North Face 2014 Annual Report Download

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1
VF CORPORATION 2014 ANNUAL REPORT
ONE VF.
POWERFUL PLATFORMS.
POWERFUL BRANDS.

Table of contents

  • Page 1
    VF CORPORATION 2014 ANNUAL REPORT P O W E R F U L B R A N D S. P O W E R F U L P L A T F O R M S. O N E V F. 1

  • Page 2
    ... CHANNELS AND GEOGRAPHIES, OUR ONE VF CULTURE AND APPROACH TO DOING BUSINESS PROVIDE A UNIQUE AND POWERFUL COMPETITIVE ADVANTAGE. TA B L E O F CON T E N T S A MESSAGE FROM CEO ERIC WISEMAN POWERFUL BRANDS POWERFUL PLATFORMS A MESSAGE FROM CFO BOB SHEARER FINANCIAL SUMMARY BOARD OF DIRECTORS...

  • Page 3
    ...passionate consumer loyalty. It's a culture that defines who we are and how we work. It's a culture of learning from the past and living in the future. It's a culture we call One VF. To further explore our brands, our platforms and the business of One VF, visit our online annual report at: reporting...

  • Page 4
    ... per share were $2.38. beyond traditional financial metrics. Here's a sampling: › We opened a new distribution center in Kunshan, China, demonstrating our commitment to growth in China and our persistent focus on operational excellence throughout our global supply chain. *Adjusted numbers are...

  • Page 5
    ... The North Face® and Timberland® brands. The report reviews our goals and our progress across three sustainability pillars: planet, products and people. › VF was named one of the 2014 Aon Hewitt Top Companies for Leaders® in North America. I often say that we try to learn from the past and live...

  • Page 6
    ... first presented in 2013. As you know, our 17x17 Plan aims at reaching $17 billion in global revenue by 2017 and reaching other milestones that will further position VF as a top performer. Scott Roe, our Vice President, Controller & Chief Accounting Officer, will succeed Bob. I've worked with Scott...

  • Page 7
    ... brands ...they set VF apart. OUTDOOR & ACTION SPORTS Founded: 1994 Lee North America Founded: 1889 Founded: 1976 Founded: 1966 Founded: 1952 Lee Asia Pacific Lee Europe Lee South America Founded: 1937 Founded: 1966 Founded: 1999 Founded: 1949 Founded: 2013 SPORTSWEAR Founded: 1973 Founded...

  • Page 8
    ... to training. The consumer is at the center of everything VF does. Through deep consumer insights work, we tapped into the passionate connections people have with The North Face® brand and promoted the concept of exploration. This process led to the creation of the "Your Land" advertising campaign...

  • Page 9
    ... world's largest youth culture brand. In 2014, for the first time, the Vans® brand achieved $2 billion in revenues. Both Footwear News and Footwear Plus recognized Vans® as "Brand of the Year." We work hard to continually evolve our Vans® brand product and marketing strategies, while staying true...

  • Page 10
    ..., more meaningful way. While these insights began to inform the brand's strategy in fall 2013, they took full hold in 2014. And the numbers suggest the strategy is working. In 2014, the Timberland® brand achieved a 13 percent increase in sales globally, on a GAAP basis, and we see even greater...

  • Page 11
    ... collection featuring retro prints and washes. › The Eagle Creek® brand won the Men's Journal Gear of the Year Award for its new EC Lync™ System, a suitcase that converts to a superlight backpack, but packs down into a small pouch. › The Eastpak® brand conducted its fourth edition of The...

  • Page 12
    ...we've discovered that across the Wrangler® brand's market share in the U.S. mass merchandise channel 1947 when a "W" was first stitched into Wrangler® brand jeans to signify "western" wear all of our consumer targets, comfort is the No. 1 factor driving them to buy. So we took that to heart and...

  • Page 13
    ... and new materials with VF's proprietary insights and deep understanding of consumers' wants and needs. We're bringing it all together to ensure that we continue to develop breakthrough products that drive brand equity and long-term growth. 17% the Lee® brand's revenue growth in China in 2014 11

  • Page 14
    .... Our focus on the end-user drives us to provide exceptional service and innovative products. Our Red Kap® brand team spends hundreds of hours in garages and repair shops with our consumers to understand every detail of how they work, so we can design an automotive product line with smart and...

  • Page 15
    ... market. So how do we do it? Invest in the best talent, create a culture that inspires and thrive on new ideas. We immerse ourselves in the lives of our consumers and consistently deliver the best quality, style and experiences possible. 85 7 for All Mankind® brand-owned retail locations...

  • Page 16
    ... us to make well-informed choices about how we adapt our products, communications and retail stores to meet the needs of a specific market's consumer, while at the same time maintaining the brand's global DNA. 2014 REVENUE GROWTH (CURRENCY-NEUTRAL) * 13% Americas (non-U.S.) 8% Europe 14 18% Asia...

  • Page 17
    ... to share experiences and learn from one another. This helps us all perform better and makes our company stronger. - Karl Heinz Salzburger, Vice President & Group President, International *On a GAAP basis, 2014 revenue growth was 5 percent, 8 percent and 17 percent for Americas (non-U.S.), Europe...

