Pennsylvania
|
|
23-1180120
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. employer identification number)
|
Securities registered pursuant to Section 12(b) of the Act:
|
||
(Title of each class)
|
(Trading Symbol(s))
|
(Name of each exchange on which registered)
|
Common Stock, without par value, stated capital, $0.25 per share
|
VFC
|
New York Stock Exchange
|
0.625% Senior Notes due 2023
|
VFC23
|
New York Stock Exchange
|
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Page
No.
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ITEM 1 — FINANCIAL STATEMENTS (UNAUDITED).
|
(In thousands, except share amounts)
|
|
December 2019
|
|
|
March 2019
|
|
December 2018
|
||||||
ASSETS
|
|
|
|
|
|
|
|
||||||
Current assets
|
|
|
|
|
|
|
|
||||||
Cash and equivalents
|
|
$
|
583,951
|
|
|
|
$
|
445,119
|
|
|
$
|
451,978
|
|
Accounts receivable, less allowance for doubtful accounts of: December 2019 ‑ $21,283; March 2019 - $19,638; December 2018 - $20,932
|
|
1,641,758
|
|
|
|
1,465,855
|
|
|
1,566,202
|
|
|||
Inventories
|
|
1,564,970
|
|
|
|
1,432,660
|
|
|
1,401,621
|
|
|||
Other current assets
|
|
365,019
|
|
|
|
433,793
|
|
|
391,800
|
|
|||
Current assets of discontinued operations
|
|
—
|
|
|
|
896,030
|
|
|
800,490
|
|
|||
Total current assets
|
|
4,155,698
|
|
|
|
4,673,457
|
|
|
4,612,091
|
|
|||
Property, plant and equipment, net
|
|
908,771
|
|
|
|
915,177
|
|
|
902,665
|
|
|||
Intangible assets, net
|
|
1,948,232
|
|
|
|
1,972,364
|
|
|
2,002,906
|
|
|||
Goodwill
|
|
1,539,579
|
|
|
|
1,541,314
|
|
|
1,536,544
|
|
|||
Operating lease right-of-use assets
|
|
1,298,631
|
|
|
|
—
|
|
|
—
|
|
|||
Other assets
|
|
963,351
|
|
|
|
772,755
|
|
|
756,065
|
|
|||
Other assets of discontinued operations
|
|
—
|
|
|
|
481,718
|
|
|
474,039
|
|
|||
TOTAL ASSETS
|
|
$
|
10,814,262
|
|
|
|
$
|
10,356,785
|
|
|
$
|
10,284,310
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
||||||
Current liabilities
|
|
|
|
|
|
|
|
||||||
Short-term borrowings
|
|
$
|
56,001
|
|
|
|
$
|
659,060
|
|
|
$
|
674,676
|
|
Current portion of long-term debt
|
|
4,677
|
|
|
|
5,263
|
|
|
5,576
|
|
|||
Accounts payable
|
|
456,993
|
|
|
|
580,867
|
|
|
536,406
|
|
|||
Accrued liabilities
|
|
1,444,421
|
|
|
|
1,154,932
|
|
|
1,115,371
|
|
|||
Current liabilities of discontinued operations
|
|
—
|
|
|
|
261,482
|
|
|
231,018
|
|
|||
Total current liabilities
|
|
1,962,092
|
|
|
|
2,661,604
|
|
|
2,563,047
|
|
|||
Long-term debt
|
|
2,110,488
|
|
|
|
2,115,884
|
|
|
2,135,240
|
|
|||
Operating lease liabilities
|
|
1,052,854
|
|
|
|
—
|
|
|
—
|
|
|||
Other liabilities
|
|
1,121,238
|
|
|
|
1,232,200
|
|
|
1,239,503
|
|
|||
Other liabilities of discontinued operations
|
|
—
|
|
|
|
48,581
|
|
|
45,896
|
|
|||
Commitments and contingencies
|
|
|
|
|
|
|
|
||||||
Total liabilities
|
|
6,246,672
|
|
|
|
6,058,269
|
|
|
5,983,686
|
|
|||
Stockholders’ equity
|
|
|
|
|
|
|
|
||||||
Preferred Stock, par value $1; shares authorized, 25,000,000; no shares outstanding at December 2019, March 2019 or December 2018
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|||
Common Stock, stated value $0.25; shares authorized, 1,200,000,000; shares outstanding at December 2019 - 394,528,067; March 2019 - 396,824,662; December 2018 - 395,472,173
|
|
98,632
|
|
|
|
99,206
|
|
|
98,868
|
|
|||
Additional paid-in capital
|
|
4,182,102
|
|
|
|
3,921,784
|
|
|
3,829,994
|
|
|||
Accumulated other comprehensive income (loss)
|
|
(895,372
|
)
|
|
|
(902,075
|
)
|
|
(886,565
|
)
|
|||
Retained earnings
|
|
1,182,228
|
|
|
|
1,179,601
|
|
|
1,258,327
|
|
|||
Total stockholders’ equity
|
|
4,567,590
|
|
|
|
4,298,516
|
|
|
4,300,624
|
|
|||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
$
|
10,814,262
|
|
|
|
$
|
10,356,785
|
|
|
$
|
10,284,310
|
|
|
|
Three Months Ended December
|
|
|
Nine Months Ended December
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
(In thousands, except per share amounts)
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
||||||||
Net revenues
|
|
$
|
3,384,746
|
|
|
|
$
|
3,227,712
|
|
|
|
$
|
9,049,493
|
|
|
|
$
|
8,584,237
|
|
Costs and operating expenses
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of goods sold
|
|
1,500,463
|
|
|
|
1,464,761
|
|
|
|
4,133,884
|
|
|
|
4,015,441
|
|
||||
Selling, general and administrative expenses
|
|
1,305,481
|
|
|
|
1,242,131
|
|
|
|
3,624,450
|
|
|
|
3,389,891
|
|
||||
Total costs and operating expenses
|
|
2,805,944
|
|
|
|
2,706,892
|
|
|
|
7,758,334
|
|
|
|
7,405,332
|
|
||||
Operating income
|
|
578,802
|
|
|
|
520,820
|
|
|
|
1,291,159
|
|
|
|
1,178,905
|
|
||||
Interest income
|
|
5,489
|
|
|
|
3,116
|
|
|
|
17,601
|
|
|
|
6,746
|
|
||||
Interest expense
|
|
(22,303
|
)
|
|
|
(28,336
|
)
|
|
|
(65,240
|
)
|
|
|
(83,640
|
)
|
||||
Other income (expense), net
|
|
(22,152
|
)
|
|
|
(1,027
|
)
|
|
|
(18,367
|
)
|
|
|
(52,422
|
)
|
||||
Income from continuing operations before income taxes
|
|
539,836
|
|
|
|
494,573
|
|
|
|
1,225,153
|
|
|
|
1,049,589
|
|
||||
Income tax expense
|
|
87,089
|
|
|
|
85,453
|
|
|
|
26,156
|
|
|
|
162,981
|
|
||||
Income from continuing operations
|
|
452,747
|
|
|
|
409,120
|
|
|
|
1,198,997
|
|
|
|
886,608
|
|
||||
Income (loss) from discontinued operations, net of tax
|
|
12,256
|
|
|
|
54,389
|
|
|
|
(35,772
|
)
|
|
|
244,380
|
|
||||
Net income
|
|
$
|
465,003
|
|
|
|
$
|
463,509
|
|
|
|
$
|
1,163,225
|
|
|
|
$
|
1,130,988
|
|
Earnings (loss) per common share - basic
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
|
$
|
1.14
|
|
|
|
$
|
1.03
|
|
|
|
$
|
3.02
|
|
|
|
$
|
2.24
|
|
Discontinued operations
|
|
0.03
|
|
|
|
0.14
|
|
|
|
(0.09
|
)
|
|
|
0.62
|
|
||||
Total earnings per common share - basic
|
|
$
|
1.17
|
|
|
|
$
|
1.17
|
|
|
|
$
|
2.93
|
|
|
|
$
|
2.86
|
|
Earnings (loss) per common share - diluted
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
|
$
|
1.13
|
|
|
|
$
|
1.02
|
|
|
|
$
|
2.99
|
|
|
|
$
|
2.21
|
|
Discontinued operations
|
|
0.03
|
|
|
|
0.14
|
|
|
|
(0.09
|
)
|
|
|
0.61
|
|
||||
Total earnings per common share - diluted
|
|
$
|
1.16
|
|
|
|
$
|
1.16
|
|
|
|
$
|
2.90
|
|
|
|
$
|
2.82
|
|
Weighted average shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
395,940
|
|
|
|
395,294
|
|
|
|
396,806
|
|
|
|
395,117
|
|
||||
Diluted
|
|
400,322
|
|
|
|
399,767
|
|
|
|
401,499
|
|
|
|
400,418
|
|
|
|
Three Months Ended December
|
|
|
Nine Months Ended December
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
(In thousands)
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
||||||||
Net income
|
|
$
|
465,003
|
|
|
|
$
|
463,509
|
|
|
|
$
|
1,163,225
|
|
|
|
$
|
1,130,988
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation and other
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Gains (losses) arising during the period
|
|
46,813
|
|
|
|
(67,820
|
)
|
|
|
(10,831
|
)
|
|
|
(241,578
|
)
|
||||
Income tax effect
|
|
5,154
|
|
|
|
(3,345
|
)
|
|
|
(815
|
)
|
|
|
(18,680
|
)
|
||||
Defined benefit pension plans
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Current period actuarial gains
|
|
35,971
|
|
|
|
1,428
|
|
|
|
21,361
|
|
|
|
53,470
|
|
||||
Amortization of net deferred actuarial losses
|
|
4,203
|
|
|
|
6,676
|
|
|
|
12,236
|
|
|
|
22,153
|
|
||||
Amortization of deferred prior service costs (credits)
|
|
13
|
|
|
|
(58
|
)
|
|
|
38
|
|
|
|
552
|
|
||||
Reclassification of net actuarial loss from settlement charge
|
|
24,943
|
|
|
|
662
|
|
|
|
25,462
|
|
|
|
8,846
|
|
||||
Reclassification of deferred prior service cost due to curtailments
