V.F. Corporation · NYSE:VFC
V.F — Q4 FY2021 Earnings Presentation
52 slides from V.F's earnings presentation, May 21, 2021
Slide 1: Q4 Fiscal 2021 Earnings Presentation
Q4 Fiscal 2021 EARNINGS PRESENTATION MAY 21, 2021
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements included in this release are "forward-looking statements" within the meaning of the federal securities laws. Forward-looking statements are made based on our expectations and beliefs concerning future events impacting VF and therefore involve several risks an
Slide 3: GAAP to Non-GAAP
GAAP to Non-GAAP All numbers and information presented are on a continuing operations basis, and thus exclude the Occupational Workwear and Jeans businesses. All numbers include the impact of the 53rd week in fiscal 2021. Additionally, unless otherwise noted, all numbers are on an “adjusted” basis w
Slide 4: VF Purpose
VF Purpose WE POWER MOVEMENTS OF SUSTAINABLE AND ACTIVE LIFESTYLES FOR THE BETTERMENT OF PEOPLE AND OUR PLANET Partnered with Management Ranked #8 on Barron’s 2021 list of 100 Announced goal to eliminate all Leadership for Tomorrow for Black Most Sustainable Companies single-use plastic packaging by
Slide 5: Fiscal 2024 Global Business Strategy
Fiscal 2024 Global Business Strategy DRIVE AND ELEVATE DISTORT TO OPTIMIZE OUR DIRECT ASIA PORTFOLIO CHANNELS ACCELERATE CONSUMER-MINDED, RETAIL- CENTRIC, HYPER-DIGITAL BUSINESS MODEL TRANSFORMATION Q 4 F I S C A L 2 0 2 1 5
Slide 6: COVID-19 Update
g —-COVID-19 Updates
Slide 7: COVID-19 Operational Update as of 5/18/2021
COVID-19 Operational Update as of 5/18/2021 Offices open with limited capacity; two locations remain closed North America ~15% of retail stores were closed at the beginning of the fourth quarter. Most stores have since re-opened and <5% of stores were closed at the end of the fourth quarter Of
Slide 8: Q4'21 Business & Financial Performance
Q4’21 Business & Financial Performance
Slide 9: Business Performance
Q4'21 Business Performance Adjusted Revenue Gross Margin Vans® $2.6B 52.7% +13% / +10% C$ +23% / +19% C$ -120bps / -120bps C$ +16%* / +12% C$* -180bps* / -190bps C$* The North Face® DTC Greater China +28% / +23% C$ +36% / +32% C$ +81% / +70% C$ +19%* / +15% C$* Mainland China +98% / +84% C$ Digital
Slide 10: Financial Performance
Q4’21 Financial Performance Adjusted Adjusted Adjusted Operating Earnings Revenue Gross Margin Margin Per Share* $2.6B 52.7% 6.7% $0.27 *On a diluted basis Q 4 F I S C A L 2 0 2 1 10
Slide 11: Financial Summary
Q4'21 Financial Summary $ in millions; except EPS Q4’20 Q4'21 YOY CHANGE YOY CHANGE* REVENUE $2,102 $2,583 +23% +16% ADJUSTED GROSS MARGIN 53.9% 52.7% -120 bps -180 bps ADJUSTED OPERATING INCOME $87 $173 +98% +59% ADJUSTED OPERATING MARGIN 4.1% 6.7% +260 bps +160 bps ADJUSTED NET INCOME $40 $106 +16
Slide 12: Strategic Growth Drivers
Q4'21 Strategic Growth Drivers Big 4 Brands International DTC DTC Digital +20% +21% / +13% C$ +36% / +32% C$ +106% / +99% C$ +16% C$ +16%* / +8% C$* +19%* / +15% C$* +65%* / +58% C$* *Organic Q 4 F I S C A L 2 0 2 1 12
Slide 13: Q4'21: Revenue Breakdown
Q4'21: Revenue Breakdown REVENUE +19% C$; excluding acquisitions revenue +16%* (+12% C$*) including the impact of the 53rd week TOTAL BIG 4 BRANDS +20% (+16% C$), with Vans® +13% (+10% C$), The North Face® +28% (+23% C$), Timberland ® +25% (+19% C$), and Dickies® +22% (+19% C$) $2,583 M REVENUE INTE
