Timberland

VF Corp. Sets Goal to Eliminate all Single-Use Plastic Packaging by 2025

VF Corp. Sets Goal to Eliminate all Single-Use Plastic Packaging by 2025

Given the magnitude of plastic packaging waste in the fashion industry, VF Corp., whose brands include The North Face, Timberland, Vans, Icebreakers, Dickies,  and Supreme, has set an ambitious goal to eliminate all single-use plastic packaging, including poly bags, by 2025.
All remaining non-plastic packaging used by VF and its brands will be reduced, originate from sustainable sources and be designed for reuse or recyclability, according to the company.
“With a portfolio comprising some of the world’s most iconic apparel and footwear brands, we recognize we play an important role as environmental stewards and can serve as a catalyst for industry movements that drive positive change,” said Jeannie Renné-Malone, vice president of global sustainability for VF. “Our new global packaging goals are an example of how we can leverage our scale for significant impact. In just one year, we could potentially eliminate as many as 100 million poly bags from our packaging waste.”

In addition, VF’s sustainability goals include that all single-use plastics in product packaging will be 100 percent recycled, bio-based content or a combination of the two by 2023; all paper-based packaging will be recycled content (minimum 80 percent, where performance allows), third-party certified virgin content or a combination of the two by 2023, and VF will commit to leadership in crucial industry coalitions and policy initiative to build circular packaging infrastructure that will enable its 2025 pledge.

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VF has been a long-standing participant of Canopy’s Pack4Good initiative, committing that its paper packaging doesn’t contain materials from Ancient and endangered Forests or other controversial sources and reduces overall forest fiber consumption for packaging.
VF has also committed to additional guidelines and sustainability goals that will support its new Sustainable Packaging initiative and commit to minimizing waste across the enterprise.
Among them are all nonessential, single-use plastics for which there is a viable product alternative that will be eliminated from VF’s offices, throughout its direct operations and from all company-sponsored events by 2023.
Further, all VF-owned distribution centers will be zero-waste by April 1, 2021. VF seeks to engage sustainability best practices at its internal and external sponsored events ad is committed to working with retailers and industry peers to support the development of collection platforms and recycling technology.
In addition, VF’s Icebreaker brand is determined to be plastic-free by 2023, removing synthetics from its entire product collection within three years. VF’s Timberland brand has set a vision for its products to have a net positive impact by 2030. By designing 100 percent of its products for circularity, the brand will work toward zero waste. By sourcing 100 percent of its natural materials through regenerative agriculture, The Timberland brand will contribute to its net positive impact on nature.
The North Face brand originally launched a Polybag Brigade recycling program with TerraCycle in 2011 and to date has recycled more than five million polybags.

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Michael Kors, Versace Parent Turns $121M Profit for First Gain in 3 Quarters

Michael Kors, Versace Parent Turns $121M Profit for First Gain in 3 Quarters

Capri Holdings Ltd.’s recovery cheered Wall Street during Thursday’s early morning hours after the retailer revealed better-than-expected quarterly earnings. 
The fashion group — parent company to the Michael Kors, Versace and Jimmy Choo brands — beat quarterly sales estimates and increased profits. Company shares rose more than 7 percent during Thursday’s session as a result.
“Our performance demonstrates the power and desirability of the Versace, Jimmy Choo and Michael Kors brands,” John D. Idol, Capri’s chairman and chief executive officer, said in a statement. “Through creativity and innovation, our luxury houses inspire excitement and passion, creating an emotional connection with our consumers. We are also attracting new consumers to each of our luxury houses as evidenced by the double-digit increase in our consumer databases.”