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,483
|
|
||||
Income tax effect
|
|
(16,334
|
)
|
|
|
(2,313
|
)
|
|
|
(15,835
|
)
|
|
|
(24,530
|
)
|
||||
Derivative financial instruments
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Gains (losses) arising during the period
|
|
(56,699
|
)
|
|
|
43,836
|
|
|
|
9,471
|
|
|
|
153,705
|
|
||||
Income tax effect
|
|
10,163
|
|
|
|
(7,217
|
)
|
|
|
(759
|
)
|
|
|
(18,664
|
)
|
||||
Reclassification to net income for (gains) losses realized
|
|
(22,563
|
)
|
|
|
5,391
|
|
|
|
(56,746
|
)
|
|
|
35,554
|
|
||||
Income tax effect
|
|
3,689
|
|
|
|
(889
|
)
|
|
|
9,689
|
|
|
|
(2,846
|
)
|
||||
Other comprehensive income (loss)
|
|
35,353
|
|
|
|
(23,649
|
)
|
|
|
(6,729
|
)
|
|
|
(22,535
|
)
|
||||
Comprehensive income
|
|
$
|
500,356
|
|
|
|
$
|
439,860
|
|
|
|
$
|
1,156,496
|
|
|
|
$
|
1,108,453
|
|
|
|
Nine Months Ended December
|
|||||||
|
|
|
|
|
|
||||
(In thousands)
|
|
2019
|
|
|
2018
|
||||
OPERATING ACTIVITIES
|
|
|
|
|
|
||||
Net income
|
|
$
|
1,163,225
|
|
|
|
$
|
1,130,988
|
|
Income (loss) from discontinued operations, net of tax
|
|
(35,772
|
)
|
|
|
244,380
|
|
||
Income from continuing operations, net of tax
|
|
1,198,997
|
|
|
|
886,608
|
|
||
Adjustments to reconcile net income to cash provided by operating activities:
|
|
|
|
|
|
||||
Depreciation and amortization
|
|
204,341
|
|
|
|
192,049
|
|
||
Amortization of operating lease right-of-use assets
|
|
287,439
|
|
|
|
—
|
|
||
Stock-based compensation
|
|
95,304
|
|
|
|
67,577
|
|
||
Provision for doubtful accounts
|
|
9,592
|
|
|
|
11,413
|
|
||
Pension expense in excess of contributions
|
|
9,428
|
|
|
|
2,932
|
|
||
Loss on sale of businesses, net of tax
|
|
—
|
|
|
|
33,501
|
|
||
Other, net
|
|
(124,056
|
)
|
|
|
(36,393
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||
Accounts receivable
|
|
(185,259
|
)
|
|
|
(418,983
|
)
|
||
Inventories
|
|
(132,862
|
)
|
|
|
(69,211
|
)
|
||
Accounts payable
|
|
(121,532
|
)
|
|
|
54,306
|
|
||
Income taxes
|
|
(44,092
|
)
|
|
|
(43,935
|
)
|
||
Accrued liabilities
|
|
(82,948
|
)
|
|
|
444,424
|
|
||
Operating lease right-of-use assets and liabilities
|
|
(318,636
|
)
|
|
|
—
|
|
||
Other assets and liabilities
|
|
32,697
|
|
|
|
(12,562
|
)
|
||
Cash provided by operating activities - continuing operations
|
|
828,413
|
|
|
|
1,111,726
|
|
||
Cash provided by operating activities - discontinued operations
|
|
13,213
|
|
|
|
324,937
|
|
||
Cash provided by operating activities
|
|
841,626
|
|
|
|
1,436,663
|
|
||
INVESTING ACTIVITIES
|
|
|
|
|
|
||||
Business acquisitions, net of cash received
|
|
—
|
|
|
|
(320,405
|
)
|
||
Proceeds from sale of businesses, net of cash sold
|
|
—
|
|
|
|
430,273
|
|
||
Capital expenditures
|
|
(186,281
|
)
|
|
|
(180,241
|
)
|
||
Software purchases
|
|
(37,333
|
)
|
|
|
(42,533
|
)
|
||
Other, net
|
|
51,985
|
|
|
|
(16,189
|
)
|
||
Cash used by investing activities - continuing operations
|
|
(171,629
|
)
|
|
|
(129,095
|
)
|
||
Cash used by investing activities - discontinued operations
|
|
(2,327
|
)
|
|
|
(19,451
|
)
|
||
Cash used by investing activities
|
|
(173,956
|
)
|
|
|
(148,546
|
)
|
||
FINANCING ACTIVITIES
|
|
|
|
|
|
||||
Net decrease in short-term borrowings
|
|
(596,559
|
)
|
|
|
(852,547
|
)
|
||
Payments on long-term debt
|
|
(4,496
|
)
|
|
|
(4,675
|
)
|
||
Payment of debt issuance costs
|
|
—
|
|
|
|
(2,123
|
)
|
||
Purchases of treasury stock
|
|
(500,003
|
)
|
|
|
(150,676
|
)
|
||
Cash dividends paid
|
|
(562,298
|
)
|
|
|
(565,176
|
)
|
||
Cash received from Kontoor Brands, net of cash transferred of $126.8 million
|
|
906,148
|
|
|
|
—
|
|
||
Proceeds from issuance of Common Stock, net of shares withheld for taxes
|
|
135,086
|
|
|
|
137,470
|
|
||
Cash used by financing activities
|
|
(622,122
|
)
|
|
|
(1,437,727
|
)
|
||
Effect of foreign currency rate changes on cash, cash equivalents and restricted cash
|
|
(4,927
|
)
|
|
|
(681
|
)
|
||
Net change in cash, cash equivalents and restricted cash
|
|
40,621
|
|
|
|
(150,291
|
)
|
||
Cash, cash equivalents and restricted cash – beginning of year
|
|
556,587
|
|
|
|
689,190
|
|
||
Cash, cash equivalents and restricted cash – end of period
|
|
$
|
597,208
|
|
|
|
$
|
538,899
|
|
|
|
Nine Months Ended December
|
|||||||
|
|
|
|
|
|
||||
(In thousands)
|
|
2019
|
|
|
2018
|
||||
Balances per Consolidated Balance Sheets:
|
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
583,951
|
|
|
|
$
|
451,978
|
|
Other current assets
|
|
3,448
|
|
|
|
2,855
|
|
||
Current and other assets of discontinued operations
|
|
—
|
|
|
|
83,351
|
|
||
Other assets
|
|
9,809
|
|
|
|
715
|
|
||
Total cash, cash equivalents and restricted cash
|
|
$
|
597,208
|
|
|
|
$
|
538,899
|
|
|
Three Months Ended December 2019
|
|
|||||||||||||||||||||
|
|
|
|
|
Additional Paid-in Capital
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Retained Earnings
|
|
|
|
|||||||||||
|
Common Stock
|
|
|
|
|
|
|
||||||||||||||||
(In thousands, except share amounts)
|
Shares
|
|
Amounts
|
|
|
|
|
Total
|
|
||||||||||||||
Balance, September 2019
|
398,865,790
|
|
|
$
|
99,716
|
|
|
$
|
4,072,640
|
|
|
$
|
(930,725
|
)
|
|
$
|
1,405,988
|
|
|
$
|
4,647,619
|
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
465,003
|
|
|
465,003
|
|
|
|||||
Dividends on Common Stock ($0.48 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(188,694
|
)
|
|
(188,694
|
)
|
|
|||||
Purchase of treasury stock
|
(5,840,550
|
)
|
|
(1,460
|
)
|
|
—
|
|
|
—
|
|
|
(498,543
|
)
|
|
(500,003
|
)
|
|
|||||
Stock-based compensation, net
|
1,502,827
|
|
|
376
|
|
|
109,462
|
|
|
—
|
|
|
(1,526
|
)
|
|
108,312
|
|
|
|||||
Foreign currency translation and other
|
—
|
|
|
—
|
|
|
—
|
|
|
51,967
|
|
|
—
|
|
|
51,967
|
|
|
|||||
Defined benefit pension plans
|
—
|
|
|
—
|
|
|
—
|
|
|
48,796
|
|
|
—
|
|
|
48,796
|
|
|
|||||
Derivative financial instruments
|
—
|
|
|
—
|
|
|
—
|
|
|
(65,410
|
)
|
|
—
|
|
|
(65,410
|
)
|
|
|||||
Balance, December 2019
|
394,528,067
|
|
|
$
|
98,632
|
|
|
$
|
4,182,102
|
|
|
$
|
(895,372
|
)
|
|
$
|
1,182,228
|
|
|
$
|
4,567,590
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Three Months Ended December 2018
|
|
|||||||||||||||||||||
|
|
|
|
|
Additional Paid-in Capital
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Retained Earnings
|
|
|
|
|||||||||||
|
Common Stock
|
|
|
|
|
|
|
||||||||||||||||
(In thousands, except share amounts)
|
Shares
|
|
Amounts
|
|
|
|
|
Total
|
|
||||||||||||||
Balance, September 2018
|
397,161,808
|
|
|
$
|
99,290
|
|
|
$
|
3,795,395
|
|
|
$
|
(862,916
|
)
|
|
$
|
1,147,787
|
|
|
$
|
4,179,556
|
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
463,509
|
|
|
463,509
|
|
|
|||||
Dividends on Common Stock ($0.51 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(201,325
|
)
|
|
(201,325
|
)
|
|
|||||
Purchase of treasury stock
|
(1,863,724
|
)
|
|
(466
|
)
|
|
—
|
|
|
—
|
|
|
(149,730
|
)
|
|
(150,196
|
)
|
|
|||||
Stock-based compensation, net
|
174,089
|
|
|
44
|
|
|
34,599
|
|
|
—
|
|
|
(1,914
|
)
|
|
32,729
|
|
|
|||||
Foreign currency translation and other
|
—
|
|
|
—
|
|
|
—
|
|
|
(71,165
|
)
|
|
—
|
|
|
(71,165
|
)
|
|
|||||
Defined benefit pension plans
|
—
|
|
|
—
|
|
|
—
|
|
|
6,395
|
|
|
—
|
|
|
6,395
|
|
|
|||||
Derivative financial instruments
|
—
|
|
|
—
|
|
|
—
|
|
|
41,121
|
|
|
—
|
|
|
41,121
|
|
|
|||||
Balance, December 2018
|
395,472,173
|
|
|
$
|
98,868
|
|
|
$
|
3,829,994
|
|
|
$
|
(886,565
|
)
|
|
$
|
1,258,327
|
|
|
$
|
4,300,624
|
|
|
|
Nine Months Ended December 2019
|
||||||||||||||||||||||
