VF Corporation's turnaround: Lower costs offset sales decline

The US apparel group VF Corporation experienced a decline in turnover in the 2024/25 financial year. At the same time, the parent company of brands such as The North Face, Vans and Timberland was able to significantly reduce its loss thanks to extensive cost-cutting measures. This is according to current results presented by the company on Wednesday.

Chief executive officer (CEO) Bracken Darrell was satisfied overall with the course of business in the last three months of the financial year. He explained in a statement: “We exceeded our forecast for operating profit in the fourth quarter, which reflects the effects of our ‘Reinvent’ transformation programme”. The five percent decline in turnover (currency-adjusted -3 percent) in the final quarter was within expectations.

Darrell also emphasised that the group had made good progress with its reform efforts. As a result, it was able to lower the cost base and strengthen the balance sheet. Overall, VF was “well positioned to master the increased uncertainties in the macroeconomic environment,” the CEO stressed.

Losses at Vans and Dickies cause group turnover to fall

In the past financial year, which ended in March, group turnover amounted to 9.50 billion dollars and thus missed the previous year's level by four percent. Adjusted for exchange rate changes, revenues also fell by four percent.

The decline in turnover was primarily due to significant losses at the Vans (minus 16 percent) and Dickies (minus 12 percent) brands. Slight increases at The North Face (plus one percent), Timberland (plus 3 percent) and the smaller group brands (plus 2 percent) were not enough to compensate for this decline.

Net loss decreases by 80 percent

Thanks to an improved gross margin as well as lower operating costs and write-downs, the group was able to achieve an operating profit of 303.8 million dollars. In the previous year, it had to accept an operating loss of 143.9 million dollars.

The reported net loss was reduced to 189.7 million dollars. Compared to the previous year, in which it had been 968.9 million dollars, the deficit fell by 80.4 percent.

Management expects turnover losses and an operating loss for the first quarter

The group waived specific forecasts for the current 2025/26 financial year. For the first quarter, it currently expects a currency-adjusted decline in turnover of between three and five percent and an operating loss adjusted for special effects in the region of 110 to 125 million dollars.