Business Wire | Jul 30, 2021 06:55AM EDT

VF Reports First Quarter Fiscal 2022 Results; Raises Full Year Fiscal 2022 Outlook

Jul. 30, 2021

DENVER--(BUSINESS WIRE)--Jul. 30, 2021--VF Corporation (NYSE: VFC) today reported financial results for its first quarter ended July 3, 2021. All per share amounts are presented on a diluted basis. This release refers to "reported" and "constant dollar" amounts, terms that are described under the heading "Constant Currency - Excluding the Impact of Foreign Currency." Unless otherwise noted, "reported" and "constant dollar" amounts are the same. This release also refers to "continuing" and "discontinued" operations amounts, which are concepts described under the heading "Discontinued Operations - Occupational Workwear Business." Unless otherwise noted, results presented are based on continuing operations. This release also refers to "adjusted" amounts, a term that is described under the heading "Adjusted Amounts - Excluding Transaction and Deal Related Activities and Costs Related to Specified Strategic Business Decisions." Unless otherwise noted, "reported" and "adjusted" amounts are the same.

"Our teams delivered an outstanding first quarter, powering VF back to pre-pandemic revenue levels while driving an earnings recovery ahead of our expectations," said Steve Rendle, VF's Chairman, President and CEO. "We continue to see broad-based momentum across the portfolio, supporting an increase to our fiscal 2022 outlook for each of our largest brands. Though the first quarter is a relatively small portion of our total year, this strong start reinforces my confidence in our ability to accelerate growth through fiscal 2022 and beyond."

Constant Currency - Excluding the Impact of Foreign Currency

This release refers to "reported" amounts in accordance with U.S. generally accepted accounting principles ("GAAP"), which include translation and transactional impacts from foreign currency exchange rates. This release also refers to "constant dollar" amounts, which exclude the impact of translating foreign currencies into U.S. dollars. Reconciliations of GAAP measures to constant currency amounts are presented in the supplemental financial information included with this release, which identifies and quantifies all excluded items, and provides management's view of why this information is useful to investors.

Discontinued Operations - Occupational Workwear Business

On June 28, 2021, VF completed the sale of its Occupational Workwear business. The Occupational Workwear business was comprised primarily of the following brands and businesses: Red Kap(r), VF Solutions(r), Bulwark(r), Workrite(r), Walls(r), Terra(r), Kodiak(r), Work Authority(r) and Horace Small(r). The business also included a license for certain Dickies(r) occupational workwear products that have historically been sold through the business-to-business channel. Accordingly, the company has reported the related held-for-sale assets and liabilities as assets and liabilities of discontinued operations and included the operating results and cash flows of the business in discontinued operations for all periods, through the date of sale.

Adjusted Amounts - Excluding Transaction and Deal Related Activities and Costs Related to Specified Strategic Business Decisions

The adjusted amounts in this release exclude transaction and deal related activities associated with the acquisition of the Supreme(r) brand. Total transaction and deal related activities include a decrease in the estimated fair value of the contingent consideration liability of $73 million and integration costs of approximately $4 million in the first quarter of fiscal 2022.

The adjusted amounts in this release exclude costs related to VF's business model transformation, a transformation initiative for our Asia-Pacific regional operations and certain cost optimization activities and other charges indirectly related to the divestiture of the Occupational Workwear business. Total costs were approximately $14 million in the first quarter of fiscal 2022.

Combined, the above items positively impacted earnings per share by $0.12 during the first quarter of fiscal 2022. All adjusted amounts referenced herein exclude the effects of these amounts.

Reconciliations of measures calculated in accordance with GAAP to adjusted amounts are presented in the supplemental financial information included with this release, which identifies and quantifies all excluded items, and provides management's view of why this information is useful to investors.

COVID-19 Outbreak Update

To help mitigate the spread of COVID-19 and in response to public health advisories and governmental actions and regulations, VF has modified its business practices, including the temporary closing of offices and retail stores, instituting travel bans and restrictions and implementing health and safety measures including social distancing and quarantines.