|
|
|
|
|
Additional Paid-in Capital
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Retained Earnings
|
|
|
|
|||||||||||
|
Common Stock
|
|
|
|
|
|
|
||||||||||||||||
(In thousands, except share amounts)
|
Shares
|
|
Amounts
|
|
|
|
|
Total
|
|
||||||||||||||
Balance, March 2019
|
396,824,662
|
|
|
$
|
99,206
|
|
|
$
|
3,921,784
|
|
|
$
|
(902,075
|
)
|
|
$
|
1,179,601
|
|
|
$
|
4,298,516
|
|
|
Adoption of new accounting standard, ASU 2016-02
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,491
|
)
|
|
(2,491
|
)
|
|
|||||
Adoption of new accounting standard, ASU 2018-02
|
—
|
|
|
—
|
|
|
—
|
|
|
(61,861
|
)
|
|
61,861
|
|
|
—
|
|
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,163,225
|
|
|
1,163,225
|
|
|
|||||
Dividends on Common Stock ($1.42 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(562,298
|
)
|
|
(562,298
|
)
|
|
|||||
Purchase of treasury stock
|
(5,840,550
|
)
|
|
(1,460
|
)
|
|
—
|
|
|
—
|
|
|
(498,543
|
)
|
|
(500,003
|
)
|
|
|||||
Stock-based compensation, net
|
3,543,955
|
|
|
886
|
|
|
260,318
|
|
|
—
|
|
|
(28,919
|
)
|
|
232,285
|
|
|
|||||
Foreign currency translation and other
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,646
|
)
|
|
—
|
|
|
(11,646
|
)
|
|
|||||
Defined benefit pension plans
|
—
|
|
|
—
|
|
|
—
|
|
|
43,262
|
|
|
—
|
|
|
43,262
|
|
|
|||||
Derivative financial instruments
|
—
|
|
|
—
|
|
|
—
|
|
|
(38,345
|
)
|
|
—
|
|
|
(38,345
|
)
|
|
|||||
Spin-off of Jeans Business
|
—
|
|
|
—
|
|
|
—
|
|
|
75,293
|
|
|
(130,208
|
)
|
|
(54,915
|
)
|
|
|||||
Balance, December 2019
|
394,528,067
|
|
|
$
|
98,632
|
|
|
$
|
4,182,102
|
|
|
$
|
(895,372
|
)
|
|
$
|
1,182,228
|
|
|
$
|
4,567,590
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Nine Months Ended December 2018
|
|
|||||||||||||||||||||
|
|
|
|
|
Additional Paid-in Capital
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Retained Earnings
|
|
|
|
|||||||||||
|
Common Stock
|
|
|
|
|
|
|
||||||||||||||||
(In thousands, except share amounts)
|
Shares
|
|
Amounts
|
|
|
|
|
Total
|
|
||||||||||||||
Balance, March 2018
|
394,313,070
|
|
|
$
|
98,578
|
|
|
$
|
3,607,424
|
|
|
$
|
(864,030
|
)
|
|
$
|
846,124
|
|
|
$
|
3,688,096
|
|
|
Adoption of new accounting standard, ASU 2014-09
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,956
|
|
|
1,956
|
|
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,130,988
|
|
|
1,130,988
|
|
|
|||||
Dividends on Common Stock ($1.43 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(565,176
|
)
|
|
(565,176
|
)
|
|
|||||
Purchase of treasury stock
|
(1,868,934
|
)
|
|
(467
|
)
|
|
—
|
|
|
—
|
|
|
(150,209
|
)
|
|
(150,676
|
)
|
|
|||||
Stock-based compensation, net
|
3,028,037
|
|
|
757
|
|
|
222,570
|
|
|
—
|
|
|
(5,356
|
)
|
|
217,971
|
|
|
|||||
Foreign currency translation and other
|
—
|
|
|
—
|
|
|
—
|
|
|
(260,258
|
)
|
|
—
|
|
|
(260,258
|
)
|
|
|||||
Defined benefit pension plans
|
—
|
|
|
—
|
|
|
—
|
|
|
69,974
|
|
|
—
|
|
|
69,974
|
|
|
|||||
Derivative financial instruments
|
—
|
|
|
—
|
|
|
—
|
|
|
167,749
|
|
|
—
|
|
|
167,749
|
|
|
|||||
Balance, December 2018
|
395,472,173
|
|
|
$
|
98,868
|
|
|
$
|
3,829,994
|
|
|
$
|
(886,565
|
)
|
|
$
|
1,258,327
|
|
|
$
|
4,300,624
|
|
|
(In thousands)
|
|
December 2019
|
|
|
March 2019
|
|
December 2018
|
||||||
Accounts receivable, net
|
|
$
|
1,641,758
|
|
|
|
$
|
1,465,855
|
|
|
$
|
1,566,202
|
|
Contract assets (a)
|
|
1,789
|
|
|
|
2,569
|
|
|
550
|
|
|||
Contract liabilities (b)
|
|
56,356
|
|
|
|
30,181
|
|
|
37,875
|
|
(a)
|
Included in the other current assets line item in the Consolidated Balance Sheets.
|
(b)
|
Included in the accrued liabilities and other liabilities line items in the Consolidated Balance Sheets.
|
|
Three Months Ended December 2019
|
|
||||||||||||||||||
(In thousands)
|
Outdoor
|
|
Active
|
|
Work
|
|
Other
|
|
Total
|
|
||||||||||
Channel revenues
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Wholesale
|
$
|
857,939
|
|
|
$
|
527,206
|
|
|
$
|
415,262
|
|
|
$
|
4,750
|
|
|
$
|
1,805,157
|
|
|
Direct-to-consumer
|
796,632
|
|
|
706,186
|
|
|
56,059
|
|
|
1,340
|
|
|
1,560,217
|
|
|
|||||
Royalty
|
4,537
|
|
|
6,070
|
|
|
8,765
|
|
|
—
|
|
|
19,372
|
|
|
|||||
Total
|
$
|
1,659,108
|
|
|
$
|
1,239,462
|
|
|
$
|
480,086
|
|
|
$
|
6,090
|
|
|
$
|
3,384,746
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Geographic revenues
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
903,184
|
|
|
$
|
686,733
|
|
|
$
|
372,808
|
|
|
$
|
—
|
|
|
$
|
1,962,725
|
|
|
International
|
755,924
|
|
|
552,729
|
|
|
107,278
|
|
|
6,090
|
|
|
1,422,021
|
|
|
|||||
Total
|
$
|
1,659,108
|
|
|
$
|
1,239,462
|
|
|
$
|
480,086
|
|
|
$
|
6,090
|
|
|
$
|
3,384,746
|
|
|
|
Three Months Ended December 2018
|
||||||||||||||||||
(In thousands)
|
Outdoor
|
|
Active
|
|
Work
|
|
Other
|
|
Total
|
||||||||||
Channel revenues
|
|
|
|
|
|
|
|
|
|
||||||||||
Wholesale
|
$
|
839,579
|
|
|
$
|
490,985
|
|
|
$
|
414,333
|
|
|
$
|
652
|
|
|
$
|
1,745,549
|
|
Direct-to-consumer
|
769,775
|
|
|
642,571
|
|
|
49,152
|
|
|
—
|
|
|
1,461,498
|
|
|||||
Royalty
|
3,251
|
|
|
9,024
|
|
|
8,390
|
|
|
—
|
|
|
20,665
|
|
|||||
Total
|
$
|
1,612,605
|
|
|
$
|
1,142,580
|
|
|
$
|
471,875
|
|
|
$
|
652
|
|
|
$
|
3,227,712
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Geographic revenues
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
889,298
|
|
|
$
|
638,179
|
|
|
$
|
379,237
|
|
|
$
|
652
|
|
|
$
|
1,907,366
|
|
International
|
723,307
|
|
|
504,401
|
|
|
92,638
|
|
|
—
|
|
|
1,320,346
|
|
|||||
Total
|
$
|
1,612,605
|
|
|
$
|
1,142,580
|
|
|
$
|
471,875
|
|
|
$
|
652
|
|
|
$
|
3,227,712
|
|
|
Nine Months Ended December 2019
|
|
||||||||||||||||||
(In thousands)
|
Outdoor
|
|
Active
|
|
Work
|
|
Other
|
|
Total
|
|
||||||||||
Channel revenues
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Wholesale
|
$
|
2,375,117
|
|
|
$
|
1,897,118
|
|
|
$
|
1,185,716
|
|
|
$
|
22,730
|
|
|
$
|
5,480,681
|
|
|
Direct-to-consumer
|
1,410,658
|
|
|
1,969,700
|
|
|
134,026
|
|
|
7,692
|
|
|
3,522,076
|
|
|
|||||
Royalty
|
9,890
|
|
|
18,404
|
|
|
18,442
|
|
|
—
|
|
|
46,736
|
|
|
|||||
Total
|
$
|
3,795,665
|
|
|
$
|
3,885,222
|
|
|
$
|
1,338,184
|
|
|
$
|
30,422
|
|
|
$
|
9,049,493
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Geographic revenues
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
1,943,491
|
|
|
$
|
2,109,479
|
|
|
$
|
1,064,516
|
|
|
$
|
—
|
|
|
$
|
5,117,486
|
|
|
International
|
1,852,174
|
|
|
1,775,743
|
|
|
273,668
|
|
|
30,422
|
|
|
3,932,007
|
|
|
|||||
Total
|
$
|
3,795,665
|
|
|
$
|
3,885,222
|
|
|
$
|
1,338,184
|
|
|
$
|
30,422
|
|
|
$
|
9,049,493
|
|
|
|
Nine Months Ended December 2018
|
||||||||||||||||||
(In thousands)
|
Outdoor
|
|
Active
|
|
Work
|
|
Other
|
|
Total
|
||||||||||
Channel revenues
|
|
|
|
|
|
|
|
|
|
||||||||||
Wholesale
|
$
|
2,280,071
|
|
|
$
|
1,829,861
|
|
|
$
|
1,209,150
|
|
|
$
|
10,222
|
|
|
$
|
5,329,304
|
|
Direct-to-consumer
|
1,358,287
|
|
|
1,728,779
|
|
|
119,347
|
|
|
—
|
|
|
3,206,413
|
|
|||||
Royalty
|
9,350
|
|
|
20,838
|
|
|
18,332
|
|
|
—
|
|
|
48,520
|
|
|||||
Total
|
$
|
3,647,708
|
|
|
$
|
3,579,478
|
|
|
$
|
1,346,829
|
|
|
$
|
10,222
|
|
|
$
|
8,584,237
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Geographic revenues
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
1,826,230
|
|
|
$
|
1,934,778
|
|
|
$
|
1,065,774
|
|
|
$
|
10,222
|
|
|
$
|
4,837,004
|
|
International
|
1,821,478
|
|
|
1,644,700
|
|
|
281,055
|
|
|
—
|
|
|
3,747,233
|
|
|||||
Total
|
$
|
3,647,708
|
|
|
$
|
3,579,478
|
