Kontoor Brands Declares $0.53 Quarterly Dividend, Eyes 15% EPS Growth in 2026

Kontoor Brands, Inc. (NYSE: KTB), a global apparel company behind Wrangler and Lee jeans, declared a regular quarterly cash dividend of $0.53 per share. The dividend will be paid March 20, 2026 to shareholders of record as of March 10. Read more dividend announcements.

The board approved the dividend as the company reported fourth quarter revenue of $1.02 billion, up 46 percent from the prior year period. The company also announced initial guidance for fiscal 2026, projecting adjusted earnings per share in the range of $6.40 to $6.50, representing 15 percent to 16 percent growth.

Capital Allocation and Share Repurchases

During the fourth quarter, Kontoor returned $54 million to shareholders through dividends and share repurchases, including $25 million in stock buybacks. For the full year, the company returned approximately $140 million to shareholders. The company has $190 million remaining under its authorized share repurchase program.

The company also made a $200 million voluntary term loan payment during the quarter, bringing its pro-forma net leverage ratio to 2.0 times. Kontoor expects to make additional voluntary term loan payments of $225 million in 2026 and achieve a net leverage ratio below 1.5 times by year-end.

Fourth Quarter and Full Year Performance

For the fourth quarter ended January 3, 2026, adjusted gross margin reached 46.8 percent, up 210 basis points from the prior year. Adjusted operating income of $150 million increased 48 percent, while adjusted earnings per share of $1.73 rose 26 percent.

Inventory at quarter-end totaled $567 million, down $198 million or 26 percent from the third quarter. The company ended the period with $108 million in cash and cash equivalents and $1.13 billion in long-term debt, with no outstanding borrowings under its revolving credit facility.

For the full year 2025, adjusted operating income reached $468 million, up 23 percent, with adjusted earnings per share of $5.59, up 14 percent. The company reported full year revenue of $3.14 billion.

2026 Outlook

Kontoor expects 2026 revenue in the range of $3.40 billion to $3.45 billion, representing approximately 9 percent growth. Adjusted operating income is projected between $506 million and $512 million, up 8 percent to 9 percent. The company anticipates cash from operations of approximately $425 million.

The guidance incorporates the impact of increased tariffs on countries from which the company sources products, with the exception of Mexico, which remains exempt under USMCA. The outlook assumes a 15 percent reciprocal tariff rate on applicable inventory receipts effective February 24, 2026, and at least a 20 percent rate on applicable inventory owned prior to that date. The company is evaluating the impact of a recent U.S. Supreme Court ruling on tariffs and a trade agreement with Bangladesh, noting that it uses U.S.-grown cotton in more than 80 percent of products sourced from Bangladesh.