- Prachi Singh |
VF Corporation’s revenue increased 20 percent or 18 percent currency neutral to 3.6 billion dollars, including a 247 million dollars contribution from the Williamson-Dickie acquisition, which closed on October 2, 2017. Excluding the Williamson-Dickie acquisition, the company said, revenue increased 12 percent or 10 percent currency neutral, driven by broad-based strength across VF’s international and direct-to-consumer platforms, outdoor & action sports coalition and workwear businesses.
“VF's fourth quarter results were stronger than we expected as growth continues to accelerate across core dimensions of our portfolio,” said Steve Rendle, the company’s Chairman and CEO in a media statement, adding, “We delivered a top-quartile total return for shareholders in 2017 and our strong performance provided us with the capacity to reinvest about 100 million dollars back into our business.”
Review of VF’s Q4 results
During the fourth quarter, the company decided to sell its Nautica brand business and on April 28, 2017, the company completed the sale of its licensed sports group (LSG) business, including the Majestic brand. On August 26, 2016, the company concluded the sale of its contemporary brands businesses, which included the 7 For All Mankind, Splendid and Ella Moss brands. VF’s after-tax net loss from discontinued operations was 17 million dollars in the fourth quarter, while the after-tax net loss from discontinued operations was 106 million dollars for the full year 2017.
Gross margin for the quarter improved 130 basis points to 51.5 percent and on an adjusted basis, gross margin increased 60 basis points to 51.6 percent. Excluding the Williamson-Dickie acquisition, adjusted gross margin increased 140 basis points to 52.4 percent. Changes in foreign currency negatively impacted gross margin by 10 basis points. Operating income on a reported basis was 481 million dollars and on an adjusted basis, increased 6 percent to 497 million dollars, including a 19 million dollars contribution from the Williamson-Dickie acquisition.
Operating margin on a reported basis increased 390 basis points to 13.2 percent, while adjusted operating margin declined 180 basis points to 13.6 percent. Adjusted operating margin, excluding the Williamson-Dickie acquisition, declined 130 basis points to 14.1 percent and changes in foreign currency negatively impacted operating margin by 30 basis points.
Fourth quarter loss per share was 0.18 dollar on a reported basis, including a 1.16 dollars negative impact from recent US tax legislation. On an adjusted basis, earnings per share increased 13 percent to 1.01 dollars, including a 0.04 dollar contribution from the Williamson-Dickie acquisition. Relative to the company's outlook provided on October 23, 2017, fourth quarter earnings per share included an incremental 0.06 dollar or 35 million dollars pretax impact from additional investments to drive accelerated growth in 2018 and beyond.
FY17 revenues rise 7 percent
Full year revenue increased 7 percent to 11.8 billion dollars, including a 247 million dollars contribution from the Williamson-Dickie acquisition. Excluding the Williamson-Dickie acquisition, revenue increased 5 percent or 4 percent currency neutral, driven by continued momentum in VF's international and direct-to-consumer platforms, outdoor & action sports coalition and workwear businesses.
Gross margin for the year increased 120 basis points to an annual record high of 50.5 percent and on an adjusted basis, gross margin increased 100 basis points to 50.5 percent. Excluding the Williamson-Dickie acquisition, adjusted gross margin increased 120 basis points to 50.7 percent. Changes in foreign currency negatively affected gross margin by 60 basis points. Operating income on a reported basis increased 10 percent to 1.5 billion dollars and adjusted operating income decreased 2 percent to 1.5 billion dollars, including a 19 million dollars contribution from the Williamson-Dickie acquisition.
Operating margin on a reported basis increased 30 basis points to 12.7 percent, while adjusted operating margin declined 120 basis points to 12.9 percent. Excluding the Williamson-Dickie acquisition, adjusted operating margin declined 110 basis points to 13.0 percent. Changes in foreign currency negatively impacted operating margin by 50 basis points.
Earnings per share on a reported basis declined 30 percent to 1.79 dollars, including a 1.15 dollars negative impact from recent US tax legislation. Adjusted earnings per share increased 4 percent or 7 percent currency neutral to 2.98 dollars, including a 0.04 dollar contribution from the Williamson-Dickie acquisition. Relative to the company's original outlook provided on February 17, 2017, full year 2017 earnings per share included a 0.19 dollars or around 100 million dollars pretax impact from incremental investments.
VF expects transition quarter revenue to rise 16 percent
VF added that since there is a change in the company's fiscal year end to the Saturday closest to March 31 from the Saturday closest to December 31 and the company will report results for the transition quarter ending March 31, 2018. For the transition quarter revenue is expected to be around 2.9 billion dollars, up 16 percent, including about a 200 million dollars contribution from the Williamson-Dickie acquisition. Excluding the Williamson-Dickie acquisition, revenue is expected to increase at a high single-digit rate due in part to changes in foreign currency.
