VFC - Earnings call transcript Q1 2020

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Operator

Greetings, and welcome to the V.F. Corporation First Quarter Fiscal 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions].

conference recorded. this reminder, a is being As

I to President your like to of conference over turn the host, Relations. go would Please now Investor ahead. Joe Alkire, Vice

Joe Alkire

welcome on make forward-looking to cause These earnings and Good and fiscal current the noted, today's filed documents regularly based actual the amounts in differ an statements. referred otherwise constant this V.F. uncertainties we to are today's will that on will results subject statements detailed basis, XXXX to morning, are call uncertainties issued call. adjusted call SEC. to with on on press be which Participants These Unless expectations are materially. was Corporation's morning. could dollar that define release in

as we discussion in the amounts lead of accurately underlying represent We numbers believe operational more business. use because performance and our true results constant our they adjusted dollar

to provide with found in You Reconciliations in of may which and which all tables financial to amounts view also the measures excluded why are and amounts management’s and reported view with included hear identifies press refer GAAP. quantify quantifies excluded items, provides items release, U.S. the investors. all to supplemental adjusted is information identify useful this can of accordance us GAAP in and this be release which managements

this operating as in which During publicly business as all above date the the as assets independent, the business, discontinued Lee spin-off has periods the Jeans operations the liabilities included first Kontoor into Republic well business Jeans and quarter results business, and of for its Wrangler, of noted brands, fiscal Accordingly, Rock name XXXX, the company the Brands. the of company the included the presented. under the company of VF removed of completed traded an and Outlet &

noted, otherwise based continuing call on are today's presented on results Unless operations.

Chairman Officer be today's Roe. on me will Chief Financial Executive call Scott Rendall Steve Chief and President Vice and Joining Officer

for call we’ll open prepared our questions. the Steve? Following remarks,

Steven Rendle

Thank Denver, from our new you, in morning Joe. headquarters Colorado. And good

XXXX of transformative Following to globe. value growth, new one most stakeholders record of our the for chapter the build of fiscal as begin long years VFs VF all on track around our success and XXX-year represents for creation a history, in we

now well of we Brands can our relocation our into even the minded driving With complete and brands focus retail on separation and to Kontoor underway, centric. more Denver now powerful consumer become

associates results is creating purpose Our as more value a that proof transformation driven, results led, first stand powerful yielding point enterprise our to be and performance shareholders. our consumers, tangible quarter for a

at VF. It's time an exciting

a take North X% first momentum basis. strong an some highlights the Growth year. brands organic Vans Face, XX% brands, this at the on XX%, grew driven which and respectively, our The of largest as and Let's our both look extends from quarter. or by increased into was two for adjusted Revenue XX%

Vans Our growth target. long continues to business perform term well its above

quality the Old of strength as importantly, strong, of seeing Slip-On the continued the and Skool. More franchise the of growth rapid acceleration we diverse the complement the are is

that performance sustain and this including we growth, The target, brand's they the one confident When with our continue the not XX% thing. Vans Van's and are making disciplined drive are growth ability in coupled intensely trajectory term explosive to consistent we deliver driven is team as focused to remains by year. long above to fuel to just investments its XX%

and to all target pipeline to in growth X% for and year fiscal North brand's we full The product and XXXX The billion first digit expectations, visibility outlook of brand the exceed performance, its the XXXX. achieving product and its territories. brand's our strengthen to light are [ph] increased energy Face across strong by North engine, regions Face $X with growth way quarter In the channels all innovation increasing on to The well to X%. renewed is double Similarly, continues

and of products, launch Speaking from a from the away has strong. are we months the few just of the response very marketplace FutureLight been

Given have to aggressively breakthrough more outdoor even we the decided has significantly behind the to industry, invest disrupt opportunity the technology. FutureLight

to coming more forward with sharing you look months. We the over

Now give XX% the with and total increased consistent nearly highlights across with in you increased our International X% And Direct-to-consumer quarter's growth brand portfolio. growth XX% revenue let performance. me more a including a XX% few XX% XX% China. in work digital. comp from performance increased nearly

to strong remained the creation driver momentum. in our of required the fundamentals value to capabilities as a sustain drive XX.X% our key us Our gross providing investment model reached growth to margin, fuel continue

in EPS including strategy. to adjusted increased to tied investments, lastly, And growth $X.XX our XX% increase has focused term a XX% long

fiscal quarter and Faces As primarily a XXXX raising results additional year, first the our cover confidence North of we're a million an updated our details launch. will moment. full the of in outlook FutureLight in our including investment, increased focused The of outlook fiscal strong XX XXXX on Scott incremental result

relocation in our June, in decision to the we the palpable officially base of of just began. is The the beginning summer, associates working the By than our the outdoor Rockies. to a the have brands leadership co-locate And over community. Denver living of a and further validation around of corporate be just ago, team move made year energy just the already at -- to headquarters complete. we the expect to new time, and short At we XXX Denver end and more our the

XXXX, quarter expectations. our one is of business So performing ahead fiscal into

of in where model for for an Day our corporate provide in growth in investing growth both term opportunities. another our look scheduled our our leaders brand September strategy, thoughtfully brands, largest will year forward against upcoming We're Beaver and and ability Investor to long our We our returns shareholders. and Creek, are XXth our algorithm. We to update quartile CSR Colorado in increased confident financial deliver top our outlook to

to it And with that, I'll over turn Scott.