The majority of VF's supply chain is currently operational. Suppliers are complying with local public health advisories and governmental restrictions which has resulted in isolated product delays. The resurgence of COVID-19 lockdowns in key sourcing countries has resulted in additional manufacturing capacity constraints during the first quarter. Additionally, port delays, equipment availability and other logistics challenges have contributed to product delays. VF is working with its suppliers to minimize disruption and is employing expedited freight as needed. VF's distribution centers are operational in accordance with local government guidelines while maintaining enhanced health and safety protocols.

In North America, less than 5 percent of stores were closed at the beginning of the first quarter. All stores have since reopened and currently all stores are open.

In the EMEA region, approximately 60 percent of stores were closed at the beginning of the first quarter. All stores have since reopened and currently all stores are open.

Nearly all of VF's owned retail stores in the APAC region, including Mainland China, were open at the beginning of the first quarter. Additional stores have since re-closed and currently 5% of stores are closed.

VF is continuing to monitor the COVID-19 outbreak globally and will comply with guidance from government entities and public health authorities to prioritize the health and well-being of its employees, customers, trade partners and consumers. As COVID-19 uncertainty continues, VF expects ongoing disruption to its business operations.

First Quarter Fiscal 2022 Income Statement Review

* Revenue increased 104 percent (up 96 percent in constant dollars) to $2.2 billion. Excluding the impact of acquisitions, revenue increased 90 percent (up 83 percent in constant dollars) driven by VF's largest brands and the EMEA and North American regions, which experienced a significant negative impact from COVID-19 in the prior year period. * Gross margin increased 360 basis points to 56.5 percent, primarily driven by reduced promotional activity. On an adjusted basis, gross margin increased 260 basis points, including a 30 basis point positive impact from acquisitions, to 56.7 percent. * Operating income on a reported basis was $203 million. On an adjusted basis, operating income increased 164 percent (160 percent in constant dollars) to $148 million, including a $32 million contribution from acquisitions. Operating margin on a reported basis was 9.2 percent. Adjusted operating margin increased 2820 basis points, including a 110 basis point positive impact from acquisitions, to 6.8 percent. * Earnings per share was $0.39 on a reported basis. On an adjusted basis, earnings per share increased 148 percent (up 144 percent in constant dollars) to $0.27, including a $0.07 contribution from acquisitions.

Balance Sheet Highlights

Inventories were down 13 percent compared with the same period last year. During the quarter, VF returned approximately $192 million of cash to shareholders through dividends. As part of the company's liquidity preservation actions during the ongoing COVID-19 outbreak, the company has suspended its share repurchase program. VF has $2.8 billion remaining under its current share repurchase authorization.

Full Year Fiscal 2022 Outlook

VF's full year outlook assumes no material deterioration to the company's current business operations as a result of COVID-19, governmental actions and regulations. VF's full year fiscal 2022 outlook has been updated and includes the following:

* Revenue is now expected to be at least $12.0 billion, reflecting growth of at least 30 percent, including an approximate $600 million contribution from the Supreme(r) brand. This compares to the previous expectation of approximately $11.8 billion, reflecting growth of approximately 28 percent. By segment, revenue for Outdoor is now expected to increase between 24 percent and 26 percent versus the previous expectation of a 23 to 25 percent increase; revenue for Active is now expected to increase between 37 percent and 39 percent versus the previous expectation of a 34 to 36 percent increase; revenue for Work is now expected to increase between 16 and 18 percent versus the previous expectation of a 10 to 12 percent increase.

* International revenue is expected to increase between 25 percent and 27 percent. By geographic region, in the EMEA region, revenue is expected to increase between 29 percent and 31 percent. In the Asia Pacific region, revenue is expected to increase between 18 percent and 20 percent. And, in the Americas (non-U.S.) region, revenue is expected to increase between 28 percent and 30 percent.