|
|
$
|
1,346,829
|
|
|
$
|
10,222
|
|
|
$
|
8,584,237
|
|
(In thousands)
|
|
April 3, 2018
|
||
Cash and equivalents
|
|
$
|
6,444
|
|
Accounts receivable
|
|
16,781
|
|
|
Inventories
|
|
31,728
|
|
|
Other current assets
|
|
3,931
|
|
|
Property, plant and equipment
|
|
3,858
|
|
|
Intangible assets
|
|
98,041
|
|
|
Other assets
|
|
4,758
|
|
|
Total assets acquired
|
|
165,541
|
|
|
|
|
|
||
Short-term borrowings
|
|
7,235
|
|
|
Accounts payable
|
|
2,075
|
|
|
Other current liabilities
|
|
21,262
|
|
|
Deferred income tax liabilities
|
|
26,870
|
|
|
Other noncurrent liabilities
|
|
433
|
|
|
Total liabilities assumed
|
|
57,875
|
|
|
|
|
|
||
Net assets acquired
|
|
107,666
|
|
|
Goodwill
|
|
89,943
|
|
|
Purchase price
|
|
$
|
197,609
|
|
(In thousands)
|
|
June 1, 2018
|
||
Accounts receivable
|
|
$
|
11,629
|
|
Inventories
|
|
9,310
|
|
|
Other current assets
|
|
575
|
|
|
Property, plant and equipment
|
|
1,107
|
|
|
Intangible assets
|
|
59,700
|
|
|
Total assets acquired
|
|
82,321
|
|
|
|
|
|
||
Accounts payable
|
|
5,068
|
|
|
Other current liabilities
|
|
7,415
|
|
|
Total liabilities assumed
|
|
12,483
|
|
|
|
|
|
||
Net assets acquired
|
|
69,838
|
|
|
Goodwill
|
|
61,719
|
|
|
Purchase price
|
|
$
|
131,557
|
|
Discontinued Operations
|
|
|
Three Months Ended December
|
|
|
Nine Months Ended December
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
(In thousands)
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
||||||||
Net revenues
|
|
$
|
—
|
|
|
|
$
|
712,447
|
|
|
|
$
|
335,203
|
|
|
|
$
|
2,073,367
|
|
Cost of goods sold
|
|
—
|
|
|
|
431,711
|
|
|
|
203,124
|
|
|
|
1,231,315
|
|
||||
Selling, general and administrative expenses
|
|
—
|
|
|
|
209,651
|
|
|
|
152,798
|
|
|
|
544,685
|
|
||||
Interest, net
|
|
—
|
|
|
|
1,373
|
|
|
|
(552
|
)
|
|
|
3,650
|
|
||||
Other income (expense), net
|
|
—
|
|
|
|
(747
|
)
|
|
|
(667
|
)
|
|
|
(3,801
|
)
|
||||
Income (loss) from discontinued operations before income taxes
|
|
—
|
|
|
|
71,711
|
|
|
|
(21,938
|
)
|
|
|
297,216
|
|
||||
Gain on the sale of discontinued operations before income taxes
|
|
—
|
|
|
|
383
|
|
|
|
—
|
|
|
|
4,589
|
|
||||
Total income (loss) from discontinued operations before income taxes
|
|
—
|
|
|
|
72,094
|
|
|
|
(21,938
|
)
|
|
|
301,805
|
|
||||
Income tax benefit (expense) (a)
|
|
12,256
|
|
|
|
(17,705
|
)
|
|
|
(13,834
|
)
|
|
|
(57,425
|
)
|
||||
Income (loss) from discontinued operations, net of tax
|
|
$
|
12,256
|
|
|
|
$
|
54,389
|
|
|
|
$
|
(35,772
|
)
|
|
|
$
|
244,380
|
|
(a)
|
Income tax benefit for the three months ended December 2019 reflects a return to accrual adjustment to the previously recorded tax expense. Income tax expense for the nine months ended December 2019 includes additional tax expense on nondeductible transaction costs and uncertain tax positions.
|
(In thousands)
|
|
December 2019
|
|
|
March 2019
|
|
December 2018
|
||||||
Cash and equivalents
|
|
$
|
—
|
|
|
|
$
|
97,892
|
|
|
$
|
83,334
|
|
Accounts receivable, net
|
|
—
|
|
|
|
242,941
|
|
|
208,258
|
|
|||
Inventories
|
|
—
|
|
|
|
510,370
|
|
|
464,454
|
|
|||
Other current assets
|
|
—
|
|
|
|
44,827
|
|
|
44,444
|
|
|||
Property, plant and equipment, net
|
|
—
|
|
|
|
142,091
|
|
|
138,975
|
|
|||
Intangible assets
|
|
—
|
|
|
|
51,913
|
|
|
53,059
|
|
|||
Goodwill
|
|
—
|
|
|
|
213,570
|
|
|
219,612
|
|
|||
Other assets
|
|
—
|
|
|
|
74,144
|
|
|
62,393
|
|
|||
Total assets of discontinued operations
|
|
$
|
—
|
|
|
|
$
|
1,377,748
|
|
|
$
|
1,274,529
|
|
|
|
|
|
|
|
|
|
||||||
Short-term borrowings
|
|
$
|
—
|
|
|
|
$
|
5,995
|
|
|
$
|
3,215
|
|
Accounts payable
|
|
—
|
|
|
|
113,866
|
|
|
109,272
|
|
|||
Accrued liabilities
|
|
—
|
|
|
|
141,621
|
|
|
118,531
|
|
|||
Other liabilities
|
|
—
|
|
|
|
48,581
|
|
|
45,896
|
|
|||
Total liabilities of discontinued operations
|
|
$
|
—
|
|
|
|
$
|
310,063
|
|
|
$
|
276,914
|
|
Other Divestitures
|
(In thousands)
|
|
December 2019
|
|
|
March 2019
|
|
December 2018
|
||||||
Finished products
|
|
$
|
1,422,605
|
|
|
|
$
|
1,284,293
|
|
|
$
|
1,250,764
|
|
Work-in-process
|
|
80,338
|
|
|
|
73,968
|
|
|
73,480
|
|
|||
Raw materials
|
|
62,027
|
|
|
|
74,399
|
|
|
77,377
|
|
|||
Total inventories
|
|
$
|
1,564,970
|
|
|
|
$
|
1,432,660
|
|
|
$
|
1,401,621
|
|
|
|
|
|
|
|
|
December 2019
|
|
|
March 2019
|
||||||||||||
(In thousands)
|
|
Weighted
Average
Amortization
Period
|
|
Amortization
Method
|
|
|
Cost
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
|
Net
Carrying
Amount
|
||||||||
Amortizable intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Customer relationships
|
|
17 years
|
|
Accelerated
|
|
|
$
|
330,196
|
|
|
$
|
151,286
|
|
|
$
|
178,910
|
|
|
|
$
|
197,129
|
|
License agreements
|
|
19 years
|
|
Accelerated
|
|
|
7,516
|
|
|
4,893
|
|
|
2,623
|
|
|
|
2,807
|
|
||||
Trademark
|
|
3 years
|
|
Straight-line
|
|
|
800
|
|
|
575
|
|
|
225
|
|
|
|
399
|
|
||||
Other
|
|
8 years
|
|
Straight-line
|
|
|
8,213
|
|
|
4,976
|
|
|
3,237
|
|
|
|
4,032
|
|
||||
Amortizable intangible assets, net
|
|
|
|
|
|
|
|
|
184,995
|
|
|
|
204,367
|
|
||||||||
Indefinite-lived intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Trademarks and trade names
|
|
|
|
|
|
|
|
|
1,763,237
|
|
|
|
1,767,997
|
|
||||||||
Intangible assets, net
|
|
|
|
|
|
|
|
|
|
|
$
|
1,948,232
|
|
|
|
$
|
1,972,364
|
|
(In thousands)
|
Outdoor
|
|
Active
|
|
Work
|
|
Total
|
|
||||||||
Balance, March 2019
|
$
|
983,889
|
|
|
$
|
393,956
|
|
|
$
|
163,469
|
|
|
$
|
1,541,314
|
|
|
Currency translation
|
(1,201
|
)
|
|
(309
|
)
|
|
(225
|
)
|
|
(1,735
|
)
|
|
||||
Balance, December 2019
|
$
|
982,688
|
|
|
$
|
393,647
|
|
|
$
|
163,244
|
|
|
$
|
1,539,579
|
|
|
(In thousands)
|
Location in Consolidated Balance Sheet
|
|
|
December 2019
|
|
||
Assets:
|
|
|
|
|
|
||
Operating lease assets
|
Operating lease right-of-use assets
|
|
|
$
|
1,298,631
|
|
|
Finance lease assets
|
Property, plant and equipment
|
|
|
22,499
|
|
|
|
Total lease assets
|
|
|
|
$
|
1,321,130
|
|
|
|
|
|
|
|
|
||
Liabilities:
|
|
|
|
|
|
||
Current
|
|
|
|
|
|
||
Operating lease liabilities
|
Accrued liabilities
|
|
|
$
|
312,704
|
|
|
Finance lease liabilities
|
Current portion of long-term debt
|
|
|
4,677
|
|
|
|
Noncurrent
|
|
|
|
|
|
||
Operating lease liabilities
|
Operating lease liabilities
|
|
|
1,052,854
|
|
|
|
Finance lease liabilities
|
Long-term debt
|
|
|
24,959
|
|
|
|
Total lease liabilities
|
|
|
|
$
|
1,395,194
|
|
|
(In thousands)
|
|
Three Months Ended December 2019
|
|
Nine Months Ended December 2019
|
|
||||
Operating lease cost
|
|
$
|
105,510
|
|
|
$
|
315,938
|
|
|
Finance lease cost – amortization of right-of-use assets
|
|
970
|
|
|
3,002
|
|
|
||
Finance lease cost – interest on lease liabilities
|
|
253
|
|
|
807
|
|
|
||
Short-term lease cost
|
|
672
|
|
|
1,937
|
|
|
||
Variable lease cost
|
|
31,707
|
|
|
89,693
|
|
|
||
Impairment
|
|
3,035
|
|
|
3,035
|
|
|
||
Gain recognized from sale-leaseback transactions
|
|
—
|
|
|
(11,329
|
)
|
|
||
Total lease cost
|
|
$
|
142,147
|
|
|
$
|
403,083
|
|
|
(In thousands)
|
|
Nine Months Ended December 2019
|
|
||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
|
||
Operating cash flows – operating leases
|
|
$
|
320,589
|
|
|
Operating cash flows – finance leases
|
|
807
|
|
|
|
Financing cash flows – finance leases
|
|
3,967
|
|
|
|
Right-of-use assets obtained in exchange for lease liabilities:
|
|
|
|
|
|
Operating leases (a)
|
|
358,159
|
|
|
|
Finance leases
|
|
—
|
|
|
(a)
|
Excludes amounts recorded upon adoption of ASC 842.
