- Prachi Singh |
VF Corporation’s revenue through 2021 is expected to grow at a five-year compounded annual growth rate (CAGR) between 4 percent and 6 percent. The company, announcing a strategic growth plan said that the growth would be fuelled by VF’s largest brands - the Vans, The North Face and Timberland brands and its international and direct-to-consumer business platforms. Earnings per share are expected to grow between 10 percent and 12 percent.
“Our 2021 strategic growth plan fuels our aspiration to consistently grow by creating amazing products and brand experiences that transform and improve the lives of consumers worldwide,” said Steve Rendle, President and CEO, in a statement, adding, “The strength and consistency of our largest brands and business platforms give me great confidence in our ability to achieve our targets.”
Expects to return 8 bn dollars to shareholders
Gross margin is expected to reach 51.5 percent in 2021, while operating margin is expected to reach 16 percent. The company expects to generate more than 9 billion dollars of cash from operations on a cumulative basis between 2017 and 2021 and return 8 billion to shareholders through dividends and share repurchases. VF expects to deliver annual total shareholder return (TSR) in the 13 percent to 15 percent range as the company continues to target top quartile TSR performance.
The company's board of directors also authorized a change in VF’s fiscal year end from the Saturday closest to December 31 of each year to the Saturday closest to March 31 of each year, effective for the fiscal year beginning April 1, 2018. Based on the seasonality and increasing weight of VF’s direct-to-consumer business, the company expects this change in fiscal year gives the company greater visibility into projecting revenue growth and planning expenses. The board approved a new 5 billion dollars share repurchase authorization.