V.F. Corporation · NYSE:VFC

V.F — Q3 2021 Earnings Presentation

36 slides from V.F's earnings presentation, Jan 27, 2021

  1. Slide 1: Q3 Fiscal 2021 Earnings Presentation

    Q3 Fiscal 2021 Earnings Presentation JANUARY 27, 2021

  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 and information presented are on a continuing operations basis, and thus exclude the Occupational Workwear and Jeans businesses. Additionally, unless otherwise noted, all numbers are on an “adjusted” basis which excludes transaction and deal related expenses associated p

  4. Slide 4: VF Purpose

    VF Purpose WE POWER MOVEMENTS OF SUSTAINABLE AND ACTIVE LIFESTYLES FOR THE BETTERMENT OF PEOPLE AND OUR PLANET Named to Forbes JUST 100 Named one of the 2020+ Top VF announced commitment to the (out of 1,000 largest Companies for Executive Women United Nations Global Compact US public companies) by

  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 1 5

  6. Slide 6: COVID-19 Update

    COVID-19 Update

  7. Slide 7: COVID-19 Operational Update as of 1/25/21

    COVID-19 Operational Update as of 1/25/21  Offices open with limited capacity; two locations remain closed  >95% of retail stores were open at the beginning of the third quarter, with all stores re-opened by mid-October. ~15% North America of stores were re-closed by the end of the third quarter.

  8. Slide 8: Q3'21 Business & Financial Performance

    Q3’21 Business & Financial Performance

  9. Slide 9: Business Performance

    Q3'21 Business Performance Adjusted Revenue Gross Margin Vans® $3.0B 55.7% -6% / -8% C$ -6% / -8% C$ -150bps / -160bps C$ The North Face® DTC Greater China Flat / -2% C$ -2% / -4% C$ +18% / +11% C$ Digital +53% / +49% C$ Mainland China +22% / +15% C$ Q 3 F I S C A L 2 0 2 1 9

  10. Slide 10: Financial Performance

    Q3’21 Financial Performance Adjusted Adjusted Adjusted Operating Earnings Revenue Gross Margin Margin Per Share* $3.0B 55.7% 15.4% $0.93 *On a diluted basis Q 3 F I S C A L 2 0 2 1 10

  11. Slide 11: Financial Summary

    Q3'21 Financial Summary $ in millions; except EPS Q3’20 Q3'21 YOY CHANGE ADJUSTED REVENUE $3,155 $2,972 -6% ADJUSTED GROSS MARGIN 57.2% 55.7% -150 bps ADJUSTED OPERATING INCOME $556 $458 -18% ADJUSTED OPERATING MARGIN 17.6% 15.4% -220 bps ADJUSTED NET INCOME $462 $366 -21% ADJUSTED EARNINGS PER SHAR

  12. Slide 12: Strategic Growth Drivers

    Q3'21 Strategic Growth Drivers Big 4 Brands International DTC DTC Digital -5% flat -2% +53% -7% C$ -4% C$ -4% C$ +49% C$ Q 3 F I S C A L 2 0 2 1 12

  13. Slide 13: Q3'21: Revenue Breakdown

    Q3'21: Revenue Breakdown REVENUE -8% C$ TOTAL BIG 4 BRANDS -5% (-7% C$), with Vans® -6% (-8% C$), The North Face® $2,972 M REVENUE flat (-2% C$), Timberland ® -14% (-17% C$), and Dickies® +9% (+7% C$) -6% Reported -6% INTERNATIONAL flat (-4% C$), with Greater China +18% (+11% C$), including Mainland

  14. Slide 14: Big Four Brand Revenue

    Q3'21 Big Four Brand Revenue -6% flat -14% +9% -8% C$ -2% C$ -17% C$ +7% C$ Q 3 F I S C A L 2 0 2 1 14

  15. Slide 15: Gross Margin Bridge

    Q3'21 Gross Margin Bridge +90 bps 57.2% +10 bps 55.7% -250bps Includes -90 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 3 F I S C A L 2 0 2 1 15

  16. Slide 16: Operating Margin Bridge

    Q3'21 Operating Margin Bridge 17.6% +40 bps 15.4% -150 bps -100 bps -10bps Note: Operating Margin on an adjusted basis *Numbers on an adjusted organic basis Q 3 F I S C A L 2 0 2 1 16 ** Reflects the impact of FX translation only

  17. Slide 17: Q3'21 Brand Performance

    Q3'21 Brand Performance

  18. Slide 18: Vans Global Performance

    Q3'21 Vans® Global Performance REVENUE DECREASED -6% (-8% C$) -6%  DTC Digital +52% (+48% C$), DTC B&M -29% (-30% C$) due to store re-closures (>15% of DTC stores were re-closed at the end of Q3)  APAC +15% (+9% C$), led by +28% (+21% C$) growth in Greater China, including +29% (+21% C$) growth in

  19. Slide 19: Vans Regional Performance

    Q3'21 Vans® Regional Performance AM E R I C AS - 1 0 % EUROPE -9% (-13% C$) AP A C + 1 5 % ( + 9 % C $ ) WHOLESALE WHOLESALE DTC -5% -4% WHOLESALE -1% (-9% C$) DTC -13% (-6% C$) +37% (-17% C$) DTC (+30% C$) -13%  DTC Digital +43% driven by strong conversion and an  On average, ~19% of DTC B&M door