Scott Roe

give VF to point proof start, current another post growth focused continues is us that the we composition aligned, Thanks, portfolio to version of Kontoor and future. as better degree performance yet our a a Steve. stronger, growth. centric a to confidence off high of consumer transformation is of itself the and look accelerated Fiscal in XXXX strong our result

into to quarter is diving that Before smallest results, note the our of QX the it's important year.

tracking seeing balance are portfolio. us retail plan most demand is quality us. while year that So consumers said, business from full of in certainly remains exceptionally the are ahead across confidence and give performance and We're both pleased the of we of of with outlook. encouraging, fundamentals the year executing With our and the of our growth The are strong ahead well. and signals we the are partners

the X% core XX% momentum or organic growth an increased basis, quarter. driven by Now first on Revenue continued engines. let's review in our

growth brands Our at growth North grew by Vans and The of XX% big three XX% Face. XX% led

all The delivered North in regions of across consistency double-digit and growth across territories. Face, remains categories all regions and product is all with Van's growth The channels impressive. strength which Equally channels of continued momentum the three exciting product

Revenue highlighted business total growth increased XX% XX% a and DXC in by in our digital. comp XX%

Our sell increased X% driven by growth through business and wholesale accounts. wholesale XX% strong key digital with across our partners,

performance highlighted of economic the brand a internationally both double digit growth standpoint, in China. of segment in From tempered despite The portfolio. XX% the our first somewhat solid the and U.S. in remained by saw work also we cyclical more a parts environment the in quarter, growth geographic more

revenue X% by which year of timing remain and the growth outlook confident in the first the Dickies was in which strategic Japan, the will impact was Revenue the X% with year. of increased line full expectations. increased growth the segment shipments our X% in Work the X% We repositioning which quarter during brand a in of for half in Dickies impacted of brand. to

in Gross towards FX margin term and faster margin strategy. transaction slightly by revenue hedge timing gains. leverage of was mainly driven the XXX offset grew our XX% strong ongoing XX.X% mix by expanded investments tied than as to basis shift operating to businesses points SG&A long higher growth our

These translate into tangible results. investments continue to strong,

it lower to XX% operating to $X.XX EPS growth growth operating to as points expanded prior profit or pulling in in expense. increased of interest operating and the strong basis all the representing income XX% Now as benefit on compared organic an pension together, reflecting has margin well year. organic basis XX% X.X% XXX

inventory our relatively Kontoor slightly the below with proceeds growth year from two balance term full repay leverage revenue gross used times, to as outlook. the ended to borrowings. is Moving quarter with sheet, which X% line spend the adjusted short the in We increased we

of as Our lot M&A balance priorities. sheet have other position is strong, dry and we our powder pursue allocation capital well as a to agenda

share the has approved adjustment VFs Consistent board Kontoor communication our $X.XX to per represents of our brands. payable XXXX following release, a of dividend record. our BFC in in dividend of and disclosure, shareholders spinoff prior with September dividend our recalibration saw the you As

combined Kontoor hold companies per had pay an to When as yesterday, of the of our dividend with Kontoor per $X.XX that dividend VF the spinoff. the to both receive quarterly announced with intend distribution dividend share. who shareholders prior considering they $X.XX they total is And equal initial a dividend to and will share,

term dividend dividend dividend result with and we grow component to market should long yield. a of The in consistent These move our we TSR algorithm key a average as remains our intend earnings forward. actions

fiscal plan, fiscal raising growth our portfolio Now of year outlook. increased in quarter XXXX the visibility year based and on performance, and our outlook full the confidence first to for XXXX. the updated turning growth Based are across strength broad our our we

billion representing on $XX.X increase year. X% Gross dollar XX an margin representing expected point organic basis growth to now basis. an to revenue We to expect XX.X% be the is prior approximate constant now compared

a year. representing per EPS on expect constant of XX% be relative now XX prior margin now over growth Operating We an point to investment basis, our representing is $X.XX incremental to to organic dollar including of increase XX.X% XX% outlook. the to $X.XX share expected prior basis adjusted $X.XX

future coupled to on investment The at of our momentum invest over opportunistically power The sustained on is margin focused across to leverage operating same the give delivering Face enterprise model, fuel the North time, platforms revenue the and gross ability our invest with the while incremental demonstrates growth technology. life wide of commitments in us expansion, launch to shareholders. The strong

our to now Moving segment outlook.

