VF Corporation has initiated an in-depth strategic review of the brands within its portfolio to ensure the company owns the brands that create the greatest long-term value.
“This quarter marked the beginning of the next phase of our transformation plan (Reinvent Strategy): resetting the marketplace for Vans, reviewing our brand portfolio and continuing to build the organization of the future,” said president and CEO Bracken Darrell.
The announcement followed the release of the company’s third-quarter results showing revenue plummeted 16 per cent year on year to $4.6 billion (US$3 billion) (and by 17 per cent in constant currency).
The company attributed the results to the negative impact of a shift in the timing of wholesale deliveries, especially for The North Face brand and the EMEA region.
Sales were down 28 per cent for Vans and dropped 10 per cent for The North Face. Timberland and Dickies reported declines of 21 per cent and 16 per cent, respectively.
By region, the Americas saw revenue plunge 24 per cent and EMEA posted a 7 per cent decrease. However, sales in the Asia-Pacific region rose 2 per cent, including a 5 per cent increase in Greater China.
Darrell described the company’s performance as “disappointing” but said he remains confident the Reinvent strategy will stabilise revenue and improve operational results.
For the full year, the company reaffirmed its free cash flow guidance of approximately $922 million.