Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Jun. 27, 2020 | Jul. 31, 2020 | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 27, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-13057 | |
Entity Registrant Name | Ralph Lauren Corporation | |
Entity Central Index Key | 0001037038 | |
Current Fiscal Year End Date | --03-27 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 13-2622036 | |
Entity Address, Address Line One | 650 Madison Avenue, | |
Entity Address, City or Town | New York, | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10022 | |
City Area Code | 212 | |
Local Phone Number | 318-7000 | |
Title of 12(b) Security | Class A Common Stock, $.01 par value | |
Trading Symbol | RL | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Class A common stock | ||
Entity Common Stock, Shares Outstanding | 48,163,405 | |
Class B common stock | ||
Entity Common Stock, Shares Outstanding | 24,881,276 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions | Jun. 27, 2020 | Mar. 28, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 2,451.3 | $ 1,620.4 |
Short-term investments | 259.3 | 495.9 |
Accounts receivable, net of allowances of $239.9 million and $276.2 million | 108.7 | 277.1 |
Inventories | 773.2 | 736.2 |
Income tax receivable | 63.9 | 84.8 |
Prepaid expenses and other current assets | 200.6 | 160.8 |
Total current assets | 3,857 | 3,375.2 |
Property and equipment, net | 945.8 | 979.5 |
Operating lease right-of-use assets | 1,464.1 | 1,511.6 |
Deferred tax assets | 309.5 | 245.2 |
Goodwill | 921.9 | 915.5 |
Intangible assets, net | 136.1 | 141 |
Other non-current assets | 106 | 111.9 |
Total assets | 7,740.4 | 7,279.9 |
Current liabilities: | ||
Short-term debt | 0 | 475 |
Current portion of long-term debt | 299.9 | 299.6 |
Accounts payable | 144.2 | 246.8 |
Income tax payable | 70.9 | 65.1 |
Current operating lease liabilities | 314.7 | 288.4 |
Accrued expenses and other current liabilities | 657.2 | 717.1 |
Total current liabilities | 1,486.9 | 2,092 |
Long-term debt | 1,630.1 | 396.4 |
Long-term operating lease liabilities | 1,517.7 | 1,568.3 |
Income tax payable | 132.7 | 132.7 |
Non-current liability for unrecognized tax benefits | 91.7 | 88.9 |
Other non-current liabilities | 325.8 | 308.5 |
Commitments and contingencies (Note 13) | ||
Total liabilities | 5,184.9 | 4,586.8 |
Equity: | ||
Additional paid-in-capital | 2,609.5 | 2,594.4 |
Retained earnings | 5,866.3 | 5,994 |
Treasury stock, Class A, at cost; 57.8 million and 57.3 million shares | (5,812.3) | (5,778.4) |
Accumulated other comprehensive loss | (109.3) | (118.2) |
Total equity | 2,555.5 | 2,693.1 |
Total liabilities and equity | 7,740.4 | 7,279.9 |
Class A common stock, par value $.01 per share; 106.0 million and 104.9 million shares issued; 48.2 million and 47.6 million shares outstanding | ||
Equity: | ||
Common stock | 1 | 1 |
Class B common stock, par value $.01 per share; 24.9 million shares issued and outstanding | ||
Equity: | ||
Common stock | $ 0.3 | $ 0.3 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) shares in Millions, $ in Millions | Jun. 27, 2020 | Mar. 28, 2020 |
Allowance on accounts receivable | $ 239.9 | $ 276.2 |
Class A common stock, par value $.01 per share; 106.0 million and 104.9 million shares issued; 48.2 million and 47.6 million shares outstanding | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares issued | 106 | 104.9 |
Common stock, shares outstanding | 48.2 | 47.6 |
Treasury stock, shares | 57.8 | 57.3 |
Class B common stock, par value $.01 per share; 24.9 million shares issued and outstanding | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares issued | 24.9 | 24.9 |
Common stock, shares outstanding | 24.9 | 24.9 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Income Statement [Abstract] | ||
Net revenues | $ 487.5 | $ 1,428.8 |
Cost of goods sold | (138.8) | (508) |
Gross profit | 348.7 | 920.8 |
Other costs and expenses | ||
Selling, general, and administrative expenses | (507.6) | (746.7) |
Impairment of assets | (2.1) | (1.2) |
Restructuring and other charges | (7) | (29.6) |
Total other operating expenses, net | (516.7) | (777.5) |
Operating income (loss) | (168) | 143.3 |
Interest expense | (9.6) | (4.2) |
Interest income | 2.9 | 11.6 |
Other income (expense), net | 2.1 | (4.1) |
Income (loss) before income taxes | (172.6) | 146.6 |
Income tax benefit (provision) | 44.9 | (29.5) |
Net income (loss) | $ (127.7) | $ 117.1 |
Net income (loss) per common share: | ||
Basic | $ (1.75) | $ 1.50 |
Diluted | $ (1.75) | $ 1.47 |
Weighted average common shares outstanding: | ||
Basic | 73.1 | 78.2 |
Diluted | 73.1 | 79.9 |
Dividends declared per share | $ 0 | $ 0.6875 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ (127.7) | $ 117.1 |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||
Foreign currency translation gains | 13 | 4 |
Net losses on cash flow hedges | (4) | (9.7) |
Net losses on defined benefit plans | (0.1) | (0.1) |
Other comprehensive income (loss), net of tax | 8.9 | (5.8) |
Total comprehensive income (loss) | $ (118.8) | $ 111.3 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Cash flows from operating activities: | ||
Net income (loss) | $ (127.7) | $ 117.1 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation and amortization expense | 63.7 | 66.2 |
Deferred income tax benefit | (66.9) | (8.1) |
Non-cash stock-based compensation expense | 15.1 | 23 |
Non-cash impairment of assets | 2.1 | 1.2 |
Bad debt expense (benefit) | (16.5) | 0.1 |
Other non-cash benefits | 0 | (2) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 186.3 | 108.6 |
Inventories | (29) | (165.7) |
Prepaid expenses and other current assets | (37.4) | (48.8) |
Accounts payable and accrued liabilities | (119.2) | 82.9 |
Income tax receivables and payables | 35.2 | 13.3 |
Deferred income | 0.3 | 1.8 |
Other balance sheet changes | 23.7 | 7.8 |
Net cash provided by (used in) operating activities | (70.3) | 197.4 |
Cash flows from investing activities: | ||
Capital expenditures | (21.3) | (49.4) |
Purchases of investments | (63.6) | (173.5) |
Proceeds from sales and maturities of investments | 301.9 | 308.4 |
Acquisitions and ventures | 0 | 0.9 |
Proceeds from sale of property | 0 | 20.8 |
Settlement of net investment hedges | 3.7 | 0 |
Net cash provided by investing activities | 220.7 | 107.2 |
Cash flows from financing activities: | ||
Repayments of borrowings on credit facilities | (475) | 0 |
Proceeds from issuance of long-term debt | 1,241.9 | 0 |
Payments of finance lease obligations | (1.6) | (4.9) |
Payments of dividends | (49.8) | (48.8) |
Repurchases of common stock, including shares surrendered for tax withholdings | (33.9) | (191.1) |
Other financing activities | (8.5) | 0 |
Net cash provided by (used in) financing activities | 673.1 | (244.8) |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 7.6 | 5.1 |
Net increase in cash, cash equivalents, and restricted cash | 831.1 | 64.9 |
Cash, cash equivalents, and restricted cash at beginning of period | 1,629.8 | 626.5 |
Cash, cash equivalents, and restricted cash at end of period | $ 2,460.9 | $ 691.4 |
Consolidated Statements of Equi
Consolidated Statements of Equity (Unaudited) - USD ($) shares in Millions, $ in Millions | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Treasury Stock [Member] | AOCI [Member] | [2] | ||
Beginning balance, shares at Mar. 30, 2019 | 128.8 | [1] | 50.7 | ||||||
Beginning balance at Mar. 30, 2019 | $ 3,287.2 | $ 1.3 | [1] | $ 2,493.8 | $ 5,979.1 | $ (5,083.6) | $ (103.4) | ||
Comprehensive Income | |||||||||
Net income (loss) | 117.1 | 117.1 | |||||||
Other comprehensive income (loss) | (5.8) | (5.8) | |||||||
Total comprehensive income (loss) | 111.3 | ||||||||
Dividends declared | (53.1) | (53.1) | |||||||
Repurchases of common stock, shares | 1.7 | ||||||||
Repurchases of common stock | (191.1) | $ (191.1) | |||||||
Stock-based compensation | 23 | 23 | |||||||
Shares issued pursuant to stock-based compensation plans, shares | [1] | 0.8 | |||||||
Shares issued pursuant to stock-based compensation plans | 0 | $ 0 | [1] | 0 | |||||
Cumulative adjustment from adoption of new accounting standards | (164.5) | (164.5) | |||||||
Ending balance, shares at Jun. 29, 2019 | 129.6 | [1] | 52.4 | ||||||
Ending balance at Jun. 29, 2019 | 3,012.8 | $ 1.3 | [1] | 2,516.8 | 5,878.6 | $ (5,274.7) | (109.2) | ||
Beginning balance, shares at Mar. 28, 2020 | 129.8 | [1] | 57.3 | ||||||
Beginning balance at Mar. 28, 2020 | 2,693.1 | $ 1.3 | [1] | 2,594.4 | 5,994 | $ (5,778.4) | (118.2) | ||
Comprehensive Income | |||||||||
Net income (loss) | (127.7) | (127.7) | |||||||
Other comprehensive income (loss) | 8.9 | 8.9 | |||||||
Total comprehensive income (loss) | (118.8) | ||||||||
Dividends declared | 0 | 0 | |||||||
Repurchases of common stock, shares | 0.5 | ||||||||
Repurchases of common stock | (33.9) | $ (33.9) | |||||||
Stock-based compensation | 15.1 | 15.1 | |||||||
Shares issued pursuant to stock-based compensation plans, shares | [1] | 1.1 | |||||||
Shares issued pursuant to stock-based compensation plans | 0 | $ 0 | [1] | 0 | |||||
Ending balance, shares at Jun. 27, 2020 | 130.9 | [1] | 57.8 | ||||||
Ending balance at Jun. 27, 2020 | $ 2,555.5 | $ 1.3 | [1] | $ 2,609.5 | $ 5,866.3 | $ (5,812.3) | $ (109.3) | ||
