VF Corp's Comeback Story: Supreme Sale and Cost Cuts Boost Stock

Core Viewpoint - VF Corp is undergoing a significant turnaround under the leadership of CEO Bracken Darrell, who aims to stabilize the company and improve its financial performance [1][12]. Group 1: Company Overview - VF Corp, listed on NYSE as VFC, owns a portfolio of well-known brands including The North Face, Vans, Timberland, and Dickies [3]. - The stock price has increased from $11.00 in May 2024 to $19.00, although the company is still reporting losses [3]. - VF Corp has reduced its inventories by 24% in fiscal Q1 2025, indicating signs of stabilization [3][11]. Group 2: Turnaround Team - VF Corp has assembled a team of industry professionals to support its turnaround strategy, including: - Paul Vogel as CFO, previously at Spotify [4]. - Nina Flood as head of Timberland [4]. - Caroline Brown as president of The North Face [4]. - Chris Stutzman as Chief Design Officer from Logitech [4]. - Abhishek Dalmia as Chief Strategy & Transformation Officer, formerly at BCG [4]. - Sun Choe as Global Brands President of Vans [4]. Group 3: Brand Portfolio and Divestitures - VF Corp operates 11 iconic lifestyle brands and is in the process of divesting its 12th brand, Supreme, for $1.5 billion to EssilorLuxottica, expected to close in Q4 2024 [5]. - The company is conducting a strategic review of all its brands and may consider further divestitures [5]. Group 4: Reinvent Turnaround Strategy - The Reinvent strategy focuses on four key priorities: 1. Improve North American results by reorganizing the operating model and investing in brand-building marketing [6][7]. 2. Accelerate the turnaround of the VANS brand by focusing on innovative products and marketing [8]. 3. Reduce costs by eliminating $300 million in fixed costs through various measures [9]. 4. Strengthen the balance sheet by reducing debt and improving cash flow, including asset sales [10]. Group 5: Financial Performance - In fiscal Q1 2025, VF Corp reported an EPS loss of 33 cents, beating estimates, with revenues down 8.9% YoY to $1.9 billion [11]. - The North Face revenue fell 3% YoY, while VANS revenue decreased by 21% YoY, showing slight improvement from previous quarters [11]. - Ending inventories dropped by 24% YoY to $676 million, and net debt decreased by nearly $587 million [11]. - VF Corp aims to raise an additional $600 million from selling non-core physical assets, excluding Supreme [12].