reported a drop in second-quarter earnings -- though the results still beat Wall Street's expectations -- and the apparel company lowered its outlook for the full year.
The company posted earnings of $74.9 million, or 68 cents a share, for the quarter, compared with last year's $88.9 million, or 79 cents a share. The 2002 figures include a gain of 3 cents a share from one-time items. Sales fell 2.2% to $1.13 billion from $1.16 billion in the same quarter in 2002.
VF's results topped the estimates of analysts polled by Thomson First Call, who had forecast a profit of 60 cents a share for the quarter. The company now believes that full-year earnings will stay flat with last year's $3.38 a share, excluding items, after previously saying that profits should grow in 2003.
Currency-exchange rates, mainly the weakening dollar, added 2 cents a share to the latest quarter's earnings. Excluding this effect of foreign-exchange rates, sales were down 5% this quarter from last year.
While international sales of jeans rose 5% thanks to the declining dollar, domestic jeans sales and global intimate apparel sales dropped as retailers worked to reduce inventories and some customers closed their stores.
Sales of The North Face, JanSport and Eastpak brands rose 12% in the quarter, driven by double-digit sales increases of North Face products.
"This year may fall short of our original expectations, but we are pleased that we will maintain our earnings at prior-year levels, demonstrating our ability to successfully manage our way through these extraordinary times," VF said in a press release.
Shares of VF rose $1.33, or 3.7%, to $37.18 on the
New York Stock Exchange