Exhibit 99 VF Announces Record Sales and Earnings for Fourth Quarter and Year GREENSBORO, N.C.--(BUSINESS WIRE)--February 8, 2006 VF Corporation (NYSE: VFC): -- 4Q EPS up 3%, including $.03 impact from expensing stock options -- 4Q revenues rise 4% to $1.6 billion -- 2005 cash flow from operations reaches $561 million -- 2006 guidance reaffirmed -- Ten million share repurchase program approved Information regarding VF's fourth quarter conference call webcast today can be found at the end of this release. VF Corporation (NYSE: VFC), a global leader in branded lifestyle apparel, today announced record results for the fourth quarter and full year 2005. All per share amounts are presented on a diluted basis. Net income in the fourth quarter rose to a record $127.5 million from $125.3 million, with earnings per share rising to $1.13 from $1.10. As previously announced, during the fourth quarter the Company early adopted Financial Accounting Standards Board Statement No. 123 (Revised 2004), Share-Based Payment ("Statement 123(R)"), which requires the expensing of stock options. The impact on net income and earnings per share in the quarter resulting from this requirement was $3.2 million and $.03, respectively. Earnings per share before the change in accounting were $1.16 in the quarter, an increase of 5% over 2004 levels. Total revenues increased 4% to a record $1,646.0 million from $1,579.2 million. Beginning in the fourth quarter of 2005, the Company has decided to report gross royalty income as a component of total revenues. Revenues in all prior periods have been restated to reflect this change. For the full year 2005, income increased 9% to $518.5 million from $474.7 million, before a one-time after-tax cumulative effect adjustment related to the early adoption of Statement 123(R) of $11.8 million, or $.10 per share, recognized in the first quarter of 2005. Income in 2005 included $16.9 million related to stock option expense, equal to $.15 per share. Accordingly, earnings per share before the change in accounting were $4.69 in 2005, an increase of 11% over the $4.21 per share in 2004. Including the cumulative effect adjustment, net income in 2005 was $506.7 million or $4.44 per share. Total revenues in 2005 rose 6% to $6,502.4 million from $6,124.6 million in 2004. Revenues in 2004 included $87 million in sales from the Company's Playwear unit, which was sold in 2004. Additional information regarding the adoption of Statement 123(R) is included in the attached financial tables. "We are delighted to deliver another record quarter and year to our shareholders," said Mackey J. McDonald, chairman and chief executive officer. "We have strong momentum behind our plans to transform VF into a company driven by dynamic, growing lifestyle brands. Our lifestyle businesses - Outdoor and Sportswear - continue to have excellent growth prospects and over the coming years will comprise a much bigger part of our overall sales mix. At the same time, our heritage businesses - Jeanswear, Intimate Apparel and Imagewear - all have strong market positions and leading brands, and the ability to continue to be important contributors to VF's profits and cash flow." Fourth Quarter Business Review Outdoor Our Outdoor coalition had another excellent quarter and continues to be the primary driver of our Company's top line growth. Total revenues increased 23% to $343.9 million in the quarter from $279.9 million in last year's period, driven by growth across nearly all our Outdoor brands. The North Face(R) brand continued to grow revenues in excess of 20% both in the U.S. and internationally. Revenues of our Vans(R) brand also rose, with continued momentum in its Classics line and double-digit growth in comparable store sales within Vans(R) brand retail stores. Our Kipling(R) brand continued to grow in Europe, while total revenues of our packs business rose 13%, driven by higher JanSport(R) brand sales in the U.S. The strong volume gains achieved by The North Face(R) brand and profit improvements in our Vans(R) brand contributed to a 45% increase in operating income in the quarter, with an increase in total Outdoor operating margins to 14.2% from 12.0%. Sportswear Revenues of our sportswear businesses, which include our Nautica(R) and John Varvatos(R) brands, as well as Kipling(R) brand sales in North America, were $182.9 million in the quarter compared with $183.6 million in the prior year period. Our Nautica(R) brand men's