Active growth for We XX% Work also strength North outlook of to XX% outdoor outlook on to We're strength X% the The continued segment the expect our grow for Face. to X%. still our raising X% between at to are and Vans. raising reflecting We based

and digit to Dickies to our raising and X% outlook we're Timberland to a to low Face We and By Vans XX% to X% X%. brand, X%. grow our North at to XX% between grow still outlook rate expect both single

to and to wholesale growth. maintaining of and finally, our to our X% continue X% raising DXC internationally And we high X% growth to outlook region, to XX% single by to U.S. for By XX% X%. outlook our outlook digit expect we're we're growth channel raising

into heading back-to-school holiday So one the quarter growth balanced with into key fiscal XXXX, the fall and pleased momentum the and we're portfolio across season. our

we Our enhance capital well momentum, is priorities fundamentals to strong quartile our look sustain more and in believe to M&A and be this are our as a we and accelerate well-positioned purposefully detail model, what TSR allocation balance you our to Day forward to to on other algorithm We updating strategy, the further sheet at investing Investor financial are the as evolution growth September. TSR and of pursue top outlook.

your Now, we’ll questions. open the line and take

Operator

first Binetti comes question Our Credit of Instructions] Please [Operator ahead. Suisse. Michael go from today

Michael Binetti

Hey guys. Good morning.

you an North the obviously so it's a start there very on describe sense basis. the the if how VF for in as North little the retailers need time me curious, for calendar they you get backlogs that, customers but question more hot than whatever the great and retail to shipping think awkward a is the I half? get at back really out on on to the on there, goods year, brand congrats are is less continuing prevailing is are Congrats a you years year, talk you back the X.X. wanting and a And over I'm have to it's look half for how and retailers ask just sustainable slip that that, the ordering you or the mindset would were back But you mentioned that quarter want calendar I the look conservatively windows few of about one July, ordering Face. it's gate guess Let just here a of back out momentum at with back Face. closer

Steven Rendle

past the Face They're retailers for good I the would I'll Sure three our line modifying is are but the years our product. tell centric, about we're with two assortments, better absolutely in start. of way the in merchandise much talked Steve. helping we've are outlook. you guide the that's of approach raise North their this backlogs help how this more with their there. year, year they to their or or drive. the the to how with thinking have flow past also over partners consistent increased orders, place wholesale they consistent modified how Michael, very And level we we about time that approach retail able flow, experience and being

So themselves place. hard good relocation Denver. North in in A East and put finds lot really last to done itself over work's a been to three position years the this of

it they've know to extremely confident You will that frankly and fall of this to into the that we're the important season. moves and FutureLight handled what brand looking launch well as forward mean winter and

Michael Binetti

call, the still the it little time that last at Day, the ask think right And before I you know Thanks the into you seen about that. were know, XXXX we'll Day. details guided got think working off operating to you know of the Great. for for but that Scott target bit this gritty into XX.X of that it know longer Analyst term, was we've margin. a nitty at about want Analyst I margin something said you get some XX% you just of on the to operating asked we'll a XX to the but restatements, longer I I framework And the and the And term. were then you baseline now to of from business get

right I to still a guess, this at of this intact, that range, level oldco some it's that's this working here I keep us steeper to right? a margin get improvement think to But about restated a for you we're climb if and if think of year, high versus of components what from in just, do algorithm off will drivers Now general year. helps it at the XX so of guess a be the that XXXX I'm level fiscal kind margin algorithm XX.X XX.X bit lot that’s bigger the

Steven Rendle

that's -- and out point right XX I itself reinvented or I yes, it's of leverage you shouldn't massive platforms pace after Sure, set this I right. the should know this, us this at investing has what to going key you It’s expect X.X right. fall. margin credit in But VF and go-forward that think years, think Michael context, the XXX we company that those what drivers we assume growth that, And sure an algorithm point for from matters, you gross and to a on on many would this the get in like mid-teens you looks just before, ballpark general, the you The times, the enterprise and that give growth, kind about you update a but that's earnings you base change should basis, wide said so I talked the earnings forward. expansion, we'll right. long, whether algorithm of

portfolio Well, than Boston. a clean different It's baseline. again. up we different a It's in we'll that had

factors those adjust. all So to need

absolute go-forward wouldn't get saying, of way about basis. long more a too nominal I algorithm, isolated the Think growth a on it’s number. So on the

Michael Binetti

– all help Region it. again. the again for congrats Got and thanks

Operator

is question from JPMorgan. Please go next ahead. of The Boss Matthew

Matthew Boss

congrats a and Thanks, nice on guys. spring

Steven Rendle

Thanks, Matt.

Matthew Boss

front, the how raised the on first to characterize see think North what as best and and guess Vans about as maybe broadly North today, revenue the for your America, Face. drove consumer you China and Europe I forecasts we it Steve,

the down down, you if it broke trends, you If broke by geography?

Steven Rendle

Sure.

consumer to are of the remaining a the that quite sold a you where our on. we're healthy. last the we've that that down by see quite to in we move. two U.S., here work realign products focused the it’s on if So break over And region bit years were We done

executed us like distribution we've growing, those pressured digital some moved of have side of and channels department know we divestitures from some more more business. of away with mid-tier and You the strong, a fast very aligned a and well the DXC store business find really the specialty that ourselves and

the amount more consumer aligning to And know a experiential pull how we're effective comment our and in you with we're with pull to So to really products and earlier them that in. of that consumer ability much much that, more and strategy connect proper merchandising way, connect flow my marketing our able really way.

