Shares at VF Corporation, the parent company of The North Face, Eastpak and Jansport, dropped 8.8% for the week to close at $35.23 on Friday after the company issued a rather dim view of its prospects for the second quarter.

Citing “difficult retail conditions”, VFC revised its sales forecast for Q2 to be down 5% to 7% below last year’s Q2, compared to its original “flat” projection. As a result, earnings are expected to decline by approximately 20% to 25% versus VFC’s previous guidance of a “flat to down 5%” forecast for the second quarter.

VFC saw sales of $1.16 billion in Q2 2002 and reported income from continuing operations of $.79 per share. Those numbers would put VFC earnings in the range of 59 cents to 63 cents per share for Q2 2003, and sales of $1.08 billion to $1.10 billion, well below First Call EPS expectations of 76 cents and revenue of $1.18 billion for the quarter.

Company chairman and CEO Mackey McDonald indicated aggressive moves by retailers to control inventories have hurt sales across most of VF’s businesses. The company will be taking measures to react to the new realities moving forward. “Inventory control remains a priority for us, and we have taken the appropriate actions to keep our inventories in line”, said McDonald.