Adjusted earnings per share is expected to approximate 0.65 dollar, up 27 percent, including about a 0.02 dollar contribution from the Williamson-Dickie acquisition. Excluding the Williamson-Dickie acquisition, adjusted earnings per share is expected to increase more than 20 percent due in part to changes in foreign currency.
Picture:Facebook/The North Face
- Prachi Singh |
VF Corporation has been recognized as one of the 2018 world’s most ethical companies by the Ethisphere Institute. The company said in a statement that VF is the only apparel company to make to the list, underscoring the company’s commitment to leading its industry through ethical business standards and practices.
“We are honoured to be once again recognized as one of the world’s most ethical companies,” said Steve Rendle, VF’s Chairman, President and CEO in a media release, adding, “At VF, we believe that business success and social responsibility are interconnected.”
The world's most ethical companies assessment is based upon the Ethisphere Institute’s Ethics Quotient (EQ) framework, which offers a quantitative way to assess a company’s performance in an objective, consistent and standardized manner. The information collected provides a comprehensive sampling of definitive criteria of core competencies in the areas of corporate governance, risk, sustainability, compliance and ethics.
“While the discourse around the world changed profoundly in 2017, a stronger voice emerged. Global corporations operating with a common rule of law are now society’s strongest force to improve the human condition. This year we saw companies increasingly finding their voice,” added Ethisphere’s CEO, Timothy Erblich.
Picture:VF Corporation website
- Prachi Singh |
The board of directors of Dick’s Sporting Goods, Inc. has authorized and declared a quarterly dividend of 0.225 dollar per share on the company's Common Stock and Class B Common Stock, payable in cash on March 30, 2018, to stockholders of record at the close of business on March 9, 2018. This dividend represents an increase of approximately 32 percent over the company's previous quarterly per share amount and is equivalent to an annualized rate of 0.90 dollar per share.
"The significant increase in our dividend demonstrates the strength of our balance sheet and the confidence we have in our company's future," said Edward W. Stack, Chairman and CEO in a statement, adding, "We remain firmly committed to investing in the profitable growth of our business and returning capital to our shareholders."
Picture:Facebook/Dick's Sporting Goods
- Prachi Singh |
Nike Inc’s board of directors has announced a quarterly cash dividend of 0.20 dollar per share on the company’s outstanding Class A and Class B common stock payable on April 2, 2018, to shareholders of record at the close of business on March 5, 2018.
The company based near Beaverton, Oregon, reported 5 percent sales rise in the second quarter in December, driven by international geographies and continued strength in Nike Direct, partly offset by an expected decline in North America wholesale revenue.
- Angela Gonzalez-Rodriguez |
Equities research analysts expect Express, Inc. (NYSE:EXPR) to announce 691.56 million dollars in sales for the current quarter.
Zacks reports that several analysts estimate Express’ earnings to come in between 668.70 million dollars to 713.40 million dollars.
Express reported sales of 678.78 million dollars during the same quarter last year, which would suggest a positive year-over-year growth rate of 1.9 percent. The company is expected to issue its next earnings report on Wednesday, March 14.
According to Zacks, analysts expect that Express will report full-year sales of 691.56 million dollars for the current financial year, with estimates ranging from 2.11 billion dollars to 2.14 billion dollars.
For the next year, analysts expect that the company will post sales of 2.10 billion dollars per share, with estimates ranging from 2.09 billion dollars to 2.11 billion dollars.
- Prachi Singh |
Tapestry, Inc’s board of directors has declared a quarterly cash dividend of 0.3375 dollar per common share. The company said, dividend is payable on April 2, 2018 to shareholders of record as of the close of business on March 9, 2018.
Tapestry expects revenues for fiscal 2018 to increase about 30 percent versus fiscal 2017, to 5.8 to 5.9 billion dollars, with low-single digit organic growth and the acquisition of Kate Spade adding over 1.2 billion dollars in revenue. The company has also projected earnings per diluted share in the range of 2.52 dollars-2.60 dollars, an increase of about 17 percent to 21 percent for the year, including mid-to-high single digit accretion from the acquisition of Kate Spade.
- Prachi Singh |
Sales at Asics in the fourth quarter increased 3.8 percent to 89.9 billion Japanese yen (0.8 billion dollars), reports the brand in a press release. The Japanese company reported an operating loss of 4.85 billion Japanese yen (0.04 billion dollars) against 4 billion Japanese yen (0.03 billion dollars) in the same period last year. The net loss shrunk to 2.8 billion Japanese yen (0.02 billion dollars) against 3.1 billion Japanese yen (0.029 billion dollars), in the same quarter last year.