around that kind U.S. view, a political noise a brands as place point noise of yourself lot in with really consumer you where align of we the So our macro seems there's but us that and pause you marketplace. from and really likeminded think and clear of the healthy, on community, economic separate from provide an individual, a can focus yourself

from in strategy that to connect we confident the And really same sit But standpoint the marketplace our consumers and some we're country in we there. see European where it's the with true marketplace challenging the there. navigate diverse feel with a indicators Europe, certain in really able across and

ahead brands And you with tremendous us, to awareness much there, opportunity continue our to in standpoint that our you'll upside very just with working connect a consumers. know see and brands, ability an China, from portfolio of tight have so we're

confident and validation near We think the this connect. continue that I very XX% to quarter, we this our posted very rate of results that in feel just growth ability is brands to to

the place outlook we and and gives we across across confidence the the and year out the momentum seen to marketing confidence. growth our guidance channels nature books we us in that broad this the last for the forward us the of what our based to order the have we and performance the the drive QX, carried regions our in in is against that you across get have confidence in then gives outlook year, What we’ve the categories, the of that raise that product –

still of deliver we quarter path smallest are our to our our us the it’s commitment. and in know quarter year, it that on against one confidence know gives You you

Matthew Boss

the XX quarter expansion, follow your the over margin, what up price point margin just product ASPs year. then in what’s gross of versus was moderating about back then And were thinking basis behind half gross primary full a driver this the on selling breakdown we if great. the That’s and cost rate and the

Steven Rendle

the benefit in plus was driver. first of largest your so question the currency we in so from hedge part ago locked first the Yes, or year quarter, that the a gains

that -- you the said move we quarter moderate see think you’ll year. through last I as

a quarters, benefit still subside. preceding benefit of in there’s will that the the So amount

year to the the for still the drivers So the but you fourth quarter. the time by rate, get by the year you it’s of know relatively one of insignificant end of it’s

is XX guidance know format related XX the end see end will our in point year, still do high year. DXC a somewhat half the year the of you Vans the you it other mix but basis point basis large moderation. that we single-digit by the the that soft range moderate issue Vans implies The that math, expansion think The in through and DXC to that in and landing about. if talked we that of second mix you're implied say that the that it’s by the for I will full with

Matthew Boss

quarter. Congrats again nice Great. a on

Steven Rendle

Thank you.

Operator

is go Please The Jaffray. ahead. Piper next from question of Murphy Erinn

Erinn Murphy

guess from has brand thanks the Steve just you, Amer I how both Could bought speak you talk now maybe the you are Great, for a China. bit Chinese Sports? then, evolving morning. And there Anta in National you seeing a competitive good I anything that space different landscape more little perspective? outdoor was hoping could about

Steven Rendle

it’s remains very set a I market competitive Yes, in similar. very crowded very so outdoor place. space really the the China specifically; mean

invests local significant respect as any As as we a your well segment, competitor. heavily more it’s in retail a as but doing, of different them certainly just seen early really are as international what checks see change environments channel haven’t do walk this plethora Anta and you And brands. into you they the

our about relevant peak, is the or understanding China what’s to outdoor to products going able our and it’s we versus peak, Face And is on and to are think the to how mountains that in very Europe the outdoors experiences has outdoors we Europe. less the your brand that that and in consumer, the in that North in most there brand, live trying really less the adjacency and in could into that It’s big focus Outdoor going individualistic, bag looking place. our friends I are important might here that to than very outdoor see consumer where different market like with be at consumer it’s Asia. we’re the bring that team they more

collection, piece exploration understanding consumer’s I the lifestyle urban of life. component the the of So consumer, with our use you to what’s both more we deep Sports the teams think with how connect them that it’s have properly with connect how to outdoor do the then and this that aspect know Mountain city outdoor

Erinn Murphy

to? more with incremental area then North $X.XX the about first it forth that you that it. launch QX I what launch, are FutureLight drove maybe or talk going product in the down that little a And Got FutureLight results? that fuelling then, what so bit investment helpful. kind And the terms of quarter investment just from of you. a like just the That’s drilling the is behind around perspective you coming, guess sounds can Thank for is that Face.

Steven Rendle

Yes, So in. I’ll start

work the more logo across fly see of here strong holistically able wear, results and learning’s validation We sales, and Asia their brand and for growth really across really what has which the from solid sportswear categories. QX, but based real learning broad is the and So Europe being the to regions, been was really in been also rainwear, had we have doing, their good. that taking

get that with from the be really In a Validation people we aspect a to back-to-school our category falling the into that the of that and brands the was we APACs driving in wear growth want also bags marketing the purchasing standpoint. – but equipment important that as saw come the and this a logo those brand, it are PACs in saw double digit really strong point our products. and people brand prove brand in we is to fact, to equipment the tents part products But which core outdoors is certainly and the as using logo wear in looking great. of they are is

On FutureLight question, could the repeat just the aspect, mind, would Erinn? you you

Erinn Murphy

Yes, now you just does haven’t areas the about in going plant around be $X.XX before incremental going fuelling of really behind curious to investment that of investment had incremental that kind launch? that’s what FutureLight, maybe other talked and you that is

Scott Roe

our experiential a Yes, deals sure. technology. component. It online a media a that really people demand very so bring is but and both It because this from that’s this has just investment in also way. that different, job holistically tremendous to around for it component, And really it, and in-store being now building will different there and able quite technology in expanded online print, new we’ll a and help be an social print of awareness differently story both enhanced the in-store tools performs to in light team done in articulate understand

Steven Rendle

investment Yes, plants. the Erinn. and on significant I’ll Obviously we just had that in build

more. even is this So

this a trade from and for we we the the outdoor time very industry. reception we what in a be harder to was from even will be As felt we on the can believe consumers, see see great as opportunity the disruptive technology lean

more do about we area did was distributed. Chinese well pretty it If was The see in market. as China need we by it region, store to opportunity the a little the you and one think storytelling the it

Erinn Murphy

both Great. best. the all Thank and you

Steven Rendle

you, Thank Erinn.

