Business Wire | Oct 22, 2021 06:55AM EDT

VF Reports Second Quarter Fiscal 2022 Results; Reaffirms Full Year Fiscal 2022 Earnings Outlook

Oct. 22, 2021

DENVER--(BUSINESS WIRE)--Oct. 22, 2021--VF Corporation (NYSE: VFC) today reported financial results for its second quarter ended October 2, 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.

"As we move through the halfway point of our fiscal year, I remain encouraged by the underlying momentum across the portfolio, and the broad-based nature of this strength gives me confidence that we are driving the right strategy to accelerate growth in the quarters ahead," said Steve Rendle, VF's Chairman, President and CEO. "While the recovery has been impacted by further pandemic-related disruptions, we continue to see accelerating demand signals across our business, and our ability to reaffirm our Fiscal 2022 revenue and earnings outlook is a clear testament to the resiliency and optionality of our model."

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 $35 million in the second quarter of fiscal 2022 and $108 million in the first six months of fiscal 2022, and integration costs of approximately $1 million in the second quarter of fiscal 2022 and $6 million in the first six months 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 $10 million in the second quarter of fiscal 2022 and $24 million in the first six months of fiscal 2022.

Combined, the above items positively impacted earnings per share by $0.07 during the second quarter of fiscal 2022 and $0.19 during the first six months 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 second quarter. Additionally, continued port congestion, equipment availability and other logistics challenges have contributed to increasing 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, no stores were closed during second quarter. Currently, all stores are open.

In the EMEA region, no stores were closed during second quarter. Currently, all stores are open.

In the APAC region, including Mainland China, 5% of stores were closed at the beginning of the second quarter. Stores have since re-opened and nearly all stores are open at the end of the quarter.

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.

Second Quarter Fiscal 2022 Income Statement Review

* Revenue increased 23 percent (up 21 percent in constant dollars) to $3.2 billion. Excluding the impact of acquisitions, revenue increased 19 percent (up 17 percent in constant dollars) driven by the EMEA and North American regions, which experienced a negative impact from COVID-19 in the prior year period. VF's wholesale business continues to be materially impacted by the timing of shipments due to port delays and logistics challenges. * Gross margin increased 290 basis points to 53.7 percent, primarily driven by reduced promotional activity. On an adjusted basis, gross margin increased 300 basis points, including a 20 basis point positive impact from acquisitions, to 53.9 percent. * Operating income on a reported basis was $558 million. On an adjusted basis, operating income increased 56 percent (53 percent in constant dollars) to $534 million, including an $8 million contribution from acquisitions. Operating margin on a reported basis was 17.5 percent. Adjusted operating margin increased 360 basis points, including a 30 basis point negative impact from acquisitions, to 16.7 percent. * Earnings per share was $1.18 on a reported basis. On an adjusted basis, earnings per share increased 66 percent (up 63 percent in constant dollars) to $1.11, including a $0.02 contribution from acquisitions.

Balance Sheet Highlights

Inventories were up 2 percent compared with the same period last year. During the quarter, VF returned approximately $192 million of cash to shareholders through dividends. VF is reinstating its share repurchase program, under which it is authorized to repurchase up to $2.8 billion of its common stock. This plan was suspended on April 7, 2020 as a precaution due to the COVID-19 pandemic.

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 and related governmental actions and regulations. VF's full year fiscal 2022 outlook includes the following:

* Revenue is expected to be approximately $12.0 billion, reflecting growth of around 30 percent, including an approximate $600 million contribution from the Supreme(r) brand. By segment, revenue for Outdoor is now expected to increase between 25 percent and 27 percent versus the previous expectation of a 24 to 26 percent increase; revenue for Active is now expected to increase between 35 percent and 37 percent versus the previous expectation of a 37 to 39 percent increase; revenue for Work is now expected to increase between 19 and 21 percent versus the previous expectation of a 16 to 18 percent increase.