[1] | (a) Includes Class A and Class B common stock. During the three months ended June 29, 2019 , 0.5 million shares of Class B common stock were converted into an equal number of shares of Class A common stock pursuant to the terms of the Class B common stock (see Note 14 ). | ||||||||
[2] | (b) Accumulated other comprehensive income (loss). |
Consolidated Statements of Eq_2
Consolidated Statements of Equity (Unaudited) (Parenthetical) shares in Millions | 3 Months Ended |
Jun. 29, 2019shares | |
Statement of Stockholders' Equity [Abstract] | |
Conversion of Stock, Shares Converted | 0.5 |
Description of Business
Description of Business | 3 Months Ended |
Jun. 27, 2020 | |
Description of Business [Abstract] | |
Description of Business | Description of Business Ralph Lauren Corporation ("RLC") is a global leader in the design, marketing, and distribution of premium lifestyle products, including apparel, footwear, accessories, home furnishings, fragrances, and hospitality. RLC's long-standing reputation and distinctive image have been developed across an expanding number of products, brands, sales channels, and international markets. RLC's brand names include Ralph Lauren, Ralph Lauren Collection, Ralph Lauren Purple Label, Polo Ralph Lauren, Double RL, Lauren Ralph Lauren, Polo Ralph Lauren Children, Chaps, and Club Monaco, among others. RLC and its subsidiaries are collectively referred to herein as the "Company," "we," "us," "our," and "ourselves," unless the context indicates otherwise. The Company diversifies its business by geography (North America, Europe, and Asia, among other regions) and channel of distribution (retail, wholesale, and licensing). This allows the Company to maintain a dynamic balance as its operating results do not depend solely on the performance of any single geographic area or channel of distribution. The Company sells directly to consumers through its integrated retail channel, which includes its retail stores, concession-based shop-within-shops, and digital commerce operations around the world. The Company's wholesale sales are made principally to major department stores, specialty stores, and third-party digital partners around the world, as well as to certain third-party-owned stores to which the Company has licensed the right to operate in defined geographic territories using its trademarks. In addition, the Company licenses to third parties for specified periods the right to access its various trademarks in connection with the licensees' manufacture and sale of designated products, such as certain apparel, eyewear, fragrances, and home furnishings. The Company organizes its business into the following three reportable segments: North America, Europe, and Asia. In addition to these reportable segments, the Company also has other non-reportable segments. See Note 17 for further discussion of the Company's segment reporting structure. |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Jun. 27, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Interim Financial Statements These interim consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the "SEC") and are unaudited. In the opinion of management, these consolidated financial statements contain all normal and recurring adjustments necessary to present fairly the consolidated financial position, income (loss), comprehensive income (loss), and cash flows of the Company for the interim periods presented. In addition, certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the U.S. ("U.S. GAAP") and the notes thereto have been condensed or omitted from this report as is permitted by the SEC's rules and regulations. However, the Company believes that the disclosures provided herein are adequate to prevent the information presented from being misleading. This report should be read in conjunction with the Company's Annual Report on Form 10-K filed with the SEC for the fiscal year ended March 28, 2020 (the "Fiscal 2020 10-K"). Basis of Consolidation These unaudited interim consolidated financial statements present the consolidated financial position, income (loss), comprehensive income (loss), and cash flows of the Company, including all entities in which the Company has a controlling financial interest and is determined to be the primary beneficiary. All significant intercompany balances and transactions have been eliminated in consolidation. Fiscal Periods The Company utilizes a 52-53 week fiscal year ending on the Saturday closest to March 31. As such, fiscal year 2021 will end on March 27, 2021 and will be a 52-week period ("Fiscal 2021 "). Fiscal year 2020 ended on March 28, 2020 and was also a 52-week period ("Fiscal 2020 "). The first quarter of Fiscal 2021 ended on June 27, 2020 and was a 13-week period. The first quarter of Fiscal 2020 ended on June 29, 2019 and was also a 13-week period. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and notes thereto. Actual results could differ materially from those estimates. Significant estimates inherent in the preparation of the consolidated financial statements include reserves for bad debt, customer returns, discounts, end-of-season markdowns, operational chargebacks, and certain cooperative advertising allowances; the realizability of inventory; reserves for litigation and other contingencies; useful lives and impairments of long-lived tangible and intangible assets; fair value measurements; accounting for income taxes and related uncertain tax positions; valuation of stock-based compensation awards and related forfeiture rates; reserves for restructuring activity; and accounting for business combinations, among others. Reclassifications Certain reclassifications have been made to prior period financial information in order to conform to the current period's presentation. Seasonality of Business The Company's business is typically affected by seasonal trends, with higher levels of retail sales in its second and third fiscal quarters and higher wholesale sales in its second and fourth fiscal quarters. These trends result primarily from the timing of key vacation travel, back-to-school, and holiday shopping periods impacting its retail business and the timing of seasonal wholesale shipments. As a result of changes in its business, consumer spending patterns, and the macroeconomic environment, including those resulting from disease pandemics and other catastrophic events, historical quarterly operating trends and working capital requirements may not be indicative of the Company's future performance. In addition, fluctuations in sales, operating income (loss), and cash flows in any fiscal quarter may be affected by other events affecting retail sales, such as changes in weather patterns. Accordingly, the Company's operating results and cash flows for the three-month period ended June 27, 2020 are not necessarily indicative of the operating results and cash flows that may be expected for the full Fiscal 2021 . COVID-19 Pandemic A novel strain of coronavirus commonly referred to as COVID-19 has spread rapidly across the globe in recent months, including throughout all major geographies in which the Company operates (North America, Europe, and Asia), resulting in adverse economic conditions and business disruptions, as well as significant volatility in global financial markets. Governments worldwide have imposed varying degrees of preventative and protective actions, such as temporary travel bans, forced business closures, and stay-at-home orders, all in an effort to reduce the spread of the virus. Such factors, among others, have resulted in a significant decline in retail traffic, tourism, and consumer spending on discretionary items. Additionally, during this period of uncertainty, companies across a wide array of industries have implemented various initiatives to reduce operating expenses and preserve cash balances, including work furloughs and reduced pay, which could lower consumers' disposable income levels or willingness to purchase discretionary items. Further, even after such government restrictions and company initiatives are lifted, consumer behavior, spending levels, and/or shopping preferences, such as willingness to congregate in shopping centers or other populated locations, could be adversely affected. In connection with the COVID-19 pandemic, the Company has experienced varying degrees of business disruptions and periods of closure of its stores, distribution centers, and corporate facilities, as have the Company's wholesale customers, licensing partners, suppliers, and vendors. During the first quarter of Fiscal 2021, the majority of the Company's stores in key markets were closed for an average of 8 to 10 weeks, resulting in significant adverse impacts to its operating results. Although nearly all of the Company's stores were reopened by the end of the first quarter of Fiscal 2021, the majority are operating at limited hours and customer capacity levels in accordance with local health guidelines, with traffic remaining challenged. The Company's wholesale business has also been adversely affected, particularly in North America and Europe, as a result of department store closures and lower traffic and consumer demand. Throughout the pandemic, the Company's priority has been to ensure the safety and well-being of its employees, consumers, and the communities in which it operates around the