sportswear business continues to perform well, with a 7% increase in revenues in the quarter. Offsetting this increase was a decline in sales of off-price goods. Our John Varvatos(R) brand men's luxury business had another double-digit increase in revenues in the quarter, and we are continuing to make good progress in our launch of the Kipling(R) brand in the U.S. Operating margins were 14.4% in the quarter, a decline from prior year levels, due in part to investments to support the upcoming launch of Nautica(R) brand women's sportswear, higher spending behind the brand's Navigate Life(TM) marketing platform and a decline in profits in our young men's denim business. Jeanswear Overall, our jeanswear business continues to be healthy. Total Jeanswear revenues, which include the Wrangler(R), Lee(R), Riders(R), Rustler(R) and Wrangler Hero(R) brands, rose slightly in the quarter, to $686.8 million from $679.8 million. Revenues in both our domestic and international businesses increased during the quarter, with particular strength in our Mass Market, Western Specialty, Mexican and Latin American businesses. Our Lee(R) brand business continues to be challenged, with aggressive efforts underway to stabilize performance. Total Jeanswear operating income rose 3% in the quarter, with an increase in operating margins during the period to 17.8%. Intimate Apparel Revenues in our Intimate Apparel coalition were more stable than in the last several quarters. Total revenues decreased slightly to $183.6 million in the 2005 quarter from $185.9 million in the 2004 quarter. Our Mass Brands business had an excellent quarter, with revenues up 13%. As has been the case all during 2005, revenue comparisons in our Private Brands business were negatively impacted by the absence of a large program with a private label customer, which boosted revenues and manufacturing efficiencies in the prior year. Operating income declined sharply to $3.2 million from $14.3 million, a result of lower manufacturing capacity utilization and costs associated with improving our product assortments in department and mid-tier stores. Imagewear Our Imagewear coalition reported higher revenues in the quarter, up 2% to $234.6 million from $230.9 million, with the increase due to the acquisition of a licensee of the Harley-Davidson Motor Company, Inc. in early 2005. Operating margins remained strong, at 15.2% in the quarter. The decrease in operating income was due in part to difficult comparisons related to a more profitable mix of sales of World Series apparel products in 2004 versus 2005. Operating margins declined in the quarter due in part to the impact of adopting Statement 123(R). Operating margins in the 2005 quarter were 12.1% compared to 12.9% in the 2004 quarter, with 30 basis points of the decline due to the effects of Statement 123(R). Operating income was $199.9 million in the quarter, including a $5.0 million impact from Statement 123(R), compared with $204.0 million in the year-ago period. Our balance sheet continues to be very strong, giving us ample flexibility to support future growth. We ended the year with nearly $300 million in cash. Inventories at year-end were 11% above 2004 year-end, with the majority of the increase in our growing lifestyle businesses. Debt as a percent of total capital was 22.6% at the end of the year, or 15.7% net of cash. During the quarter we repurchased one million shares of common stock, bringing the total shares repurchased during the year to four million. Outlook We're looking forward to another record year in both revenues and earnings in 2006. We continue to anticipate solid organic growth in revenues of approximately 4 to 5% in 2006, driven by double-digit growth in our Outdoor coalition and mid-single digit growth in our Sportswear and Imagewear coalitions. We expect stable revenues in our Jeanswear and Intimates coalitions. Identifying and adding strong new brands to our portfolio remains a priority, but we will maintain a disciplined approach and only pursue those that have the potential to make a positive long-term contribution to total shareholder returns. Earnings per share are expected to grow more than revenues in 2006. Based on the $4.44 per share reported in 2005, which includes the $.10 per share cumulative effect adjustment from adopting Statement 123(R), earnings per share are expected to rise approximately 8%. Based on 2005 earnings per share of $4.54 before the cumulative effect