Slide 14: Big Four Brand Revenue
Q4'21 Big Four Brand Revenue +13% +28% +25% +22% +10% C$ +23% C$ +19% C$ +19% C$ Q 4 F I S C A L 2 0 2 1 14
Slide 15: Gross Margin Bridge
Q4'21 Gross Margin Bridge 53.9% -20 bps +60 bps 52.7% +10 bps -170bps Includes -70 bps impact from FX transaction timing Note: Gross Margin on an adjusted basis *Numbers on an adjusted organic basis ** Reflects the impact of FX translation only Q 4 F I S C A L 2 0 2 1 15
Slide 16: Operating Margin Bridge
Q4'21 Operating Margin Bridge +100 bps 6.7% +310 bps +10 bps 4.1% +20 bps -180 bps Note: Operating Margin on an adjusted basis *Numbers on an adjusted organic basis Q 4 F I S C A L 2 0 2 1 16 ** Reflects the impact of FX translation only
Slide 17: Q4'21 Brand Performance
Q4'21 Brand Performance
Slide 18: Vans Global Performance
Q4'21 Vans ® Global Performance REVENUE INCREASED +13% (+10% C$) DTC +19% (+17% C$) led by Digital +57% (+52% C$), brick and mortar returns to growth globally despite extended lockdowns across +13% EMEA APAC +32% (+24% C$) led by +43% (+33% C$) growth in Greater China Accelerating momentum acr
Slide 19: Vans Regional Performance
Q4'21 Vans ® Regional Performance AM E R I C AS + 1 4 % ( + 1 3 % C $ ) EUROPE +3% (-4% C$) AP A C + 3 2 % ( + 2 4 % C $ ) DTC +17% (+9% C$) WHOLESALE DTC WHOLESALE +44% +20% +7% DTC WHOLESALE (+37% C$) (+12% C$) (+6% C$) +19% flat (-8% C$) DTC Digital +73%, strong consumer engagement with new O
Slide 20: The North Face Global Performance
Q4'21 The North Face ® Global Performance REVENUE INCREASED 28% (+23% C$) DTC +17% (+13% C$) led by Digital +63% (+56% C$) +28% Continued strength internationally, with 19% C$ growth in EMEA and 93% C$ growth in APAC Clean inventory levels in all channels globally VECTIV™ trail running and h
Slide 21: The North Face Regional Performance
Q4'21 The North Face ® Regional Performance AM E R I C AS + 1 3 % ( + 1 2 % C $ ) EUROPE +29% (+19% C$) AP A C + 1 0 4 % ( + 9 3 % C $ ) DTC +26% WHOLESALE DTC (+16% C$) WHOLESALE WHOLESALE DTC +27% +1% +159% +30% +72% (+26% C$) (+146% C$) (+20% C$) (+62% C$) DTC Digital +19% C$ On average, ~50%
Slide 22: Timberland Global Performance
Q4'21 Timberland ® Global Performance REVENUE INCREASED +25% (+19% C$) DTC +22% (+16% C$), including +106% (+96% C$) growth in DTC Digital +25% Strong growth from Classics, Outdoor Footwear and Timberland PRO® EMEA region returned to growth with strong DTC Digital growth more than offsetting B
Slide 23: Timberland Regional Performance
Q4'21 Timberland ® Regional Performance AM E R I C AS + 2 1 % EUROPE +11% (+2% C$) AP A C + 6 5 % ( + 5 7 % C $ ) DTC +35% DTC WHOLESALE +13% +1 0 % WHOLESALE DTC (+4% C$) (+1% C$) +156% +19% (+143% C$) (+13% C$) WHOLESALE +16% (+15% C$) DTC Digital growth of +104% C$ On average, ~80% of DTC B&M
Slide 24: Dickies Global Performance
Q4'21 Dickies ® Global Performance REVENUE INCREASED +22% (+19% C$) DTC Digital +57% (+52% C$) +22% Growth in APAC led by +120% (+107% C$) growth in Greater China, including +162% (+143% C$) in Mainland China Continued strong performance from key strategic growth drivers – Work-inspired lifest
Slide 25: Dickies Regional Performance
