Sponsors
Billabong ▼ -0.005 | PPR ▲ +0.05 | American Apparel ▲ +0.117 | The Buckle ▲ +0.37 | Columbia ▲ +0.81 | Deckers Outdoor ▲ +2.01 | Dicks ▲ +0.29 | Foot Locker ▲ +0.18 | Genesco ▲ +0.65 | Iconix Brand Group ▲ +0.42 | Jarden Corp ▲ +1.08 | Nordstrom ▲ +0.25 | Luxottica ▲ +0.33 | Nike ▲ +0.45 | Pacific Sunwear ▲ +0.03 | Skullcandy ▲ +0.22 | Sport Chalet ▼ 0.00 | Urban Outfitters ▲ +0.36 | VF Corp ▼ -0.08 | Quiksilver ▲ +0.25 | Zumiez ▼ 0.00 | Macys ▲ +0.19 | Tillys ▲ +0.31 |
Ticker Sponsor
Readers Say
The most up-to-date information
The most up-to-date information

“Shop-Eat-Surf is a great source for the most up to date information of what is going on in our industry. I always enjoy reading the articles and appreciate the effort from Tiffany and her team."

- By Richard Woolcott, CEO and Founder, Volcom
I require all our executives to read it
I require all our executives to read it

There is no better publication that I am aware of that is so accurate and on top of any news and developments in our industry. I personally recommend it to many people that want to know and understand more about our industry. For the most part, shop-eat-surf.com gets the stories first. As a matter of fact, I require all the executives in our company to read it.

- By Hezy Shaked, President & CEO, Tilly's
New Industry Insight

Shorebreak Hotel as a venue for industry events. Cinematographer Louie Schwartzberg's "Moving Art Retreat" in June at Turtle Bay Resort. Details on Industry Insight.


Tiffany Montgomery
Print This Article

VF on Vans, Reef results and its acquisition strategy

VF on Vans, Reef results and
By Tiffany Montgomery
February 10, 2009 3:56 PM

VF held a 2008 fourth quarter and full year earnings conference call this afternoon and some interesting details emerged about Vans, Reef and VF's acquisition strategy.

Vans

Vans continues to post strong results despite the economic climate, according to Steve Murray, president of Vans and VF's Action Sports Americas coalition, who spoke on the call.

Domestic sales increased 13 percent for the year ended Dec. 31. All channels and categories posted strong results except snow equipment.

Footwear sales rose 11 percent, with especially strong performance in classic and core products.

Apparel and accessory sales increased 40 percent, with notable strength at the independent skate and mid-tier department store level. The launch of boys' apparel at the mid-tier and the new signature apparel lines from Vans skaters were also successful.

Direct to consumer sales grew 20 percent. For the year, comp sales at Vans stores increased 8 percent. In the fourth quarter, comp store sales increased 9 percent, a real achievement given how tough the fourth quarter was at retail. Vans opened 20 stores during the year and remodeled 30. E-commerce sales grew 40 percent for the year.

Steve MurraySteve, right, said the fourth quarter was volatile for both its own retail stores and wholesale customers, especially the three weeks around Thanksgiving. Business stabilized in the middle and end of December. He said the company currently is "cautiously optimistic."

Vans will continue to invest in product development, marketing programs and new retail stores, especially outside of California, where Steve said the demand for Vans exceeds the network of retailers that carry the product. Those investments will be made while the company still keeps a close eye on inventory, SG&A and product margins.

Internationally, Vans is doing "extremely well," with new stores in Paris and Hossegor, France, bringing the total number of Vans stores in Europe to 10.

Reef

Reef had "a tough year" in 2008, particularly in the core market, which accounts for two-thirds of Reef's business.

Reef's sales in 2008 fell 4 percent. In the fourth quarter, sales declined 11 percent.

Steve said in the competitive sandal business, there was a lower rate of reorder than expected through the key summer months.

Acquisitions

Eric WisemanVF CEO Eric Wiseman, right, said the company is still interested in acquisitions, but will proceed in a disciplined way that with an eye toward keeping VF's balance sheet strong. VF ended the year with $382 million in cash and $53 million in short-term borrowings. It also has a $1.3 billion unused line of credit.

Wiseman said the kinds of companies VF is interested in acquiring would fit into VF's outdoor, action sports, contemporary or sportswear coalitions. They would also be lifestyle brands that have "financial and strategic characteristics around global expansion and owned retail."

Interesting denim note

VF also owns 7 for All Mankind, a premium denim brand. Mike Egeck, the executive in charge of the contemporary division, was asked about some competitors dropping prices.

He said he didn't think it was a good idea, and some retailers he had spoken to agreed. While the market had softened for jeans over $200, sales of denim in the $150 to $200 range are holding up so the brand is increasing the number of styles it has in that price range.

Economy

VF is assuming the economy will not improve in 2009. Wiseman said the consensus of VF's varied retail customers is that nobody expects a turnaround in 2009. He said by the middle of 2009, the company should have a better sense of how 2010 may play out.

For more details, click here to see VF's press release. 

 

 

Airfare.com - Flights, hotels and more!

 


Articles You Might Have Missed