North Face owner VF weathers warm winter
(Reuters) - At least one cold-weather clothing maker was able to keep its cool during the unusually warm winter this year.
VF Corp (VFC.N), whose outdoor gear brands include The North Face and Smartwool, posted higher-than-expected quarterly earnings on Thursday as last year's Timberland acquisition helped drive sales up 37 percent.
The results stood in contrast to what much of the apparel industry experienced during the late fall and early winter, as warm weather kept consumers from buying sweaters and heavy coats.
Jefferies analyst Taposh Bari noted the strength of VF's North Face brand.
"The biggest takeaway from the quarter is this brand's resiliency in the face of weather and European headwinds," Bari said in a note to clients. "Strength here suggests that not all 'winter brands' are created equal."
Global sales of North Face rose 22 percent, and the brand had comparable-sales growth in both the Americas and internationally, VF Corp said.
"The North Face America's fourth-quarter revenue growth was the strongest we've seen all year and included strong double-digit direct-to-consumer growth in both retail and e-commerce channels," Steve Rendle, president of VF's outdoors segment in Americas, said on a conference call with investors.
Net income rose to $257.3 million, or $2.28 a share, from $54.2 million, or 49 cents a share, a year earlier. Excluding one-time times, VF earned $2.32 a share, beating the analysts' average estimate of $2.30.
Sales of $2.91 billion were just above the analysts' average forecast of $2.89 billion compiled by Thomson Reuters I/B/E/S.
VF forecast a 2012 profit below Wall Street estimates for the current year, citing unfavorable foreign currency rates and higher pension expenses.
The company, whose other brands include Nautica, Lee and Vans, said it expected earnings of $9.30 a share excluding one-time items this year. Analysts were looking for $9.53, according to Thomson Reuters I/B/E/S.
"The market is likely to interpret this outlook as adequately conservative and look past the 'below consensus' headline," analyst Bari said.
The company bought Timberland for $2 billion in September to fortify its outdoor business.
VF shares were up 2 percent at $146.05 in morning trading on the New York Stock Exchange.
(Reporting By Dhanya Skariachan and Nivedita Bhattacharjee; Editing by Gerald E. McCormick and John Wallace)
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