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V.F. Corporation (NYSE:VFC) disclosed that it received a decision from the U.S. Court of Appeals for the First Circuit that upheld the U.S. Tax Court’s decision in favor of the Internal Revenue Service. The case involved the timing of income inclusion associated with V.F. Corporation’s acquisition of The Timberland Company in September of 2011.
The apparel manufacturing company said it is disappointed with the appeals court’s decision, as it believes the decision of the U.S. Tax Court was in error based on the technical merits.
As recently disclosed,V.F. Corporation (VFC) paid $875.7M related to the 2011 taxes and interest being disputed, which was recorded as an income tax receivable. As a result of the appeals court’s ruling, the net impact to V.F. Corporation’s (VFC) tax expense is estimated to be up to $730.0M, plus the reversal of accrued interest income of approximately $19.6M. The estimated non-cash increase in tax expense will be made during the second quarter of fiscal 2024. VFC said the decision has no impact on the company’s cash and debt outlook for fiscal year 2024.
Earnings snapshot: For the fiscal first quarter, the maker of North Face apparel reported non-GAAP EPS of -$0.15, which missed the average analyst estimate by $0.03. Revenue of $2.08B beat by $10M. For the full year, VFC expects EPS between $2.05 and $2.25 versus the consensus of $2.10. Revenue is expected to be modestly down to flat for the year, reflecting ongoing weakness in the wholesale business and a longer-than-anticipated turnaround for Vans. Free cash flow is expected to be in line with previous guidance of $900M.
Image and article originally from seekingalpha.com. Read the original article here.