adjustment, we expect an increase in earnings per share of approximately 6%, in line with our previous guidance. Also as previously disclosed, the impact on 2006 earnings per share from expensing stock options is expected to be $.17 per share. Based on the changing mix of our business and the seasonality experienced by our growing Outdoor business, as well as improvements we expect in our Lee brand and Intimates businesses, we expect stronger earnings comparisons in the second half of the year compared to the first half. For the first quarter, we expect earnings per share to be up slightly over prior year levels, with revenues increasing by approximately 5%. We also anticipate another strong year of cash flow from operations, which could reach $600 million in 2006. Share Repurchase VF also announced that its Board of Directors has approved an authorization for the Company to repurchase 10 million shares. We are nearing the completion of our current 10 million share repurchase program, which was initiated in 2001. We plan to repurchase approximately two million shares of common stock this year to offset the dilution resulting from the exercise of stock options. Dividend Declared The Board of Directors declared a regular quarterly cash dividend of $.29 per share, payable on March 20, 2006 to shareholders of record as of the close of business on March 10, 2006. Cautionary Statement on Forward-looking Statements Certain statements included in this release are "forward-looking statements" within the meaning of the federal securities laws. Management cautions that forward-looking statements are not guarantees and that actual results could differ materially from those expressed or implied in the forward-looking statements. Important risk factors that could cause the actual results of operations or financial condition of the Company to differ include, but are not limited to, the overall level of consumer spending for apparel; changes in trends in the segments of the market in which the Company competes; the financial strength and competitive conditions, including consolidation, of our customers and of our suppliers; actions of competitors, customers, suppliers and service providers that may impact the Company's business; the Company's ability to make and integrate acquisitions successfully; the Company's ability to achieve expected sales and earnings growth from ongoing businesses and acquisitions; the Company's ability to achieve its planned cost savings; natural disasters; terrorist actions; and the impact of economic and political factors in the markets where the Company competes, such as recession or changes in interest rates, currency exchange rates, price levels, capital market valuations and other factors over which the Company has no control. Investors are also directed to consider the risks and uncertainties discussed in documents filed by the Company with the Securities and Exchange Commission. About the Company VF Corporation is a leader in branded lifestyle apparel including jeanswear, outdoor products, intimate apparel, image apparel and sportswear. Its principal brands include Lee(R), Wrangler(R), Riders(R), Rustler(R), Vanity Fair(R), Vassarette(R), Bestform(R), Lily of France(R), Nautica(R), John Varvatos(R), JanSport(R), Eastpak(R), The North Face(R), Vans(R), Reef(R), Napapijri(R), Kipling(R), Lee Sport(R) and Red Kap(R). VF Corporation's press releases, annual report and other information can be accessed through the Company's home page, www.vfc.com. Webcast Information VF will hold its fourth quarter conference call and webcast today at 8:30 a.m. ET. Interested parties should call (800)811-8845 domestic, or (913)981-4905 international, to access the call. You may also access this call via the Internet at www.vfc.com. A replay will be available through February 21, 2006 and can be accessed by dialing (888)203-1112 domestic, and (719) 457-0820 international. The pass code is 5524284. A replay also can be accessed at the Company's web site at www.vfc.com. VF CORPORATION Consolidated Statements of Income (In thousands, except per share amounts) Three Months Ended December Year Ended December ----------------------- ----------------------- 2005 2004 2005 2004 ----------- ----------- ----------- ----------- Net Sales $1,626,110 $1,559,761 $6,428,648 $6,054,536 Royalty Income 19,889 19,397 73,729 70,052 ----------- ----------- ----------- ----------- Total Revenues 1,645,999 1,579,158 6,502,377 6,124,588 ----------- ----------- ----------- ----------- Costs and Operating Expenses Cost of goods sold 972,254 923,413 3,785,243 3,644,255 Marketing, administrative and general expenses 473,860 451,695 1,888,957 1,702,545 ----------- ----------- ----------- ----------- 1,446,114 1,375,108 5,674,200 5,346,800 ----------- ----------- ----------- ----------- Operating Income 199,885 204,050 828,177 777,788 Other Income (Expense) Interest income 1,580 2,303 8,039 7,151 Interest expense (13,942) (19,067) (70,463) (76,087) Miscellaneous, net 4,259 1,312 5,060 3,268 ----------- ----------- ----------- ----------- (8,103) (15,452) (57,364) (65,668) ----------- ----------- ----------- ----------- Income before Income Taxes and Cumulative Effect of a Change in Accounting Policy 191,782 188,598 770,813 712,120 Income Taxes 64,312 63,295 252,278 237,418 ----------- ----------- ----------- ----------- Income before Cumulative Effect of a Change in Accounting Policy 127,470 125,303 518,535 474,702 Cumulative Effect of a Change in Accounting Policy - - (11,833) - ----------- ----------- ----------- ----------- Net Income $ 127,470 $ 125,303 $ 506,702 $ 474,702 =========== =========== =========== =========== Earnings Per Common Share - Basic Income before cumulative effect of a change in accounting policy $ 1.15 $ 1.13 $ 4.65 $ 4.30 Cumulative effect of a change in accounting policy - - (0.11) - Net income 1.15 1.13 4.54 4.30 Earnings Per Common Share - Diluted Income before cumulative effect of a change in accounting policy $ 1.13 $ 1.10 $ 4.54 $ 4.21 Cumulative effect of a change in accounting policy - - (0.10) - Net income 1.13 1.10 4.44 4.21 Weighted Average Shares Outstanding Basic 110,407 110,956 111,192 109,872 Diluted 113,122 114,153 114,192 112,730 Cash Dividends Per Common Share $ 0.29 $ 0.27 $ 1.10 $ 1.05 Basis of presentation: VF operates and reports using a 52/53 week fiscal year ending on the Saturday closest to December 31 of each year. For presentation purposes herein, all references to periods ended December 2005 and December 2004 relate to the fiscal periods ended as of December 31, 2005 and January 1, 2005, respectively. Change in accounting policy: During the fourth quarter of 2005, VF elected to early adopt FASB Statement No. 123 (Revised), Share-Based Payment ("Statement 123(R)"), effective as of the beginning of 2005 using the modified retrospective method. Under this method of adoption, VF recorded a noncash charge of $11.8 million (net of income taxes of $7.9 million) or $.10 per diluted share as the Cumulative Effect of a Change in Accounting Policy for periods prior to January 2005. As a result, VF has restated its operating results for the first three quarters of 2005 to recognize compensation cost for grants of stock options and other stock-based compensation over the requisite service periods in amounts previously reported in the pro forma footnote disclosures under the prior accounting rules. Financial statements for prior years have not been restated. Reclassifications: Beginning in the fourth quarter of 2005, Royalty Income is classified as a separate component of Total Revenues, with related expenses classified in Marketing, Administrative and General. Prior period amounts have been reclassified to conform with the 2005 presentation. VF CORPORATION Consolidated Balance Sheets (In thousands) December ----------------------- 2005 2004 ----------- ----------- ASSETS Current Assets Cash and equivalents $ 296,557 $ 485,507 Accounts receivable, net 764,184 738,345 Inventories 1,081,080 975,369 Deferred income taxes 106,774 99,338 Other current assets 116,781 68,893 ----------- ----------- Total current assets 2,365,376 2,367,452 Property, Plant and Equipment 1,551,411 1,539,490 Less accumulated depreciation 987,356 967,236 ----------- ----------- 564,055 572,254 Intangible Assets 744,313 639,520 Goodwill 1,097,037 1,031,594 Other Assets 400,290 382,342 ----------- ----------- $5,171,071 $4,993,162 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Short-term borrowings $ 138,956 $ 42,830 Current portion of long-term debt 33,956 401,232 Accounts payable 451,383 369,937 Accrued liabilities 527,848 547,099 ----------- ----------- Total current liabilities 1,152,143 1,361,098 Long-term Debt 647,728 556,639 Other Liabilities 539,661 536,131 Commitments and Contingencies Redeemable Preferred Stock 23,326 26,053 Common Stockholders' Equity Common Stock 110,108 111,388 Additional paid-in capital 