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Business: VF Corp., owner of Vans and several other brands was cut to junk by S&P Global Ratings Wednesday, as revenues for its top four brands continued falling in the second quarter.
S&P cut the issuer credit rating of VF based in Denver by two levels to BB from BBB-, saying it takes a “less favorable view of VF’s competitive position,” it said in a statement. The company, Vans, The North Face, Dickies and Timberland, posted weak second-quarter sales last month.
The Standard and Poor’s rating agency could cut more aggressively unless flagship brands regain growth traction from a reversal of customer tastes, weak demand from consumers, or disruption to supply chains. Growth in VF will depend on its ability to drive a turnaround at the largest brand Vans and reaccelerate momentum at The North Face, according to BI analysts Poonam Goyal and Sydney Goodman, in a note.
A spokesman for VF Corp. had no comment. Moody’s Ratings last month lowered the rating of the apparel brand company to junk.
