V.F. Corporation · NYSE:VFC

V.F — Q3 FY2020 Earnings Presentation

35 slides from V.F's earnings presentation, Jan 23, 2020

  1. Slide 1: Q3 Fiscal 2020 Earnings Presentation

    Q3 Fiscal 2020 E A R N I N G S P R E S E N TAT I O N January 23, 2020

  2. Slide 2: Safe Harbor Statement

    Safe Harbor Statement Certain statements included in this presentation 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 ris

  3. Slide 3: GAAP to Non-GAAP

    GAAP to Non-GAAP All numbers presented in this presentation, unless otherwise noted, are on an adjusted continuing operations basis which excludes transaction and deal related expenses associated with the acquisitions and integration of Icebreaker® and Altra®, transaction expenses associated with th

  4. Slide 4: Our Purpose

    Our Purpose VF POWERS MOVEMENTS OF SUSTAINABLE AND ACTIVE LIFESTYLES FOR THE BETTERMENT OF PEOPLE AND OUR PLANET Q 3 F I S C A L 2 0 2 0 4

  5. 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 3 F I S C A L 2 0 2 0 5

  6. Slide 6: Q3'20 Business & Financial Highlights

    Q3’20 Business & Financial Highlights

  7. Slide 7: Q3'20: Business Highlights

    Q3’20: Business Highlights Adjusted Revenue Adjusted Gross Margin Vans® $3.4B 55.7% +12% / +13% C$ +5% / +6% C$ +100bps diversified growth in all regions / +6%* / +7%* C$ channels / product families The North Face® DTC China +8% +7% +30% / +32% C$ balanced growth across total comps +6%, with led by

  8. Slide 8: Q3'20 Financial Highlights

    Q3’20 Financial Highlights Adjusted Adjusted Adjusted Adjusted Operating Earnings Revenue Gross Margin Margin Per Share*** $3.4B 55.7% 17.6% $1.23 +5% / +6% C$ +100bps +100bps +14% / +14% C$ +6%** / +7%** C$ +130bps** +13%* / +14%* C$ *Organic **Excluding the occupational Work businesses Q 3 F I S C

  9. Slide 9: Q3'20: Financial Summary

    Q3’20: Financial Summary $ in millions; except EPS Q3’19 Q3'20 YOY CHANGE YOY CHANGE* ADJUSTED REVENUE $3,228 $3,385 +5% +5% ADJUSTED GROSS MARGIN 54.7% 55.7% +100bps +100bps ADJUSTED OPERATING INCOME $535 $595 +11% +11% ADJUSTED OPERATING MARGIN 16.6% 17.6% +100bps +100bps ADJUSTED NET INCOME $433

  10. Slide 10: Q3'20: Strategic Growth Drivers

    Q3'20: Strategic Growth Drivers Big 4 Brands International DTC +6% +8% +7% +7% C$ +9% C$ +7% C$ Q 3 F I S C A L 2 0 2 0 10

  11. Slide 11: Q3'20: Revenue Breakdown

    Q3’20: Revenue Breakdown REVENUE +6% C$; revenue +6% (+7% C$) excluding the occupational TOTAL Work businesses BIG 4 BRANDS +6% (+7% C$), led by +12% (+13% C$) growth at Vans® , $3,385 M REVENUE +8% growth at The North Face® and +13% growth at Dickies® +5% Reported +5% INTERNATIONAL +8% (+9% C$), le

  12. Slide 12: Q3'20: Big Four Brand Revenue

    Q3'20: Big Four Brand Revenue +12% +8% -5% +13% +13% C$ +8% C$ -4% C$ +13% C$ Q 3 F I S C A L 2 0 2 0 12

  13. Slide 13: Q3'20: Gross Margin Bridge

    Q3'20: Gross Margin Bridge +60 bps NM NM 55.7% +40 bps 54.7% Note: Gross Margin on an adjusted basis *Numbers on an adjusted organic basis ** Reflects the impact of FX translation only Q 3 F I S C A L 2 0 2 0 13