1,277,486 1,087,641 Accumulated other comprehensive income (loss) (164,802) (113,071) Retained earnings 1,585,421 1,427,283 ----------- ----------- Total common stockholders' equity 2,808,213 2,513,241 ----------- ----------- $5,171,071 $4,993,162 =========== =========== VF CORPORATION Consolidated Statements of Cash Flows (In thousands) Year Ended December --------------------- 2005 2004 --------- --------- Operating Activities Net income $ 506,702 $ 474,702 Adjustments to reconcile net income to cash provided by operating activities: Cumulative effect of a change in accounting policy 11,833 - Depreciation 99,549 110,868 Amortization 33,715 29,849 Stock-based compensation 43,782 10,956 Provision for doubtful accounts 7,831 4,206 Pension funding in excess of expense (14,857) (236) Deferred income taxes 433 16,172 Other, net (10,970) 20,984 Changes in operating assets and liabilities, net of acquisitions: Accounts receivable (10,388) (20,991) Inventories (95,992) 51,450 Other current assets (45,756) (19,006) Accounts payable 80,105 3,812 Accrued compensation (11,104) 48,897 Other accrued liabilities (33,537) (1,407) --------- --------- Cash provided by operating activities 561,346 730,256 Investing Activities Capital expenditures (110,307) (81,410) Business acquisitions, net of cash acquired (211,838) (655,089) Software purchases (17,546) (13,018) Sale of property, plant and equipment 17,683 12,900 Sale of VF Playwear business 6,667 4,517 Other, net 798 (103) --------- --------- Cash used by investing activities (314,543) (732,203) Financing Activities Increase (decrease) in short-term borrowings 95,673 (19,056) Proceeds from long-term debt 117,792 - Payments on long-term debt (401,253) (3,494) Purchase of Common Stock (229,003) - Cash dividends paid (124,116) (117,731) Proceeds from issuance of Common Stock 99,974 106,613 Tax benefits of stock option exercises 17,741 - Other, net (301) (730) --------- --------- Cash used by financing activities (423,493) (34,398) Net Cash Used by Discontinued Operations - (3,320) Effect of Foreign Currency Rate Changes on Cash (12,260) 10,387 --------- --------- Net Change in Cash and Equivalents (188,950) (29,278) Cash and Equivalents - Beginning of Year 485,507 514,785 --------- --------- Cash and Equivalents - End of Year $ 296,557 $ 485,507 ========= ========= VF CORPORATION Supplemental Financial Information Business Segment Information (In thousands) Three Months Ended December Year Ended December ----------------------- ----------------------- 2005(a) 2004 2005(a) 2004 ----------- ---------- ----------- ---------- Coalition Revenues: Jeanswear $ 686,844 $ 679,827 $2,697,066 $2,706,364 Outdoor Apparel and Equipment 343,886 279,869 1,454,872 1,011,508 Intimate Apparel 183,560 185,872 848,222 906,522 Imagewear 234,617 230,907 805,775 770,293 Sportswear 182,911 183,570 650,813 618,763 Other 14,181 19,114 45,629 111,138 ---------- ---------- ---------- ---------- Total revenues $1,645,999 $1,579,159 $6,502,377 $6,124,588 ========== ========== ========== ========== Coalition Profit: Jeanswear $ 122,062 $ 118,144 $ 452,461 $ 442,151 Outdoor Apparel and Equipment 48,753 33,699 233,433 156,385 Intimate Apparel 3,175 14,307 59,595 117,804 Imagewear 35,752 44,263 126,287 117,035 Sportswear 26,360 31,202 100,139 67,202 Other 1,383 (107) (1,063) (10,726) ---------- ---------- ---------- ---------- Total coalition profit 237,485 241,508 970,852 889,851 Corporate and Other Expenses (33,341) (36,146) (137,615) (108,795) Interest, net (12,362) (16,764) (62,424) (68,936) ---------- ---------- ---------- ---------- Income Before Income Taxes and Cumulative Effect of a Change in Accounting Policy $ 191,782 $ 188,598 $ 770,813 $ 712,120 ========== ========== ========== ========== (a) 2005 includes the effects of the change in accounting policy for stock-based compensation. VF CORPORATION Supplemental Financial Information Effects of Adoption of FASB Statement No. 123 (R) 2005 Consolidated Statement of Income - Reconciliation, Compared with 2004 (In thousands, except per share amounts) Three Months Ended December -------------------------------------------------- 2005 2004 -------------------------------------- ---------- As Reported - After Prior Adoption Accounting Effects of of Policy Adoption of Statement As (Opinion 25) Statement 123(R) 123(R) Reported ------------ ---------------- ---------- ----------- Net Sales $1,626,110 $1,626,110 $1,559,761 Royalty Income 19,889 19,889 