Branded lifestyle apparel maker VF Corp. (VFC: Quote) reported Monday a higher profit in its third quarter, boosted by increased revenues. Adjusted earnings per share topped analysts' estimate, while top line missed their view. The company also backed its fiscal 2013 forecast. Separately, VF announced a four-for-one stock split, and a 21 percent increase in dividend.
In pre-market activity, VF shares gained $5.42 or 2.65 percent, and traded at $209.72.
Eric Wiseman, VF Chairman and Chief Executive Officer, said, "Our third quarter results validate our growth strategy and our ability to deliver strong results in a challenging economic environment. Our solid year-to-date results allow us to make significant, incremental brand investments while still delivering on our long-term earnings growth target."
For the third quarter, net income attributable to the company climbed to $433.76 million or $3.89 per share from $381.32 million or $3.42 per share last year. Adjusted income for the quarter, which excluded certain items, was $435.97 million or $3.91 per share.
On average, 22 analysts polled by Thomson Reuters expected the company to report earnings of $3.78 per share for the quarter. Analysts' estimates typically exclude special items.
Total revenues increased 5 percent to $3.30 billion from $3.15 billion a year ago. Analysts expected revenue of $3.34 billion for the quarter. Net sales were $3.27 billion, compared to $3.12 billion in the prior year. The company noted that changes in foreign currency exchange rates positively impacted total revenue growth by approximately one percentage point.
In the quarter, revenues from Outdoor & Action Sports segment grew 6 percent, International went up 7 percent and revenues from Direct-to-Consumer segment grew 14 percent.
Gross margin improved by 90 basis points to 47.6 percent in the period
Looking ahead, for fiscal 2013, the company continues to expect revenues to approximate $11.5 billion. Full-year adjusted earnings per share guidance remains at $10.85, and $10.78 on a GAAP basis. Analysts expect the company to report full year adjusted per share of $10.95 on revenue of $11.52 billion.
Separately, VF announced that its Board has approved a four-for-one split of its shares of common stock to be payable in the form of a stock dividend. Shareholders of record as of the close of business on December 10 will receive three additional shares of common stock for each share they own, payable on December 20.
The company said it expects the New York Stock Exchange to begin reporting the adjusted number of shares outstanding and adjusted per-share stock price on December 23.
Upon completion of the split, the number of common shares of VF will increase to approximately 440 million from approximately 110 million currently.
In addition, on a pre-split basis, VF's Board declared a quarterly dividend of $1.05 per share, reflecting an $0.18 or 21 percent increase over the previous quarter's dividend. This dividend will be payable on December 20.
Wiseman added, "During the past decade, VF has returned nearly $5 billion to shareholders through dividend payments and share repurchases. Today's announcement is the result of VF's strong financial and stock price performance, and the confidence we have in our ability to create long-term profitable growth and returns for our shareholders."
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by RTT Staff Writer
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