  20. Slide 20: The North Face Global Performance

    Q3'21 The North Face ® Global Performance REVENUE FLAT (-2% C$)  DTC Digital +64% (+61% C$) with accelerated growth across all regions flat  Sequential improvement in the Americas; EMEA and APAC return to growth  Balanced performance across On Mountain and Off Mountain product; Gucci® collab laun

  21. Slide 21: The North Face Regional Performance

    Q3'21 The North Face ® Regional Performance AM E R I C AS - 1 2 % EUROPE +22% (+17% C$) AP A C + 1 6 % ( + 1 0 % C $ ) WHOLESALE WHOLESALE DTC +13% WHOLESALE -22% +22% (+8% C$) +23% DTC (+18% C$) (+15% C$) -2% DTC +17% (+11% C$)  DTC Digital +56% C$  On average, ~25% of DTC B&M doors were closed d

  22. Slide 22: Timberland Global Performance

    Q3'21 Timberland ® Global Performance REVENUE DECREASED -14% (-17% C$) -14%  DTC -10% (-13% C$), including +37% (+32% C$) growth in DTC Digital  Growth from Timberland PRO® and Outdoor Footwear  Sell-through momentum with strategic wholesale partners; inventory levels low  Generated brand heat t

  23. Slide 23: Timberland Regional Performance

    Q3'21 Timberland ® Regional Performance AM E R I C AS - 1 9 % ( - 1 8 % C $ ) EUROPE -11% (-16% C$) AP A C - 6 % ( - 1 1 % C $ ) WHOLESALE DTC WHOLESALE DTC +12% -6% -1 1 % -12% (+6% C$) WHOLESALE (-1 6 % C$) (-18% C$) -2 5 % DTC -15% (-19% C$)  DTC Digital growth of +45% C$  On average, ~46% of D

  24. Slide 24: Dickies Global Performance

    Q3'21 Dickies® Global Performance REVENUE INCREASED +9% (+7% C$) +9%  DTC Digital +37% (+33% C$)  Solid performance in all geographic regions, balanced growth across channels  Growth in APAC led by +16% (+9% C$) growth in Greater China, including +12% (+6% C$) in Mainland China  Work-inspired li

  25. Slide 25: Dickies Regional Performance

    Q3'21 Dickies® Regional Performance AM E R I C AS + 8 % EUROPE +7% (+3% C$) AP AC + 1 4 % ( + 8 % C $ ) DTC DTC +82% +31% (+75% C$) DTC WHOLESALE +28% +6% (+21% C$) WHOLESALE -4% (flat C$) WHOLESALE (-7% C$) +3%  DTC Digital +37%  On average, ~27% of DTC B&M doors were closed  DTC performance str

  26. Slide 26: FY'21 Update

    TL HE pe LAAT TTT TL - LACE mA

  27. Slide 27: FY'21 Expected Business Evolution

    FY’21 Expected 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

  28. Slide 28: Supreme Acquisition Completed on December 28, 2020

    Supreme ® Acquisition Completed on December 28, 2020 Expected Accretion FISCAL 2021 FISCAL 2022 REVENUE ~$125M >$500M ADJUSTED EARNINGS PER SHARE* ~$0.05 >$0.20 Q 3 F I S C A L 2 0 2 1 28 *On a diluted basis.

  29. Slide 29: Fiscal Year 2021 Outlook – Including Supreme

    Fiscal Year 2021 Outlook – Including Supreme ® Adjusted Earnings Per Adjusted Free Revenue Share* Cash Flow $9.1B - $9.2B ~$1.30 ~$650M PREVIOUSLY >$9.0B PREVIOUSLY >$1.20 PREVIOUSLY >$600M Q 3 F I S C A L 2 0 2 1 29 *On a diluted basis.

  30. Slide 30: FY'21 Cash Evolution

    FY’21 Cash Evolution Net proceeds from Occupational Work divestiture incremental to $3.0B ($2.2B) liquidity estimates below $0.9B ($0.6B) $0.3B $3.9B ~($0.2B) ($0.2B) ($2.0B) $1.0B $1.4B >$1.5B FY’21 4/7/20 Term Revolver Q3’21 Q3’21 YTD Short- Q3’21 Q4’21 Free Q4’21 Supreme FY’21 Ending Beginning Re

  31. Slide 31: Appendix

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  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 2020 (Unaudited) (In thousands, except per share amounts) As Reported Transaction and Deal Specified Strategic Three Months Ended Dec

  33. Slide 33: 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) Relocation and Specified Strategic Pension As Reported Transaction and Deal

  34. Slide 34: 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 2020 Top 4 Brand Revenue Growth Americas EMEA APAC Global ® Vans % cha nge (10)% (9)% 15 % (6)% (a) % cha nge cons ta nt currency (10)% (13)% 9% (8)

  35. Slide 35: Appendix: Segment, Geographic & Channel Revenue – Q3'21

    Appendix: Segment, Geographic & Channel Revenue – Q3'21 VF CORPORATION Supplemental Financial Information Reportable Segment, Geographic and Channel Revenue Growth (Unaudited) Three Months Ended December 2020 % Change Constant Currency % Change Constant (a) (a) % Change * % Change Adjusted Currency

  36. Slide 36: Q 3 F I S C A L 2 0 2 1 36

    Q 3 F I S C A L 2 0 2 1 36

V.F. — Q3 2021 Earnings Presentation on 6ix