  14. Slide 14: Q3'20: Operating Margin Bridge

    Q3'20: Operating Margin Bridge +100 bps +100 bps NM NM 17.6% 16.6% -100 bps Strategic Investments +9% Note: Operating Margin on an adjusted basis *Numbers on an adjusted organic basis Q 3 F I S C A L 2 0 2 0 14 ** Reflects the impact of FX translation only

  15. Slide 15: Q3'20 Brand Highlights

    Q3'20 Brand Highlights 1

  16. Slide 16: Q3'20: Vans Global Performance

    Q3'20: Vans® | Global Performance REVENUE INCREASED +12% (+13% C$) WITH BALANCED GROWTH ACROSS CHANNELS, REGIONS AND CATEGORIES  DTC +12% with +9% total comp, including +26% (+27% C$) growth in DTC digital +12%  Wholesale increased +12% (+14% C$) with strength across all regions  Footwear +12% (H

  17. Slide 17: Q3'20: Vans Regional Performance

    Q3'20: Vans® | Regional Performance AM E R I C AS + 9 % EUROPE +14% (+16% C$) AP A C + 2 3 % ( + 2 5 % C $ ) DTC +13% (+15% C$) WHOLESALE DTC WHOLESALE +25% +21% +7% WHOLESALE (+23% C$) (+27% C$) (+8% C$) DTC +15% +10% (+17% C$)  Strong, balanced growth across channels led by DTC  Strong, balanced

  18. Slide 18: Q3'20: The North Face Global Performance

    Q3'20: The North Face ® | Global Performance REVENUE INCREASED +8% LED BY INTERNATIONAL +8%  DTC +7%, including +6% total comp and +12% (+13% C$) growth in DTC digital​  Wholesale increased +9% (+10% C$) driven by strength in all regions​  Double-digit growth across Mountain Lifestyle & Urban Exp

  19. Slide 19: Q3'20: The North Face Regional Performance

    Q3'20: The North Face ® | Regional Performance AM E R I C AS + 4 % EUROPE +15% (+17% C$) AP A C + 1 3 % ( + 1 5 % C $ ) WHOLESALE +4 3 % WHOLESALE DTC (+4 4 % C$) +8 % +2 6 % DTC (+1 0 % C$) (+2 8 % C$) WHOLESALE +3 % DTC +6 % +3 % (+4 % C$)  Stronger than expected Futurelight™  Balanced double-di

  20. Slide 20: Q3'20: Timberland Global Performance

    Q3'20: Timberland ® | Global Performance -5% REVENUE DECREASED -5% (-4% C$)  DTC -3% (-2% C$) with flat total comp; +6% in DTC Digital; Wholesale declined -7% (-6% C$)  Double-digit growth in Apparel was more than offset by a decline in Footwear FISCAL 2020 OUTLOOK: Revenue now expected to be -2%

  21. Slide 21: Q3'20: Timberland Regional Performance

    Q3'20: Timberland ® | Regional Performance AM E R I C AS - 4 % EUROPE -9% (-7% C$) AP A C f l a t ( + 1 % C $ ) DTC -1% WHOLESALE WHOLESALE DTC +1 4 % -1 4 % -2% (-1 2 % C$) (flat C$) WHOLESALE -6 % DTC (-5% C$) -5%  DTC Digital +9%  Challenging performance in Men’s Classics and  Strength in Chin

  22. Slide 22: Q3'20: Dickies Global Performance

    Q3'20: Dickies® | Global Performance +13% REVENUE INCREASED +13% DRIVEN BY STRENGTH ACROSS REGIONS, CHANNELS AND PRODUCT CATEGORIES  Strong performance across all strategic growth drivers: Lifestyle, China, DTC, and Digital Wholesale​ FISCAL 2020 OUTLOOK: Revenue expected to increase +4% to +5% (+5

  23. Slide 23: Q3'20: Dickies Regional Performance

    Q3'20: Dickies® | Regional Performance AM E R I C AS + 7 % EUROPE +5% (+6% C$) AP A C + 4 5 % ( + 4 6 % C $ ) DTC DTC DTC +12% WHOLESALE +23% +6% +3% (+24% C$) (+7% C$) WHOLESALE WHOLESALE (+4% C$) +83% +6% (+85% C$)  Growth driven by DTC Digital +13% C$ and Digital  Strength driven by core produc

