VF Corp, the parent company of popular brands like Vans, The North Face, and Timberland, has revised its forecast for full-year sales due to the ongoing impact of the Covid-19 pandemic. The company now expects its revenues for the fiscal year ended March 28, 2020, to range between $11.3 billion and $11.4 billion. This is a significant decline from the $13.85 billion in revenue generated the previous year.

The revised forecast includes the contribution of VF’s occupational and workwear business, which is currently being spun off. However, the financial closing procedures for this transaction have not been completed yet. This latest prediction is an even further downward revision from the previous estimate of $11.75 billion, which was announced in January.

The Covid-19 pandemic has caused economic disruption worldwide, leading to VF Corp withdrawing its earlier guidance last month. The company’s stores in North America and the EMEA regions will remain closed until at least May 3, while most of its stores in China have resumed operations.

Unlike many competitors in the industry, VF Corp has been providing pay and benefits to its retail associates during the temporary store closures. However, in an effort to mitigate the financial impact of the crisis, VF CEO Steve Rendle has taken a 50% salary reduction, and the rest of the executive team has agreed to a 25% pay cut. The company has also drawn down the remaining $1 billion from its senior unsecured revolving credit facility and suspended its share repurchase program.

To address its financial obligations, VF Corp has announced its intention to offer senior notes underwritten by Barclays, BofA Securities, J.P. Morgan, and Morgan Stanley. This demonstrates the company’s commitment to managing its financial challenges while navigating through the uncertainties posed by the global pandemic.

While facing declining sales and disrupted supply chains, VF Corp’s revised forecast highlights the significant impact of Covid-19 on the retail industry. However, the company’s focus on supporting its employees and taking measures to manage its financial obligations reflects its determination to weather the storm and emerge stronger in the long run. As the pandemic continues, it remains to be seen how the retail sector will recover and adapt to a new normal.

Useful links:
1. VF Corp Official Website
2. Barclays Official Website