world. The Company continues to take into account the guidance of local governments and global health organizations and has implemented new health and safety protocols in its stores, distribution centers, and corporate facilities. The Company has also taken various preemptive actions to preserve cash and strengthen its liquidity position, including: • amending its Global Credit Facility in May 2020 to temporarily waive its leverage ratio requirement (see Note 10 ); • issuing $1.250 billion of unsecured senior notes in June 2020, the proceeds of which are being used for general corporate purposes (see Note 10 ); • temporarily suspending its quarterly cash dividend and common stock repurchase program, effective beginning in the first quarter of Fiscal 2021 (see Note 14 ); • temporarily reducing the base compensation of its executives and senior management team, as well as its Board of Directors, for the first quarter of Fiscal 2021; • temporarily furloughing or reducing work hours for a significant portion of its employees, who nevertheless remain eligible to receive employee benefits during such period; • carefully managing its expense structure across all key areas of spend, including aligning inventory levels with anticipated demand, negotiating rent abatements with certain of its landlords, and postponing non-critical capital build-out and other investments and activities; • pursuing relevant government subsidy programs related to COVID-19 business disruptions; and • improving upon its cash conversion cycle largely driven by its accounts receivable collection efforts and extended vendor payment terms. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Jun. 27, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Revenue Recognition The Company recognizes revenue across all channels of the business when it satisfies its performance obligations by transferring control of promised products or services to its customers, which occurs either at a point in time or over time, depending on when the customer obtains the ability to direct the use of and obtain substantially all of the remaining benefits from the products or services. The amount of revenue recognized considers terms of sale that create variability in the amount of consideration that the Company ultimately expects to be entitled to in exchange for the products or services, and is subject to an overall constraint that a significant revenue reversal will not occur in future periods. Sales and other related taxes collected from customers and remitted to government authorities are excluded from revenue. Revenue from the Company's retail business is recognized when the customer takes physical possession of the products, which occurs either at the point of sale for merchandise purchased at the Company's retail stores and concession-based shop-within-shops, or upon receipt of shipment for merchandise ordered through direct-to-consumer digital commerce sites. Such revenues are recorded net of estimated returns based on historical trends. Payment is due at the point of sale. Gift cards issued to customers by the Company are recorded as a liability until they are redeemed, at which point revenue is recognized. The Company also estimates and recognizes revenue for gift card balances not expected to ever be redeemed (referred to as "breakage") to the extent that it does not have a legal obligation to remit the value of such unredeemed gift cards to the relevant jurisdiction as unclaimed or abandoned property. Such estimates are based upon historical redemption trends, with breakage income recognized in proportion to the pattern of actual customer redemptions. Revenue from the Company's wholesale business is generally recognized upon shipment of products, at which point title passes and risk of loss is transferred to the customer. In certain arrangements where the Company retains the risk of loss during shipment, revenue is recognized upon receipt of products by the customer. Wholesale revenue is recorded net of estimates of returns, discounts, end-of-season markdowns, operational chargebacks, and certain cooperative advertising allowances. Returns and allowances require pre-approval from management and discounts are based on trade terms. Estimates for end-of-season markdown reserves are based on historical trends, actual and forecasted seasonal results, an evaluation of current economic and market conditions, retailer performance, and, in certain cases, contractual terms. Estimates for operational chargebacks are based on actual customer notifications of order fulfillment discrepancies and historical trends. The Company reviews and refines these estimates on at least a quarterly basis. The Company's historical estimates of these amounts have not differed materially from actual results. Revenue from the Company's licensing arrangements is recognized over time during the period that licensees are provided access to the Company's trademarks (i.e., symbolic intellectual property) and benefit from such access through their sales of licensed products. These arrangements require licensees to pay a sales-based royalty which, for most arrangements, may be subject to a contractually-guaranteed minimum royalty amount. Payments are generally due quarterly and, depending on time of receipt, may be recorded as a liability until recognized as revenue. The Company recognizes revenue for sales-based royalty arrangements (including those for which the royalty exceeds any contractually-guaranteed minimum royalty amount) as licensed products are sold by the licensee. If a sales-based royalty is not ultimately expected to exceed a contractually-guaranteed minimum royalty amount, the minimum is generally recognized as revenue ratably over the respective contractual period. This sales-based output measure of progress and pattern of recognition best represents the value transferred to the licensee over the term of the arrangement, as well as the amount of consideration that the Company is entitled to receive in exchange for providing access to its trademarks. As of June 27, 2020 , contractually-guaranteed minimum royalty amounts expected to be recognized as revenue during future periods were as follows: Contractually-Guaranteed Minimum Royalties (a) (millions) Remainder of Fiscal 2021 $ 56.7 Fiscal 2022 67.3 Fiscal 2023 43.6 Fiscal 2024 26.6 Fiscal 2025 and thereafter 1.1 Total $ 195.3 (a) Amounts presented do not contemplate anticipated contract renewals or royalties earned in excess of the contractually-guaranteed minimums. Disaggregated Net Revenues The following tables disaggregate the Company's net revenues into categories that depict how the nature, amount, timing, and uncertainty of revenues and cash flows are affected by economic factors for the fiscal periods presented: Three Months Ended June 27, 2020 June 29, 2019 North America Europe Asia Other Total North America Europe Asia Other Total (millions) Sales Channel (a) : Retail $ 142.6 $ 79.2 $ 166.5 $ 6.5 $ 394.8 $ 403.1 $ 218.5 $ 246.5 $ 49.5 $ 917.6 Wholesale 22.5 41.5 5.4 0.5 69.9 316.3 142.3 12.1 1.8 472.5 Licensing — — — 22.8 22.8 — — — 38.7 38.7 Total $ 165.1 $ 120.7 $ 171.9 $ 29.8 $ 487.5 $ 719.4 $ 360.8 $ 258.6 $ 90.0 $ 1,428.8 (a) Net revenues from the Company's retail and wholesale businesses are recognized at a point in time. Net revenues from the Company's licensing business are recognized over time. Deferred Income Deferred income represents cash payments received in advance of the Company's transfer of control of products or services to its customers and is generally comprised of unredeemed gift cards, net of breakage, and advance royalty payments from licensees. The Company's deferred income balances were $15.1 million and $14.6 million as of June 27, 2020 and March 28, 2020 , respectively, and were primarily recorded within accrued expenses and other current liabilities within the consolidated balance sheets. During the three months ended June 27, 2020 , the Company recognized $3.4 million of net revenues from amounts recorded as deferred income as of March 28, 2020 . The majority of the deferred income balance as of June 27, 2020 is expected to be recognized as revenue within the next twelve months. Shipping and Handling Costs Costs associated with shipping goods to the Company's customers are accounted for as fulfillment activities and reflected as a component of selling, general, and administrative ("SG&A") expenses in the consolidated statements of operations. Costs of preparing merchandise for sale, such as picking, packing, warehousing, and order charges ("handling costs"), are also included in SG&A expenses. Shipping and handling costs billed to customers are included in revenue. A summary of shipping and handling costs for the fiscal periods presented is as follows: Three Months Ended June 27, June 29, (millions) Shipping costs $ 8.4 $ 9.9 Handling costs 26.5 36.2 Net Income (Loss) per Common Share Basic net income (loss) per common share is computed by dividing net income (loss) attributable to common shares by the weighted-average number of common shares outstanding during the period. Weighted-average common shares include shares of the Company's Class A and Class B common stock. Diluted net income (loss) per common share adjusts basic net income (loss) per common share for the dilutive effects