Scott Roe

Erinn. Thanks

Operator

The next question Please Walvis of is ahead. from go Sachs. Alexandra Goldman

Alexandra Walvis

I North discrepancy trend wondering and Vans the for about question. was that the sell-through other perhaps digital and thinking about was partners following know the America's on know wholesale. you a would you'll that partners. selling you taking color partners between that, Face. I for that same question helpful? channel strengths any there and be and much both these then, from if so was partners And Thanks those wholesale had which keep It brick any there. you strong versus get in particular can Hey mortar

Scott Roe

market. you just good healthy. seeing selling in can be of comment out Inventories shape we're Yes. distribution and the are categories inventories pretty is we couple I'd comments. -- different and hearing than you're things little good of a reiterate channels A a product product What receptivity the in see, that, out Steve's From your there. behind our earlier strong is the trend retail. what were the other may comments in our are to that's certainly the are shape, to the some at

that demand would retailers also going to reiterate in with closer particular You Steve said, seeing their I buy. thing are another we're know that

not big push inventory an channel, eye later demand, So you're that more of keeping well. into you're seeing and we're a closer seeing the as by to on

So balance the of the I can the least that for health -- and categories would characterize in is our our see. business inventory and of at from situation good what we

Steven Rendle

And partner outstanding I standpoint, a particular an would one partner on breakout we've really well, wouldn't of standpoint…from and then channels, from any comes is these a doing our aligned job. focused where to How I partner Each -- one our our to performing portfolio where we now more see don't good strength. sporting you where life. the Channels, Specialty brand portfolio know the partners be

know our of provider break them to able on product, issues work down top are really we're make to that you teams through and to margin Our with that sure for delivering that commitment against within assortment, the what understand the need are them. the we to sell be business,

Digital wholesale in us. it's brick with both there, aspect. to but for strong continues and an to We've you partners digital the nice have performance growth be continue be know very that and mortar really national toolkit partners their seen also our standalone important and digital

Alexandra Walvis

you if business, -- could, would direct mean I that elaborate and then that that outlet performance mentioned comment you consumer debt the were Great. the the at dragging North you be if on full trends be -- across wonder, perhaps that outlets a on more would that performance And little a that you direct-to-consumer Face bit, then I broadly business within the comment could little could helpful? on to bit. versus

Steven Rendle

I'll on Yes, start that.

mean, the news, bad was simple. I pretty I So comment guess good news.

we Our way in broad outlet but brand look a dispose don't in appropriate and as in just of it simply is know look at have of suffered as inventory, good didn't remember, thing from a overall, a we our assortment a driver, which the to outlets growth lack you -- at way. a access we bit outlets, a

So digital, we well suffer grow too when see a notable we're mortar not that as outlet -- and right. upset we our did bit. our brick It's as

So our Both outlet in and full price. channels our we full the was see business. growth in drag in price

Alexandra Walvis

so much Thanks Good guys. luck.

Steven Rendle

you. Thank Great.

Operator

from of go is question Securities. Please Guggenheim ahead. next The Bob Drbul

Robert Drbul

in see Hi between variation you the more brand little you your wondering the working a the on can the of in terms was know in U.S. what's guys. business, Timberland the seven morning. about that Asia the I on talk and you bit Timberland other is, plus and Good given Europe where regions the U.S. outlook? know and and

was a increase?. just you terms the versus Dickey's in minutes rest wondering outlook you year the on quarter what just spend guys then, of Thanks. do on and of the And the X% business the drive current X% the could few expect to if to

Steven Rendle

Why I'll Scott take on Scott on don’t Dickies. Great. I you take in -- Timberland, fill can and

with we interesting. where Timberland Bob, is with really So are Dick

and through dealers, our it's desire to first U.S. specific the and the you design that And a we're But then really what's at sell realign from brand. behind same we strategy like impacts on and better, a reset would our time, efforts diversification product segmented part improved go-to-market plan. the from sell better this our little even very been off and standpoint, standpoint, and as that's bit results we're and disciplines, for doing the of is of last that products. through our to the our of motion. lot aspects into this behind very a tracking know the where from full that seeing on. be experiential working number quarters, non-classics doing marketing standpoint, interesting We're they've of look the development hard seeing business a on but You creative is their about quarter of how for a classics and because coming results doing in we've elevate at the good also is to merchandising you the raising quarter on really foremost We've product of we're actions talked know a are this that brand, I is think how

the to Asia start continued work see you here the and strong classics, that's offer non-classics at and look that relevant we're across specifically U.S. seeing the that to the Asia, into sell you've through good make off around sizing on based and China right the bring on we marketplace. sell-through When assortment sure pay that And market. the in broad we the

spring and mode saw winter sell In where and still warm recovery the impact throughs. know on carried Europe, business through we in classics spring we're our has that from into an you a

leadership that just a court manage to of The the our We're continue commitment. to sell make reset get required continue ability that news to that committed impact team our like digit the to capabilities very to our as to We be, results. happy. add is in be. to understand non-classics a in earlier it's and these now done, marketplace, to classics remain results place, are drive mid-single well us the skill on have in in to drive this we where as we confident our But good to behind basis. where get little the We see to the to We bit we've doesn't it, actions European the that sets, playbook. that and work global drove ourselves execute how the exactly we'd