19,397 ---------- ---------- ---------- Total Revenues 1,645,999 1,645,999 1,579,158 ---------- ---------- ---------- Costs and Operating Expenses Cost of goods sold 971,610 $ 644 972,254 923,413 Marketing, administrative and general expenses 469,548 4,312 473,860 451,695 ---------- ------- ---------- ---------- 1,441,158 4,956 1,446,114 1,375,108 ---------- ------- ---------- ---------- Operating Income 204,841 (4,956) 199,885 204,050 Other Income (Expense) Interest income 1,580 1,580 2,303 Interest expense (13,942) (13,942) (19,067) Miscellaneous, net 4,259 4,259 1,312 ---------- --------------- ---------- ---------- (8,103) - (8,103) (15,452) ---------- --------------- ---------- ---------- Income before Income Taxes and Cumulative Effect of a Change in Accounting Policy 196,738 (4,956) 191,782 188,598 Income Taxes 66,054 (1,742) 64,312 63,295 ---------- ------- ---------- ---------- Income before Cumulative Effect of a Change in Accounting Policy 130,684 (3,214) 127,470 125,303 Cumulative Effect of a Change in Accounting Policy - - - - ---------- ------- ---------- ---------- Net Income $ 130,684 $(3,214) $ 127,470 $ 125,303 ========== ======= ========== ========== Earnings Per Common Share - Basic Income before cumulative effect of a change in accounting policy $ 1.18 $ (0.03) $ 1.15 $ 1.13 Cumulative effect of a change in accounting policy - - - - Net income 1.18 (0.03) 1.15 1.13 Earnings Per Common Share - Diluted Income before cumulative effect of a change in accounting policy $ 1.16 $ (0.03) $ 1.13 $ 1.10 Cumulative effect of a change in accounting policy - - - - Net income 1.16 (0.03) 1.13 1.10 Note: The above reconciliation from the prior accounting rules for stock-based compensation to the newly adopted Statement 123(R) is provided to assist the reader in understanding the impact of this change in accounting policy on VF's 2005 Consolidated Statement of Income. VF CORPORATION Supplemental Financial Information Effects of Adoption of FASB Statement No. 123 (R) 2005 Consolidated Statement of Income - Reconciliation, Compared with 2004 (In thousands, except per share amounts) Year Ended December ----------------------------------------------------- 2005 2004 -------------------------------- ------------------- Effects Prior of As Reported - Accounting Adoption After Policy of Adoption (Opinion Statement of Statement As 25) 123(R) 123(R) Reported ----------- --------- ------------ ------------------- Net Sales $6,428,648 $6,428,648 $ 6,054,536 Royalty Income 73,729 73,729 70,052 ---------- ---------- ------------------- Total Revenues 6,502,377 6,502,377 6,124,588 ---------- ---------- ------------------- Costs and Operating Expenses Cost of goods sold 3,782,319 $ 2,924 3,785,243 3,644,255 Marketing, administrative and general expenses 1,865,186 23,771 1,888,957 1,702,545 ---------- -------- ---------- ------------------- 5,647,505 26,695 5,674,200 5,346,800 ---------- -------- ---------- ------------------- Operating Income 854,872 (26,695) 828,177 777,788 Other Income (Expense) Interest income 8,039 8,039 7,151 Interest expense (70,463) (70,463) (76,087) Miscellaneous, net 5,060 5,060 3,268 ---------- --------- ---------- ------------------- (57,364) - (57,364) (65,668) ---------- -------- ---------- ------------------- Income before Income Taxes and Cumulative Effect of a Change in Accounting Policy 797,508 (26,695) 770,813 712,120 Income Taxes 262,104 (9,826) 252,278 237,418 ---------- -------- ---------- ------------------- Income before Cumulative Effect of a Change in Accounting Policy 535,404 (16,869) 518,535 474,702 Cumulative Effect of a Change in Accounting Policy (11,833) (11,833) - ----------- -------- ---------- ------------------- Net Income $ 535,404 $(28,702) $ 506,702 $ 474,702 ========== ======== ========== =================== Earnings Per Common Share - Basic Income before cumulative effect of a change in accounting policy $ 4.80 $ (0.15) $ 4.65 $ 4.30 Cumulative effect of a change in accounting policy - (0.11) (0.11) - Net income 4.80 (0.26) 4.54 4.30 Earnings Per Common Share - Diluted Income before cumulative effect of a change in accounting policy $ 4.69 $ (0.15) $ 4.54 $ 4.21 Cumulative effect of a change in accounting policy - (0.10) (0.10) - Net income 4.69 (0.25) 4.44 4.21 Note: The above reconciliation from the prior accounting rules for stock-based compensation to the newly adopted Statement 123(R) is provided to assist the reader in understanding the impact of