of outstanding restricted stock units ("RSUs"), stock options, and any other potentially dilutive instruments, only in the periods in which such effects are dilutive. The weighted-average number of common shares outstanding used to calculate basic net income (loss) per common share is reconciled to shares used to calculate diluted net income (loss) per common share as follows: Three Months Ended June 27, June 29, (millions) Basic shares 73.1 78.2 Dilutive effect of RSUs and stock options — (a) 1.7 Diluted shares 73.1 79.9 (a) Incremental shares of 1.6 million attributable to outstanding RSUs were excluded from the computation of diluted shares for the three months ended June 27, 2020 , as such shares would not be dilutive as a result of the net loss incurred. All earnings per share amounts have been calculated using unrounded numbers. The Company has outstanding performance-based and market-based RSUs, which are included in the computation of diluted shares only to the extent that the underlying performance or market conditions (i) have been satisfied as of the end of the reporting period or (ii) would be considered satisfied if the end of the reporting period were the end of the related contingency period and the result would be dilutive. In addition, options to purchase shares of the Company's Class A common stock at an exercise price greater than the average market price of the common stock during the reporting period are anti-dilutive and therefore not included in the computation of diluted net income (loss) per common share. As of June 27, 2020 and June 29, 2019 , there were 0.8 million and 1.0 million , respectively, of additional shares issuable contingent upon vesting of performance-based RSUs and upon exercise of anti-dilutive stock options, that were excluded from the diluted shares calculations. Accounts Receivable In the normal course of business, the Company extends credit to wholesale customers that satisfy defined credit criteria. Payment is generally due within 30 to 120 days and does not include a significant financing component. Accounts receivable is recorded at amortized cost, which approximates fair value, and is presented in the Company's consolidated balance sheets net of certain reserves and allowances. These reserves and allowances consist of (i) reserves for returns, discounts, end-of-season markdowns, operational chargebacks, and certain cooperative advertising allowances (see the " Revenue Recognition " section above for further discussion of related accounting policies) and (ii) allowances for doubtful accounts. A rollforward of the activity in the Company's reserves for returns, discounts, end-of-season markdowns, operational chargebacks, and certain cooperative advertising allowances is presented below: Three Months Ended June 27, June 29, (millions) Beginning reserve balance $ 204.7 $ 176.5 Amount charged against revenue to increase reserve 11.3 113.9 Amount credited against customer accounts to decrease reserve (33.9 ) (125.9 ) Foreign currency translation 1.9 1.0 Ending reserve balance $ 184.0 $ 165.5 An allowance for doubtful accounts is determined through analysis of accounts receivable aging, assessments of collectability based on evaluation of historical trends, the financial condition of the Company's customers and their ability to withstand prolonged periods of adverse economic conditions, and evaluation of the impact of current and forecasted economic and market conditions over the related asset's contractual life, among other factors. The Company's estimated allowance for doubtful accounts as of June 27, 2020 reflects adverse impacts associated with COVID-19 business disruptions, which include temporary department and specialty store closures worldwide, as well as declines in retail traffic, tourism, and consumer spending on discretionary items. A rollforward of the activity in the Company's allowance for doubtful accounts is presented below: Three Months Ended June 27, June 29, (millions) Beginning reserve balance $ 71.5 $ 15.7 Amount recorded to expense to increase (decrease) reserve (a) (16.5 ) 0.1 Amount written-off against customer accounts to decrease reserve — (1.0 ) Foreign currency translation 0.9 0.2 Ending reserve balance $ 55.9 $ 15.0 (a) Amounts recorded to bad debt expense are included within SG&A expenses in the consolidated statements of operations. Concentration of Credit Risk The Company sells its wholesale merchandise primarily to major department stores, specialty stores, and third-party digital partners around the world, and extends credit based on an evaluation of each customer's financial capacity and condition, usually without requiring collateral. In the Company's wholesale business, concentration of credit risk is relatively limited due to the large number of customers and their dispersion across many geographic areas. However, the Company has three key wholesale customers that generate significant sales volume. During Fiscal 2020 , the Company's sales to its three largest wholesale customers accounted for approximately 18% of total net revenues. Substantially all of the Company's sales to its three largest wholesale customers related to its North America segment. As of June 27, 2020 , these three key wholesale customers constituted approximately 16% of total gross accounts receivable. Inventories The Company holds inventory that is sold in its retail stores and digital commerce sites directly to consumers. The Company also holds inventory that is sold through wholesale distribution channels to major department stores, specialty stores, and third-party digital partners. Substantially all of the Company's inventories consist of finished goods, which are stated at the lower of cost or estimated realizable value, with cost determined on a weighted-average cost basis. Inventory held by the Company totaled $773.2 million , $736.2 million , and $988.6 million as of June 27, 2020 , March 28, 2020 , and June 29, 2019 , respectively. Implementation Costs Incurred in Cloud Computing Arrangements For cloud computing arrangements that are a service contract, the Company capitalizes certain implementation costs incurred (depending on their nature) during the application development stage of the related project, and expenses costs during the preliminary project and post-implementation stages as they are incurred. Capitalized implementation costs are expensed on a straight-line basis over the reasonably certain term of the hosting arrangement, beginning when the module is ready for its intended use. The Company's cloud computing arrangements relate to various areas, including certain retail store and digital commerce operations, and corporate and administrative functions. Capitalized amounts related to such arrangements are recorded within prepaid expenses and other current assets and within other non-current assets in the consolidated balance sheets (see Note 6 ). Capitalized implementation costs expensed during the three-month periods ended June 27, 2020 and June 29, 2019 were $2.5 million and $0.8 million , respectively, and were recorded in SG&A expenses in the consolidated statements of operations. See Note 4 for further discussion of the Company's adoption of a new accounting standard related to implementation costs incurred in connection with cloud computing arrangements that are a service contract as of the beginning of Fiscal 2021. Derivative Financial Instruments The Company records derivative financial instruments on its consolidated balance sheets at fair value. Changes in the fair value of derivative instruments that are designated and qualify for hedge accounting are either (i) offset through earnings against the changes in fair value of the related hedged assets, liabilities, or firm commitments or (ii) recognized in equity as a component of accumulated other comprehensive income (loss) ("AOCI") until the hedged item is recognized in earnings, depending on whether the instrument is hedging against changes in fair value or cash flows and net investments, respectively. Each derivative instrument that qualifies for hedge accounting is expected to be highly effective in offsetting the risk associated with the related exposure. For each instrument that is designated as a hedge, the Company documents the related risk management objective and strategy, including identification of the hedging instrument, the hedged item, and the risk exposure, as well as how hedge effectiveness will be assessed over the instrument's term. To assess hedge effectiveness at the inception of a hedging relationship, the Company generally uses regression analysis, a statistical method, to compare changes in the fair value of the derivative instrument to changes in the fair value or cash flows of the related hedged item. The extent to which a hedging instrument has been and is expected to remain highly effective in achieving offsetting changes in fair value or cash flows is assessed by the Company on at least a quarterly basis. Given its use of derivative instruments, the Company is exposed to the risk that counterparties to such contracts will fail to meet their contractual obligations. To mitigate such counterparty credit risk, the Company has a policy of only entering into contracts with carefully selected financial institutions based upon an evaluation of