North Face 2013 Annual Report Download

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VF CORPORATION 2013 ANNUAL REPORT
POWERFUL BRANDS. POWERFUL PLATFORMS. ONE VF.

Table of contents

  • Page 1
    POWERFUL BRANDS. POWERFUL PLATFORMS. ONE VF. VF CORPORATION 2013 ANNUAL REPORT

  • Page 2
    03 05 20 30 36 ONE VF: LETTER TO SHAREHOLDERS POWERFUL BRANDS POWERFUL PLATFORMS FINANCIAL UPDATE BOARD OF DIRECTORS & OPERATING COMMITTEE

  • Page 3
    ...and brands are organized into five coalitions: Outdoor & Action Sports, Jeanswear, Imagewear, Sportswear and Contemporary Brands. While VF is highly diversified across brands, products, distribution channels and geographies, our one-company approach to doing business provides a unique and powerful...

  • Page 4
    ... supports this growth with a business model built on powerful platforms that empower our teams to make their brands as strong as they can be. Our international, direct-to-consumer, supply chain, strategy and sustainability platforms work behind the scenes to drive a singular approach to efficiency...

  • Page 5
    ...business platforms also play a vital role in that growth. Across our company, our teams collaborate and share, providing capabilities that include: strategy and innovation counsel, leadership development, direct-to-consumer expertise, supply chain leadership, international knowhow and sustainability...

  • Page 6
    ... summary, starting with 2012 as the baseline, by 2017 we plan to achieve annual: » Revenue of $17.3 billion, representing a five-year compound annual growth rate (CAGR) of 10 percent, with organic growth representing eight percentage points and acquisitions representing two points; » International...

  • Page 7
    ... business model to develop and advance our brands. By doing so, we enable reinvestment, promote growth and deliver superior returns to our shareholders. Powerful brands ...they set VF apart. OUTDOOR & ACTION SPORTS Founded: 1994 Lee North America Founded: 1889 Founded: 1976 Founded: 1966 Founded...

  • Page 8
    .... In 2013, The North Face® brand became VF's first-ever $2 billion brand. Whether you're scaling the world's highest peaks, simply exploring the outdoors, or walking the metropolitan streets of major cities - our athletetested, expedition-proven outdoor, action sports and performance apparel...

  • Page 9
    ...four-season consumer opportunity, while delivering value to shareholders. As part of our five-year plan, we expect The North Face® brand to reach $3.3 billion by 2017, based on a five-year compound annual growth rate of 12 percent. That includes double-digit growth rates in the Americas, Europe and...

  • Page 10
    ... brand and art, music and street culture enthusiasts. Today, the Vans® brand evolution continues - from its foundation as an original skateboarding company in '66, to its emergence as a leading action sports brand, to defining its anthem of living "Off the Wall" as youth culture - the Vans® brand...

  • Page 11
    ... music festivals. The tour celebrated its 19th year in 2013, drawing more than a half-million people in the United States, Mexico, Australia and Europe. Other brand events 415 owned retail stores at the end of 2013 14M brand loyalists reached through various online channels include: Vans® Triple...

  • Page 12
    ... the resources of VF's powerful platforms, we've made a strong start on doing just that. The Timberland® brand has a rich history of designing and engineering some of the world's most iconic footwear, apparel and accessories for the outdoor lifestyle. Yet the brand stands for more than New England...

  • Page 13
    ...all Timberland® brand product collections, from footwear to apparel to accessories. It's a formula that came to life in the brand's largestever global marketing campaign: Best Then. Better Now. Starting with the 40th anniversary of the iconic yellow boot, the campaign reminded consumers of all they...

  • Page 14
    ...? Yes. But our Wrangler® brand is so much more than that. For the millions of loyal consumers around the world who have purchased jeanswear and apparel from the Wrangler® brand during the past 67 years, this is a brand that represents honesty, integrity and getting the job done. The Wrangler...

  • Page 15
    ... job site. The Advanced Comfort jeans debuted a new fabric construction, using a unique blend of fibers that results in denim that moves with you and lasts twice as long. Our goal at the Wrangler® brand is to completely satisfy our consumers. To do that, we work closely with them to learn firsthand...

  • Page 16
    ... the Lee Jeans Company. The brand's heritage is jeanswear quality, comfort and fit. We like to say we are America's "go-to" jean. That said, today's Lee® brand has extended The appeal of the Lee® brand is found in its attractive range of apparel for men and women - girls and boys. The inspiration...

  • Page 17
    ...-known department store channels by staying focused on the consumer at all times. Global revenues for the Lee® brand were flat in 2013 compared with 2012, with low single-digit growth in the Americas and Europe, and a low single-digit decline in Asia Pacific. years of being America's "go-to" jean...

  • Page 18
    ... sales and international momentum. The brand was also launched in Russia, Turkey, Ukraine and Brazil. In 2014, we will grow our direct-to-consumer business and set the stage to open full-price stores in the United States. By 2017, the Nautica® brand plans to achieve $700 million in annual revenue...

  • Page 19
    ... handbags, luggage, backpacks, totes and accessories, the Kipling® brand is available in more than 55 countries around the world. And it's a brand that benefits tremendously from VF's powerful global business platform. We promise our consumers a global lifestyle brand with bags and accessories...