this change in accounting policy on VF's 2005 Consolidated Statement of Income. VF CORPORATION Supplemental Financial Information Effects of Adoption of FASB Statement No. 123(R) 2005 Consolidated Statements of Income By Quarter (In thousands, except per share amounts) 2005 ---------------------------------------------------------- First Second Third Fourth Quarter(b) Quarter(b) Quarter(b) Quarter Year ----------- ----------- ----------- ----------- ---------- Net Sales $1,563,643 $1,435,831 $1,803,064 $1,626,110 $6,428,648 Royalty Income 18,542 16,276 19,022 19,889 73,729 ---------- ---------- ---------- ---------- ---------- Total Revenues 1,582,185 1,452,107 1,822,086 1,645,999 6,502,377 ---------- ---------- ---------- ---------- ---------- Costs and Operating Expenses Cost of goods sold 915,564 841,812 1,055,613 972,254 3,785,243 Marketing, administrative and general expenses 480,115 456,511 478,471 473,860 1,888,957 ---------- ---------- ---------- ---------- --------- 1,395,679 1,298,323 1,534,084 1,446,114 5,674,200 ---------- ---------- ---------- ---------- --------- Operating Income 186,506 153,784 288,002 199,885 828,177 Other Income (Expense) Interest income 3,016 2,041 1,402 1,580 8,039 Interest expense (18,674) (18,490) (19,357) (13,942) (70,463) Miscellaneous, net 119 (137) 819 4,259 5,060 ---------- ---------- ---------- ---------- ------- (15,539) (16,586) (17,136) (8,103) (57,364) ---------- ---------- ---------- ---------- ------- Income before Income Taxes and Cumulative Effect of a Change in Accounting Policy 170,967 137,198 270,866 191,782 770,813 Income Taxes 56,281 40,449 91,236 64,312 252,278 ---------- ---------- ---------- ---------- ------- Income before Cumulative Effect of a Change in Accounting Policy 114,686 96,749 179,630 127,470 518,535 Cumulative Effect of a Change in Accounting Policy (11,833) - - - (11,833) ---------- ---------- ---------- ---------- ------- Net Income $ 102,853 $ 96,749 $ 179,630 $ 127,470 $ 506,702 ========== ========== ========== ========== ======== Earnings Per Common Share - Basic Income before cumulative effect of a change in accounting policy $ 1.02 $ 0.87 $ 1.61 $ 1.15 $ 4.65 Cumulative effect of a change in accounting policy (0.11) - - - (0.11) Net income 0.92 0.87 1.61 1.15 4.54 Earnings Per Common Share - Diluted Income before cumulative effect of a change in accounting policy $ 1.00 $ 0.85 $ 1.57 $ 1.13 $ 4.54 Cumulative effect of a change in accounting policy (0.10) - - - (0.10) Net income 0.89 0.85 1.57 1.13 4.44 (b) Restated to include the effects of the change in accounting policy for stock- based compensation. VF CORPORATION Supplemental Financial Information Effects of Adoption of FASB Statement No. 123 (R) 2005 Business Segment Information By Quarter (In thousands) First Second Third Fourth Quarter(c) Quarter(c) Quarter(c) Quarter Year ----------- ------------ ----------- --------- ----------- Coalition Revenues: Jeanswear $ 713,502 $ 601,974 $ 694,746 $ 686,844 $2,697,066 Outdoor Apparel and Equipment 285,381 300,434 525,171 343,886 1,454,872 Intimate Apparel 227,703 223,191 213,768 183,560 848,222 Imagewear 187,304 180,809 203,045 234,617 805,775 Sportswear 159,596 134,372 173,934 182,911 650,813 Other 8,699 11,327 11,422 14,181 45,629 ---------- ---------- ---------- ---------- --------- Total revenues $1,582,185 $1,452,107 $1,822,086 $1,645,999 $6,502,377 ========== ========== ========== ========== ========== Coalition Profit: Jeanswear $ 116,679 $ 91,827 $ 121,893 $ 122,062 $ 452,461 Outdoor Apparel and Equipment 31,725 41,712 111,243 48,753 233,433 Intimate Apparel 22,308 13,060 21,052 3,175 59,595 Imagewear 29,570 24,157 36,808 35,752 126,287 Sportswear 26,429 18,562 28,788 26,360 100,139 Other (724) (204) (1,518) 1,383 (1,063) ---------- ---------- ---------- ---------- --------- Total coalition profit 225,987 189,114 318,266 237,485 970,852 Corporate and Other Expenses (39,362) (35,467) (29,445) (33,341) (137,615) Interest, net (15,658) (16,449) (17,955) (12,362) (62,424) ---------- ---------- ---------- ---------- --------- Income Before Income Taxes and Cumulative Effect of a Change in Accounting Policy $ 170,967 $ 137,198 $ 270,866 $ 191,782 $ 770,813 ========== ========== ========== ========== ========== (c) Restated to include the effects of the change in accounting policy for stock- based compensation. CONTACT: VF Services, Inc. Cindy Knoebel, CFA VP, Financial & Corporate Communications 212-841-7141/336-424-6189