* International revenue is expected to increase between 24 percent and 26 percent. By geographic region, in the EMEA region, revenue is expected to increase between 30 percent and 32 percent. In the Asia Pacific region, revenue is expected to increase between 12 percent and 14 percent. And, in the Americas (non-U.S.) region, revenue is expected to increase between 30 percent and 32 percent.

* Direct-to-consumer revenue is now expected to increase between 34 percent and 36 percent versus the previous expectation of 39 percent and 41 percent, including Digital revenue growth of about 20 percent versus the previous expectation of 29 and 31 percent.

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

* Adjusted operating margin is expected to increase around 500 basis points to around 13.0 percent.

* Adjusted earnings per share is expected to be around $3.20, including an approximate $0.25 contribution from the Supreme(r) brand.

* 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 $0.50 per share, payable on December 20, 2021, to shareholders of record on December 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 second 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 second 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 September Six Months Ended September

2021 2020 2021 2020

Net revenues $ 3,198,235 $ 2,608,324 $ 5,392,792 $ 3,684,617

Costs andoperating expenses

Cost of goods 1,479,446 1,282,406 2,434,997 1,789,357 sold

Selling,general and 1,160,303 1,005,970 2,196,425 1,822,121 administrativeexpenses

Total costsand operating 2,639,749 2,288,376 4,631,422 3,611,478 expenses

Operating 558,486 319,948 761,370 73,139 income

Interest, net (34,370 ) (30,931 ) (67,145 ) (58,880 )

Other income 7,549 4,644 16,590 (33,543 ) (expense), net

Income (loss)fromcontinuing 531,665 293,661 710,815 (19,284 ) operationsbefore incometaxes

Income tax 67,612 50,415 92,790 15,212 expense

Income (loss)from 464,053 243,246 618,025 (34,496 ) continuingoperations

Income fromdiscontinued - 13,476 170,273 5,605 operations,net of tax

Net income $ 464,053 $ 256,722 $ 788,298 $ (28,891 ) (loss)

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

Continuing $ 1.18 $ 0.62 $ 1.58 $ (0.09 ) operations

Discontinued - 0.03 0.43 0.01 operations

Total earnings(loss) per $ 1.18 $ 0.66 $ 2.01 $ (0.07 ) common share -basic

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

Continuing $ 1.18 $ 0.62 $ 1.57 $ (0.09 ) operations

Discontinued - 0.03 0.43 0.01 operations

Total earnings(loss) per $ 1.18 $ 0.66 $ 2.00 $ (0.07 ) common share -diluted

Weightedaverage shares outstanding

Basic 391,779 389,219 391,565 388,957

Diluted 394,017 391,180 394,072 390,986

Cash dividendsper common $ 0.49 $ 0.48 $ 0.98 $ 0.96 share



* Calculation not meaningful

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 September 2021 relate to the 13-week and 26-weekfiscal periods ended October 2, 2021 and all references to periods endedSeptember 2020 relate to the 13-week and 26-week fiscal periods ended September26, 2020. References to March 2021 relate to information as of April 3, 2021.

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

VF CORPORATIONCondensed Consolidated Balance Sheets

(Unaudited)

(In thousands)



