VF Corp. Cuts 2016 Guidance While Jeanswear Stays Strong
Jeanswear was one of the few bright spots in an otherwise rocky second quarter for VF Corp., the company said Friday, cutting estimates for 2016.
The sportswear segment, including the Nautica and Kipling brands, experienced the most drastic decline in revenue, down 19 percent to $115 million due to continuing struggles in U.S. department stores and outlet channels. There was a 20 percent decrease in Nautica brand revenue and a mid-teen decrease in the Kipling brand’s North American business, compared with the same period last year.
The jeanswear segment saw second-quarter revenue up 3 percent to $629 million. Wrangler brand revenue increased 2 percent across regions, and Lee brand was up 8 percent with a mid-teen percentage rate jump in its Europe business.
The contemporary segment, which consists of 7 For All Mankind, Splendid and Ella, was classified as discontinued operations in the report, following the June sale of the category to Delta Galil Industries, Ltd. for $120 million.
Earnings per share for Q2 were $0.35 compared with $0.39 during the same period last year. Company revenue is now expected to increase only 3 to 4 percent this fiscal, as compared to the previous outlook of a mid-single digit percentage rate increase.