their credit ratings and certain other factors, adhering to established limits for credit exposure. The Company's established policies and procedures for mitigating credit risk from derivative transactions include ongoing review and assessment of its counterparties' creditworthiness. The Company also enters into master netting arrangements with counterparties, when possible, to further mitigate credit risk. In the event of default or termination (as such terms are defined within the respective master netting arrangement), these arrangements allow the Company to net-settle amounts payable and receivable related to multiple derivative transactions with the same counterparty. The master netting arrangements specify a number of events of default and termination, including the failure to make timely payments. The fair values of the Company's derivative instruments are recorded on its consolidated balance sheets on a gross basis. For cash flow reporting purposes, proceeds received or amounts paid upon the settlement of a derivative instrument are classified in the same manner as the related item being hedged, primarily within cash flows from operating activities for its forward foreign exchange contracts and within cash flows from investing activities for its cross-currency swap contracts, both as discussed below. Cash Flow Hedges The Company uses forward foreign currency exchange contracts to mitigate its risk related to exchange rate fluctuations on inventory transactions made in an entity's non-functional currency. To the extent designated as cash flow hedges, related gains or losses on such instruments are initially deferred in equity as a component of AOCI and are subsequently recognized within cost of goods sold in the consolidated statements of operations when the related inventory is sold. If a derivative instrument is dedesignated or if hedge accounting is discontinued because the instrument is not expected to be highly effective in hedging the designated exposure, any further gains (losses) are recognized in earnings each period within other income (expense), net. Upon discontinuance of hedge accounting, the cumulative change in fair value of the derivative instrument recorded in AOCI is recognized in earnings when the related hedged item affects earnings, consistent with the hedging strategy, unless the related forecasted transaction is probable of not occurring, in which case the accumulated amount is immediately recognized within other income (expense), net. Hedges of Net Investments in Foreign Operations The Company periodically uses cross-currency swap contracts to reduce risk associated with exchange rate fluctuations on certain of its net investments in foreign subsidiaries. Changes in the fair values of such derivative instruments that are designated as hedges of net investments in foreign operations are recorded in equity as a component of AOCI in the same manner as foreign currency translation adjustments. In assessing the effectiveness of such hedges, the Company uses a method based on changes in spot rates to measure the impact of foreign currency exchange rate fluctuations on both its foreign subsidiary net investment and the related hedging instrument. Under this method, changes in the fair value of the hedging instrument other than those due to changes in the spot rate are initially recorded in AOCI as a translation adjustment and are amortized into earnings as interest expense using a systematic and rational method over the instrument's term. Changes in fair value associated with the effective portion (i.e., those due to changes in the spot rate) are recorded in AOCI as a translation adjustment and are released and recognized in earnings only upon the sale or liquidation of the hedged net investment. Fair Value Hedges Changes in the fair value of a derivative instrument that is designated as a fair value hedge, along with offsetting changes in the fair value of the related hedged item attributable to the hedged risk, are recorded in earnings. To the extent that the change in the fair value of the hedged item does not fully offset the change in the fair value of the hedging instrument, the resulting net impact is reflected in earnings within the income statement line item associated with the hedged item. Undesignated Hedges The Company uses undesignated hedges primarily to hedge foreign currency exchange rate risk related to third-party and intercompany balances and exposures. Changes in the fair value of undesignated derivative instruments are recognized in earnings each period within other income (expense), net. See Note 12 for further discussion of the Company's derivative financial instruments. Refer to Note 3 of the Fiscal 2020 10-K for a summary of all of the Company's significant accounting policies. |
Recently Issued Accounting Stan
Recently Issued Accounting Standards | 3 Months Ended |
Jun. 27, 2020 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Recently Issued Accounting Standards | Recently Issued Accounting Standards Implementation Costs Incurred in Cloud Computing Arrangements In August 2018, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2018-15, "Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract" ("ASU 2018-15"). ASU 2018-15 addresses diversity in practice surrounding the accounting for costs incurred to implement a cloud computing hosting arrangement that is a service contract by establishing a model for capitalizing or expensing such costs, depending on their nature and the stage of the related project during which they are incurred. Any capitalized costs are to be expensed over the reasonably certain term of the hosting arrangement and presented in the same line within the statement of operations as the expense for the arrangement's fees. ASU 2018-15 also requires enhanced qualitative and quantitative disclosures surrounding hosting arrangements that are service contracts. The Company adopted ASU 2018-15 as of the beginning of Fiscal 2021. Prior to adoption, the Company had already generally accounted for implementation costs incurred in connection with cloud computing arrangements in a manner consistent with the new standard. Therefore, other than the new disclosure requirements, the adoption of ASU 2018-15 did not have an impact on the Company's consolidated financial statements. See Note 3 for further discussion of the Company's accounting for cloud computing arrangements. Measurement of Credit Losses on Financial Instruments In June 2016, the FASB issued ASU No. 2016-13, "Measurement of Credit Losses on Financial Instruments" ("ASU 2016-13"). ASU 2016-13, which was further updated and clarified by the FASB through issuance of additional related ASUs, amends the guidance surrounding measurement and recognition of credit losses on financial assets measured at amortized cost, including trade receivables and investments in certain debt securities, by requiring upfront recognition of an allowance for credit losses expected to be incurred over an asset's contractual life based on relevant information about past events, current conditions, and supportable forecasts impacting its ultimate collectability. It is expected that application of this "expected loss" model will result in earlier recognition of credit losses than the current "as incurred" model, under which losses are recognized only upon occurrence of an event that gives rise to the incurrence of a probable loss. While the Company's historical bad debt write-off activity has generally been insignificant, similar to current practice, the extent of losses ultimately recognized will depend on prevailing conditions and ongoing consideration of information and forecasts that inform assessments of collectability. The Company adopted ASU 2016-13 as of the beginning of Fiscal 2021 using the modified retrospective basis. Overall, the adoption of ASU 2016-13 did not have a material impact on the Company's consolidated financial statements. |
Property and Equipment
Property and Equipment | 3 Months Ended |
Jun. 27, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment, net consists of the following: June 27, March 28, (millions) Land and improvements $ 15.3 $ 15.3 Buildings and improvements 311.6 309.0 Furniture and fixtures 637.7 629.5 Machinery and equipment 383.2 378.8 Capitalized software 547.4 543.3 Leasehold improvements 1,213.6 1,194.5 Construction in progress 33.0 37.5 3,141.8 3,107.9 Less: accumulated depreciation (2,196.0 ) (2,128.4 ) Property and equipment, net $ 945.8 $ 979.5 Depreciation expense was $58.5 million and $60.3 million during the three-month periods ended June 27, 2020 and June 29, 2019 , respectively, and is recorded primarily within SG&A expenses in the consolidated statements of operations. |
Other Assets and Liabilities
Other Assets and Liabilities | 3 Months Ended |
Jun. 27, 2020 | |
Balance Sheet Related Disclosures [Abstract] | |