  • Page 20
    ... by women, men and children in markets around the world. The U.S. market for these premium products faced challenges in 2013, primarily due to weakness in demand for premium denim products in high-end department stores. Excluding the John Varvatos® brand, which was sold in April 2012, revenues for...

  • Page 21
    ... and lifestyle apparel. On the Image side of the business, we provide our customers uniform and workwear solutions to enhance their image, while improving worker productivity and comfort. Our garments are worn by millions of workers across a wide range of industrial, service and government...

  • Page 22
    POWERFUL PLATFORMS - International A CLEAR PATH TOWARD GROWTH

  • Page 23
    ... and reliable supply chain resources and access to capital. As a result, the Timberland® brand has maintained its core DNA and is better positioned than ever to establish vital retail partnerships and attract new consumers in key markets across Europe and Asia. The outcome? A strong brand got even...

  • Page 24
    POWERFUL PLATFORMS - Direct-to-Consumer BUILDING STRONG CONNECTIONS

  • Page 25
    ...One VF directto-consumer business platform flows from three growth strategies: continuously driving comp-store performance, opening new stores that feature the right brands in the right locations and accelerating our e-commerce sales. It's rooted in our belief that building strong, direct-toconsumer...

  • Page 26
    POWERFUL PLATFORMS - Strategy & Innovation INNOVATION DRIVEN BY INSIGHT

  • Page 27
    ... what we learn. At The North Face® brand, for example, we partner with enthusiasts on new product research and development. For example, we've done similar work on the Wrangler® brand with cowboys, workers and consumers in the United States, India, China, Brazil and Europe. We've lived on ranches...

  • Page 28
    POWERFUL PLATFORMS - Supply Chain KEEPING OUR BALANCE

  • Page 29
    ... we make things. We know how to engineer products and that guides how we build plants and operate factories to produce the apparel and footwear retailers and consumers expect. It's what we call "hard skills." These are skills that we leverage in developing our sourcing partners in key regions around...

  • Page 30
    POWERFUL PLATFORMS - Sustainability AN OPPORTUNITY TO LEAD

  • Page 31
    ... of our industry. This is one way VF is helping to shape the future of apparel, sustainably." Letitia Webster Senior Director - Corporate Sustainability For any company, sustainability is a journey that begins with a question: "What kind of company do we want to be?" At VF, the answer starts with...

  • Page 32
    .... It was also the first year of our new five-year plan, and our results have us nicely on track to deliver against our longterm targets. Let's take a closer look: » Our 2013 revenues increased 5 percent to a record $11.4 billion, compared with $10.9 billion in 2012. Leading the way were continued...

  • Page 33
    ...VALUE TO SHAREHOLDERS BY CREATING SUSTAINABLE, PROFITABLE GROWTH FOR OUR BRANDS." In 2013, global revenues of our Jeanswear coalition were up 1 percent over 2012. This reflected a low single-digit percentage increase in the Americas region and a low single-digit decline in our international business...

  • Page 34
    5-YEAR FINANCIAL SUMMARY YEAR ENDED DECEMBER In thousands, except per share amounts 2013 8 2012 8 20118 2010 2009 Summary of Operations1 Total revenues Operating income Net income attributable to VF Corporation Earnings (loss) per common share attributable to VF Corporation common stockholders...

  • Page 35
    ...YEAR ENDED DECEMBER In thousands 2013 2012 Assets Current Assets Cash and equivalents Accounts receivable, net Inventories Other current assets Total...' Equity Common Stock Additional paid-in capital Accumulated other comprehensive income (loss) Retained earnings Total stockholders' equity $...

  • Page 36
    ...STATEMENTS OF INCOME YEAR ENDED DECEMBER In thousands, except per share amounts 2013 $ 11,302,350 117,298 11,419,648 $ 2012 10,766,020 ...304) 888,089 Net Sales Royalty Income Total Revenues Costs and Operating Expenses Cost of goods sold Selling, general and administrative expenses Operating Income...

  • Page 37
    ... OF CASH FLOWS YEAR ENDED DECEMBER In thousands 2013 2012 2011 Operating Activities Net income Depreciation and amortization Stock-based compensation Provision for doubtful accounts Deferred income taxes Pension expense in excess of (less than) contributions Gain on sale of business Other, net...

  • Page 38
    ... Senior Vice President & President, Meals Division General Mills, Inc. Minneapolis, Minnesota Director since 2009, Age 46 Laura W. Lang 3,5 Managing Member Narragansett Ventures, LLC New York, New York Director since 2011, Age 58 Committees of the Board: 1 Audit Committee 2 Executive Committee...

  • Page 39
    ...VF Contacts Lance Allega Vice President Investor Relations Carole Crosslin Director Corporate Communications Letitia Webster Senior Director Corporate Sustainability Transfer Agent and Registrar Communications concerning shareholder address changes, stock transfers, changes of ownership, lost stock...

  • Page 40
    VF CORPORATION 105 CORPORATE CENTER BLVD. GREENSBORO, NC 27408 336.424.6000 FOR ADDITIONAL INFORMATION VISIT: VFC.COM The paper used in this report contains 30% post-consumer fiber, and it was printed using solvent-free inks and emission-free coatings. The body sections were printed in an SGP-...