|
|
|
December 2019
|
|
|
Weighted average remaining lease term:
|
|
|
|
|
Operating leases
|
|
5.54 years
|
|
|
Finance leases
|
|
13.64 years
|
|
|
|
|
|
|
|
Weighted average discount rate:
|
|
|
|
|
Operating leases
|
|
2.43
|
%
|
|
Finance leases
|
|
3.12
|
%
|
|
(In thousands)
|
|
Operating Leases
|
|
Finance Leases
|
|
Total
|
|
||||||
Remainder of 2020
|
|
$
|
42,116
|
|
|
$
|
1,006
|
|
|
$
|
43,122
|
|
|
2021
|
|
417,892
|
|
|
6,532
|
|
|
424,424
|
|
|
|||
2022
|
|
300,452
|
|
|
1,910
|
|
|
302,362
|
|
|
|||
2023
|
|
223,579
|
|
|
1,626
|
|
|
225,205
|
|
|
|||
2024
|
|
146,783
|
|
|
1,550
|
|
|
148,333
|
|
|
|||
Thereafter
|
|
334,070
|
|
|
23,495
|
|
|
357,565
|
|
|
|||
Total lease payments
|
|
1,464,892
|
|
|
36,119
|
|
|
1,501,011
|
|
|
|||
Less: present value adjustment
|
|
99,334
|
|
|
6,483
|
|
|
105,817
|
|
|
|||
Present value of lease liabilities
|
|
$
|
1,365,558
|
|
|
$
|
29,636
|
|
|
$
|
1,395,194
|
|
|
(In thousands)
|
|
Operating Leases
|
||
2020
|
|
$
|
320,224
|
|
2021
|
|
287,829
|
|
|
2022
|
|
212,918
|
|
|
2023
|
|
154,920
|
|
|
2024
|
|
100,789
|
|
|
Thereafter
|
|
251,228
|
|
|
Total lease payments
|
|
$
|
1,327,908
|
|
|
|
Three Months Ended December
|
|
|
Nine Months Ended December
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
(In thousands)
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
||||||||
Service cost – benefits earned during the period
|
|
$
|
3,401
|
|
|
|
$
|
6,097
|
|
|
|
$
|
10,192
|
|
|
|
$
|
17,882
|
|
Interest cost on projected benefit obligations
|
|
14,581
|
|
|
|
15,807
|
|
|
|
44,085
|
|
|
|
47,638
|
|
||||
Expected return on plan assets
|
|
(23,176
|
)
|
|
|
(23,185
|
)
|
|
|
(69,505
|
)
|
|
|
(70,216
|
)
|
||||
Settlement charges
|
|
24,943
|
|
|
|
662
|
|
|
|
25,462
|
|
|
|
8,846
|
|
||||
Curtailments
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,483
|
|
||||
Amortization of deferred amounts:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net deferred actuarial losses
|
|
4,203
|
|
|
|
6,676
|
|
|
|
12,236
|
|
|
|
22,153
|
|
||||
Deferred prior service costs (credits)
|
|
13
|
|
|
|
(58
|
)
|
|
|
38
|
|
|
|
552
|
|
||||
Net periodic pension cost (income)
|
|
$
|
23,965
|
|
|
|
$
|
5,999
|
|
|
|
$
|
22,508
|
|
|
|
$
|
36,338
|
|
|
|
December 31, 2019
|
|
|
September 30, 2019
|
||
U.S. qualified defined benefit pension plan
|
|
3.34
|
%
|
|
|
N/A
|
|
Supplemental defined benefit pension plan
|
|
3.35
|
%
|
|
|
3.23
|
%
|
(In thousands, except share amounts)
|
|
December 2019
|
|
|
March 2019
|
|
December 2018
|
||||||
Shares held for deferred compensation plans
|
|
—
|
|
|
|
—
|
|
|
147,464
|
|
|||
Cost of shares held for deferred compensation plans
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
$
|
2,126
|
|
(In thousands)
|
|
December 2019
|
|
|
March 2019
|
|
December 2018
|
||||||
Foreign currency translation and other
|
|
$
|
(663,319
|
)
|
|
|
$
|
(725,679
|
)
|
|
$
|
(737,127
|
)
|
Defined benefit pension plans
|
|
(249,530
|
)
|
|
|
(243,184
|
)
|
|
(219,644
|
)
|
|||
Derivative financial instruments
|
|
17,477
|
|
|
|
66,788
|
|
|
70,206
|
|
|||
Accumulated other comprehensive income (loss)
|
|
$
|
(895,372
|
)
|
|
|
$
|
(902,075
|
)
|
|
$
|
(886,565
|
)
|
|
Three Months Ended December 2019
|
|
||||||||||||||
(In thousands)
|
Foreign Currency Translation and Other
|
|
Defined Benefit Pension Plans
|
|
Derivative Financial Instruments
|
|
Total
|
|
||||||||
Balance, September 2019
|
$
|
(715,286
|
)
|
|
$
|
(298,326
|
)
|
|
$
|
82,887
|
|
|
$
|
(930,725
|
)
|
|
Other comprehensive income (loss) before reclassifications
|
51,967
|
|
|
26,827
|
|
|
(46,536
|
)
|
|
32,258
|
|
|
||||
Amounts reclassified from accumulated other comprehensive income (loss)
|
—
|
|
|
21,969
|
|
|
(18,874
|
)
|
|
3,095
|
|
|
||||
Net other comprehensive income (loss)
|
51,967
|
|
|
48,796
|
|
|
(65,410
|
)
|
|
35,353
|
|
|
||||
Balance, December 2019
|
$
|
(663,319
|
)
|
|
$
|
(249,530
|
)
|
|
$
|
17,477
|
|
|
$
|
(895,372
|
)
|
|
|
Three Months Ended December 2018
|
||||||||||||||
(In thousands)
|
Foreign Currency Translation and Other
|
|
Defined Benefit Pension Plans
|
|
Derivative Financial Instruments
|
|
Total
|
||||||||
Balance, September 2018
|
$
|
(665,962
|
)
|
|
$
|
(226,039
|
)
|
|
$
|
29,085
|
|
|
$
|
(862,916
|
)
|
Other comprehensive income (loss) before reclassifications
|
(71,165
|
)
|
|
1,065
|
|
|
36,619
|
|
|
(33,481
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income (loss)
|
—
|
|
|
5,330
|
|
|
4,502
|
|
|
9,832
|
|
||||
Net other comprehensive income (loss)
|
(71,165
|
)
|
|
6,395
|
|
|
41,121
|
|
|
(23,649
|
)
|
||||
Balance, December 2018
|
$
|
(737,127
|
)
|
|
$
|
(219,644
|
)
|
|
$
|
70,206
|
|
|
$
|
(886,565
|
)
|
|
Nine Months Ended December 2019
|
|
||||||||||||||
In thousands
|
Foreign Currency Translation and Other
|
|
Defined Benefit Pension Plans
|
|
Derivative Financial Instruments
|
|
Total
|
|
||||||||
Balance, Balance, March 2019
|
$
|
(725,679
|
)
|
|
$
|
(243,184
|
)
|
|
$
|
66,788
|
|
|
$
|
(902,075
|
)
|
|
Adoption of new accounting standard, ASU 2018-02
|
(9,088
|
)
|
|
(50,402
|
)
|
|
(2,371
|
)
|
|
(61,861
|
)
|
|
||||
Other comprehensive income (loss) before reclassifications
|
(11,646
|
)
|
|
15,108
|
|
|
8,712
|
|
|
12,174
|
|
|
||||
Amounts reclassified from accumulated other comprehensive income (loss)
|
—
|
|
|
28,154
|
|
|
(47,057
|
)
|
|
(18,903
|
)
|
|
||||
Spin-off of Jeans Business
|
83,094
|
|
|
794
|
|
|
(8,595
|
)
|
|
75,293
|
|
|
||||
Net other comprehensive income (loss)
|
62,360
|
|
|
(6,346
|
)
|
|
(49,311
|
)
|
|
6,703
|
|
|
||||
Balance, December 2019
|
$
|
(663,319
|
)
|
|
$
|
(249,530
|
)
|
|
$
|
17,477
|
|
|
$
|
(895,372
|
)
|
|
|
Nine Months Ended December 2018
|
||||||||||||||
In thousands
|
Foreign Currency Translation and Other
|
|
Defined Benefit Pension Plans
|
|
Derivative Financial Instruments
|
|
Total
|
||||||||
Balance, March 2018
|
$
|
(476,869
|
)
|
|
$
|
(289,618
|
)
|
|
$
|
(97,543
|
)
|
|
$
|
(864,030
|
)
|
Other comprehensive income (loss) before reclassifications
|
(260,258
|
)
|
|
39,877
|
|
|
135,041
|
|
|
(85,340
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income (loss)
|
—
|
|
|
30,097
|
|
|
32,708
|
|
|
62,805
|
|
||||
Net other comprehensive income (loss)
|
(260,258
|
)
|
|
69,974
|
|
|
167,749
|
|
|
(22,535
|
)
|
||||
Balance, December 2018
|
$
|
(737,127
|
)
|
|
$
|
(219,644
|
)
|
|
$
|
70,206
|
|
|
$
|
(886,565
|
)
|
|
|
Nine Months Ended December 2019
|
|
Expected volatility
|
|
24% to 27%
|
|
Weighted average expected volatility
|
|
25%
|
|
Expected term (in years)
|
|
6.1 to 7.6
|
|
Weighted average dividend yield
|
|
2.5%
|
|
Risk-free interest rate
|
|
1.6% to 2.4%
|
|
Weighted average fair value at date of grant
|
|
$17.19
|
|
|
|
Three Months Ended December
|
|
|
Nine Months Ended December
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
(In thousands)
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
||||||||
Segment revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Outdoor
|
|
$
|
1,659,108
|
|
|
|
$
|
1,612,605
|
|
|
|
$
|
3,795,665
|
|
|
|
$
|
3,647,708
|
|
Active
|
|
1,239,462
|
|
|
|
1,142,580
|
|
|
|
3,885,222
|
|
|
|
3,579,478
|
|
||||
Work
|
|
480,086
|
|
|
|
471,875
|
|
|
|
1,338,184
|
|
|
|
1,346,829
|
|
||||
Other
|
|
6,090
|
|
|
|
652
|
|
|
|
30,422
|
|
|
|
10,222
|
|
||||
Total segment revenues
|
|
$
|
3,384,746
|
|
|
|
$
|
3,227,712
|
|
|
|
$
|
9,049,493
|
|
|
|
$
|
8,584,237
|
|
Segment profit (loss):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Outdoor
|
|
$
|
348,995
|
|
|
|
$
|
338,009
|
|
|
|
$
|
525,107
|
|
|
|
$
|
512,635
|
|
Active
|
|
286,474
|
|
|
|
272,862
|
|
|
|
982,240
|
|
|
|
893,110
|
|
||||
Work
|
|
54,556
|
|
|
|
56,178
|
|
|
|
140,791
|
|
|
|
156,425
|
|
||||
Other
|
|
(2,800
|
)
|
|
|
520
|
|
|
|
(2,035
|
)
|
|
|
3,470
|
|
||||
Total segment profit
|
|
687,225
|
|
|
|
667,569
|
|
|
|
1,646,103
|
|
|
|
1,565,640
|
|
||||
Corporate and other expenses (a)
|
|
(130,575
|
)
|
|
|
(147,776
|
)
|
|
|
(373,311
|
)
|
|
|
(439,157
|
)
|
||||
Interest expense, net
|
|
(16,814
|
)
|
|
|
(25,220
|
)
|
|
|
(47,639
|
)
|
|
|
(76,894
|
)
|
||||
Income from continuing operations before income taxes
|
|
$
|
539,836
|
|
|
|
$
|
494,573
|
|
|
|
$
|
1,225,153
|
|
|
|
$
|
1,049,589
|
|
(a)
|
Certain corporate overhead and other costs of $25.3 million and $70.9 million for the three and nine-month periods ended December 2018, respectively, previously allocated to the former Jeans segment and Other category for segment reporting purposes, have been reallocated to continuing operations.