* Direct-to-consumer revenue is now expected to increase between 39 percent and 41 percent versus the previous expectation of 38 percent and 40 percent, including Digital revenue growth of between 29 percent and 31 percent.

* Adjusted gross margin is expected to exceed 56.0 percent, which represents an estimated increase of more than 270 basis points.

* Adjusted operating margin is now expected to increase more than 500 basis points to more than 13.0 percent, versus the previous expectation of approximately 12.8 percent.

* Adjusted earnings per share is expected to be at least $3.20, including an approximate $0.25 contribution from the Supreme(r) brand. This compares to the previous expectation of approximately $3.05.

* Adjusted cash flow from operations is expected to exceed $1.0 billion.

* Other full year assumptions include an effective tax rate of approximately 15 percent and capital expenditures of approximately $350 million.

Dividend Declared

VF's Board of Directors declared a quarterly dividend of $0.49 per share, payable on September 20, 2021, to shareholders of record on September 10, 2021. Subject to approval by its Board of Directors, VF intends to continue to pay its regularly scheduled dividend and is not currently contemplating the suspension of its dividend.

Webcast Information

VF will host its first quarter fiscal 2022 conference call beginning at 8:30 a.m. Eastern Time today. The conference call will be broadcast live via the Internet, accessible at ir.vfc.com. For those unable to listen to the live broadcast, an archived version will be available at the same location.

Presentation

A presentation on first quarter fiscal 2022 results will be available at ir.vfc.com beginning at approximately 7:30 a.m. Eastern Time today and will be archived at the same location.

About VF

Founded in 1899, VF Corporation is one of the world's largest apparel, footwear and accessories companies connecting people to the lifestyles, activities and experiences they cherish most through a family of iconic outdoor, active and workwear brands including Vans(r), The North Face(r), Timberland(r) and Dickies(r). Our purpose is to power movements of sustainable and active lifestyles for the betterment of people and our planet. We connect this purpose with a relentless drive to succeed to create value for all stakeholders and use our company as a force for good. For more information, please visit vfc.com.

Forward-looking Statements

Certain statements included in this release are "forward-looking statements" within the meaning of the federal securities laws. Forward-looking statements are made based on our expectations and beliefs concerning future events impacting VF and therefore involve several risks and uncertainties. You can identify these statements by the fact that they use words such as "will," "anticipate," "estimate," "expect," "should," and "may" and other words and terms of similar meaning or use of future dates, however, the absence of these words or similar expressions does not mean that a statement is not forward-looking. All statements regarding VF's plans, objectives, projections and expectations relating to VF's operations or financial performance, and assumptions related thereto are forward-looking statements. We caution that forward-looking statements are not guarantees and that actual results could differ materially from those expressed or implied in the forward-looking statements. VF undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Potential risks and uncertainties that could cause the actual results of operations or financial condition of VF to differ materially from those expressed or implied by forward-looking statements include, but are not limited to: risks arising from the widespread outbreak of an illness or any other communicable disease, or any other public health crisis, including the coronavirus (COVID-19) global pandemic; the level of consumer demand for apparel, footwear and accessories; disruption to VF's distribution system; the financial strength of VF's customers; fluctuations in the price, availability and quality of raw materials and contracted products; disruption and volatility in the global capital and credit markets; VF's response to changing fashion trends, evolving consumer preferences and changing patterns of consumer behavior; intense competition from online retailers and other direct-to-consumer business risks; manufacturing and product innovation; increasing pressure on margins; VF's ability to implement its business strategy; VF's ability to grow its international, direct-to-consumer and digital businesses; VF's ability to transform its model to be more consumer-minded, retail-centric and hyper-digital; retail industry changes and challenges; VF's ability to create and maintain an agile and efficient operating model and organizational structure; VF's and its vendors' ability to maintain the strength and security of information technology systems; the risk that VF's facilities and systems and those of our third-party service providers may be vulnerable to and unable to anticipate or detect data security breaches and data or financial loss; VF's ability to properly collect, use, manage and secure business, consumer and employee data and comply with privacy and security regulations; foreign currency fluctuations; stability of VF's and VF's vendors' manufacturing facilities and VF's ability to establish and maintain effective supply chain capabilities; continued use by VF's suppliers of ethical business practices; VF's ability to accurately forecast demand for products; continuity of members of VF's management; VF's ability to recruit, develop or retain qualified employees; VF's ability to protect trademarks and other intellectual property rights; possible goodwill and other asset impairment; maintenance by VF's licensees and distributors of the value of VF's brands; VF's ability to execute acquisitions and dispositions and integrate acquisitions, including the recently acquired Supreme(r) brand; business resiliency in response to natural or man-made economic, political or environmental disruptions; changes in tax laws and liabilities; legal, regulatory, political and economic risks and changes to laws and regulations; adverse or unexpected weather conditions; VF's indebtedness and its ability to obtain financing on favorable terms, if needed, could prevent VF from fulfilling its financial obligations; climate change and increased focus on sustainability issues; and risks associated with the spin-off of our Jeanswear business completed on May 22, 2019, including the risk that VF will not realize all of the expected benefits of the spin-off; the risk that the spin-off will not be tax-free for U.S. federal income tax purposes; and the risk that there will be a loss of synergies from separating the businesses that could negatively impact the balance sheet, profit margins or earnings of VF. More information on potential factors that could affect VF's financial results is included from time to time in VF's public reports filed with the SEC, including VF's Annual Report on Form 10-K, and Quarterly Reports on Form 10-Q, and Forms 8-K filed or furnished with the SEC.