Q4'21 Dickies ® Regional Performance AM E R I C AS + 9 % EUROPE +5% (-3% C$) AP AC + 1 2 0 % ( + 1 0 7 % C $ ) DTC DTC +54% +74% (+53% C$) (+63% C$) DTC +38% WHOLESALE (+29% C$) WHOLESALE +244% -3% (+225% C$) (-11% C$) WHOLESALE +3% DTC Digital +60% C$ DTC Digital +137% C$ with strength across
Slide 26: FY'21 Business & Financial Performance
FY’21 Business & Financial Performance
Slide 27: Business Performance
FY'21 Business Performance Adjusted Revenue Gross Margin Vans® $9.2B 53.3% -15% / -16% C$ -12% / -13% C$ -220bps / -220bps C$ -13%* / -15% C$* -230bps* / -240bps C$* The North Face® DTC Greater China -9% / -11% C$ -5% / -7% C$ +24% / +20% C$ -8%* / -10% C$* Mainland China +30% / +25% C$ Digital +67%
Slide 28: Financial Performance
FY’21 Financial Performance Adjusted Adjusted Adjusted Operating Earnings Revenue Gross Margin Margin Per Share* $9.2B 53.3% 8.0% $1.31 *On a diluted basis Q 4 F I S C A L 2 0 2 1 28
Slide 29: Financial Summary
FY'21 Financial Summary $ in millions; except EPS FY’20 FY'21 YOY CHANGE YOY CHANGE* ADJUSTED REVENUE $10,474 $9,239 -12% -13% ADJUSTED GROSS MARGIN 55.5% 53.3% -220 bps -230 bps ADJUSTED OPERATING INCOME $1,345 $742 -45% -47% ADJUSTED OPERATING MARGIN 12.8% 8.0% -480 bps -500 bps ADJUSTED NET INCOM
Slide 30: Strategic Growth Drivers
FY'21 Strategic Growth Drivers Big 4 Brands International DTC DTC Digital -11% -7% / -11% C$ -5% / -7% C$ +67% / +64% C$ -13% C$ -8%* / -12% C$* -8%* / -10% C$* +58%* / +55% C$* Revenue on an adjusted basis. Q 4 F I S C A L 2 0 2 1 30 *Organic
Slide 31: FY'21: Revenue Breakdown
FY'21: Revenue Breakdown REVENUE -13% C$; excluding acquisitions revenue -13%* (-15% C$*) including the impact of the 53rd week TOTAL BIG 4 BRANDS +11% (+13% C$), with Vans® -15% (-16% C$), The North Face® -9% (-11% C$), Timberland ® -14% (-17% C$), and Dickies® +9% $9,239 M REVENUE (+7% C$) -12% Re
Slide 32: Big Four Brand Revenue
FY'21 Big Four Brand Revenue -15% -9% -14% +9% -16% C$ -11% C$ -17% C$ +7% C$ Q 4 F I S C A L 2 0 2 1 32
Slide 33: Gross Margin Bridge
FY'21 Gross Margin Bridge +50 bps 55.5% +10 bps +10 bps 53.3% -290bps Includes -70 bps impact from FX transaction timing Note: Gross Margin on an adjusted basis *Numbers on an adjusted organic basis ** Reflects the impact of FX translation only Q 4 F I S C A L 2 0 2 1 33
Slide 34: Operating Margin Bridge
FY'21 Operating Margin Bridge 12.8% -230 bps -50 bps +10bps +20bps 8.0% -230 bps Note: Operating Margin on an adjusted basis *Numbers on an adjusted organic basis Q 4 F I S C A L 2 0 2 1 34 ** Reflects the impact of FX translation only
Slide 35: FY'21 Cash Evolution
FY’21 Cash Evolution $3.0B ($2.2B) $1.0B ($0.8B) ($2.0B) $1.0B $1.4B $1.45B FY’21 4/7/20 Term Revolver FY’21 FY’21 Supreme FY’21 Ending Beginning Revolver Debt & CP Free Dividend Acquisition Cash and Cash and Draw Offer Paydown Cash Payments Investments Investments Flow Total Liquidity1 $2.4B $3.6B*
Slide 36: FY'21 Business Evolution
FY’21 Business Evolution 1Q21 2Q21 3Q21 4Q21 North America and EMEA North America re-opening in Steady improvement in North North America stabilizes begin to reopen flux America ↔ On a normalized basis, EMEA Continued steady Continued steady ↔ EMEA stabilizes begins to return to growth i
Slide 37: Supreme Acquisition Completed on December 28, 2020
Supreme ® Acquisition Completed on December 28, 2020 Accretion FISCAL 2021 FISCAL 2022 REVENUE $142M ~$600M ADJUSTED EARNINGS PER SHARE* $0.06 ~$0.25 Q 4 F I S C A L 2 0 2 1 37 *On a diluted basis.