September March September

2021 2021 2020

ASSETS

Current assets

Cash and equivalents $ 1,360,138 $ 815,750 $ 1,877,398

Accounts receivable, net 1,787,331 1,298,020 1,606,479

Inventories 1,464,714 1,061,839 1,434,843

Short-term investments - 598,806 800,000

Other current assets 357,687 423,877 408,809

Current assets of - 587,578 552,677 discontinued operations

Total current assets 4,969,870 4,785,870 6,680,206

Property, plant and 1,011,415 975,876 933,990 equipment, net

Goodwill and intangible 5,434,009 5,454,972 3,024,607 assets, net

Operating lease right-of-use 1,380,106 1,474,434 1,385,121 assets

Other assets 1,093,687 1,062,877 917,342

Total assets $ 13,889,087 $ 13,754,029 $ 12,941,266

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

Short-term borrowings $ 10,173 $ 11,061 $ 13,237

Current portion of long-term 1,001,037 1,023 1,127 debt

Accounts payable 534,365 463,208 450,109

Accrued liabilities 1,838,790 1,609,928 1,505,703

Current liabilities of - 125,257 114,356 discontinued operations

Total current liabilities 3,384,365 2,210,477 2,084,532

Long-term debt 4,682,751 5,709,149 5,679,440

Operating lease liabilities 1,146,944 1,236,461 1,129,840

Other liabilities 1,076,546 1,541,778 1,102,216

Total liabilities 10,290,606 10,697,865 9,996,028

Stockholders' equity 3,598,481 3,056,164 2,945,238

Total liabilities and $ 13,889,087 $ 13,754,029 $ 12,941,266 stockholders' equity



VF CORPORATIONCondensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)



Six Months Ended September

2021 2020

Operating activities

Net income (loss) $ 788,298 $ (28,891 )

Income from discontinued operations, net of 170,273 5,605 tax

Income (loss) from continuing operations, 618,025 (34,496 ) net of tax

Depreciation and amortization 134,553 138,853

Reduction in the carrying amount of 208,687 205,635 right-of-use assets

Other adjustments (1,138,492 ) (270,482 )

Cash provided (used) by operating (177,227 ) 39,510 activities - continuing operations

Cash provided by operating activities - 6,090 43,298 discontinued operations

Cash provided (used) by operating (171,137 ) 82,808 activities

Investing activities

Business acquisitions, net of cash received 3,760 -

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

Purchases of short-term investments - (800,000 )

Proceeds from sale of short-term 598,806 - investments

Capital expenditures (144,582 ) (112,501 )

Software purchases (42,119 ) (38,345 )

Other, net 20,491 (3,839 )

Cash provided (used) by investing 1,052,885 (954,685 ) activities - continuing operations

Cash used by investing activities - (525 ) (2,693 ) discontinued operations

Cash provided (used) by investing 1,052,360 (957,378 ) activities

Financing activities

Net increase (decrease) from short-term (1,397 ) 1,758,317 borrowings and long-term debt

Cash dividends paid (384,427 ) (373,638 )

Proceeds from issuance of Common Stock, net 25,971 (7,221 ) of (payments) for tax withholdings

Cash provided (used) by financing (359,853 ) 1,377,458 activities

Effect of foreign currency rate changes on (10,958 ) (8,082 ) cash, cash equivalents and restricted cash

Net change in cash, cash equivalents and 510,412 494,806 restricted cash

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

Cash, cash equivalents and restricted cash $ 1,361,617 $ 1,906,128 - end of period

VF CORPORATIONSupplemental Financial Information

Reportable Segment Information

(Unaudited)

(In thousands)



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

Segment revenues

Outdoor $ 1,506,621 $ 1,154,407 31 % 28 % 31 % 28 %

Active 1,392,173 1,200,202 16 % 14 % 8 % 6 %

Work 299,163 253,551 18 % 17 % 18 % 17 %

Other ^(c) 278 164 * * * *

Totalsegment $ 3,198,235 $ 2,608,324 23 % 21 % 19 % 17 %revenues

Segmentprofit (loss)

Outdoor $ 284,076 $ 132,475

Active 284,349 259,123

Work 61,973 8,173

Other ^(c) (370 ) (2,526 )

Totalsegment 630,028 397,245 profit

Corporateand other (63,993 ) (72,653 ) expenses

Interest, (34,370 ) (30,931 ) net

Incomefromcontinuingoperations $ 531,665 $ 293,661 beforeincometaxes



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

^(b) Excludes acquisition representing the operating results of Supreme for thethree months ended September 2021. Refer to Non-GAAP financial information on"Reconciliation of Select GAAP Measures to Non-GAAP Measures - Three and SixMonths Ended September 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 and sourcing activities related totransition services.

