VF's Supplier-Financed Payables Reach $848.0 Million As A $500.0 Million Note Comes Due In April
Inventory and payables swelled in the September quarter while cash burn narrowed and a note maturity moved into current liabilities.
Obligations that VF Corp.'s suppliers can get paid early on, through a bank-backed program, reached $848.0 million inside accounts payable at the end of September, up from $466.0 million in March. VF, which owns The North Face, Vans and Timberland, said in its 10-Q filed Wednesday that $500.0 million of notes due April 2027 now sit in current liabilities.
Payables and inventory balloon
Accounts payable rose to $1,284,221 thousand from $826,347 thousand in March. The company attributes the increase to the seasonality of inventory purchases and the timing of payments to vendors.
The supplier-finance balance eased from $960.7 million in the prior quarter's filing but is above the $696.6 million at September 2025. Under the program, suppliers use VF's credit rating to be paid by financial institutions before the agreed payment date.
Inventories climbed to $1,984,403 thousand from $1,371,274 thousand in March, which the filing ties mainly to seasonality. Against September 2025, it cites planned purchases and expected sales growth in the second half of the fiscal year.
Cash burn narrows, maturity looms
Cash used by operations was $(214,030) thousand for the six months, against $(372,468) thousand a year earlier. The company credits higher net income, tariff refunds and less cash tied up in working capital.
VF held $443.0 million of cash and had $25.0 million drawn on its $1.5 billion asset-backed credit facility, with $1.47 billion available. Working capital fell to $1,501.5 million from $1,828.3 million in March. Net debt to total capital was 69.2%, flat from March.
VF reported net income of $285.3 million, or $0.71 a share, for the quarter, against $189.8 million, or $0.48, a year earlier. Revenue fell 4% to $2.7 billion, including a 5% drag from the sale of Dickies.
A margin helped by tariff refunds
Gross margin rose 320 basis points (3.2 percentage points) to 55.4%, which the filing credits mainly to the Dickies sale, currency, price increases and lower product costs. Separately, $37.3 million of a $55.9 million tariff-related inventory reserve was released into cost of goods sold in the June quarter and the remaining $18.6 million in the September quarter. VF says it has now received substantially all of its tariff refund receivable.
The company said in its earnings release that it reaffirmed full-year guidance. The filing says no shares were bought back in the six months, with $2.5 billion of authorization left. Capital priorities for the near-to-medium term are cutting leverage and reinvesting part of its savings.
The quarterly dividend of $0.09 a share is payable December 17 to holders of record on December 10.
Sources
- 10-Q Filing — VF Corp. (VFC) — SEC EDGAR
- 10-Q Filing — VF Corp. (VFC), Q1 FY2027 filed 2026-07-29 (comparison basis) — SEC EDGAR
- Earnings release (8-K Item 2.02, q22027earningspressrelease.htm) — VF Corp., filed 2026-10-28 — SEC EDGAR
- V.F. Corp. to Report Q2 Earnings: What Surprise Awaits Investors? — Yahoo Finance
- VF Corp. (Vienna:VFC.VI) : Articles :: Law360 — law360.com
- Brooks v. VF Corporation et al — law360.com
- VF Corporation Exceeds Guidance in Second Quarter Fiscal 2027 — businesswire.com
