Apparel maker VF Corp. (VFC) said Wednesday that it targets revenue growth of $1.1 billion in its Asia Pacific business over the next five years.
At an investor meeting held in Shanghai, VF Corp. discussed its strategic plans for its fastest-growing international business to reach $2 billion in revenues by 2017. This represents an annual growth rate of 17 percent from revenues of about $900 million forecast by the company for 2012.
The company expects growth from its five largest brands in the region - Timberland, Lee, The North Face, Vans, and Kipling.
Greensboro, North Carolina-based VF Corp. also confirmed its previous 2012 outlook provided in late July for revenues in Asia to increase about 20 percent and for revenues in Europe to grow at a low double-digit rate.
Aidan O'Meara, President of VF Asia Pacific, said, "Our strategies for growth in Asia Pacific - winning big in China, expanding our footprint within other countries in the region, leveraging our scale and focusing on our largest brands - give us confidence in our ability to reach $2.0 billion in revenues by 2017 in this growing and dynamic market."
VF Corp. expects substantial growth in each major Asia Pacific country during the next five years.
China, currently comprising about half of the region's total revenues, is expected to account for 60 percent of total revenues by 2017, growing at an annual rate of about 21 percent over the five-year period.
India, where VF currently markets its Lee, Wrangler and Vans brands, is expected to grow at an annual rate of 22 percent and increase to 10 percent of total Asia Pacific revenues by 2017 from the current 8 percent.
Revenues in Japan, strengthened by the addition of the Timberland brand, are expected to grow at an annual rate of 8 percent over the next five years.
Korea, where VF will open a new subsidiary office, is expected to represent the fastest-growing region, with revenues expected to grow at an annual rate of 52 percent.
VF Corp. projects revenue growth of $230 million for the Timberland brand in Asia Pacific over the next five years, while the Lee brand is expected to grow its business in the region by $150 million over the same period.
The company projects the North Face brand to grow its Asia Pacific revenues by $340 million by 2017 and the Vans brand to add $200 million in revenues to its Asia Pacific business during the next five years.
VF Corp. expects the Kipling brand to add $80 million in revenues in the region over the next five years.
In late July, VF Corp. reported an increase in profit for the second quarter, as revenue growth was strengthened by the $2.3 billion acquisition of footwear company Timberland.
Net income for the quarter rose to $155.3 million or $1.40 per share from $129.37 million or $1.17 per share in the year-ago period. Revenue for the quarter grew 16 percent to $2.14 billion.
In Wednesday's regular session, VFC is trading at $161.48, up $0.95 or 0.59 percent on a volume of 136,403 shares.
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