Scott Roe

take Bob so Yes, I'll Dickies.

of all it's region. got you've So to look first by really

international drag put which in So and Americas, that growth on long line range that's the our a grew quarter. we is digits with really, in aspirations the mid-single

the Speaking quarter. little in by first timing quarter we expect in change a noise and trajectory basis mid-single from year for Europe, for there we just a quarter see where just growth don't really the see we Europe to digit

to the actions had Japan end, China and a We remarks taken. it that relates an in repositioning really unfortunate teen we thing a As that is high Asia, been it's it of the growth masked call by the and some episodic. has obviously beginning of prepared in that's we've

term category. few and a collaborations, done appropriate in in fall well the the that in both As that that are would some we which brand as as distribution with at same historically health been have our categories look long choices of judgment not

know we so foundation to at basis. the on really forward shrink that We've back Japan, a to gotten have you So we've our in that marketplace. really a a of a decided ground, segmentation, apart torn can growth as case solid then is friend looked we have this go pull in, have appropriate teams us

for we see it's the growth the the in and in this work opportunity unfortunate is China interest we this the for Dickies because, opportunity category, we're coming real a say I inspired as years factor really a think excited about pretty big brand. apparel consumer lifestyle brand, there. The

Steven Rendle

just may the I if add side. brand Bob, on

the Dickey's take of Vans has brand You elevate important history work because and into recently work, be business these the brands, talked and consumer the lifestyle very Dickies. brought work at good well. them and new on the business, this back who look able the to He be in some the a we've we're of really VF. beyond Bruce, saw bring we appointment and and to acquired we stories him to brands of us when marketplace Danny We’ve them went really opportunity as to as a our is behind side at on involved application our president business move part with the and was about announced a fortunate and occupational authenticity

but And us a a in the we've to at He brand his brand you the elevate feel authentic bringing understanding and time right Danny and right from got international has core business his forward. drive put management, in and Williamson a skills, the drive building really we standpoint, helping person really remains this know brand strong the really place. partner in Phillip brand

Robert Drbul

Scott. Thanks Steve. Thanks,

Steven Rendle

Yup, Rob.

Operator

is Please question Laurent Vasilescu Macquarie ahead. The next Group. go of from

Laurent Vasilescu

I my want increase and performance versus stores you plan for in are end on what the Good X% It the revenues questions. to it stores parse mid thanks quarter, of like taking quarter. how the much many to store actually how for comps the rate you the your and follow out this morning brick looks number up and overall your year teen mortar for expectations performed year-over-year. the how grew about Can year with? the

Steven Rendle

Yes.

at I'll for we're XXXX. end. store out as count at fiftyish From So put a start it we the fourteen

a for that as store XX We we're from year, portfolio. about growth have that standpoint the continuing the than net more obviously updating openings

over the comp last are our in line that's we comparable. and years. -- comp From standpoint, So overall a our what with several growth talked we've about is obviously fairly

on digital So comp basis, we're looking a our XX from digit double by led at an growth high high a or standpoint. XXs percent overall really

how XXish the of to trying our out saying that. openings. by you're of seen with DXC think that way and driven that contributor Laurent, being guidance the of consistent couple the led what by what e-com is get I another largest store over net to it's is that is last years much openings, So is with store very Most of we've comp

Laurent Vasilescu

the we the $XX looks wanted The Thank much called cadence million great. on How should included spend. That's much the very you for How some press of In that. quarter? Scott. follow up Altra. million like to about quarter. you for And release, which XX modeling next to it's questions last think and I the of quarter, tied and million was today's Icebreaker out $XX synergies with it

the an quarter. for by terms of bit tax in a looks the Anything tax basis lastly, should on the And little adjusted high rate we quarter? this about rate think for then

Scott Roe

Yes.

at start the I'll So end.

rate small there's kind numbers see it’s small to of that of strange we’re in Overall know you the part me our percentages. your that. get XX.X%. So get the going small Remind Again first it's to when distorts guidance, and XX% a law you which tax quarter question, quarters, Laurent? of you

Laurent Vasilescu

the quarter. of million, Sure. about [Indiscernible] XX yes. the out the last was synergy then, million And It called

Scott Roe

Yes.

were it's those you can So see you million synergies the put numbers now full the quarter. -- we and and it the for And about XX we out break by our can that X-K actually year. we so that, out estimating you know

short new a the expect by or half out, with we the that's and is, out week CSA. answer to we've the news million, from been we XX So what of pretty so saying. just put And covered ago And that consistent X-K. in be was about no a what what half

the a TSA see relatively there's evenly only on the those TSAs you'll So had off quarter. back you are know little noise quarter. that of month as first the is in first slightly as evolve quarters. the We one more through Other loaded

as three per see full you you'll through So full quarter as three months the move months -- a a year.

