VF Corporation Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

DISCONTINUED OPERATIONS

DISCONTINUED OPERATIONS

12 Months Ended

Apr. 01, 2023

Discontinued Operations and Disposal Groups [Abstract]

The Company continuously assesses the composition of its portfolio to ensure it is aligned with its strategic objectives and positioned to maximize growth and return to shareholders.

Occupational Workwear Business

On January 21, 2020, VF announced its decision to explore the divestiture of its Occupational Workwear business. The Occupational Workwear business was comprised primarily of the following brands and businesses: Red Kap®, VF Solutions®, Bulwark®, Workrite®, Walls®, Terra®, Kodiak®, Work Authority® and Horace Small®. The business also included the license of certain Dickies® occupational workwear products that have historically been sold through the business-to-business channel. As of March 28, 2020, the Occupational Workwear business met the held-for-sale and discontinued operations accounting criteria. Accordingly, the Company has reported the results of the Occupational Workwear business and the related cash flows as discontinued operations in the Consolidated Statements of Operations and Consolidated Statements of Cash Flows, respectively, through the date of sale.

On June 28, 2021, VF completed the sale of the Occupational Workwear business. The Company has received proceeds of $616.9 million, net of cash sold, resulting in a final after-tax gain on sale of $146.0 million, which was included in the income from discontinued operations, net of tax line item in the Consolidated Statement of Operations for the year ended March 2022.

The results of the Occupational Workwear business were previously reported in the Work segment. The results of the Occupational Workwear business recorded in the income from discontinued operations, net of tax line item in the Consolidated Statements of Operations were income of $170.7 million (including a final after-tax gain on sale of $146.0 million) and income of $53.0 million for the years ended March 2022 and 2021, respectively.

Under the terms of a transition services agreement, the Company will provide certain support services for periods generally between 12 and 27 months from the closing date of the transaction.

Summarized Discontinued Operations Financial Information

The following table summarizes the major line items for the Occupational Workwear business that are included in the income from discontinued operations, net of tax line item in the Consolidated Statements of Operations:


	Year Ended March

(In thousands)	2023 (a)		2022		2021
Net revenues	$	—	$	181,424	$	671,574
Cost of goods sold	—		117,193		471,652
Selling, general and administrative expenses	—		38,735		143,259
Interest income, net	—		194		312
Other income (expense), net	—		6		365
Income from discontinued operations before income taxes	—		25,696		57,340
Gain on the sale of discontinued operations before income taxes	—		133,970		—
Total income from discontinued operations before income taxes	—		159,666		57,340
Income tax expense (benefit) (b)	—		(11,006)		4,377
Income from discontinued operations, net of tax	$	—	$	170,672	$	52,963

(a)There was no activity during the year ended March 2023.

(b)Income tax benefit for the year ended March 2022 included $12.0 million of deferred tax benefit related to capital and other losses realized upon the sale of the Occupational Workwear business.