Other Assets and Liabilities | Other Assets and Liabilities Prepaid expenses and other current assets consist of the following: June 27, March 28, (millions) Prepaid inventory $ 41.8 $ 0.2 Non-trade receivables 32.8 27.0 Other taxes receivable 22.3 24.7 Prepaid software maintenance 15.7 14.8 Inventory return asset 10.5 8.9 Cloud computing arrangement implementation costs 9.3 8.4 Prepaid advertising and marketing 7.1 10.1 Prepaid occupancy expense 5.8 6.7 Derivative financial instruments 3.7 13.7 Other prepaid expenses and current assets 51.6 46.3 Total prepaid expenses and other current assets $ 200.6 $ 160.8 Other non-current assets consist of the following: June 27, March 28, (millions) Derivative financial instruments $ 42.9 $ 48.6 Security deposits 29.2 29.4 Restricted cash 8.2 8.0 Cloud computing arrangement implementation costs 5.1 4.9 Other non-current assets 20.6 21.0 Total other non-current assets $ 106.0 $ 111.9 Accrued expenses and other current liabilities consist of the following: June 27, March 28, (millions) Accrued inventory $ 181.5 $ 167.1 Accrued operating expenses 181.0 176.4 Accrued payroll and benefits 149.5 186.2 Other taxes payable 65.0 47.9 Accrued capital expenditures 26.4 29.1 Restructuring reserve 17.1 25.5 Deferred income 15.0 14.6 Finance lease obligations 9.4 9.8 Derivative financial instruments 0.7 6.9 Dividends payable — 49.8 Other accrued expenses and current liabilities 11.6 3.8 Total accrued expenses and other current liabilities $ 657.2 $ 717.1 Other non-current liabilities consist of the following: June 27, March 28, (millions) Finance lease obligations $ 189.7 $ 189.4 Deferred lease incentives and obligations 55.8 57.8 Accrued benefits and deferred compensation 18.6 19.5 Derivative financial instruments 17.5 — Deferred tax liabilities 10.5 10.0 Other non-current liabilities 33.7 31.8 Total other non-current liabilities $ 325.8 $ 308.5 |
Impairment of Assets
Impairment of Assets | 3 Months Ended |
Jun. 27, 2020 | |
Asset Impairment Charges [Abstract] | |
Impairment of Assets | Impairment of Assets During the three-month periods ended June 27, 2020 and June 29, 2019 , the Company recorded non-cash impairment charges of $2.1 million and $1.2 million , respectively, to write off certain long-lived assets primarily related to store closures identified through its on-going store portfolio evaluation and its restructuring plans (see Note 8), respectively. See Note 11 |
Restructuring and Other Charges
Restructuring and Other Charges | 3 Months Ended |
Jun. 27, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Other Charges | Restructuring and Other Charges A description of significant restructuring and other activities and their related costs is provided below. Fiscal 2019 Restructuring Plan On June 4, 2018, the Company's Board of Directors approved a restructuring plan associated with the Company's strategic objective of operating with discipline to drive sustainable growth (the "Fiscal 2019 Restructuring Plan"). The Fiscal 2019 Restructuring Plan includes the following restructuring-related activities: (i) rightsizing and consolidation of the Company's global distribution network and corporate offices; (ii) targeted severance-related actions; and (iii) closure of certain of its stores and shop-within-shops. Actions associated with the Fiscal 2019 Restructuring Plan are complete and no additional charges are expected to be incurred in connection with this plan. A summary of the charges recorded in connection with the Fiscal 2019 Restructuring Plan during the fiscal period presented, as well as the cumulative charges recorded since its inception, is as follows: Three Months Ended June 29, Cumulative Charges (millions) Cash-related restructuring charges: Severance and benefit costs $ 5.9 $ 90.3 Lease termination and store closure costs 0.3 2.3 Other cash charges 0.8 10.8 Total cash-related restructuring charges 7.0 103.4 Non-cash charges: Impairment of assets (see Note 7) 1.2 19.0 Inventory-related charges (a) 0.6 8.2 Accelerated stock-based compensation expense (b) — 3.6 Loss on sale of property (c) — 11.6 Total non-cash charges 1.8 42.4 Total charges $ 8.8 $ 145.8 (a) Inventory-related charges are recorded within cost of goods sold in the consolidated statements of operations. (b) Accelerated stock-based compensation expense, which is recorded within restructuring and other charges in the consolidated statements of operations, was recorded in connection with vesting provisions associated with certain separation agreements. (c) Loss on sale of property, which was recorded within restructuring and other charges in the consolidated statements of operations, was incurred in connection with the sale of one of the Company's distribution centers in North America. A summary of current period activity in the restructuring reserve related to the Fiscal 2019 Restructuring Plan is as follows: Severance and Benefit Costs Lease Termination and Store Closure Costs Other Cash Charges Total (millions) Balance at March 28, 2020 $ 23.5 $ — $ 0.6 $ 24.1 Additions charged to expense — — — — Cash payments charged against reserve (8.0 ) — (0.6 ) (8.6 ) Balance at June 27, 2020 $ 15.5 $ — $ — $ 15.5 Other Restructuring Activities During the three months ended June 27, 2020 , the Company recorded $2.6 million in cash-related restructuring charges, primarily associated with severance and benefit costs. As of June 27, 2020 , the remaining restructuring liability related to these charges, together with the liability related to restructuring plans initiated prior to the Company's fiscal year ended March 30, 2019 ("Fiscal 2019"), was $4.4 million , reflecting cash payments of $1.6 million made during the three months ended June 27, 2020 . The Company also recorded non-cash inventory-related charges of $1.3 million within cost of goods sold in the consolidated statements of operations during the three months ended June 27, 2020 in connection with its restructuring activities. Other Charges During the three-month periods ended June 27, 2020 and June 29, 2019 , the Company recorded other charges of $4.4 million and $1.8 million , respectively, primarily related to rent and occupancy costs associated with certain previously exited real estate locations for which the related lease agreements have not yet expired. The Company also recorded other charges of $20.8 million during the three months ended June 29, 2019 |
Income Taxes
Income Taxes | 3 Months Ended |
Jun. 27, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Effective Tax Rate The Company's effective tax rate, which is calculated by dividing each fiscal period's income tax benefit (provision) by pretax income (loss), was 26.0% and 20.1% during the three-month periods ended June 27, 2020 and June 29, 2019 , respectively. The effective tax rate for the three months ended June 27, 2020 was higher than the U.S. federal statutory income tax rate of 21% primarily due to an income tax benefit recorded in connection with expected net operating loss carrybacks allowed under the CARES Act (as defined below), partially offset by valuation allowances recorded against certain deferred tax assets as a result of significant business disruptions attributable to COVID-19 that could impact the ultimate realizability of such assets. The effective tax rate for the three months ended June 29, 2019 was lower than the U.S. federal statutory income tax rate of 21% primarily due to the favorable impact of the proportion of earnings generated in lower taxed foreign jurisdictions versus the U.S. In response to the COVID-19 pandemic, various governments worldwide have enacted, or are in the process of enacting, measures to provide aid and economic relief to companies adversely impacted by the pandemic. For example, on March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"). The CARES Act includes various provisions, including the modification of net operating loss carryback periods and limitation, modification to interest deduction limitations, and creation of refundable employee retention tax credits, among other provisions. The Company expects certain of these provisions to favorably impact its Fiscal 2021 operating results. Uncertain Income Tax Benefits The Company classifies interest and penalties related to unrecognized tax benefits as part of its income tax benefit (provision). The total amount of unrecognized tax benefits, including interest and penalties, was $91.7 million and $88.9 million as of June 27, 2020 and March 28, 2020 , respectively, and is included within non-current liability for unrecognized tax benefits in the consolidated balance sheets. The total amount of unrecognized tax benefits that, if recognized, would affect the Company's effective tax rate was $70.8 million and $71.7 million as of June 27, 2020 and March 28, 2020 , respectively. Future Changes in Unrecognized Tax Benefits The total amount of unrecognized tax benefits relating to the Company's tax positions is subject to change based on future events including, but not limited to, settlements of ongoing tax audits and assessments and the expiration of applicable statutes of limitations. Although the outcomes and timing of such events are highly uncertain, the Company does not anticipate that the balance of gross unrecognized tax benefits, excluding interest and penalties, will change significantly during the next twelve months. However, changes in the occurrence, expected outcomes, and timing of such events could cause the Company's current estimate to change materially in the future. The Company files a consolidated U.S. federal income tax return, as well as tax returns in various state, local, and foreign jurisdictions. The Company is generally no longer subject to examinations by the relevant tax authorities for years prior to its fiscal year ended March 30, 2013. |
