking ahead, VF Corporation said that due to the “uncertainty of the duration and severity” of the pandemic “it is not possible” for it to provide a financial outlook for full-year fiscal 2021 at this time.
However it added that first quarter fiscal 2021 revenues are expected to be down slightly more than 50%. Full-year fiscal 2021 free cash flow is expected to exceed $600m (£495m).
Steve Rendle, chairman, president and CEO, said: “Through the first ten months of fiscal 2020 our business delivered results above our stated long-term growth objectives. Then the world changed for all of us as a result of Covid-19.
“From the early days of the outbreak VF has taken a people-first approach in our Covid-19 response, prioritizing the health and safety of our people, while also protecting their financial well-being. As we’ve implemented measures to care for and protect our people, we’ve also taken several key actions to advance our Enterprise Protection Strategy.”
He added: “These prudent actions, most of which have been precautionary, have helped us preserve liquidity and given us more flexibility to manage our global business operations through the prolonged crisis. Moving forward we’re committed to using this moment to set VF and our brands up for the next successful chapter in our 121-year history.”