* Calculation not meaningful

VF CORPORATIONSupplemental Financial Information

Reportable Segment Information

(Unaudited)

(In thousands)



% Change Six Months Ended September % Change % Constant % Constant Change Currency Change Currency Organic and ^(a) ^ (b) Organic^ 2021 2020 (a) (b)

Segment revenues

Outdoor $ 2,124,375 $ 1,495,635 42 % 38 % 42 % 38 %

Active 2,694,241 1,771,518 52 % 48 % 38 % 34 %

Work 573,898 415,981 38 % 36 % 38 % 36 %

Other ^(c) 278 1,483 * * * *

Totalsegment $ 5,392,792 $ 3,684,617 46 % 43 % 40 % 36 %revenues

Segmentprofit (loss)

Outdoor $ 212,329 $ (28,236 )

Active 555,211 266,259

Work 102,977 (3,228 )

Other ^(c) (652 ) (4,887 )

Totalsegment 869,865 229,908 profit

Corporateand other (91,905 ) (190,312 ) expenses

Interest, (67,145 ) (58,880 ) net

Income(loss)fromcontinuing $ 710,815 $ (19,284 ) operationsbeforeincometaxes



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

^(b) Excludes acquisition representing the operating results of Supreme for thesix months ended September 2021. Refer to Non-GAAP financial information on"Reconciliation of Select GAAP Measures to Non-GAAP Measures - Three and SixMonths Ended September 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 and sourcing activities related totransition services.

* Calculation not meaningful

VF CORPORATIONSupplemental Financial Information

Reportable Segment Information - Constant Currency Basis

(Unaudited)

(In thousands)



Three Months Ended September 2021

Adjust for As Reported Foreign Constant under GAAP Currency Currency Exchange

Segment revenues

Outdoor $ 1,506,621 $ (24,735 ) $ 1,481,886

Active 1,392,173 (19,140 ) 1,373,033

Work 299,163 (3,727 ) 295,436

Other 278 - 278

Total segment revenues $ 3,198,235 $ (47,602 ) $ 3,150,633

Segment profit (loss)

Outdoor $ 284,076 $ (6,309 ) $ 277,767

Active 284,349 (3,875 ) 280,474

Work 61,973 (1,257 ) 60,716

Other (370 ) (27 ) (397 )

Total segment profit 630,028 (11,468 ) 618,560

Corporate and other (63,993 ) 389 (63,604 ) expenses

Interest, net (34,370 ) - (34,370 )

Income from continuingoperations before income $ 531,665 $ (11,079 ) $ 520,586 taxes

Diluted earnings per 89 % (3 )% 86 %share 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 CORPORATIONSupplemental Financial Information

Reportable Segment Information - Constant Currency Basis

(Unaudited)

(In thousands)



Six Months Ended September 2021

Adjust for As Reported Foreign Constant under GAAP Currency Currency Exchange

Segment revenues

Outdoor $ 2,124,375 $ (54,948 ) $ 2,069,427

Active 2,694,241 (66,956 ) 2,627,285

Work 573,898 (8,753 ) 565,145

Other 278 - 278

Total segment revenues $ 5,392,792 $ (130,657 ) $ 5,262,135

Segment profit (loss)

Outdoor $ 212,329 $ (5,084 ) $ 207,245

Active 555,211 (14,714 ) 540,497

Work 102,977 (2,069 ) 100,908

Other (652 ) (55 ) (707 )

Total segment profit 869,865 (21,922 ) 847,943

Corporate and other (91,905 ) 1,117 (90,788 ) expenses

Interest, net (67,145 ) - (67,145 )

Income from continuingoperations before income $ 710,815 $ (20,805 ) $ 690,010 taxes



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 CORPORATIONSupplemental Financial Information

Reconciliation of Select GAAP Measures to Non-GAAP Measures - Three and SixMonths Ended September 2021

(Unaudited)

(In thousands, except per share amounts)



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

Revenues $ 3,198,235 $ - $ - $ 3,198,235 $ (99,574 ) $ 3,098,661



Gross 1,718,789 - 5,868 1,724,657 (59,385 ) 1,665,272 profit

Percent 53.7 % 53.9 % 53.7 %



Operating 558,486 (33,886 ) 9,738 534,338 (7,984 ) 526,354 income

Percent 17.5 % 16.7 % 17.0 %



Dilutedearningsper sharefrom 1.18 (0.09 ) 0.02 1.11 (0.02 ) 1.09 continuingoperations^(d)



