VF announces record Q3 results
VF Corporation has announced record results for the third quarter of 2011. Revenues rose 23% to $2,750.1 million from $2,232.4 million in 2010. The acquisition of The Timberland Company, which was completed on September 13, added $163.6 million to revenues.
Excluding Timberland, organic revenue growth in the quarter was 16%. All VF coalitions achieved strong revenue gains: outdoor and action sports revenues, which now include the Timberland and Smartwool brands, grew 37%; jeanswear revenues rose 8%; imagewear revenues increased 14%; sportswear revenues grew 18%; and contemporary brands revenues were up 11%.
Gross margin declined, to 45.3% from 46.5% in the 2010 period, reflecting the impact of higher product costs. Operating income of $430.1 million included a net benefit from the Timberland acquisition of $13.5 million, which included acquisition-related expenses of $26.6 million. Operating margin was 15.6% compared with 15.9% in the 2010 period, with acquisition-related expenses negatively impacting operating margin by approximately 100 basis points. On an organic basis, the third quarter operating margin increased to 16.1% from 15.9%.
Net income grew 24% to $300.7 million from $242.8 million.
“The strength of VF’s diversified brand portfolio has never been more evident,” said Eric Wiseman, chairman and CEO. “These results, in this environment, clearly demonstrate that VF has the right brands and strategies for strong and sustainable long-term growth. Our businesses continue to post healthy and very profitable organic growth, and the acquisition of Timberland further strengthens our portfolio with the addition of two outstanding outdoor brands.”
