VF to Sell Its Nautica Business
The company also reported fourth-quarter earnings results.
VF Corp. has plans to sell its Nautica business.
The company said it decided to sell Nautica during the fourth quarter and has classified it as a discontinued business in the quarter. Earlier last year, VF completed the sale of its Licensed Sports Group. And in 2016, it sold its Contemporary Brands business.
VF acquired Nautica Enterprises Inc. in 2003 for $586 million.
The apparel and accessories giant disclosed the planned sale on Friday, at the same time it posted fourth-quarter results.
For the three months ended Dec. 30, the net loss was $90.3 million, or 23 cents a diluted share, against net income of $264.3 million, or 63 cents, a year ago. On an adjusted basis, earnings per share was $1.01.
Total revenues rose 20.1 percent to $3.65 billion from $3.04 billion, which included a net sales gain of 20 percent to $3.62 billion from $3.02 billion. The balance of revenues was from royalty income. Further, the increase in revenues included a contribution of $247 million from its Williamson-Dickie acquisition, which it completed in October.
Wall Street was expecting EPS of $1.02 on revenues of $3.66 billion.
Steve Rendle, chairman and chief executive officer, said, “We delivered a top-quartile total return for shareholders in 2017 and our strong performance provided us with the capacity to reinvest about $100 million back into our business.”
The ceo said the company remains in the “early phase of a multiyear journey to become a purpose-led, agile, consumer-centric organization.”
VF said revenues were driven by continued momentum in the international and direct-to-consumer platforms, Outdoor & Action Sports coalition and Workwear businesses. The company also said that gross margin rose 120 basis points to an “annual record high of 50.5 percent,” helped by benefits from pricing, lower product and restructuring costs and a mix-shift toward higher margin businesses.
Beginning on March 31, VF — as disclosed previously — will change its fiscal year end to the Saturday closest to March 31 from the Saturday closest to Dec. 31. The first 12-month fiscal year, or fiscal 2019, will run from April 1, 2018 through March 30, 2019.
For the transition quarter ending March 31, VF said adjusted EPS is expected to be 65 cents on revenues estimated at $2.9 billion.
Shares of VF slipped 1.5 percent to $82.69 in pre-market trading at 7:30 a.m.