For the full year, consolidated net sales increased 0.3 percent to 400.2 billion Japanese yen (3.7 billion dollars), decreasing 2 percent on a currency-neutral basis. Gross profit increased 3.8 percent to 183.3 million Japanese yen (1.7 million dollars), however net profit fell 16.7 percent to 12.97 billion Japanese yen (0.1 billion dollars) due to loss incurred on business restructuring in the European region.
Highlights of Asics’ full year results
Domestic net sales for the year decreased 0.5 percent to 101.1 billion Japanese yen (0.95 billion dollars) mainly due to weak sales in sportswear, despite steady sales of running shoes. Overseas sales increased 0.5 percent but decreased 2.6 percent currency-neutral to 299.1 billion Japanese yen (2.8 billion dollars), mainly due to weak sales in the American and European regions, despite strong sales of running shoes and Onitsuka Tiger shoes in the Oceania/Southeast and South Asian regions as well as the East Asian region.
In other regions, Asics America widened its loss in the fourth quarter but saw earnings improve in the full year. In the fourth quarter, operating loss in the America was 1.97 billion Japanese yen (0.01 billion dollars) against a loss of 858 million Japanese yen (8 million dollars) in the same period a year ago. Sales in the America declined 7.2 percent to 23.9 billion Japanese yen (0.2 billion dollars) from 25.7 billion Japanese yen (0.24 billion dollars). For the full year, sales in the American region decreased 6 percent or 7.7 percent on a currency-neutral to 106.2 billion Japanese yen (0.9 billion dollars), due to weak sales in the US.
Sales in Japan decreased 0.4 percent to 119.46 billion Japanese yen (1.12 billion dollars), due to poor sales in the sportswear segment. Segment income decreased 6.3 percent to 5.89 billion Japanese yen (0.05 billion dollars). In the European region, sales decreased 1.2 percent or 5.4 percent on a currency-neutral basis to 106.3 billion Japanese yen (0.9 billion dollars). In the Oceania/Southeast and South Asian regions, sales increased 15.1 percent or 9.5 percent on a currency-neutral basis to 27.7 million Japanese yen (0.27 million dollars), due to the strong sales of running shoes and Onitsuka Tiger shoes.
In the East Asian region, sales increased 13 percent or 10.4 percent on a currency-neutral basis to 49.1 billion Japanese yen (0.46 billion dollars), due to the continuing strong sales of running shoes and Onitsuka Tiger shoes in China, despite lower sales in South Korea due to restructuring current retail stores.
Asics predicts 6.2 percent sales growth for FY18
For 2018, Asics expects sales to improve 6.2 percent to 425 billion Japanese yen (3.9 billion dollars) and operating income is expected to reach 20 billion Japanese yen (0.18 billion dollars), up 2.2 percent and net profit, 12 billion Japanese yen (0.1 billion dollars).
Aiming for global growth, Asics had launched a five-year strategic plan, ‘Asics Growth Plan (AGP) 2020’, as its management target since launch in 2015, and has been aiming to achieve 750 billion Japanese yen (7.05 billion dollars) in sales, 10 percent in operating income ratio and 15 percent in ROE by FY2020. However, the company said, mainly due to changes in the consumer trend and sales channels, sales has stayed around 400 billion Japanese yen (3.7 billion dollars) till 2017, so the company has decided to revise its plan, in order to put Asics back on its further growth path, through the priority allocation of its resources to growth areas and the improvement of profitability.
- Prachi Singh |
For the 26 weeks to December 31, 2017, Laura Ashley Holdings Plc reported sales of 134.7 million pounds (189 million dollars), a fall of 7.7 percent. This overall fall, the company said, was primarily due to the closure of 25 stores during the second half of last year. Like-for-like retail sales for the period fell by 0.5 percent. Total ecommerce sales grew to 26.9 million pounds (37.7 million dollars), an increase of 5.1 percent. Gross margin fell to 38.5 percent and due to the impact of the weakening of sterling, group profit before taxation declined to 4.3 million pounds (6 million dollars).
Commenting on the company’s first half performance, Laura Ashley Chairman Tan Sri Dr Khoo Kay Peng said in a statement: “Trading conditions have continued to be challenging during the first six months of the year. The impact felt due to the weakening of sterling, year on year, was the most significant single factor in the fall of profit before tax. The board have reviewed the first half results and forecasts for the remainder of the year to June 30, 2018 and, given the continued market challenges, considers that net pre-tax profit for the year will fall below market expectations.”