  24. Slide 24: Financial Outlook

    Financial Outlook

  25. Slide 25: Fiscal Year 2020 Outlook

    Fiscal Year 2020 Outlook Adjusted Adjusted Adjusted Adjusted Gross Operating Earnings Revenue Margin Margin Per Share*** ~$11.75B ~+5% 54.1% 13.8% ~$3.30 +80bps +90bps ~+15% ~+7%* ~+18%* +8%** PREVIOUSLY ~$11.8B, ~+8%* PREVIOUSLY $3.32 to $3.37 *Organic, C$ basis **Organic, C$ basis, excluding the o

  26. Slide 26: Fiscal Year 2020 Revenue Outlook: Segments

    Fiscal Year 2020 Revenue Outlook: Segments Outdoor Active Work ~+4% ~+8% ~+1% ~+5%* ~+12%* +2%* to +3%* +6%** to 7%** PREVIOUSLY +6%* to +7%* PREVIOUSLY +11%* to +12%* PREVIOUSLY +4%* to +5%* *Organic, C$ basis **Organic, C$ basis, excluding the occupational Work business Q 3 F I S C A L 2 0 2 0 26

  27. Slide 27: Fiscal Year 2020 Revenue Outlook: Brands

    Fiscal Year 2020 Revenue Outlook: Brands ~+14% ~+8% -3% to -2% +4% to +5% ~+15%* ~+9%* -2%* to -1%* +5%* to +6%* PREVIOUSLY +13%* to +14%* PREVIOUSLY +9%* to +10%* PREVIOUSLY +1%* to +2%* *C$ basis Q 3 F I S C A L 2 0 2 0 27

  28. Slide 28: Fiscal Year 2020 Revenue Outlook: Regions

    Fiscal Year 2020 Revenue Outlook: Regions +2% to +3% +6%* to +7%* EMEA ~+5% +5%* to +6%* PREVIOUSLY: +7%* to +8%* U.S. +12% to +13% +15%* to +16%* PREVIOUSLY: +16%* to +17%* APAC +4% to +5% +5%* to +6%* ex. impact of business model change +7%* to +8%* PREVIOUSLY: +4%* to +5%* AMERICAS (non-U.S.) *Ad

  29. Slide 29: Fiscal Year 2020 Revenue Outlook: Channels

    Fiscal Year 2020 Revenue Outlook: Channels Direct-to- Direct-to-Consumer Wholesale Consumer Digital +2% to +3% +9% to +10% +5%* to +6%* +10%* to +11%* ~+20%* PREVIOUSLY +12%* to +13%* PREVIOUSLY ~+25% *Adjusted Organic, C$ basis Q 3 F I S C A L 2 0 2 0 29

  30. Slide 30: Appendix

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  31. Slide 31: 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 Months Ended December 2019 (Unaudited) (In thousands, except per share amounts) Transaction and Relocation and Pension As Reported Deal Related Specified S

  32. Slide 32: 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 Months Ended December 2018 (Unaudited) (In thousands, except per share amounts) As Reported Transaction and Deal Relocation and other Impact of U.S. Contri

  33. Slide 33: Appendix: Top 4 Brand Revenue

    Appendix: Top 4 Brand Revenue VF CORPORATION Supplemental Financial Information Top 4 Brand Revenue Information (Unaudited) Three Months Ended December 2019 Top 4 Brand Revenue Growth Americas EMEA APAC Global ® Vans % change 9% 14 % 23 % 12 % (a ) % change constant currency 9% 16 % 25 % 13 % ® The

  34. Slide 34: Appendix: Segment, Geographic & Channel Revenue – Q3'20

    Appendix: Segment, Geographic & Channel Revenue – Q3’20 VF CORPORATION Supplemental Financial Information Reportable Segment, Geographic and Channel Revenue Growth (Unaudited) Three Months Ended December 2019 % Change Constant % Change Constant % Change Constant % Change Currency and % Change Adjust

  35. Slide 35: Q 3 F I S C A L 2 0 2 0 35

    Q 3 F I S C A L 2 0 2 0 35

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