VF Corporation enjoys boost from Dickies acquisition

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VF Corporation has reported double-digit revenue rises in its last quarter, aided by the acquisition of Williamson-Dickie.

In the three months to March, the Vans, Timberland, The North Face and Wrangler owner saw revenues increase 22 per cent to $3 billion (£2.21 billion) including a $233 million (£171.78 million) revenue contribution from its newly-acquired Dickies brand.

Excluding these contributions, VF Corporation’s revenues rose 12 per cent over the period.

Gross margins also improved 20 basis points to 50.5 per cent, or 160 basis points to 51.9 per cent excluding the new acquisition.

Meanwhile operating income increased 14 per cent on an adjusted basis to $330 million (£243.15 million), but adjusted operating margins dropped 80 basis points to 10.8 per cent.

Its outdoor and action sports brands, which include Vans, The North Face and Timberland, saw sales increase 19 per cent.

Vans continued to be its best performer with a 45 per cent rise in sales, while The North Face saw an 11 per cent rise.

The only one of its top five performing brands to post a decline in sales was jeanswear label Lee, dropping 11 per cent in the quarter.

“VF’s transition period results were strong as the broad-based growth acceleration that began in the second half of 2017 continued,” president and chief executive Steve Rendle said.

“Our core growth engines are driving strong global momentum as we begin to enter the acceleration phase of our 2021 strategy. VF is in the midst of a transformation to become a purpose-led, consumer-centric organization.

“We are evolving and adapting to a rapidly changing marketplace and remain committed to delivering top quartile returns for our shareholders.”

Looking ahead, VF expects revenue for the 2019 fiscal year to rise between nine and 10 per cent, coming in between $13.45 billion (£9.91 billion) and $13.55 billion (£9.99 billion).

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