  • Page 18
    ... in stores and online comes down to making smart use of insights to create a shopping environment that engages consumers and offers what they want, when and where they want it. Our direct-to-consumer businesses across VF are rich with information to strengthen our performance. Over time, we've found...

  • Page 19
    ... & CHINA world's leading e-commerce markets Meanwhile, online shopping continues to grow at a rapid rate. In 2015, experts expect global e-commerce to be up more than 20 percent. VF is actively harvesting data across the company's e-commerce sites and transforming that information into a "digital...

  • Page 20
    ... new design, production and distribution approaches that our competitors can't duplicate. Four years ago, VF developed a plan and a process for accelerating innovation throughout the company, from new product development to better manufacturing processes to enhancements to the digital and in-store...

  • Page 21
    ... product innovation, retail experiences and marketing that connect with consumers - who they are and how they live their lives. One of the key things that makes all this work is our One VF culture of collaboration. It unites us and gives us great potential to succeed in reaching the goals found...

  • Page 22
    ... as a journey of discovery ...from market surveys to hours spent one-on-one with consumers. We uncover their preferences and deeply understand their needs. We talk to people who live the category lifestyle; in this instance, men and women who live in or near the city, care deeply about style, and...

  • Page 23
    ... refine or even rebuild the brand's DNA and to inform a strategy that defines the brand's real sweet spot - not only to satisfy, but to inspire the consumer. GUIDE PRODUCT DEVELOPMENT AND MARKETING Execution Our insights guide product development and marketing, and create a retail experience that...

  • Page 24
    ... of a global supply chain provide us with a competitive advantage that enables us to consistently deliver our brands to the global marketplace and do that in a fast-changing business environment. Whether at our wholesale partners' locations, in our own stores or online, consumers want product when...

  • Page 25
    ... around the world support our company's supply chain activities. From the women and men who produce Vans® brand shoes at our factory in the Dominican Republic to those who hand-sew Major League Baseball® jerseys at our owned facility in Easton, Pa., we couldn't be more proud of the work they do...

  • Page 26
    ...VF's 115-year history was more pivotal than 2014. Last year we launched our first global, comprehensive Sustainability & Responsibility report, which provides an in-depth look at our sustainability aspirations, goals and measurable achievements. The report - a starting point for greater transparency...

  • Page 27
    ...we invest back into our business. As one of VF's five global business platforms, sustainability contributes to the company's growth through the development of sustainable products, by connecting more deeply with globally conscious consumers, and by generating cost savings across our operations - all...

  • Page 28
    ...at the end of the first quarter of 2015, after nearly 30 years with VF Corporation. Bob started as Assistant Controller, rose through the finance organization and was promoted to Chief Financial Officer in 2005. During his tenure as CFO, VF's revenues have more than doubled, and VF's share price has...

  • Page 29
    ...Let's start with Outdoor & Action Sports. We expect this group to deliver another great year, led by continued strength in VF's biggest brands: The North Face®, Vans® and Timberland®. Actually, we expect strong growth from most brands within this coalition. We anticipate low double-digit currency...

  • Page 30
    5-YEAR FINANCIAL SUMMARY YEAR ENDED DECEMBER In thousands, except per share amounts 2014 (9) 2013(9) 2012(9) 2011(9) 2010 Summary of Operations1 Total revenues Operating income Net income attributable to VF Corporation Earnings (loss) per common share attributable to VF Corporation common ...

  • Page 31
    ...YEAR ENDED DECEMBER In thousands 2014 2013 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 32
    ... per share amounts 2014 $ 12,154,784 127,377 12,282,161 $ 2013 11,302,350 117,298 11,419,648 5,931,469 3,841,032 - 9,772,501 1,647,147 4,141 (84,773) (4,025) 1,562,490 352,371 1,210,119 - $ 1,210,119 $ $ 2012 10,766,020 113,835 10,879,855 Net Sales Royalty Income Total Revenues...

  • Page 33
    ... FLOWS YEAR ENDED DECEMBER In thousands 2014 2013 2012 Operating Activities Net income Adjustments to reconcile net income to cash provided by operating activities: Impairment of goodwill and intangible assets Depreciation and amortization Stock-based compensation Provision for doubtful accounts...

  • Page 34
    ... Common Stock. Questions concerning general Plan information should be directed to the Office of the Vice President, General Counsel and Secretary of VF Corporation. Ursula O. Fairbairn 4,5 President & Chief Executive Officer Fairbairn Group LLC Sarasota, Florida Director since 1994, Age 72...

  • Page 35
    ... Thomas A. Glaser Vice President & President, Supply Chain VF Contacts Scott Deitz Vice President, Public Affairs Lance Allega Vice President, Investor Relations Letitia Webster Senior Director, Corporate Sustainability Craig Hodges Director, Corporate Communications Robert K. Shearer Senior...

  • Page 36
    VF CORPORATION 105 CORPORATE CENTER BLVD. GREENSBORO, NC 27408 336.424.6000 FOR ADDITIONAL INFORMATION VISIT VFC.COM Printed on paper that consists of at least 10% post-consumer fiber