|
|
|
Three Months Ended December
|
|
|
Nine Months Ended December
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
(In thousands, except per share amounts)
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
||||||||
Earnings per share – basic:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
|
$
|
452,747
|
|
|
|
$
|
409,120
|
|
|
|
$
|
1,198,997
|
|
|
|
$
|
886,608
|
|
Weighted average common shares outstanding
|
|
395,940
|
|
|
|
395,294
|
|
|
|
396,806
|
|
|
|
395,117
|
|
||||
Earnings per share from continuing operations
|
|
$
|
1.14
|
|
|
|
$
|
1.03
|
|
|
|
$
|
3.02
|
|
|
|
$
|
2.24
|
|
Earnings per share – diluted:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
|
$
|
452,747
|
|
|
|
$
|
409,120
|
|
|
|
$
|
1,198,997
|
|
|
|
$
|
886,608
|
|
Weighted average common shares outstanding
|
|
395,940
|
|
|
|
395,294
|
|
|
|
396,806
|
|
|
|
395,117
|
|
||||
Incremental shares from stock options and other dilutive securities
|
|
4,382
|
|
|
|
4,473
|
|
|
|
4,693
|
|
|
|
5,301
|
|
||||
Adjusted weighted average common shares outstanding
|
|
400,322
|
|
|
|
399,767
|
|
|
|
401,499
|
|
|
|
400,418
|
|
||||
Earnings per share from continuing operations
|
|
$
|
1.13
|
|
|
|
$
|
1.02
|
|
|
|
$
|
2.99
|
|
|
|
$
|
2.21
|
|
•
|
Level 1 — Quoted prices in active markets for identical assets or liabilities.
|
•
|
Level 2 — Significant directly observable data (other than Level 1 quoted prices) or significant indirectly observable
|
•
|
Level 3 — Prices or valuation techniques that require significant unobservable data inputs. These inputs would normally be VF’s own data and judgments about assumptions that market participants would use in pricing the asset or liability.
|
|
Total Fair Value
|
|
Fair Value Measurement Using (a)
|
|
||||||||||||
(In thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
|||||||||
December 2019
|
|
|
|
|
|
|
|
|
||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
247,270
|
|
|
$
|
247,270
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Time deposits
|
2,689
|
|
|
2,689
|
|
|
—
|
|
|
—
|
|
|
||||
Derivative financial instruments
|
51,643
|
|
|
—
|
|
|
51,643
|
|
|
—
|
|
|
||||
Investment securities
|
134,026
|
|
|
128,409
|
|
|
5,617
|
|
|
—
|
|
|
||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Derivative financial instruments
|
42,979
|
|
|
—
|
|
|
42,979
|
|
|
—
|
|
|
||||
Deferred compensation
|
145,814
|
|
|
—
|
|
|
145,814
|
|
|
—
|
|
|
||||
|
Total Fair Value
|
|
Fair Value Measurement Using (a)
|
|
||||||||||||
(In thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
|||||||||
March 2019
|
|
|
|
|
|
|
|
|
||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
248,560
|
|
|
$
|
248,560
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Time deposits
|
8,257
|
|
|
8,257
|
|
|
—
|
|
|
—
|
|
|
||||
Derivative financial instruments
|
92,771
|
|
|
—
|
|
|
92,771
|
|
|
—
|
|
|
||||
Investment securities
|
186,698
|
|
|
176,209
|
|
|
10,489
|
|
|
—
|
|
|
||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Derivative financial instruments
|
22,337
|
|
|
—
|
|
|
22,337
|
|
|
—
|
|
|
||||
Deferred compensation
|
199,336
|
|
|
—
|
|
|
199,336
|
|
|
—
|
|
|
(a)
|
There were no transfers among the levels within the fair value hierarchy during the nine months ended December 2019 or the year ended March 2019.
|
|
|
Fair Value of Derivatives
with Unrealized Gains
|
|
|
Fair Value of Derivatives
with Unrealized Losses
|
||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
(In thousands)
|
|
December 2019
|
|
|
March 2019
|
|
December 2018
|
|
|
December 2019
|
|
|
March 2019
|
|
December 2018
|
||||||||||||
Foreign currency exchange contracts designated as hedging instruments
|
|
$
|
46,573
|
|
|
|
$
|
92,356
|
|
|
$
|
88,910
|
|
|
|
$
|
(42,050
|
)
|
|
|
$
|
(21,798
|
)
|
|
$
|
(7,197
|
)
|
Foreign currency exchange contracts not designated as hedging instruments
|
|
5,070
|
|
|
|
415
|
|
|
—
|
|
|
|
(929
|
)
|
|
|
(539
|
)
|
|
(164
|
)
|
||||||
Total derivatives
|
|
$
|
51,643
|
|
|
|
$
|
92,771
|
|
|
$
|
88,910
|
|
|
|
$
|
(42,979
|
)
|
|
|
$
|
(22,337
|
)
|
|
$
|
(7,361
|
)
|
|
|
December 2019
|
|
|
March 2019
|
|
December 2018
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
(In thousands)
|
|
Derivative
Asset
|
|
Derivative
Liability
|
|
|
Derivative
Asset
|
|
Derivative
Liability
|
|
Derivative
Asset
|
|
Derivative
Liability
|
||||||||||||
Gross amounts presented in the Consolidated Balance Sheets
|
|
$
|
51,643
|
|
|
$
|
(42,979
|
)
|
|
|
$
|
92,771
|
|
|
$
|
(22,337
|
)
|
|
$
|
88,910
|
|
|
$
|
(7,361
|
)
|
Gross amounts not offset in the Consolidated Balance Sheets
|
|
(27,958
|
)
|
|
27,958
|
|
|
|
(22,274
|
)
|
|
22,274
|
|
|
(7,273
|
)
|
|
7,273
|
|
||||||
Net amounts
|
|
$
|
23,685
|
|
|
$
|
(15,021
|
)
|
|
|
$
|
70,497
|
|
|
$
|
(63
|
)
|
|
$
|
81,637
|
|
|
$
|
(88
|
)
|
(In thousands)
|
|
December 2019
|
|
|
March 2019
|
|
December 2018
|
||||||
Other current assets
|
|
$
|
49,650
|
|
|
|
$
|
83,582
|
|
|
$
|
78,594
|
|
Accrued liabilities
|
|
(34,710
|
)
|
|
|
(18,590
|
)
|
|
(5,540
|
)
|
|||
Other assets
|
|
1,993
|
|
|
|
9,189
|
|
|
10,316
|
|
|||
Other liabilities
|
|
(8,269
|
)
|
|
|
(3,747
|
)
|
|
(1,821
|
)
|
(In thousands)
|
|
Gain (Loss) on Derivatives Recognized in OCI
Three Months Ended December
|
|
|
Gain (Loss) on Derivatives Recognized in OCI
Nine Months Ended December
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cash Flow Hedging Relationships
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
||||||||
Foreign currency exchange
|
|
$
|
(56,699
|
)
|
|
|
$
|
43,836
|
|
|
|
$
|
9,471
|
|
|
|
$
|
153,705
|
|
(In thousands)
|
|
Gain (Loss) Reclassified from Accumulated OCI into Income Three Months Ended December
|
|
|
Gain (Loss) Reclassified from Accumulated OCI into Income Nine Months Ended December
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Location of Gain (Loss)
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
||||||||
Net sales
|
|
$
|
(5,507
|
)
|
|
|
$
|
772
|
|
|
|
$
|
(11,226
|
)
|
|
|
$
|
6,244
|
|
Cost of goods sold
|
|
27,157
|
|
|
|
(4,570
|
)
|
|
|
60,989
|
|
|
|
(31,146
|
)
|
||||
Selling, general and administrative expenses
|
|
1,231
|
|
|
|
(1,020
|
)
|
|
|
3,329
|
|
|
|
(5,240
|
)
|
||||
Other income (expense), net
|
|
1,006
|
|
|
|
690
|
|
|
|
7,574
|
|
|
|
(1,673
|
)
|
||||
Interest expense
|
|
(1,324
|
)
|
|
|
(1,263
|
)
|
|
|
(3,920
|
)
|
|
|
(3,739
|
)
|
||||
Total
|
|
$
|
22,563
|
|
|
|
$
|
(5,391
|
)
|
|
|
$
|
56,746
|
|
|
|
$
|
(35,554
|
)
|
(In thousands)
|
Severance
|
|
Other
|
|
Total
|
|
||||||
Accrual at March 2019
|
$
|
58,106
|
|
|
$
|
11,035
|
|
|
$
|
69,141
|
|
|
Charges
|
7,116
|
|
|
2,564
|
|
|
9,680
|
|
|
|||
Cash payments
|
(33,965
|
)
|
|
(11,246
|
)
|
|
(45,211
|
)
|
|
|||
Adjustments to accruals
|
3,101
|
|
|
1,144
|
|
|
4,245
|
|
|
|||
Impact of foreign currency
|
(2,285
|
)
|
|
(713
|
)
|
|
(2,998
|
)
|
|
|||
Accrual at December 2019
|
$
|
32,073
|
|
|
$
|
2,784
|
|
|
$
|
34,857
|
|
|
|
|
Three Months Ended December
|
|
|
Nine Months Ended December
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
(In thousands)
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
||||||||
Outdoor
|
|
$
|
1,670
|
|
|
|
$
|
2,276
|
|
|
|
$
|
6,400
|
|
|
|
$
|
15,171
|
|
Active
|
|
322
|
|
|
|
485
|
|
|
|
789
|
|
|
|
3,537
|
|
||||
Work
|
|
1,460
|
|
|
|
—
|
|
|
|
2,084
|
|
|
|
3,939
|
|
||||
Corporate and other
|
|
407
|
|
|
|
1,045
|
|
|
|
407
|
|
|
|
3,546
|
|
||||
Total
|
|
$
|
3,859
|
|
|
|
$
|
3,806
|
|
|
|
$
|
9,680
|
|
|
|
$
|
26,193
|
|
ITEM 2 — MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
|
HIGHLIGHTS OF THE THIRD QUARTER OF FISCAL 2020
|
•
|
Revenues were up 5% to $3.4 billion compared to the three months ended December 2018, primarily due to the $183.8 million contribution from organic growth, partially offset by a 1% unfavorable impact from foreign currency.