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

Revenues $ 5,392,792 $ - $ - $ 5,392,792 $ (245,305 ) $ 5,147,487



Gross 2,957,795 - 12,069 2,969,864 (148,194 ) 2,821,670 profit

Percent 54.8 % 55.1 % 54.8 %



Operating 761,370 (102,482 ) 23,862 682,750 (39,673 ) 643,077 income

Percent 14.1 % 12.7 % 12.5 %



Dilutedearningsper sharefrom 1.57 (0.24 ) 0.05 1.38 (0.08 ) 1.30 continuingoperations^(d)



^(a) Transaction and deal related activities include activities associated withthe acquisition of Supreme Holdings, Inc. ("Supreme") for the three and sixmonths ended September 2021. Transaction and deal related activities include adecrease in the estimated fair value of the contingent consideration liabilityof $35.0 million and $108.0 million for the three and six months endedSeptember 2021, respectively, and integration costs of $1.1 million and $5.5million for the three and six months ended September 2021, respectively. Thetransaction and deal related activities resulted in a net tax benefit of $1.2million and net tax expense of $8.3 million in the three and six months endedSeptember 2021, respectively, primarily related to the impact of the decreasesin the estimated fair value of the contingent consideration liability on theinterim tax rate calculations.

^(b) Specified strategic business decisions for the three and six months endedSeptember 2021 include costs related to VF's business model transformation of$0.2 million and $1.7 million in the three and six months ended September 2021,respectively, related primarily to restructuring and other costs. Specifiedstrategic business decisions also include costs related to a transformationinitiative for our Asia-Pacific regional operations of $13.3 million and $21.8million in the three and six months ended September 2021, respectively.Specified strategic business decisions also include cost optimization chargesand other activities, including the sale of certain assets, indirectly relatedto the divestiture of the Occupational Workwear business, which totaled incomeof $3.8 million and costs of $0.4 million during the three and six months endedSeptember 2021, respectively. The specified strategic business decisions alsoinclude non-operating income of $1.7 million during the three and six monthsended September 2021 associated with VF's transformation initiatives. Thespecified strategic business decisions resulted in a net tax benefit of $1.0million and $3.2 million in the three and six months ended September 2021,respectively.

^(c) The contribution from acquisition represents the operating results ofSupreme for the three and six months ended September 2021. The results excludetransaction and deal related activities.

^(d) Amounts shown in the table have been calculated using unrounded numbers.The diluted earnings per share impacts were calculated using 394,017,000 and394,072,000 weighted average common shares for the three and six months endedSeptember 2021, respectively.



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 and six months ended September 2021). Contribution fromacquisition also excludes transaction and deal related activities. Theseadjusted presentations are non-GAAP measures. Management believes thesemeasures provide 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 CORPORATIONSupplemental Financial Information

Reconciliation of Select GAAP Measures to Non-GAAP Measures - Three and SixMonths Ended September 2020

(Unaudited)

(In thousands, except per share amounts)



Transaction Specified As Reported and StrategicThree Months Ended AdjustedSeptember 2020 under GAAP Deal Business Related Decisions Costs^ (a) ^(b)

Revenues $ 2,608,324 $ - $ - $ 2,608,324



Gross profit 1,325,918 - 1,646 1,327,564

Percent 50.8 % 50.9 %



Operating income 319,948 42 21,516 341,506

Percent 12.3 % 13.1 %



Diluted earningsper share from 0.62 - 0.04 0.67 continuingoperations ^(c)



Transaction Specified As Reported and StrategicSix Months Ended AdjustedSeptember 2020 under GAAP Deal Business Related Decisions Costs^(a) ^(b)

Revenues $ 3,684,617 $ - $ - $ 3,684,617



Gross profit 1,895,260 410 14,663 1,910,333

Percent 51.4 % 51.8 %



Operating income 73,139 452 37,485 111,076

Percent 2.0 % 3.0 %



Diluted earnings(loss) per share (0.09 ) - 0.19 0.10 from continuingoperations ^(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 six months endedSeptember 2020.

