First-quarter net income from continuing operations came in 13% higher at $134.1 million, or $1.17 per share. Net income, including discontinued operations, was 7.9% higher at $138.3 million, or $1.20 per share. Revenue increased 15% to $1.67 billion.
VF's most recent acquisitions particularly seem to be paying off. Majestic Athletic contributed $27 million in revenues in the quarter, while Eagle Creek added another $6 million.
VF also upped its guidance for the year, predicting revenue growth of 12%, to $7 billion, in 2007, and earnings-per-share growth of 12%, as opposed to its previous guidance of 10%. (Last quarter, that old guidance lagged analysts' expectations.) VF expects that its two most recent acquisitions will add $180 million in revenues for the year.
Although VF's quarterly earnings did beat analysts' expectations, the company endured a few bumps along the way. Gross margin and profit margin were flat year over year. Foreign currency exchange rates contributed an extra $0.05 per share, but a higher tax rate and a greater number of average shares outstanding teamed up to cancel out that advantage.
Ultimately, though, the quarter seemed bright for VF -- brighter than expected, certainly. It's been busy bringing new brands into its large portfolio, already known for Lee, Wrangler, Vans, and the North Face, as well as the Vanity Fair intimates line it recently sold to Berkshire Hathaway's
While VF's dividend payouts are a plus, and its forward P/E of 15 doesn't sound outlandish, the company isn't exactly a great bargain. Then again, it may seem more reasonable than fellow consumer-goods giant Liz Claiborne
All's fair in further Foolishness:
- Revisit VF's fourth-quarter results.
- VF recently acquired Eagle Creek.
- We reviewed VF's performance for 2006.