VF Corp. sales slip in Q4

An inconsistent U.S. marketplace and the sale of one of its business units contributed to lower fourth quarter sales for VF Corp.



The company, whose brands include The North Face and Timberland, reported that its net sales fell 0.1% to of $3.2 billion, for the quarter ended Dec. 31, 2016.



Total revenue came in at $3.3 billion, down 0.2%.



On August 26, 2016, the company completed the sale of its Contemporary Brands businesses, which included the 7 For All Mankind, Splendid and Ella Moss brands. The company’s net loss from these discontinued operations was $98 million in 2016, which includes both the loss on the sale of the Contemporary Brands businesses and the operating results of the businesses.



International revenue in the fourth quarter was up 5%, and represented 34% of total VF’s fourth quarter sales, compared to 33% in the same period last year.



Direct-to-consumer revenue was also up 11% in the fourth quarter, driven by a mid-teen increase in both the outdoor and action sports and international divisions, VF said.



The company’s e-commerce business continued its strong momentum with 21% revenue growth during the quarter. Overall, direct-to-consumer revenue reached 37% of total fourth quarter revenue compared with 33% for the same period last year.



There were 1,507 VF-owned retail stores at the end of the quarter compared with 1,405 at the end of the fourth quarter of 2015.



Looking ahead, VF plans to place a stronger focus on the customer and meeting their needs — a move that the company expects will increase revenue for fiscal 2017, albeit at a low single-digit percentage rate. Similarly, VF expects international revenue to grow at a low single-digit per-centage rate.



Meanwhile, VF expects its direct-to-consumer revenue to remain strong, growing at a high single-digit percentage rate. This will include the addition of about 50 stores and mid-single-digit comparable sales growth, and an expected increase of approximately 25% in e-commerce revenue, the company said.



“The pace of change in both our industry and the broader consumer landscape is happening at an accelerated rate,” said Steve Rendle, president and CEO.



“The proliferation of technology and innovation across all aspects of our lives has shifted consumers’ shopping behaviors and elevated their expectations when engaging with our brands,” he said. “We are pivoting to become more agile and consumer centric to compete and win in this changing global marketplace.”