Slide 38: FY'22 Outlook
FY’22 Outlook
Slide 39: Fiscal Year 2022 Outlook
Fiscal Year 2022 Outlook Adjusted Adjusted Adjusted Adjusted Operating Earnings Revenue Gross Margin Margin Per Share* Supreme® ~$11.8B >56% ~12.8% ~$3.05 Revenue ~+28% +>270bps ~+480bps ~+134% ~$600M Earnings Per Share* ~$0.25 *On a diluted basis. Q 4 F I S C A L 2 0 2 1 39
Slide 40: Fiscal Year 2022 Revenue Outlook: Segments
Fiscal Year 2022 Revenue Outlook: Segments Outdoor Active Work +23% to +25% +34% to +36% +10% to +12% Q 4 F I S C A L 2 0 2 1 40
Slide 41: Fiscal Year 2022 Revenue Outlook: Brands
Fiscal Year 2022 Revenue Outlook: Brands +26% to +25% to +16% to +10% to +28% +27% +18% +12% Q 4 F I S C A L 2 0 2 1 41
Slide 42: Fiscal Year 2022 Revenue Outlook: Regions
Fiscal Year 2022 Revenue Outlook: Regions +29% to +31% EMEA +28% to +30% U.S. +18% to +20% APAC +28% to +30% AMERICAS (non-U.S.) Q 4 F I S C A L 2 0 2 1 42
Slide 43: Fiscal Year 2022 Revenue Outlook: Channels
Fiscal Year 2022 Revenue Outlook: Channels Direct-to- Direct-to-Consumer Wholesale Consumer Digital +17% to +19% +38% to +40% +29% to +31% Q 4 F I S C A L 2 0 2 1 43
Slide 44: FY'22: Revenue Breakdown
FY’22: Revenue Breakdown BY SEGMENT B Y C H AN N E L BY REGION B Y B R AN D DTC: US WHOLESALE THE STORES EMEA NORTH OUTDOOR USA VANS FACE ACTIVE INTERNATIONAL TIMBERLAND DTC: WHOLESALE APAC DIGITAL NON-US DICKIES WORK DIGITAL AMERICAS OTHER WHOLESALE SUPREME Q 4 F I S C A L 2 0 2 1 44
Slide 45: FY'22 Cash Evolution
FY’22 Cash Evolution Long-term capital allocation priorities unchanged: M&A, dividend, share repurchases with near-term focus on deleverage ~$2.0B $1.45B FY’22 Beginning Cash FY’22 Occupational Work FY’22 Dividend All Other FY’22 Ending Cash and Investments Free Cash Flow Divestiture Proceeds Paymen
Slide 46: Appendix
Appendix
Slide 47: Appendix: GAAP to Non-GAAP
Appendix: GAAP to Non-GAAP VF CORPORATION Supplemental Financial Information Reconciliation of Select GAAP Measures to Non-GAAP Measures - Three and Twelve Months Ended March 2021 (Unaudited) (In thousands, except per share amounts) As Reported Transaction and Deal Specified Strategic Contribution f
Slide 48: Appendix: GAAP to Non-GAAP
Appendix: GAAP to Non-GAAP VF CORPORATION Supplemental Financial Information Reconciliation of Select GAAP Measures to Non-GAAP Measures - Three and Twelve Months Ended March 2020 (Unaudited) (In thousands, except per share amounts) Relocation and Pension Settlement Charge, Specified Strategic Goodw
Slide 49: Appendix: Top 4 Brand Revenue
Appendix: Top 4 Brand Revenue VF CORPORATION Supplemental Financial Information Top 4 Brand Revenue Information (Unaudited) Three Months Ended March 2021 Twelve Months Ended March 2021 Top 4 Brand Revenue Growth Americas EMEA APAC Global Americas EMEA APAC Global ® Vans % cha nge 14 % 3% 32 % 13 % (
Slide 50: Appendix: Segment, Geographic & Channel Revenue – Q4'21
Appendix: Segment, Geographic & Channel Revenue – Q4'21 VF CORPORATION Supplemental Financial Information Reportable Segment, Geographic and Channel Revenue Growth - Three Months Ended March 2021 (Unaudited) Three Months Ended March 2021 % Change Constant % Change Constant % Change Currency* % Chang
Slide 51: Appendix: Segment, Geographic & Channel Revenue – FY'21
Appendix: Segment, Geographic & Channel Revenue – FY'21 VF CORPORATION Supplemental Financial Information Reportable Segment, Geographic and Channel Revenue Growth - Twelve Months Ended March 2021 (Unaudited) Twelve Months Ended March 2021 % Change Constant % Change Constant % Change Constant % Chan
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