Laurent Vasilescu

of best much. you Very helpful. very Thank luck. And

Scott Roe

Thank you, Laurent.

Operator

of Please next is from The question Boruchow Ike Fargo. Wells go ahead.

Ike Boruchow

me add to on North one the Van's, congrats. way Good one Two on let on Vans. I good my Hey start first year. guess questions, Face. everyone morning

in curious lack XQ you numbers. the the given is that or of over where the kind or is the global You I'm looking a like Steve quarter of in there a know launch It's strong specific I Scott, know it. made product accelerated and currency guess, just for anything is quarter occurred year word. abnormally just something strong that impressive at pretty constant which simply actually first growth better

Scott Roe

say talked Yes. One you that trend at zoom landing is about soft the overall that. about on and one bears would quarter quarter. the isolate on new the out may know oh Last click a the say were come Ike, we I you out saying too bulls look we're I'll and much go, we've thing start if where particular I to think in not would and the this here encourage quarter, you and world.

orchestrated landing curve, a hard We but don't that of shape to see fundamentally different ourselves time. period long soft the over exact in It's a see this an we place. as predict of

I they very way business their the is Remember, not franchise. now icons. quarter manage is see to strength that on one just thing the think in it encouraging the of slip the there

of X.X creation at or the communication, people saw managed orchestrated acceleration a slip happen this so resurgence by And from the is million remains didn't the loyalty been on. school we online, series of whether That's communication, accident. at demand the while in-store and very That strong, it's which old events point.

over So we manage this how is, on proof period to another and us this more drive. just our point says that quarter again, in it. we've would That's view to long a confidence gives long time, term us of ability say have I franchise it's what

Steven Rendle

the that the of strong and consumer, is driving standpoint of well the I slip progressive from some you product team's focus quickly. but commitment validation their it coming just from results the intense old on the the real apparel. really portion on to as both Heritage add really in the see I product as mean, their school, would line

really, Van in the their know but executing really tailoring you who and artists campaign self-expression makers So it's their the they heads the out be and shoes how it's the against product there personal celebrating creative brand. I individualistic. you in the and to waffle around create are -- excitement grid, know very saw

of the base. is their individuals self-expression vision creative life around able the those those specific drive to brand to Just his brand forefront very keeps consumer at elevate their to and stories bring how to,

mentioned, ability them of interest. Scott in those and loyalty And conversations loyalty a percentage and base, really the conversation high loyalty one grow very programs their helps shape of that, with manage continues to to keep consumers to that one growing that in

Ike Boruchow

Face. And it. a one quick North Got on then just

year strong. a growth now. have strong for been global double been the has So digits almost Trends

you You've in talked coming FutureLight about got months. Steve; few a

you creation. the of another just you up portfolio seem demand the bullish You and this it had level guess, the drive Steve the trying brand how reeds of some ability or know FutureLight excited guys maybe be very just far. North another that to some just of us out XX kind rank million you maybe frame could are, to launches are put in behind how what excitement? internally, does actually in to can this there understand you help for gave I'm product be to brand very I all Face do this to investment examples to internally because so either

Steven Rendle

I'm happy that. to about to talk Great. you

technology when category many in breakthrough FutureLight, a marketplace. important really it year, very many And there's level it's So a apparel years. the breathable a to outdoor breakthrough idea last a it's the it of in been is, this marketplace hit in not waterproof you know

And the it's more the such we're able we in own. those I make think, clear, this it idea, a product most tell validation way want this behind experience that placed, that our be be to what break sure in is the channels to will in us to consumers through story put specialty powerful even to to able draw such in gives distribution in it. confidence of it's breakthrough a resources and this where channels launch

is and Because using. waterproof accustomed from historical know it understand to how become that to important It's once different it, the of breathables some all just experience you the you remember you we've product that in in in North the positioned its mountain is the outdoor at assortment end Summit the this way the Series products has the high fall Face or of their Steep very Series.

those does That's it absolute the in assortment. have technical not targeted right It's So a pieces. most very it. place broad to start

the cascade over time start it gen with then sight will it broader to will assortment, then through line will rainwear And too. X has brand the gen be of and iterations followed and X that

line to is brand, It's validation broader the to starting North lifestyle exploration focus just side, a the is Face the draw but comes ideas technical new very innovation also exciting up at across the outdoor outdoor and they're based to to how piece urban to lifestyle to consumers consumer. not that in this talk ideas and that it the So clear bring these idea. breakthrough the

Ike Boruchow

Got it. Thanks guys.