Debt
Debt | 3 Months Ended |
Jun. 27, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt consists of the following: June 27, March 28, (millions) $300 million 2.625% Senior Notes (a) $ 299.9 $ 299.6 $400 million 3.750% Senior Notes (b) 396.6 396.4 $500 million 1.700% Senior Notes (c) 497.3 — $750 million 2.950% Senior Notes (d) 736.2 — Borrowings outstanding under credit facilities — 475.0 Total debt 1,930.0 1,171.0 Less: short-term debt and current portion of long-term debt 299.9 774.6 Total long-term debt $ 1,630.1 $ 396.4 (a) The carrying value of the 2.625% Senior Notes is presented net of unamortized debt issuance costs and original issue discount of $0.1 million and $0.2 million as of June 27, 2020 and March 28, 2020 , respectively. The carrying value of the 2.625% Senior Notes as of March 28, 2020 also reflects an adjustment of $0.2 million associated with a related interest rate swap contract (see Note 12 ). (b) The carrying value of the 3.750% Senior Notes is presented net of unamortized debt issuance costs and original issue discount of $3.4 million and $3.6 million as of June 27, 2020 and March 28, 2020 , respectively. (c) The carrying value of the 1.700% Senior Notes is presented net of unamortized debt issuance costs and original issue discount of $2.7 million as of June 27, 2020 . (d) The carrying value of the 2.950% Senior Notes is presented net of unamortized debt issuance costs and original issue discount of $13.8 million as of June 27, 2020 . Senior Notes In August 2015, the Company completed a registered public debt offering and issued $300 million aggregate principal amount of unsecured senior notes due August 18, 2020 , which bear interest at a fixed rate of 2.625% , payable semi-annually (the "2.625% Senior Notes"). The 2.625% Senior Notes were issued at a price equal to 99.795% of their principal amount. The proceeds from this offering were used for general corporate purposes. In August 2018, the Company completed another registered public debt offering and issued an additional $400 million aggregate principal amount of unsecured senior notes due September 15, 2025 , which bear interest at a fixed rate of 3.750% , payable semi-annually (the "3.750% Senior Notes"). The 3.750% Senior Notes were issued at a price equal to 99.521% of their principal amount. The proceeds from this offering were used for general corporate purposes, including repayment of the Company's previously outstanding $300 million principal amount of unsecured 2.125% senior notes that matured September 26, 2018 (the "2.125% Senior Notes"). In June 2020, the Company completed another registered public debt offering and issued an additional $500 million aggregate principal amount of unsecured senior notes due June 15, 2022 , which bear interest at a fixed rate of 1.700% , payable semi-annually (the "1.700% Senior Notes"), and $750 million aggregate principal amount of unsecured senior notes due June 15, 2030 , which bear interest at a fixed rate of 2.950% , payable semi-annually (the "2.950% Senior Notes"). The 1.700% Senior Notes and 2.950% Senior Notes were issued at prices equal to 99.880% and 98.995% of their principal amounts, respectively. The proceeds from these offerings are being used for general corporate purposes, which included the repayment of $475 million previously outstanding under the Company's Global Credit Facility (as defined below) on June 3, 2020 , and may also be used to repay the Company's $300 million aggregate principal amount outstanding of 2.625% Senior Notes. The Company has the option to redeem the 2.625% Senior Notes, 3.750% Senior Notes, 1.700% Senior Notes, and 2.950% Senior Notes (collectively, the "Senior Notes"), in whole or in part, at any time at a price equal to accrued and unpaid interest on the redemption date plus the greater of (i) 100% of the principal amount of the series of Senior Notes to be redeemed or (ii) the sum of the present value of Remaining Scheduled Payments, as defined in the supplemental indentures governing such Senior Notes (together with the indenture governing the Senior Notes, the "Indenture"). The Indenture contains certain covenants that restrict the Company's ability, subject to specified exceptions, to incur certain liens; enter into sale and leaseback transactions; consolidate or merge with another party; or sell, lease, or convey all or substantially all of the Company's property or assets to another party. However, the Indenture does not contain any financial covenants. Commercial Paper The Company has a commercial paper borrowing program that allows it to issue up to $500 million of unsecured commercial paper notes through private placement using third-party broker-dealers (the "Commercial Paper Program"). Borrowings under the Commercial Paper Program are supported by the Global Credit Facility, as defined below. Accordingly, the Company does not expect combined borrowings outstanding under the Commercial Paper Program and Global Credit Facility to exceed $500 million . Commercial Paper Program borrowings may be used to support the Company's general working capital and corporate needs. Maturities of commercial paper notes vary, but cannot exceed 397 days from the date of issuance. Commercial paper notes issued under the Commercial Paper Program rank equally with the Company's other forms of unsecured indebtedness. As of June 27, 2020 , there were no borrowings outstanding under the Commercial Paper Program. Revolving Credit Facilities Global Credit Facility In August 2019, the Company replaced its existing credit facility and entered into a new credit facility that provides for a $500 million senior unsecured revolving line of credit through August 12, 2024 (the "Global Credit Facility") under terms and conditions substantially similar to those of the previous facility. The Global Credit Facility is also used to support the issuance of letters of credit and maintenance of the Commercial Paper Program. Borrowings under the Global Credit Facility may be denominated in U.S. Dollars and certain other currencies, including Euros, Hong Kong Dollars, and Japanese Yen, and are guaranteed by all of the Company's domestic significant subsidiaries. In accordance with the terms of the agreement governing the Global Credit Facility, the Company has the ability to expand its borrowing availability under the Global Credit Facility to $1 billion , subject to the agreement of one or more new or existing lenders under the facility to increase their commitments. There are no mandatory reductions in borrowing ability throughout the term of the Global Credit Facility. Under the Global Credit Facility as originally implemented, U.S. Dollar-denominated borrowings bear interest, at the Company's option, either at (a) a base rate, by reference to the greatest of: (i) the annual prime commercial lending rate of JPMorgan Chase Bank, N.A. in effect from time to time, (ii) the weighted-average overnight Federal funds rate plus 50 basis points , or (iii) the one-month London Interbank Offered Rate ("LIBOR") plus 100 basis points ; or (b) LIBOR, adjusted for the Federal Reserve Board's Eurocurrency liabilities maximum reserve percentage, plus a spread of 75 basis points , subject to adjustment based on the Company's credit ratings ("Adjusted LIBOR"). Foreign currency-denominated borrowings bear interest at Adjusted LIBOR. In addition to paying interest on any outstanding borrowings under the Global Credit Facility, the Company is required to pay a commitment fee to the lenders under the Global Credit Facility relating to the unutilized commitments. The commitment fee rate of 6.5 basis points is subject to adjustment based on the Company's credit ratings. These provisions were amended in May 2020, as discussed below. The Global Credit Facility contains a number of covenants that, among other things, restrict the Company's ability, subject to specified exceptions, to incur additional debt; incur liens; sell or dispose of assets; merge with or acquire other companies; liquidate or dissolve itself; engage in businesses that are not in a related line of business; make loans, advances, or guarantees; engage in transactions with affiliates; and make certain investments. As originally implemented, the Global Credit Facility also required the Company to maintain a maximum ratio of Adjusted Debt to Consolidated EBITDAR (the "leverage ratio") of no greater than 4.25 as of the date of measurement for the four most recent consecutive fiscal quarters. Adjusted Debt is defined generally as consolidated debt outstanding, including finance lease obligations, plus all operating lease obligations. Consolidated EBITDAR is defined generally as consolidated net income plus (i) income tax expense, (ii) net interest expense, (iii) depreciation and amortization expense, (iv) operating lease cost, (v) restructuring and other non-recurring expenses, and (vi) acquisition-related costs. This requirement was amended in May 2020, as discussed below. In May 2020, the Company entered into an amendment of its Global Credit Facility (the "Amendment"). Under the Amendment, until the earlier of (a) the date on which the Company provides the periodic reporting information required under the Global Credit Facility for the quarter ending September 