Total company revenues for the three-month period ending Sept. 26 declined 23 percent to $1.1 billion, down from $1.4 billion the same time last year. But Capri still managed to widen its profits to $121 million, compared with $73 million a year ago. A noticeable improvement from a company that lost a combined $731 million in the last two quarters. 
In the most recent quarter, Michael Kors, Capri’s largest business, had top-line sales of $793 million, down from more than $1 billion a year ago. The brand pulled in a profit of $190 million, down from $222 million last year. Versace, which the company bought in December 2018, had revenues of $195 million, compared with $228 million a year ago. Profits were $20 million, up from just $9 million last year. At Jimmy Choo, revenues were $122 million, compared with $125 million last year. The luxury footwear brand managed to break even, compared with a loss of $10 million a year ago. 

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While things like travel retail may be on the decline for the foreseeable future, Idol told analysts on Thursday morning’s conference call that luxury is making a comeback. 
“Consumers are spending at higher rates on luxury products as there has been reduced spending on experiences due to travel restrictions,” Idol said.
“Luxury is enduring, as it creates an emotional connection with consumers, inspiring excitement and passion in those who value design, innovation, as well as exceptional quality,” he continued. “The industry has proven resilient with sales, historically recovering rapidly following economic downturns and global health crises.”
By category, Versace showed strength in men’s wear and fashion athletic footwear, along with the Barocco V pattern, while Jimmy Choo sold out of its $5,500 Jimmy Choo x Timberland Swarovski crystal-studded boots almost immediately. The company expects the brands’ revenues to grow to $1 billion and $500 million, respectively, over the next several years.
At Michael Kors, large handbags and footwear, in addition to men’s accessories and outerwear, performed well during the quarter. 
“It’s really nice to see big backpacks selling again,” Idol said. “We see the greatest softness in women’s ready-to-wear and men’s ready-to-wear and that’s really across the group.”
Meanwhile, total company e-commerce sales increased 60 percent during the quarter, year-over-year. Other bright spots included positive sales in Mainland China during the last three months. (Idol said the fastest recovery is happening in Asia.)

“We continue to see opportunity in [Capri] and expect upward revisions on already inexpensive valuation to prove compelling,” Simeon Siegel, managing director and senior retail analyst at BMO Capital Markets, wrote in a note. “Notably, the Americas sales for Versace and Jimmy Choo were both up [year-over-year] as we continue to expect high-end consumers to help luxury spending in the absence of travel. Additionally, management highlighted positive global retail sales at Versace. We expect revenue to continue its improving trajectory.”
The company ended the quarter with $1.5 billion in long-term debt and $238 million in cash and equivalents. Capri has 1,261 brick-and-mortar units around the globe, including 828 Michael Kors stores, 227 Jimmy Choo stores and 206 Versace stores. Idol said the company plans on reducing its overall store count by closing unprofitable Michael Kors locations.
Capri is not providing forward-looking guidance, but Thomas Edwards, executive vice president, chief financial officer and chief operating officer of Capri, said on the call that the company expects revenues to decline by approximately 30 percent for the year.
“An improvement versus our prior expectations,” Edwards said. 
The fashion group also plans to reduce its exposure to wholesale — from about 30 percent of overall company revenues in 2019 to approximately 20 percent over the next few years — as the company continues to open Versace and Jimmy Choo stores and grow its e-commerce businesses.
“Our feeling is that in North America, digital will represent at a point in time over the next couple of years between 40 percent and 50 percent of the overall revenues for the brands in North America,” Idol said on the call. “[In] Europe, we don’t see that type of trajectory. We see something that will probably get us to a 30 percent level over the next few years. And in Asia, as you know, it’s a much smaller piece of the business today, low single digits. But we do think that that will kind of be in that 10 percent to 15 percent range again, over the next few years.
“The COVID-19 pandemic continues to profoundly impact the entire world,” Idol continued. “As the world continues to emerge from this crisis, we are increasingly optimistic about the outlook for the fashion luxury industry and Capri Holdings. We have an incredible portfolio of luxury houses, each with their rich heritage, exclusive DNA and strong brand loyalty. We are uniquely positioned to drive multiple years of strong growth as we continue to execute on our strategic initiatives.”
Shares of Capri Holdings are down nearly 32 percent year-over-year.

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