Operator

from of ahead. Poser is question Susquehanna. next go The Sam Please

SamPoser

What at is know taking what seeing talked coming the the was you you into North A season talk Good couple own already? relative, market retailers Thank the you your did year about -- on place outlets Can stores, for let's going and morning. about you're say my questions. how you in of your in things. fall the Face? last

Steven Rendle

an set inventory we well. outdoor doing what question, segment know guess a is the if see in are that retailers I Sam. of I that's don't Sure.

has think this is, and one years. I way. think the at really a everybody robust I learned No coming lesson in overt their season over

how the with into our you watching we've but based making season, know step the contact very only practices those our the We've year to that on prior not continue in of I assortments in interacting sales the really in lot staying think individual know and know you against a past talked there's teams evolve inventory commitment you sell through retailers. around thought the goes the in, about our sure and in on retailers properly. manage sell got place right to deliver through, sell margin and products to individual through to

see winter a year, would you it you as sitting retail and selling a to comes of the to the think from staying outdoor we see level. a segment marketplace winter that We is – impacted step marketplace. Europe in warm on of you Europe inventory a in and place our know based management we The it Timberland. best despite sell we had back like an in operating in assure is know healthy see more mentioned healthy So thoughtful, much I at through thoughtful that's I just last our a store their healthy tell standpoint. retailers warm a with portion and

SamPoser

it's the then lastly, model you taking, the to start in that North urban going are to other that as create global use and if with seeing I that where then Face, you. are forcefully more you with place of really more How And -- say Vans you with we word, of created in your exploration. a on to I'll Thank year? Timberland the you've mentioned going would is know well? sort and putting see brands pull states this is going that basis, that? are and more come And Is expand we that into

Steven Rendle

Sure.

the important know very some the expression. see an know it's urban is mean about I it consumer. North those that specifically, you that Face the interest build exploration, of the are Certainly, I oftentimes important you key is within design happening mean and just to it that North Japan but I part in within team, But of Asia and in exploration element more sitting that exploration an pole will very think thoughtful urban inspiration. thought the that way. ago things you you urban Face urban portion XX, on grow? know icons from see So that manages a helps within icons methodical and XX years And the line, and the we of

know of both the in Japanese of to our has been I exploration, sell retail really And in know able we through offer partners probably you have know an seen understand North to and were nice you Face where but what you offer also store. know line, we Brooklyn, products driven the store you parts you've think some urban from our global there and the connections. really Sam

it total sure, for cross-brands your of manage there's it's Vans continue question poll North offer it's a on of a small Face they'll and So I will the percentage To the it sharing. accordingly. lot but mean, a

is to often One well team be selling co-location to an intimate we of in accelerated opportunity the even through really already offices. our the cross-brand Denver reasons that seen and more than of get we've outdoor and North and Kong have see Swiss our in our able center to we've come the moving asked Hong Carolina. more brands to we would that co-locate By Vans in worked here country, to Denver

other that is reasons. And one the exactly of

key kind done, of central practices been we're seen last to a enhanced basis, across behind brand a is that these work two areas best investments that that part about speak really that digital that event to consumers, have on the sharing making to that ability day investments, over the driving loyalty, experience, we're and using to enable of sharing the are the that data speak and So that years. the to big how investments and of you've going day be platforms

not see growth, the North that a as absolutely brands of just we Face. our So part of each key

SamPoser

much continued very you Thank a success. and

Steven Rendle

Sam. you, Thank

Scott Roe

Thanks Sam.

Operator

of Please question ahead. The Duffy Stifel. next is go from Jim

JimDuffy

about behavioral program. consumers? good time. shopping in fairly seeing from Van’s and of impressive assortment Any loyalty period about a range, these membership Thanks thing? that morning. the I of frequency growth wanted short you of speak behavior, guys ask purchase, on the of channel data to Can patterns in some you're type Pretty

Steven Rendle

from in question. data of I Well is They're of I think assortment drawing much that's know much rate element The consumer do that results. represented that enhanced front a specific I much have me. don't We loyalty. higher of the in good a they're Jim, frequency. has this don't that

heritage styles. really the see slip we school, old lot seeing but through we're in the a on and product, scaling of know progressive nice growth You

key be represented that but time we're relevant we've seeing loyalty greater assortment much making the you know the to the patterns, I consistent we're had of about products from of is one relevant that to new So loyalty to sell and would base to here, The of think relevant well the and drive with the in-store what a the really the is that with to a interaction you ideas, you so one capabilities also year. and able through. your what is Vans in within you messaging, drive relationships that come talking at one and might data that more to to team built at events conversation doing. around introduce the the intimate just more consistent is data an sits And advanced one in being to core really to with interactions then purchase science that personalized drive we're and one one much work

JimDuffy

commentary. to is there Americas the the globally? the program. presentation, Point clarification the just Americas are In program or million membership under an X.X members expand on number Is plans of listed that

Steven Rendle

out that but is did But number. live bring global manner in Europe. it's we It Asian marketplace, And work do able the and the is live know done. in went live that's predominantly roll It's loyalty Americas year a today. in to where the Europe last There it a that will you we're -- in program Asia. loyalty is a that fall, well last in

JimDuffy

Great. Thanks.

Steven Rendle

Thanks Jeff.

Operator

would That's for back over closing all to Randall turn to remarks. the for questions today. Steve time like call we the have I

Steven Rendle

today. we with thank you excited We're Well where everybody joining us for are. here

been our to You that in an lot Mountains and know commitments and the a to the to ourselves launched strategy. position look time confidence we you here look and the of being year September. change year at owe we we evolution moves We in Rocky for to XXXX deliver gives you our September. of year know last year that able the update in forward in this five in we took share forward against to just seeing Boston us we with find that in and you since we There’s here

thank us you for joining today. So again

Operator

This today’s conference. concludes

You may for you time. disconnect at lines your participation. Thank this your

V.F. (VFC) 24 Jul 192020 Q1 Earnings call transcript