|
•
|
Active segment revenues increased 8% to $1.2 billion compared to the three months ended December 2018, including a 1% unfavorable impact from foreign currency.
|
•
|
Outdoor segment revenues increased 3% to $1.7 billion compared to the three months ended December 2018, including a 1% unfavorable impact from foreign currency.
|
•
|
Direct-to-consumer revenues were up 7% over the 2018 period. E-commerce revenues increased 16% in the current period, including a 1% unfavorable impact from foreign currency. Direct-to-consumer revenues accounted for 46% of net revenues for the three months ended December 2019.
|
•
|
International revenues increased 8% compared to the three months ended December 2018, including a 1% unfavorable
|
•
|
Gross margin increased 110 basis points to 55.7% compared to the three months ended December 2018 primarily driven by a mix-shift to higher margin businesses and a favorable net foreign currency transaction impact.
|
•
|
Earnings per share increased 11% to $1.13 from $1.02 in the 2018 period. The increase was driven by organic growth in all segments, and continued strength in our direct-to-consumer and international businesses. These improvements were partially offset by the impact from a pension settlement charge, costs related to the relocation of our global headquarters and certain brands to Denver, Colorado, specified strategic business decisions in South America, continued investments in our key strategic growth initiatives and the unfavorable impacts from foreign currency.
|
ANALYSIS OF RESULTS OF OPERATIONS
|
Consolidated Statements of Income
|
(In millions)
|
|
Three Months Ended December
|
|
Nine Months Ended December
|
|
||||
Net revenues — 2018
|
|
$
|
3,227.7
|
|
|
$
|
8,584.2
|
|
|
Organic
|
|
183.8
|
|
|
681.7
|
|
|
||
Acquisition
|
|
—
|
|
|
11.8
|
|
|
||
Dispositions
|
|
(4.4
|
)
|
|
(96.3
|
)
|
|
||
Impact of foreign currency
|
|
(22.4
|
)
|
|
(131.9
|
)
|
|
||
Net revenues — 2019
|
|
$
|
3,384.7
|
|
|
$
|
9,049.5
|
|
|
|
|
Three Months Ended December
|
|
|
Nine Months Ended December
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
||||
Gross margin (net revenues less cost of goods sold)
|
|
55.7
|
%
|
|
|
54.6
|
%
|
|
|
54.3
|
%
|
|
|
53.2
|
%
|
Selling, general and administrative expenses
|
|
38.6
|
|
|
|
38.5
|
|
|
|
40.1
|
|
|
|
39.5
|
|
Operating margin
|
|
17.1
|
%
|
|
|
16.1
|
%
|
|
|
14.3
|
%
|
|
|
13.7
|
%
|
Information by Reportable Segment
|
|
Three Months Ended December
|
|
||||||||||||||||||
(In millions)
|
Outdoor
|
|
Active
|
|
Work
|
|
Other (a)
|
|
Total
|
|
||||||||||
Segment revenues — 2018
|
$
|
1,612.6
|
|
|
$
|
1,142.6
|
|
|
$
|
471.9
|
|
|
$
|
0.6
|
|
|
$
|
3,227.7
|
|
|
Organic
|
58.7
|
|
|
109.8
|
|
|
10.1
|
|
|
5.2
|
|
|
183.8
|
|
|
|||||
Dispositions
|
—
|
|
|
(3.1
|
)
|
|
(1.3
|
)
|
|
—
|
|
|
(4.4
|
)
|
|
|||||
Impact of foreign currency
|
(12.2
|
)
|
|
(9.8
|
)
|
|
(0.6
|
)
|
|
0.2
|
|
|
(22.4
|
)
|
|
|||||
Segment revenues — 2019
|
$
|
1,659.1
|
|
|
$
|
1,239.5
|
|
|
$
|
480.1
|
|
|
$
|
6.0
|
|
|
$
|
3,384.7
|
|
|
|
Nine Months Ended December
|
|
||||||||||||||||||
(In millions)
|
Outdoor
|
|
Active
|
|
Work
|
|
Other (a)
|
|
Total
|
|
||||||||||
Segment revenues — 2018
|
$
|
3,647.7
|
|
|
$
|
3,579.5
|
|
|
$
|
1,346.8
|
|
|
$
|
10.2
|
|
|
$
|
8,584.2
|
|
|
Organic
|
195.6
|
|
|
439.0
|
|
|
22.9
|
|
|
24.2
|
|
|
681.7
|
|
|
|||||
Acquisition
|
11.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11.8
|
|
|
|||||
Dispositions
|
—
|
|
|
(71.3
|
)
|
|
(25.0
|
)
|
|
—
|
|
|
(96.3
|
)
|
|
|||||
Impact of foreign currency
|
(59.4
|
)
|
|
(62.0
|
)
|
|
(6.5
|
)
|
|
(4.0
|
)
|
|
(131.9
|
)
|
|
|||||
Segment revenues — 2019
|
$
|
3,795.7
|
|
|
$
|
3,885.2
|
|
|
$
|
1,338.2
|
|
|
$
|
30.4
|
|
|
$
|
9,049.5
|
|
|
|
Three Months Ended December
|
|
||||||||||||||||||
(In millions)
|
Outdoor
|
|
Active
|
|
Work
|
|
Other (a)
|
|
Total
|
|
||||||||||
Segment profit — 2018
|
$
|
338.0
|
|
|
$
|
272.9
|
|
|
$
|
56.2
|
|
|
$
|
0.5
|
|
|
$
|
667.6
|
|
|
Organic
|
12.7
|
|
|
14.4
|
|
|
(1.7
|
)
|
|
(5.5
|
)
|
|
19.9
|
|
|
|||||
Dispositions
|
—
|
|
|
0.9
|
|
|
0.2
|
|
|
—
|
|
|
1.1
|
|
|
|||||
Impact of foreign currency
|
(1.7
|
)
|
|
(1.7
|
)
|
|
(0.1
|
)
|
|
2.1
|
|
|
(1.4
|
)
|
|
|||||
Segment profit — 2019
|
$
|
349.0
|
|
|
$
|
286.5
|
|
|
$
|
54.6
|
|
|
$
|
(2.9
|
)
|
|
$
|
687.2
|
|
|
|
Nine Months Ended December
|
|
||||||||||||||||||
(In millions)
|
Outdoor
|
|
Active
|
|
Work
|
|
Other (a)
|
|
Total
|
|
||||||||||
Segment profit — 2018
|
$
|
512.6
|
|
|
$
|
893.1
|
|
|
$
|
156.4
|
|
|
$
|
3.5
|
|
|
$
|
1,565.6
|
|
|
Organic
|
19.3
|
|
|
111.9
|
|
|
(14.1
|
)
|
|
(8.2
|
)
|
|
108.9
|
|
|
|||||
Acquisition
|
(0.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|
|||||
Dispositions
|
—
|
|
|
(6.6
|
)
|
|
(0.9
|
)
|
|
—
|
|
|
(7.5
|
)
|
|
|||||
Impact of foreign currency
|
(6.6
|
)
|
|
(16.2
|
)
|
|
(0.6
|
)
|
|
2.7
|
|
|
(20.7
|
)
|
|
|||||
Segment profit — 2019
|
$
|
525.1
|
|
|
$
|
982.2
|
|
|
$
|
140.8
|
|
|
$
|
(2.0
|
)
|
|
$
|
1,646.1
|
|
|
(a)
|
Included in the Other category for the three and nine months ended December 2019 are results primarily related to the sale of non-VF products. The three and nine months ended December 2018 reflect results primarily from transition services related to the sale of the Nautica® brand business. Differences in the results as compared to the prior year, other than the impact of foreign currency, are reflected within the "organic" activity.
