VF Corporation reported sales in the company’s Outdoor businesses rose 17% in the fourth quarter and 3% in 2002. An increase of 22% in first quality sales of The North Face brand and an 11% increase in international Outdoor sales were partially offset by lower domestic sales of JanSport and Eastpak brand daypacks.
Imagewear sales rose 10% in the fourth quarter and declined 3% in 2002. Sales in VFC’s Licensed Sports Apparel unit grew strongly in 2002, driven by the rollout of new licensed apparel products for the NFL.
Total Q4 sales rose 6% to $1.3 billion. Excluding net restructuring charges, income increased to $84.4 million, with earnings per share increasing 55% to $0.76. Full year 2002 sales were down 2.6% to $5.1 billion. Excluding net restructuring charges, income rose 24.2% to $380.9 million, with EPS rising 27% to $3.38.
Nearly every VF business improved its profitability in 2002. Imagewear profitability improved significantly during the year. Margins also expanded in the Licensed Sports Apparel unit. Margins in the company’s Outdoor business rose by two percentage points in 2002.
Overall, gross margins improved three full percentage points in 2002, to 36.0% from 32.9%, due primarily to lower cost sourcing and improved capacity utilization. Operating margins increased to 12.2% from 8.7%.
VFC expects the Outdoor business to post mid-single digit percentage gains in sales in 2003. Imagewear sales are expected to be flat. Total company sales are planned to rise approximately 1% in 2003.