VF CORPORATION

Condensed Consolidated Statements of Operations

(Unaudited)

(In thousands, except per share amounts)



Three Months Ended June

2021 2020

Net revenues $ 2,194,557 $ 1,076,293

Costs and operating expenses

Cost of goods sold 955,551 506,951

Selling, general and administrative 1,036,122 816,151 expenses

Total costs and operating expenses 1,991,673 1,323,102

Operating income (loss) 202,884 (246,809 )

Interest, net (32,775 ) (27,949 )

Other income (expense), net 9,041 (38,187 )

Income (loss) from continuing operations 179,150 (312,945 ) before income taxes

Income tax expense (benefit) 25,178 (35,203 )

Income (loss) from continuing operations 153,972 (277,742 )

Income (loss) from discontinued 170,273 (7,871 ) operations, net of tax

Net income (loss) $ 324,245 $ (285,613 )

Earnings (loss) per common share - basic ^ (a)

Continuing operations $ 0.39 $ (0.71 )

Discontinued operations 0.44 (0.02 )

Total earnings (loss) per common share - $ 0.83 $ (0.73 ) basic

Earnings (loss) per common share - diluted ^ (a)

Continuing operations $ 0.39 $ (0.71 )

Discontinued operations 0.43 (0.02 )

Total earnings (loss) per common share - $ 0.82 $ (0.73 ) diluted

Weighted average shares outstanding

Basic 391,351 388,695

Diluted 394,128 390,791

Cash dividends per common share $ 0.49 $ 0.48



Basis of presentation of condensed consolidated financial statements: VFoperates and reports using a 52/53 week fiscal year ending on the Saturdayclosest to March 31 of each year. For presentation purposes herein, allreferences to periods ended June 2021 and June 2020 relate to the 13-weekfiscal period ended July 3, 2021 and the 13-week fiscal period ended June 27,2020, respectively, and references to March 2021 relate to the balance sheet asof April 3, 2021.

^(a) Amounts have been calculated using unrounded numbers.