Review of Laura Ashley’s H1 results
As at December 31, 2017, the property portfolio in the UK consisted of 161 stores. During the reporting period, the company closed six stores. Total UK retail sales of 122.9 million pounds (172.6 million dollars) were recorded during the period compared to 133.4 million pounds (187.4 million dollars), in the same period of 2016. On a like-for-like basis, UK retail sales fell by 0.5 percent. Total ecommerce sales reached 26.9 million pounds (37.7 million dollars) against 25.6 million pounds (35.9 million dollars) in the first half of 2016.
Fashion sales including adult fashion, fashion accessories and perfumery, for the 26 weeks decreased by 1 percent over the same period last year with like-for-like sales up 1.2 percent.
On February 2, 2018, the company announced that, on September 17, 2018, the master license agreement with Aeon will be terminated and, as a result, license rights will revert back to the UK for Japan, Taiwan and Hong Kong. In the reporting period, international operations contributed 6.7 percent of total group revenue. At December 31, 2017, there were 246 franchised stores in 29 territories worldwide. Franchise and licensing revenue of 9.9 million pounds (13.9 million dollars) was recorded during the first half against 10.2 million pounds (14.3 million dollars) in 2016, due to the performance of the franchise business reflecting sluggish trading conditions in some of the franchised territories.
Licensing revenues increased 21 percent and the company signed a new licence partner for the Thailand market during the period.
Picture:Laura Ashley website
- Prachi Singh |
The London-based online retailer Farfetch is looking at floating its New-York based initial public offering (IPO) at a valuation of 5 billion dollars, reports CNBC, citing sources familiar with the development. Farfetch, founded in London in 2008 by Portuguese entrepreneur José Neves, has offices in 11 cities, including London, Tokyo and Los Angeles. Neves had told Reuters in 2016 that the “next financial milestone” for the company would be to float an IPO.
Running a marketplace model, Farfetch offers over 700 brands including luxury labels such as Gucci and emerging ones like Gabriela Hearst and caters to its customers in more than 190 countries worldwide. In 2016, according to the accounts filed with the UK regulators, the company’s turnover of 151 million pounds (209.9 million dollars under current exchange) jumped 74 percent, while gross merchandise value reached 547 million pounds (760.3 million dollars). However the company posted losses of 34 million pounds (47.3 million dollars) during the year under review.
Farfetch has inked several partnership deals such as with JD.com in Asia and The Chalhoub Group in the Middle East as well as with Conde Nast. In 2015, the company also acquired London fashion boutique Browns, which it calls the ‘Store of the Future’ offering touch-screen-enhanced mirrors and connected clothing racks. Farfetch has also launched Black and White, an infrastructure platform for luxury labels to develop their own e-commerce business.
- Prachi Singh |
After witnessing a slump in Q4 sales and profit, the Hennes and Mauritz AB (H&M) has predicted higher earnings this fiscal year. Ahead of its Capital Markets Day, the company said in view of the ongoing shift in the industry and the H&M group’s ongoing transition work, 2018 is expected to remain challenging but there are good opportunities for a somewhat better result for the full year compared with the previous year.
H&M’s sales in comparable stores are expected to remain negative with a gradual improvement during the year. A tough start with high opening stock levels from Q4 2017 and imbalances in the product range, the company added, are resulting in high markdown costs, with a negative effect on earnings at the start of the year. However, the online and new business sales are expected to increase by at least 25 percent and sales in newly opened stores are expected to add approximately 4 percent to group sales in 2018.
H&M predicts per year sales growth of 25 percent
Sales for new business, H&M added, are expected to continue to increase by at least 25 percent per year, thus reaching over 50 billion Swedish krona (6.2 billion dollars) in 2022. Online sales for the H&M group are expected to continue to increase strongly by around 20 percent per year to reach 75 billion Swedish krona (9.3 billion dollars) in 2022. Sales in newly opened stores are expected to increase sales for the H&M group by approximately 1-3 percent per year.
While the ongoing shift from physical stores to online is expected to continue, H&M expects as the group’s transition work and initiatives take effect, the physical stores will return to comparable positive sales development from 2019 onwards, leading to good increases in profit.
H&M banks upon sales growth of online channel
Online sales at H&M amounted to 29 billion Swedish krona (3.6 billion dollars), 12.5 percent of the total group sales. The company added that the group’s online channel is showing good profitability and accounted for 22 percent of the H&M group’s operating profit.
Sales of new business, that includes the company’s newer brands COS, Weekday, Cheap Monday, Monki, H&M Home, & Other Stories and Arket, amounted to 17 billion Swedish krona (2.1 billion dollars), 7 percent of the H&M group’s total sales. The company added that newly opened stores have very good terms and flexibility and the average payback period for new stores is less than 17 months.