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DISCONTINUED OPERATIONS | 3 Months Ended
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Mar. 31, 2018
Discontinued Operations and Disposal Groups [Abstract] |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS The Company continuously assesses the composition of our portfolio to ensure it is aligned with our strategic objectives and positioned to maximize growth and return to our shareholders. Nautica® Brand Business VF signed a definitive agreement for the sale of the Nautica® brand business on March 17, 2018, and completed the transaction on April 30, 2018. VF received cash proceeds of $289.1 million, which are subject to working capital and other adjustments. During the fourth quarter of 2017, the Company reached the strategic decision to exit the Nautica® brand business, and determined that it met the held-for-sale and discontinued operations accounting criteria. Accordingly, the Company began to report the results of the Nautica® brand business as discontinued operations in the Consolidated Statements of Income and present the related assets and liabilities as held-for-sale in the Consolidated Balance Sheets. These changes have been applied for all periods presented. The results of the Nautica® brand's North America business were previously reported in the former Sportswear coalition, and the results of the Asia business were previously reported in the Outdoor & Action Sports coalition. The results of the Nautica® brand business recorded in the loss from discontinued operations, net of tax line item in the Consolidated Statements of Income were losses of $8.4 million (including an $18.1 million increase in the estimated loss on sale) for the three months ended March 2018 and income of $1.4 million for the three months ended March 2017. Certain corporate overhead costs and coalition costs previously allocated to the Nautica® brand business for segment reporting purposes did not qualify for classification within discontinued operations and have been reallocated to continuing operations. Under the terms of the transition services agreement, the Company will provide certain support services for periods up to 12 months from the closing date of the transaction. Licensing Business In the first quarter of 2017, the Company reached the strategic decision to exit its Licensing Business, which comprised the Licensed Sports Group ("LSG") and the JanSport® brand collegiate businesses. Accordingly, the Company began to report the results of the businesses as discontinued operations in the Consolidated Statements of Income and present the related assets and liabilities as held-for-sale in the Consolidated Balance Sheets. These changes have been applied for all periods presented. LSG included the Majestic® brand and was previously reported within our Imagewear coalition. On April 28, 2017, VF completed the sale of LSG to Fanatics, Inc. The Company received proceeds of $213.5 million, net of cash sold, and recorded an after-tax loss on sale of $4.1 million, of which $1.4 million is included in the loss from discontinued operations, net of tax line item in the Consolidated Statements of Income for the three months ended March 2017. The LSG results recorded in the loss from discontinued operations, net of tax line item in the Consolidated Statements of Income were losses of $0.3 million (including the estimated loss on sale of $1.4 million) for the three months ended March 2017. In the fourth quarter of 2017, VF completed the sale of the assets associated with the JanSport® brand collegiate business, which was previously included within our Outdoor & Action Sports coalition. The Company received net proceeds of $1.5 million and recorded an after-tax loss on sale of $0.2 million, of which $1.0 million is included in the loss from discontinued operations, net of tax line item in the Consolidated Statements of Income for the three months ended March 2017. The JanSport® brand collegiate results recorded in the loss from discontinued operations, net of tax line item in the Consolidated Statements of Income were losses of $5.2 million (including the estimated loss on sale of $1.0 million) for the three months ended March 2017. Certain corporate overhead and other costs previously allocated to the Licensing Business for segment reporting purposes do not qualify for classification within discontinued operations and have been reallocated to continuing operations. Under the terms of the transition services agreement, the Company is providing certain support services for periods ranging from three to 24 months from the closing date of the transaction. Revenue and expense items associated with the transition services are primarily recorded in the Imagewear coalition. Summarized Discontinued Operations Financial Information The following table summarizes the major line items for the Nautica® brand business and the Licensing Business that are included in the loss from discontinued operations, net of tax line item in the Consolidated Statements of Income:
|  | Three Months Ended March
(In thousands) |  | 2018 |  |  | 2017
Revenues |  | $ | 94,362 |  |  |  | $ | 202,667 |
Cost of goods sold |  | 48,946 |  |  |  | 131,301 |
Selling, general and administrative expenses |  | 34,649 |  |  |  | 62,073 |
Interest expense, net |  | — |  |  |  | (17 | )
Income from discontinued operations before income taxes |  | 10,767 |  |  |  | 9,276 |
Loss on the sale of discontinued operations before income taxes |  | (18,065 | ) |  |  | (3,531 | )
Total income (loss) from discontinued operations before income taxes |  | (7,298 | ) |  |  | 5,745 |
Income tax expense (a) |  | (1,073 | ) |  |  | (9,858 | )
Loss from discontinued operations, net of tax |  | $ | (8,371 | ) |  |  | $ | (4,113 | )
(a) | The 2018 adjustment to the estimated loss on sale related to the Nautica® brand business was nondeductible for income tax purposes. Income tax expense for the three months ended March 2017 includes $7.5 million of deferred tax expense related to GAAP and tax basis differences for LSG.
The following table summarizes the carrying amounts of major classes of assets and liabilities of discontinued operations for each of the periods presented:
(In thousands) |  | March 2018 |  |  | December 2017 (c) |  | March 2017 (c)
Cash |  | $ | 2,330 |  |  |  | $ | 2,592 |  |  | $ | 1,182 |
Accounts receivable, net |  | 26,298 |  |  |  | 27,941 |  |  | 56,208 |
Inventories |  | 55,610 |  |  |  | 43,297 |  |  | 146,768 |
Other current assets |  | 1,247 |  |  |  | 2,497 |  |  | 15,778 |
Property, plant and equipment, net |  | 15,021 |  |  |  | 14,914 |  |  | 28,495 |
Intangible assets |  | 262,202 |  |  |  | 262,352 |  |  | 305,509 |
Goodwill |  | 49,005 |  |  |  | 49,005 |  |  | 182,292 |
Other assets |  | 3,961 |  |  |  | 3,631 |  |  | 3,835 |
Allowance to reduce assets to estimated fair value, less costs to sell |  | (42,094 | ) |  |  | (25,529 | ) |  | — |
Total assets of discontinued operations (a) |  | $ | 373,580 |  |  |  | $ | 380,700 |  |  | $ | 740,067 |
Accounts payable |  | $ | 11,619 |  |  |  | $ | 16,993 |  |  | $ | 34,197 |
Accrued liabilities |  | 10,658 |  |  |  | 18,203 |  |  | 15,726 |
Other liabilities |  | 11,912 |  |  |  | 12,011 |  |  | 13,184 |
Deferred income tax liabilities (b) |  | 51,838 |  |  |  | 53,812 |  |  | 73,651 |
Total liabilities of discontinued operations (a) |  | $ | 86,027 |  |  |  | $ | 101,019 |  |  | $ | 136,758 |
(a) | Amounts at March 2017 have been classified as current and long-term in the Consolidated Balance Sheets.
(b) | Deferred income tax balances reflect VF’s consolidated netting by jurisdiction.
(c) | Certain assets and liabilities previously reported as discontinued operations will be retained by VF based on the terms of the definitive sale agreement, and thus have been removed from discontinued operations for all periods presented. The impact was not material to any periods presented.
The cash flows related to discontinued operations have not been segregated, and are included in the Consolidated Statements of Cash Flows. There were no significant capital expenditures and operating noncash items for any periods presented. Depreciation and amortization expense was $5.6 million for the three months ended March 2017.

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- Definition The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI http://asc.fasb.org/topic&trid=2155823 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 + Details
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