VF CORPORATION

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands)



June March June

2021 2021 2020

ASSETS

Current assets

Cash and equivalents $ 1,274,926 $ 815,750 $ 2,145,111

Accounts receivable, net 1,138,811 1,298,020 934,984

Inventories 1,216,818 1,061,839 1,402,858

Short-term investments 598,806 598,806 700,000

Other current assets 334,777 423,877 513,049

Current assets of - 587,578 565,135 discontinued operations

Total current assets 4,564,138 4,785,870 6,261,137

Property, plant and 1,016,465 975,876 957,309 equipment, net

Goodwill and intangible 5,455,210 5,454,972 3,018,370 assets, net

Operating lease right-of-use 1,426,706 1,474,434 1,354,308 assets

Other assets 1,087,832 1,062,877 887,921

Total assets $ 13,550,351 $ 13,754,029 $ 12,479,045

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

Short-term borrowings $ 8,091 $ 11,061 $ 19,256

Current portion of long-term 1,001,030 1,023 1,025 debt

Accounts payable 534,803 463,208 348,932

Accrued liabilities 1,527,522 1,609,928 1,254,967

Current liabilities of - 125,257 91,283 discontinued operations

Total current liabilities 3,071,446 2,210,477 1,715,463

Long-term debt 4,726,234 5,709,149 5,609,792

Operating lease liabilities 1,192,792 1,236,461 1,104,500

Other liabilities 1,285,849 1,541,778 1,136,692

Total liabilities 10,276,321 10,697,865 9,566,447

Stockholders' equity 3,274,030 3,056,164 2,912,598

Total liabilities and $ 13,550,351 $ 13,754,029 $ 12,479,045 stockholders' equity



VF CORPORATION

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)



Three Months Ended June

2021 2020

Operating activities

Net income (loss) $ 324,245 $ (285,613 )

Income (loss) from discontinued operations, 170,273 (7,871 ) net of tax

Income (loss) from continuing operations, 153,972 (277,742 ) net of tax

Depreciation and amortization 68,050 63,026

Reduction in the carrying amount of 104,930 101,772 right-of-use assets

Other adjustments (252,034 ) 102,490

Cash provided (used) by operating 74,918 (10,454 ) activities - continuing operations

Cash provided by operating activities - 6,090 7,266 discontinued operations

Cash provided (used) by operating 81,008 (3,188 ) activities

Investing activities

Proceeds from sale of businesses, net of 616,529 - cash sold

Purchases of short-term investments - (700,000 )

Capital expenditures (93,218 ) (69,191 )

Software purchases (21,006 ) (13,477 )

Other, net 7,048 (573 )

Cash provided (used) by investing 509,353 (783,241 ) activities - continuing operations

Cash used by investing activities - (525 ) (1,914 ) discontinued operations

Cash provided (used) by investing 508,828 (785,155 ) activities

Financing activities

Net increase (decrease) from short-term (3,226 ) 1,765,041 borrowings and long-term debt

Cash dividends paid (192,131 ) (186,746 )

Proceeds from issuance of Common Stock, net 20,910 (15,634 ) of (payments) for tax withholdings

Cash provided (used) by financing (174,447 ) 1,562,661 activities

Effect of foreign currency rate changes on 10,003 4,126 cash, cash equivalents and restricted cash

Net change in cash, cash equivalents and 425,392 778,444 restricted cash

Cash, cash equivalents and restricted cash 851,205 1,411,322 - beginning of year

Cash, cash equivalents and restricted cash $ 1,276,597 $ 2,189,766 - end of period

VF CORPORATION

Supplemental Financial Information

Reportable Segment Information

(Unaudited)

(In thousands)



% Change % Change Three Months Ended June % Constant % Constant Change Currency Change and Currency Organic Organic 2021 2020 ^(a) ^ (b) ^(a) (b)

Segment revenues

Outdoor $ 617,754 $ 341,228 81 % 72 % 81 % 72 %

Active 1,302,068 571,316 128 % 120 % 102 % 94 %

Work 274,735 162,430 69 % 66 % 69 % 66 %

Other ^(c) - 1,319 * * * *

Totalsegment $ 2,194,557 $ 1,076,293 104 % 96 % 90 % 83 %revenues

Segmentprofit (loss)

Outdoor $ (71,747 ) $ (160,711 )

Active 270,862 7,136

Work 41,004 (11,401 )

Other ^(c) (282 ) (2,361 )

Totalsegment 239,837 (167,337 ) profit(loss)

Corporateand other (27,912 ) (117,659 ) expenses

Interest, (32,775 ) (27,949 ) net

Income(loss)fromcontinuing $ 179,150 $ (312,945 ) operationsbeforeincometaxes



^(a) Refer to constant currency definition on the following pages.

