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

Annual report pursuant to Section 13 and 15(d)

RESTRUCTURING

RESTRUCTURING

12 Months Ended

Mar. 30, 2024

Restructuring and Related Activities [Abstract]

The Company incurs restructuring charges related to strategic initiatives and cost optimization of business activities. Beginning in the third quarter of Fiscal 2024, restructuring costs include charges related to Reinvent, a transformation program to enhance focus on brand-building and to improve operating performance and allow VF to achieve its full potential. The Company currently estimates it will incur approximately $130.0 million to $150.0 million in restructuring and restructuring-related charges in connection with Reinvent, and that substantially all actions will be completed by the end of Fiscal 2025. Of the total estimated charges, the Company anticipates that more than one-half will relate to severance and employee-related benefits and the remainder will relate to asset impairments and other non-cash write-downs. Cash payments are generally expected to be paid within one year of charges

incurred. During the year ended March 2024, VF recorded $108.7 million of charges in connection with Reinvent, of which $69.3 million related to severance and employee-related benefits and $39.4 million related to non-cash asset write-downs. As of March 2024, $19.0 million of cash payments related to the Reinvent charges have been made.

During the years ended March 2024, 2023 and 2022, VF recognized $110.7 million, $75.7 million and $20.0 million, respectively, of total restructuring charges related to approved initiatives. Of the restructuring charges recognized in the year ended March 2024, $106.2 million were reflected in selling, general and administrative expenses and $4.5 million in cost of goods sold. Of the restructuring charges recognized in the year ended March 2023, $70.9 million were reflected in selling,

general and administrative expenses and $4.8 million in cost of goods sold. Of the restructuring charges recognized in the year ended March 2022, $18.3 million were reflected in selling, general and administrative expenses and $1.7 million in cost of goods sold. The Company has not recognized any significant incremental costs related to the accruals for the year ended March 2023 or prior periods.

Of the total restructuring accrual at March 2024, $52.5 million is expected to be paid out within the next 12 months and is classified within accrued liabilities (Note 14). The remaining $8.2 million will be paid out beyond the next 12 months and thus is classified within other liabilities.

The components of the restructuring charges are as follows:


	Year Ended March

(In thousands)	2024		2023		2022
Severance and employee-related benefits	$	70,008	$	57,433	$	12,283
Asset impairments and write-downs	39,386		—		—
Accelerated depreciation	—		8,016		7,016

Contract termination and other	1,326		10,289		703
Total restructuring charges	$	110,720	$	75,738	$	20,002

Restructuring costs by business segment are as follows:


	Year Ended March

(In thousands)	2024		2023		2022
Outdoor	$	242	$	1,088	$	4,523
Active	434		1,478		1,008
Work	—		9		2,315
Corporate and other	110,044		73,163		12,156
Total	$	110,720	$	75,738	$	20,002

The activity in the restructuring accrual was as follows:


(In thousands)	Severance		Other		Total
Accrual at March 2022	$	25,640	$	1,211	$	26,851
Charges	57,433		5,190		62,623

Cash payments and settlements	(41,338)		(345)		(41,683)
Adjustments to accruals	(3,236)		40		(3,196)
Impact of foreign currency	222		449		671
Accrual at March 2023	38,721		6,545		45,266
Charges	70,008		—		70,008
Cash payments and settlements	(42,684)		(5,923)		(48,607)
Adjustments to accruals	(5,660)		(287)		(5,947)
Impact of foreign currency	(54)		10		(44)
Accrual at March 2024	$	60,331	$	345	$	60,676