VF Corporation sees weaker demand for The North Face, Timberland brands; revises earnings outlook as CEO departs
Published: 11:56 05 Dec 2022 EST
V.F. Corporation (NYSE:VFC) told investors it is revising its fiscal 2023 outlook lower due to weaker than anticipated consumer demand across its categories, primarily in North America, which has resulted in a more elevated-than-expected promotional environment as well as order cancellations in its wholesale channel to manage trade inventories.
The owner of active-lifestyle brands that include Vans, The North Face, Timberland, and Dickies also announced that its chairman, president and CEO Steve Rendle is retiring with immediate effect.
Lead independent director Benno Dorer has been named interim president and CEO. Richard Carucci, a director on the Board since 2009, will serve as interim chairman, the company added.
“We are fortunate to have Benno lead VF while the Board conducts a search for a permanent CEO,” Carucci said in a statement.
“He knows VF extremely well and has an excellent track record of generating strong business results in a global consumer portfolio business,” he added.
Also weighing on its 2023 earnings, but to a lesser degree, are the impact of inflation on consumer spending in Europe and ongoing COVID-related disruption in China, VF said.
The company now expects total revenue growth for the second half to March 31, 2022, of 3% to 4% in constant dollars, down from previous guidance of 5% to 6%. Adjusted diluted earnings per share for the full year is now expected to be $2 to $2.20, versus $3.18 in the prior year and compared to the previous outlook of $2.40 to $2.50, VF said.
VF’s shares declined more than 7% in early trade on Monday.
Contact the author at stephen.gunnion@proactiveinvestors.com
