Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations

Overview

Highlights of the Third Quarter of 2012

All references to "organic" financial data exclude the Timberland® and SmartWool® brands ("Timberland"), acquired on September 13, 2011. All per share amounts are presented on a diluted basis.

• Revenues grew to $3.1 billion, an increase of 14% from the 2011 quarter, composed of growth from the addition of Timberland and 2% organic growth.

• International revenues rose 20% over the 2011 quarter, reflecting 21% growth due to Timberland offset by a 1% decline in organic revenues (net of a 9% negative impact from foreign currency rate fluctuations). International revenues represented 40% of total revenues in the third quarter of 2012.

• VF's business in Asia continued to experience significant growth, with revenues up 51% in the quarter, composed of 29% growth from the addition of Timberland and 22% organic growth.

• Direct-to-consumer revenues increased 28% in the quarter, with 19 percentage points of the increase due to Timberland. Direct-to-consumer revenues accounted for 18% of VF's total revenues in the quarter.

• Gross margin increased to 46.7% in 2012 from 45.3% in the 2011 quarter, with improvement in nearly every coalition.

• Earnings per share increased to $3.42 from $2.69 in the 2011 quarter, with $0.44 per share accretion from Timberland that included a $0.10 per share impact from acquisition-related expenses.