^(b) Specified strategic business decisions for the three and six months endedSeptember 2020 include cost optimization activity and other charges indirectlyrelated to the strategic review of the Occupational Workwear business, whichtotaled $20.2 million and $33.2 million during the three and six months endedSeptember 2020, respectively. The costs also include $1.1 million and $4.0million for the three and six months ended September 2020, respectively, forjeanswear wind down activities in South America after the separation of KontoorBrands, and costs related to specified strategic business decisions to ceaseoperations in Argentina and planned business model changes in certain othercountries in South America. The six months ended September 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 $4.1 million and $6.0 million in thethree and six months ended September 2020, respectively.

^(c) Amounts shown in the table have been calculated using unrounded numbers.The diluted earnings per share impacts were calculated using 391,180,000 and390,986,000 weighted average common shares for the three and six months endedSeptember 2020, respectively.



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 CORPORATIONSupplemental Financial Information

Top 4 Brand Revenue Information

(Unaudited)



Three Months Ended September Six Months Ended September 2021 2021

Top 4Brand Americas EMEA APAC Global Americas EMEA APAC GlobalRevenueGrowth

Vans^(r)

% change 10 % 10 % (2 ) 8 % 49 % 46 % 13 % 41 % %

% change )constant 9 % 7 % (7 % 7 % 48 % 38 % 6 % 37 %currency*

The North Face^(r)

% change 24 % 44 % 30 % 31 % 36 % 67 % 31 % 45 %

% changeconstant 23 % 40 % 23 % 29 % 35 % 59 % 23 % 41 %currency*

Timberland ^(r)

% change 47 % 11 % 6 % 26 % 64 % 24 % (2 ) 38 % %

% change )constant 46 % 10 % 1 % 25 % 62 % 19 % (7 % 34 %currency*

Dickies^ (r)

% change 34 % (16 ) 10 % 21 % 55 % (9 ) 9 % 36 % % %

% change ) )constant 34 % (18 % 5 % 19 % 55 % (13 % 3 % 34 %currency*

*Refer to constant currency definition on previous pages.

VF CORPORATIONSupplemental Financial Information

Geographic and Channel Revenue Information

(Unaudited)



Three Months Ended September 2021

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

Geographic Revenue Growth

U.S. 27 % 27 % 22 % 22 %

EMEA 19 % 17 % 17 % 15 %

APAC 13 % 8 % 7 % 2 %

Greater China 9 % 3 % 9 % 3 %

Americas (non-U.S.) 29 % 22 % 29 % 22 %

International 18 % 15 % 16 % 12 %

Global 23 % 21 % 19 % 17 %



Six Months Ended September 2021

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

Geographic Revenue Growth

U.S. 56 % 56 % 47 % 47 %

EMEA 43 % 37 % 40 % 34 %

APAC 21 % 14 % 12 % 6 %

Greater China 13 % 5 % 13 % 5 %

Americas (non-U.S.) 59 % 47 % 59 % 47 %

International 37 % 30 % 32 % 25 %

Global 46 % 43 % 40 % 36 %



Three Months Ended September 2021

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

Channel Revenue Growth

Wholesale^ (b) 17 % 16 % 17 % 16 %

Direct-to-consumer 32 % 31 % 21 % 20 %

Digital 24 % 22 % 5 % 3 %



Six Months Ended September 2021

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

Channel Revenue Growth

Wholesale^ (b) 40 % 36 % 40 % 36 %

Direct-to-consumer 57 % 53 % 40 % 36 %

Digital 25 % 21 % 0 % (3 )%



As of September

2021 2020

DTC Store Count

Total 1,358 1,382



*Refer to constant currency definition on previous pages.

^(a) Excludes acquisition representing the operating results of Supreme for thethree and six months ended September 2021. Refer to Non-GAAP financialinformation on "Reconciliation of Select GAAP Measures to Non-GAAP Measures -Three and Six Months Ended September 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/20211022005068/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