) reported fourth-quarter 2012 adjusted earnings of $3.07 per
share, speeding ahead of the prior-year period earnings of $2.32
and Zacks Consensus Estimate of $3.03. The year-over-year
increase was primarily driven a strong top-line growth along with
Quarter in Detail
V.F. Corp.'s fourth-quarter revenue of $3.003 billion fell
short of the Zacks Consensus Estimate of $3.072 billion. However,
it grew 4% compared with the year-ago period, on the back of
robust growth in Outdoor & Action Sports, international and
direct-to-consumer revenues. However, the sale of John Varvatos
in April 2012 had a 1% negative impact on revenues.
Gross margin in the quarter spiked 220 basis points to 47.4%
from 45.2% in the comparable year-ago quarter, resulting from
improvement in higher margin businesses along with lower product
costs. Moreover, adjusted operating margin expanded 280 basis
points to 15.1%, reflecting higher gross margin.
Outdoor & Action Sports
surged 6% from the year-ago quarter to $1.710 billion. Continued
growth momentum at the company's The North Face and Vans brands
partially offset by weak performance at timberland brand
contributed to the revenue growth. Segment operating income
increased 18% year over year, while operating margin expanded 190
basis points to 18.8%.
revenue increased 3% to $734.8 million. The year-over-year 5%
growth at the U.S., Latin and Central America and Asian
businesses were partially offset by a decline in revenues in
Europe. Moreover, the company witnessed significant growth in the
segment's operating income and margin, mainly on improved gross
margin that came from lower product costs and improved operating
revenue inched up 2% in the quarter to $262.1 million. Moreover,
operating income and margin at the segment surged due to low
increased 15% to $182.7 million driven by increased Nautica and
Kipling brands revenues. Segment operating income increased 70%,
while operating margin expanded 580 basis points primarily due to
robust revenue growth and operational efficiencies.
revenue slumped 17% to $106.9 million due to the sale of John
Varvatos. However, operating income surged 20% during the
quarter, while adjusted operating margin expanded 320 basis
points on the back of increased direct-to-consumer business and
lower closeout sales.
revenues increased 7%. The growth was largely driven by strength
across the biggest brands in America, Asia and Europe.
revenue increased 8%, driven by the addition of 41 new stores and
a 15 percentage point growth contribution from Timberland. The
company's total owned retail stores were 1,129 at the end of
2012. Direct-to-consumer revenues reached 21% of VF's 2012 total
V.F. Corp. ended the fiscal with cash and cash equivalents of
$597.5 million and long-term debt of $1.429 million. The
company's shareholder equity came in at $5.126 billion at the end
The board of directors of this Zacks Rank #3 (Hold) company
declared a quarterly cash dividend of 87 cents per share.
Dividend will be paid on March 18, 2013 to shareholders of record
as of March 8, 2013.
Looking into 2013
Given the solid 2012 results, the company expects 2013 revenue
to increase 6% to $11.5 billion. Gross and operating margins are
anticipated to expand by 100 basis points.
Based on above forecasts, V.F. Corp. expects its adjusted
earnings for fiscal 2013 to be $10.70 per share.
The company projects its cash flow to touch a record of $1.4
Other Stocks to Consider
Apart from V.F. Corp., some of the company's peers are also
expected to report better-than-expected quarterly results in near
New York & Company Inc.
) has an Earnings ESP of +12.50% and carries a Zacks Rank #2
Abercrombie & Fitch Company
) with an Earnings ESP of +1.04% and a Zacks Rank #2 (Buy).
True Religion Apparel Inc.
) with an Earnings ESP of +2.94% and a Zacks Rank #2 (Buy).
Our proven model shows that a company may beat the earnings if
it has the right combination of two key components - Positive
Earnings ESP (Read:
Zacks Earnings ESP: A Better Method
) and a Zacks Rank #1, #2 and #3.
ABERCROMBIE (ANF): Free Stock Analysis Report
NEW YORK & CO (NWY): Free Stock Analysis
TRUE RELIGION (TRLG): Free Stock Analysis
V F CORP (VFC): Free Stock Analysis Report
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