|
|
|
Three Months Ended December
|
|
|
Nine Months Ended December
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(Dollars in millions)
|
|
2019
|
|
|
2018
|
|
Percent
Change |
|
|
2019
|
|
|
2018
|
|
Percent
Change |
||||||||||
Segment revenues
|
|
$
|
1,659.1
|
|
|
|
$
|
1,612.6
|
|
|
2.9
|
%
|
|
|
$
|
3,795.7
|
|
|
|
$
|
3,647.7
|
|
|
4.1
|
%
|
Segment profit
|
|
349.0
|
|
|
|
338.0
|
|
|
3.3
|
%
|
|
|
525.1
|
|
|
|
512.6
|
|
|
2.4
|
%
|
||||
Operating margin
|
|
21.0
|
%
|
|
|
21.0
|
%
|
|
|
|
|
13.8
|
%
|
|
|
14.1
|
%
|
|
|
|
|
Three Months Ended December
|
|
|
Nine Months Ended December
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(Dollars in millions)
|
|
2019
|
|
|
2018
|
|
Percent
Change |
|
|
2019
|
|
|
2018
|
|
Percent
Change |
||||||||||
Segment revenues
|
|
$
|
1,239.5
|
|
|
|
$
|
1,142.6
|
|
|
8.5
|
%
|
|
|
$
|
3,885.2
|
|
|
|
$
|
3,579.5
|
|
|
8.5
|
%
|
Segment profit
|
|
286.5
|
|
|
|
272.9
|
|
|
5.0
|
%
|
|
|
982.2
|
|
|
|
893.1
|
|
|
10.0
|
%
|
||||
Operating margin
|
|
23.1
|
%
|
|
|
23.9
|
%
|
|
|
|
|
25.3
|
%
|
|
|
25.0
|
%
|
|
|
|
|
Three Months Ended December
|
|
|
Nine Months Ended December
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(Dollars in millions)
|
|
2019
|
|
|
2018
|
|
Percent
Change |
|
|
2019
|
|
|
2018
|
|
Percent
Change |
||||||||||
Segment revenues
|
|
$
|
480.1
|
|
|
|
$
|
471.9
|
|
|
1.7
|
%
|
|
|
$
|
1,338.2
|
|
|
|
$
|
1,346.8
|
|
|
(0.6
|
)%
|
Segment profit
|
|
54.6
|
|
|
|
56.2
|
|
|
(2.9
|
)%
|
|
|
140.8
|
|
|
|
156.4
|
|
|
(10.0
|
)%
|
||||
Operating margin
|
|
11.4
|
%
|
|
|
11.9
|
%
|
|
|
|
|
10.5
|
%
|
|
|
11.6
|
%
|
|
|
Reconciliation of Segment Profit to Income Before Income Taxes
|
|
|
Three Months Ended December
|
|
|
Nine Months Ended December
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(Dollars in millions)
|
|
2019
|
|
|
2018
|
|
Percent
Change |
|
|
2019
|
|
|
2018
|
|
Percent
Change |
||||||||||
Corporate and other expenses
|
|
$
|
130.6
|
|
|
|
$
|
147.8
|
|
|
(11.6
|
)%
|
|
|
$
|
373.3
|
|
|
|
$
|
439.2
|
|
|
(15.0
|
)%
|
Interest expense, net
|
|
16.8
|
|
|
|
25.2
|
|
|
(33.3
|
)%
|
|
|
47.6
|
|
|
|
76.9
|
|
|
(38.0
|
)%
|
International Operations
|
Direct-to-Consumer Operations
|
ANALYSIS OF FINANCIAL CONDITION
|
Consolidated Balance Sheets
|
•
|
Increase in accounts receivable — primarily due to the seasonality of the business and increased wholesale shipments.
|
•
|
Increase in inventories — primarily due to the seasonality of the business, including mixed results during the 2019 holiday season, primarily impacting the Americas region, and higher inventory levels in the occupational work businesses.
|
•
|
Decrease in other current assets — due to lower prepaid expenses and a decrease in derivative assets.
|
•
|
Increase in operating lease right-of-use assets — due to amounts recorded in connection with the adoption of Financial Accounting Standards Board Accounting Standards Codification Topic 842, Leases ("ASC 842").
|
•
|
Increase in other assets — primarily due to an increase in deferred tax assets due to the enactment of certain provisions of the Swiss Tax Act.
|
•
|
Decrease in short-term borrowings — due to net repayment of commercial paper borrowings including the use of funds provided by the cash received from Kontoor Brands.
|
•
|
Decrease in accounts payable — due to the timing of payments to vendors.
|
•
|
Increase in accrued liabilities — primarily due to amounts recorded for operating lease liabilities in connection with the adoption of ASC 842.
|
•
|
Increase in operating lease liabilities — due to amounts recorded for operating lease liabilities in connection with the adoption of ASC 842.
|
•
|
Decrease in other liabilities — primarily due to the reclassification of deferred rent credits from other liabilities to operating lease right-of-use assets in connection with the adoption of ASC 842.
|
•
|
Increase in inventories — driven by growth in the business, higher inventory levels in the occupational work businesses and mixed results during the 2019 holiday season, primarily impacting the Americas region.
|
•
|
Increase in operating lease right-of-use assets — due to amounts recorded in connection with the adoption of ASC 842.
|
•
|
Increase in other assets — primarily due to an increase in deferred tax assets due to the enactment of certain provisions of the Swiss Tax Act.
|
•
|
Decrease in short-term borrowings — due to net repayment of commercial paper borrowings including the use of funds provided by the cash received from Kontoor Brands.
|
•
|
Decrease in accounts payable — driven by the timing of payments to vendors.
|
•
|
Increase in accrued liabilities — primarily due to amounts recorded for the current portion of operating lease liabilities in connection with the adoption of ASC 842.
|
•
|
Increase in operating lease liabilities — due to amounts recorded for operating lease liabilities in connection with the adoption of ASC 842.
|
•
|
Decrease in other liabilities — primarily due to the reclassification of deferred rent credits from other liabilities to operating lease right-of-use assets in connection with the adoption of ASC 842.
|
Liquidity and Capital Resources
|
|
|
December
|
|
|
March
|
|
December
|
(Dollars in millions)
|
|
2019
|
|
|
2019
|
|
2018
|
Working capital
|
|
$2,193.6
|
|
|
$1,377.3
|
|
$1,479.6
|
Current ratio
|
|
2.1 to 1
|
|
|
1.6 to 1
|
|
1.6 to 1
|
Debt to total capital
|
|
43.6%
|
|
|
39.3%
|
|
39.6%
|
|
|
Nine Months Ended December
|
|||||||
|
|
|
|
|
|
||||
(In thousands)
|
|
2019
|
|
|
2018
|
||||
Cash provided by operating activities
|
|
$
|
828,413
|
|
|
|
$
|
1,111,726
|
|
Cash used by investing activities
|
|
(171,629
|
)
|
|
|
(129,095
|
)
|
||
Cash used by financing activities
|
|
(622,122
|
)
|
|
|
(1,437,727
|
)
|
•
|
Contractual obligations and commercial commitments at the end of Fiscal 2019 included approximately $349 million
|
•
|
Inventory purchase obligations decreased by approximately $600 million at the end of December 2019 primarily due to the timing of sourcing activities.
|
•
|
In addition to operating lease liabilities recorded in VF's Consolidated Balance Sheet, the Company has entered into approximately $295 million of leases that have not yet commenced, primarily related to certain distribution center facilities.
|
Recent Accounting Pronouncements
|
Critical Accounting Policies and Estimates
|
•
|
Financial projections and future cash flows, including terminal growth rates based on the expected long-term growth rate of the brand;
|
•
|
Royalty rates based on market data as well as active license agreements of the brand; and,
|
•
|
Market-based discount rates.
|
Cautionary Statement on Forward-looking Statements
|
ITEM 3 — QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
|
ITEM 4 — CONTROLS AND PROCEDURES.
|
ITEM 1 — LEGAL PROCEEDINGS.
|
ITEM 1A — RISK FACTORS.
|
ITEM 2 — UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
|
(c)
|
Issuer purchases of equity securities:
|
Third Quarter Fiscal 2020
|
|
Total
Number of
Shares
Purchased
|
|
Weighted
Average
Price Paid
per Share
|
|
Total Number of
Shares Purchased
as Part of Publicly
Announced Programs
|
|
Dollar Value
of Shares that May
Yet be Purchased
Under the Program
|
||||||
September 29 - October 26, 2019
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
3,836,982,574
|
|
October 27 - November 23, 2019
|
|
5,168,698
|
|
|
85.37
|
|
|
5,168,698
|
|
|
3,395,709,327
|
|
||
November 24 - December 28, 2019
|
|
671,852
|
|
|
87.42
|
|
|
671,852
|
|
|
3,336,979,318
|
|
||
Total
|
|
5,840,550
|
|
|
|
|
5,840,550
|
|
|
|
ITEM 6 — EXHIBITS.
|
|
Executive Deferred Savings Plan II, as amended and restated as of January 1, 2020
|
|
|
Certification of Steven E. Rendle, Chairman, President and Chief Executive Officer, pursuant to 15 U.S.C. Section 10A, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
Certification of Scott A. Roe, Executive Vice President and Chief Financial Officer, pursuant to 15 U.S.C. Section 10A, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
Certification of Steven E. Rendle, Chairman, President and Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
Certification of Scott A. Roe, Executive Vice President and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
101.INS
|
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
104
|
|
Cover Page Interactive Data File - the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
|
|
V.F. CORPORATION
|
||
|
(Registrant)
|
||
|
|
|
|
|
By:
|
|
/s/ Scott A. Roe
|
|
|
|
Scott A. Roe
|
|
|
|
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
|
|
|
|
Date: February 4, 2020
|
By:
|
|
/s/ Bryan H. McNeill
|
|
|
|
Bryan H. McNeill
|
|
|
|
Vice President, Controller and Chief Accounting Officer
(Principal Accounting Officer)
|
/s/ Anita Z. Graham
|
Anita Z. Graham
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
February 4, 2020
|
/s/ Steven E. Rendle
|
|
Steven E. Rendle
|
|
Chairman, President and Chief Executive Officer
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
February 4, 2020
|
/s/ Scott A. Roe
|
|
Scott A. Roe
|
|
Executive Vice President and Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
February 4, 2020
|
/s/ Steven E. Rendle
|
|
Steven E. Rendle
|
|
Chairman, President and Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
February 4, 2020
|
/s/ Scott A. Roe
|
|
Scott A. Roe
|
|
Executive Vice President and Chief Financial Officer
|