^(b) Excludes acquisition representing the operating results of Supreme for thethree months ended June 2021. Refer to Non-GAAP financial information on"Reconciliation of Select GAAP Measures to Non-GAAP Measures - Three MonthsEnded June 2021" page for additional information.

^(c) Other is included for purposes of reconciliation of revenues and profit,but it is not considered a reportable segment. Includes results primarilyrelated to the sale of non-VF products.

* Calculation not meaningful

VF CORPORATION

Supplemental Financial Information

Reportable Segment Information - Constant Currency Basis

(Unaudited)

(In thousands)





Three Months Ended June 2021

As Reported Adjust for Foreign

under GAAP Currency Constant Exchange Currency

Segment revenues

Outdoor $ 617,754 $ (30,213 ) $ 587,541

Active 1,302,068 (47,816 ) 1,254,252

Work 274,735 (4,993 ) 269,742

Total segment revenues $ 2,194,557 $ (83,022 ) $ 2,111,535

Segment profit (loss)

Outdoor $ (71,747 ) $ 1,225 $ (70,522 )

Active 270,862 (10,839 ) 260,023

Work 41,004 (812 ) 40,192

Other (282 ) (28 ) (310 )

Total segment profit 239,837 (10,454 ) 229,383

Corporate and other (27,912 ) 728 (27,184 )expenses

Interest, net (32,775 ) - (32,775 )

Income from continuingoperations before income $ 179,150 $ (9,726 ) $ 169,424 taxes

Diluted earnings per share 155 % (3 )% 152 %growth



Constant Currency Financial Information

VF is a global company that reports financial information in U.S. dollars inaccordance with GAAP. Foreign currency exchange rate fluctuations affect theamounts reported by VF from translating its foreign revenues and expenses intoU.S. dollars. These rate fluctuations can have a significant effect on reportedoperating results. As a supplement to our reported operating results, wepresent constant currency financial information, which is a non-GAAP financialmeasure that excludes the impact of translating foreign currencies into U.S.dollars. We use constant currency information to provide a framework to assesshow our business performed excluding the effects of changes in the rates usedto calculate foreign currency translation. Management believes this informationis useful to investors to facilitate comparison of operating results and betteridentify trends in our businesses.

To calculate foreign currency translation on a constant currency basis,operating results for the current year period for entities reporting incurrencies other than the U.S. dollar are translated into U.S. dollars at theaverage exchange rates in effect during the comparable period of the prior year(rather than the actual exchange rates in effect during the current yearperiod).

These constant currency performance measures should be viewed in addition to,and not in lieu of or superior to, our operating performance measurescalculated in accordance with GAAP. The constant currency information presentedmay not be comparable to similarly titled measures reported by other companies.

VF CORPORATION

Supplemental Financial Information

Reconciliation of Select GAAP Measures to Non-GAAP Measures - Three MonthsEnded June 2021

(Unaudited)

(In thousands, except per share amounts)

Three Transaction Specified ContributionMonths As Reported and Deal Strategic from AdjustedEnded June Related Business Adjusted Acquisition ^ Organic2021 under GAAP Activities Decisions (c) ^(a) ^(b)

