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Investing.com - VF Corporation (NYSE:VFC) reported better-than-expected second quarter results on Tuesday, as strong performance from The North Face and Timberland brands helped offset continued weakness at Vans.
Shares of the outdoor apparel maker fell 1.26% in pre-market trading following the announcement.
The company posted adjusted earnings per share of $0.52, comfortably beating analyst expectations of $0.42. Revenue came in at $2.8 billion, exceeding the consensus estimate of $2.73 billion and representing a 2% increase YoY, or a 1% decrease on a constant currency basis.
The North Face and Timberland brands were standout performers, growing 6% and 7% respectively compared to last year, or 4% each on a constant currency basis. Meanwhile, Vans showed sequential improvement but still declined 9% YoY, or 11% on a constant currency basis.
"In Q2 we made further progress on our turnaround plan," said Bracken Darrell, President and CEO. "We delivered broad-based growth for The North Face and Timberland, while continuing to moderate declines in Vans. We also announced the pending sale of Dickies for $600 million, enhancing our capacity to invest in the portfolio and drive shareholder returns."
The company’s adjusted operating margin improved to 11.8%, up 40 basis points from the same period last year. Gross margin remained flat at 52.2% compared to the previous year.
For the third quarter, VF Corp expects revenue to decline between 1% and 3% on a constant currency basis compared to last year, with adjusted operating income projected between $275 million and $305 million.
The company’s Board of Directors declared a quarterly dividend of $0.09 per share, payable on December 18 to shareholders of record as of December 10.
VF Corp also highlighted that its net debt decreased by $1.5 billion, or 21%, compared to last year, strengthening its financial position as it continues to execute its transformation strategy.