Bucking the economic doldrums, it’s full steam ahead for The North Face and its parent company VF Crop. (NYSE:VFC).
Fresh off its acquisition of the Timberland and SmartWool brands, the Greensboro, N.C.–based apparel, footwear and equipment maker reported record third-quarter revenue of $2.75 billion – up 23 percent from a year ago. Even excluding the latest brand additions, revenue for VF Corp. rose 16 percent in the quarter, company officials said.
“While we’re all hearing and reading about a tougher economic environment we have seen little evidence of a slowdown in our business,” VF Corp. CEO Eric Wiseman said on a conference call following the earnings report Oct. 24.
The strong revenue growth was once again led by the company’s outdoor group, which includes The North Face, Vans and Jansport brands, along with Timberland and SmartWool. All together, the group’s revenue rose 37 percent to nearly $1.44 billion in the third quarter, and would have been a 22 percent rise without the acquisitions. By brand, company officials said The North Face revenue grew by 22 percent and Vans rose by 25 percent.
The outdoor group now accounts for 52 percent of VF’s business and it continues to outpace the quarterly growth from VF’s other segments of Jeanswear, which grew 8 percent in the third quarter; Imagewear, which grew 14 percent; Sportswear up 18 percent; and Contemporary Brands up 11 percent.
VF’s third-quarter net income jumped 24 percent to $300.7 million, or $2.69 per share, versus a net income of $242.8 million, or $2.22 per share during the same period a year ago. The Timberland/SmartWool acquisition accounted for about $0.25 per share extra in the results.
With the strong earnings and Timberland/SmartWool acquisition complete, the company increased its guidance to full-year 2011 revenue growth of between 22 and 23 percent, or about 13.5 percent minus the acquisitions. Full-year 2011 earnings per share are expected to reach $8.15, up from prior guidance for earnings of approximately $7.50 per share with the acquisitions accounting for about $0.55 per share.
Along with the earnings report, VF’s board of directors declared a quarterly cash dividend of $0.72 per share, an increase of 14 percent. The dividend is payable on Dec. 19, 2011 to shareholders of record as of the close of business on Dec. 9, 2011.
--Compiled by David Clucas