Revenues $ 2,194,557 $ - $ - $ 2,194,557 $ (145,731 ) $ 2,048,826



Gross 1,239,006 - 6,201 1,245,207 (88,809 ) 1,156,398 profit

Percent 56.5 % 56.7 % 56.4 %



Operating 202,884 (68,596 ) 14,124 148,412 (31,689 ) 116,723 income

Percent 9.2 % 6.8 % 5.7 %



Dilutedearningsper sharefrom 0.39 (0.15 ) 0.03 0.27 (0.07 ) 0.20 continuingoperations^(d)



^(a) Transaction and deal related activities include activities associated withthe acquisition of Supreme Holdings, Inc. ("Supreme") for the three monthsended June 2021. Transaction and deal related activities include a decrease inthe estimated fair value of the contingent consideration liability of $73.0million and integration costs of $4.4 million for the three months ended June2021. The transaction and deal related activities resulted in a net tax expenseof $9.5 million in the three months ended June 2021, primarily related to theimpact of the decrease in the estimated fair value of the contingentconsideration liability on the interim tax rate calculation.

^(b) Specified strategic business decisions for the three months ended June2021 include costs related to VF's business model transformation of $1.5million in the three months ended June 2021, related primarily to restructuringand other costs. Specified strategic business decisions also include costsrelated to a transformation initiative for our Asia-Pacific regional operationsof $8.5 million in the three months ended June 2021. Specified strategicbusiness decisions also include cost optimization activities and other chargesindirectly related to the divestiture of the Occupational Workwear business,which totaled $4.1 million during the three months ended June 2021. Thespecified strategic business decisions resulted in a net tax benefit of $2.2million in the three months ended June 2021.

^(c) The contribution from acquisition represents the operating results ofSupreme for the three months ended June 2021. The results exclude transactionand deal related activities.

^(d) Amounts shown in the table have been calculated using unrounded numbers.The diluted earnings per share impacts were calculated using 394,128,000weighted average common shares for the three months ended June 2021.



Non-GAAP Financial Information

The financial information above has been presented on a GAAP basis, on anadjusted basis, which excludes the impact of transaction and deal relatedactivities and activity related to specified strategic business decisions, andon an adjusted organic basis, which excludes the operating results of Supreme(for the three months ended June 2021). Contribution from acquisition alsoexcludes transaction and deal related activities. These adjusted presentationsare non-GAAP measures. Management believes these measures provide investorswith useful supplemental information regarding VF's underlying business trendsand the performance of VF's ongoing operations and are useful forperiod-over-period comparisons of such operations.

Management uses the above financial measures internally in its budgeting andreview process and, in some cases, as a factor in determining compensation.While management believes that these non-GAAP financial measures are useful inevaluating the business, this information should be considered as supplementalin nature and should be viewed in addition to, and not in lieu of or superiorto, VF's operating performance measures calculated in accordance with GAAP. Inaddition, these non-GAAP financial measures may not be the same as similarlytitled measures presented by other companies.

VF CORPORATION

Supplemental Financial Information

Reconciliation of Select GAAP Measures to Non-GAAP Measures - Three MonthsEnded June 2020

(Unaudited)

(In thousands, except per share amounts)

Transaction SpecifiedThree Months Ended As Reported and Deal StrategicJune 2020 Related Business Adjusted under GAAP Costs^ (a) Decisions ^(b)

Revenues $ 1,076,293 $ - $ - $ 1,076,293



Gross profit 569,342 410 13,017 582,769

Percent 52.9 % 54.1 %



Operating income (246,809 ) 410 15,969 (230,430 )(loss)

Percent (22.9 ) (21.4 ) % %



Diluted earnings(loss) per share from (0.71 ) - 0.14 (0.57 )continuing operations^(c)



^(a) Transaction and deal related costs include expenses associated with theanticipated sale of the Occupational Workwear business of $0.4 million, thatdid not meet the criteria for discontinued operations, for the three monthsended June 2020.

^(b) Specified strategic business decisions for the three months ended June2020 include costs associated with jeanswear wind down activities in SouthAmerica post the separation of Kontoor Brands and costs related to specifiedstrategic business decisions to cease operations in Argentina and plannedbusiness model changes in certain other countries in South America, whichtotaled $2.9 million for the three months ended June 2020. The costs alsoinclude $13.0 million during the three months ended June 2020 for costoptimization activity indirectly related to the strategic review of theOccupational Workwear business. The three months ended June 2020 also include a$42.4 million noncash charge recorded in the 'Other income (expense), net' linerelated to the release of certain currency translation amounts associated withthe wind down activities in South America. The specified business decisionscosts resulted in a net tax benefit of $1.9 million in the three months endedJune 2020.

^(c) Amounts shown in the table have been calculated using unrounded numbers.The diluted earnings per share impacts were calculated using 390,791,000weighted average common shares for the three months ended June 2020.



Non-GAAP Financial Information

The financial information above has been presented on a GAAP basis and on anadjusted basis, which excludes the impact of transaction and deal related costsand activity related to specified strategic business decisions. The adjustedpresentation provides non-GAAP measures. Management believes these measuresprovide investors with useful supplemental information regarding VF'sunderlying business trends and the performance of VF's ongoing operations andare useful for period-over-period comparisons of such operations.

Management uses the above financial measures internally in its budgeting andreview process and, in some cases, as a factor in determining compensation.While management believes that these non-GAAP financial measures are useful inevaluating the business, this information should be considered as supplementalin nature and should be viewed in addition to, and not in lieu of or superiorto, VF's operating performance measures calculated in accordance with GAAP. Inaddition, these non-GAAP financial measures may not be the same as similarlytitled measures presented by other companies.

VF CORPORATION

Supplemental Financial Information

Top 4 Brand Revenue Information

(Unaudited)

Three Months Ended June 2021

Top 4 Brand Revenue Growth Americas EMEA APAC Global

Vans^(r)

% change 146 % 148 % 29 % 110 %

% change constant currency* 144 % 125 % 19 % 102 %

The North Face^(r)

% change 81 % 168 % 31 % 93 %

% change constant currency* 80 % 142 % 22 % 83 %

Timberland^(r)

% change 111 % 74 % (18 )% 70 %

% change constant currency* 108 % 58 % (22 )% 63 %

Dickies^(r)

% change 84 % 10 % 7 % 61 %

% change constant currency* 83 % (1 )% 0 % 58 %

*Refer to constant currency definition on previous pages.

VF CORPORATION

Supplemental Financial Information

Geographic and Channel Revenue Information

(Unaudited)

Three Months Ended June 2021

% Change % Change % Change % Change Constant Organic ^ Constant Currency* (a) Currency and Organic*^(a)

Geographic Revenue Growth

U.S. 125 % 125 % 107 % 107 %

EMEA 126 % 106 % 117 % 97 %

APAC 32 % 24 % 20 % 11 %

Greater China 19 % 9 % 19 % 9 %

Americas (non-U.S.) 175 % 146 % 175 % 146 %

International 84 % 68 % 74 % 58 %

Global 104 % 96 % 90 % 83 %



Three Months Ended June 2021

% Change % Change % Change % Change Constant Organic ^ Constant Currency* (a) Currency and Organic*^(a)

Channel Revenue Growth

Wholesale^ (b) 111 % 102 % 111 % 102 %

Direct-to-consumer 97 % 90 % 70 % 64 %

Digital 25 % 20 % (4 )% (9 )%



As of June

2021 2020

DTC Store Count

Total 1,364 1,376



*Refer to constant currency definition on previous pages.

^(a) Excludes acquisition representing the operating results of Supreme forthe three months ended June 2021. Refer to Non-GAAP financial information on"Reconciliation of Select GAAP Measures to Non-GAAP Measures - Three MonthsEnded June 2021" page for additional information.

^(b) Royalty revenues are included in the wholesale channel for all periods.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210730005056/en/

CONTACT: VF Corporation John Kelley, 720-778-4053 Senior Director, Corporate Development and Investor Relations or Craig Hodges, 720-778-4116 Vice President, Corporate Affairs