30, 2021 and (b) the date on which the Company certifies that its leverage ratio as of the last day of the two most recent fiscal quarters was no greater than 4.25 (the "Ratings-Based Toggle Date"), for loans based on Adjusted LIBOR, the spread over Adjusted LIBOR will be increased to 187.5 basis points , the spread on loans based on the base rate will be 87.5 basis points and the commitment fee will be increased to 25 basis points , in each case with no adjustments based on the Company's credit ratings. The pricing will return to the original levels set forth in the Global Credit Facility on the Ratings-Based Toggle Date. Additionally, the leverage ratio requirements have been waived until the quarter ending September 30, 2021 . The maximum permitted leverage ratio for that fiscal quarter would be 5.25 . For the fiscal quarters ending December 31, 2021 and March 31, 2022, the maximum permitted leverage ratio would be 4.75 . For each fiscal quarter ending on or after June 30, 2022 , the leverage ratio test would return to 4.25 . The Amendment also (a) imposes a new requirement that would remain in effect until the Ratings-Based Toggle Date that the aggregate amount of unrestricted cash of the Company and its subsidiaries plus the undrawn amounts available under the Global Credit Facility may not be less than $750 million , (b) restricts the amount of dividends and distributions on, or purchases, redemptions, repurchases, retirements or acquisitions of, the Company's stock until the Specified Period Termination Date (as defined below), (c) until March 31, 2021, amends the material adverse change representation to disregard pandemic-related impacts to the business, and (d) until the Specified Period Termination Date, adds certain other restrictions on indebtedness incurred by the Company and its subsidiaries and investments and acquisitions by the Company and its subsidiaries. The "Specified Period Termination Date" is the earlier of (i) the date on which the Company provides the periodic reporting information required under the Global Credit Facility for the quarter ending June 30, 2022 and (ii) the date on which the Company certifies that its leverage ratio as of the last day of the two most recent fiscal quarters was no greater than 4.25 . Upon the occurrence of an Event of Default under the Global Credit Facility, the lenders may cease making loans, terminate the Global Credit Facility, and declare all amounts outstanding to be immediately due and payable. The Global Credit Facility specifies a number of events of default (many of which are subject to applicable grace periods), including, among others, the failure to make timely principal, interest, and fee payments or to satisfy the covenants, including the financial covenant described above. Additionally, the Global Credit Facility provides that an Event of Default will occur if Mr. Ralph Lauren, the Company's Executive Chairman and Chief Creative Officer, and entities controlled by the Lauren family fail to maintain a specified minimum percentage of the voting power of the Company's common stock. As of June 27, 2020 , no Event of Default (as such term is defined pursuant to the Global Credit Facility) has occurred under the Company's Global Credit Facility . In March 2020, the Company borrowed $475.0 million under the Global Credit Facility as a preemptive action to preserve cash and strengthen its liquidity position in response to the COVID-19 pandemic. These borrowings were subsequently repaid in June 2020 with proceeds from the issuances of the 1.700% Senior Notes and 2.950% Senior Notes. As of June 27, 2020 , there were no borrowings outstanding under the Global Credit Facility and the Company was contingently liable for $8.8 million of outstanding letters of credit. 364 Day Facility In May 2020, the Company entered into a new credit facility with the same lenders that are parties to the Global Credit Facility (the "364 Day Facility") as a preemptive measure to strengthen its liquidity in response to the COVID-19 pandemic. The 364 Day Facility provided for a $500 million senior unsecured revolving line of credit through May 25, 2021 , provided that the maturity date may be earlier if the Company issues senior notes other than to refinance the currently outstanding senior notes due August 18, 2020 . In connection with the issuances of the 1.700% Senior Notes and 2.950% Senior Notes in June 2020, the 364 Day Facility automatically terminated in accordance with its terms because the aggregate proceeds received upon issuance of these senior notes exceeded the amount necessary to refinance the 2.625% Senior Notes. Pan-Asia Credit Facilities Certain of the Company's subsidiaries in Asia have uncommitted credit facilities with regional branches of JPMorgan Chase (the "Banks") in China and South Korea (the "Pan-Asia Credit Facilities"). These credit facilities are subject to annual renewal and may be used to fund general working capital and corporate needs of the Company's operations in the respective countries. Borrowings under the Pan-Asia Credit Facilities are guaranteed by the parent company and are granted at the sole discretion of the Banks, subject to availability of the Banks' funds and satisfaction of certain regulatory requirements. The Pan-Asia Credit Facilities do not contain any financial covenants. The Company's Pan-Asia Credit Facilities by country are as follows: • China Credit Facility — provides Ralph Lauren Trading (Shanghai) Co., Ltd. with a revolving line of credit of up to 50 million Chinese Renminbi (approximately $7 million ) through April 3, 2021 , which is also able to be used to support bank guarantees. • South Korea Credit Facility — provides Ralph Lauren (Korea) Ltd. with a revolving line of credit of up to 30 billion South Korean Won (approximately $25 million ) through October 30, 2020 . As of June 27, 2020 , there were no borrowings outstanding under the Pan-Asia Credit Facilities. Refer to Note 11 of the Fiscal 2020 10-K for additional discussion of the terms and conditions of the Company's debt and credit facilities. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Jun. 27, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements U.S. GAAP establishes a three-level valuation hierarchy for disclosure of fair value measurements. The determination of the applicable level within the hierarchy for a particular asset or liability depends on the inputs used in its valuation as of the measurement date, notably the extent to which the inputs are market-based (observable) or internally-derived (unobservable). A financial instrument's categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels are defined as follows: • Level 1 — inputs to the valuation methodology based on quoted prices (unadjusted) for identical assets or liabilities in active markets. • Level 2 — inputs to the valuation methodology based on quoted prices for similar assets or liabilities in active markets for substantially the full term of the financial instrument; quoted prices for identical or similar instruments in markets that are not active for substantially the full term of the financial instrument; and model-derived valuations whose inputs or significant value drivers are observable. • Level 3 — inputs to the valuation methodology based on unobservable prices or valuation techniques that are significant to the fair value measurement. The following table summarizes the Company's financial assets and liabilities that are measured and recorded at fair value on a recurring basis, excluding accrued interest components: June 27, March 28, (millions) Investments in commercial paper (a)(b) $ 50.0 $ 243.6 Derivative assets (a) 46.6 62.3 Derivative liabilities (a) 18.2 6.9 (a) Based on Level 2 measurements. (b) Amounts are included within short-term investments in the consolidated balance sheet. The Company's investments in commercial paper are classified as available-for-sale and recorded at fair value in its consolidated balance sheets using external pricing data, based on interest rates and credit ratings for similar issuances with the same remaining term as the Company's investments. To the extent the Company invests in bonds, such investments are also classified as available-for-sale and recorded at fair value in its consolidated balance sheets based on quoted prices in active markets. The Company's derivative financial instruments are recorded at fair value in its consolidated balance sheets and are valued using pricing models that are primarily based on market observable external inputs, including spot and forward currency exchange rates, benchmark interest rates, and discount rates consistent with the instrument's tenor, and consider the impact of the Company's own credit risk, if any. Changes in counterparty credit risk are also considered in the valuation of derivative financial instruments. The Company's cash and cash equivalents, restricted cash, and time deposits are recorded at carrying value, which generally approximates fair value based on Level 1 measurements. The Company's debt instruments are recorded at their carrying values in its consolidated balance sheets, which may differ from their respective fair values. The fair values of the Senior Notes are estimated based on external pricing data, including available quoted market prices, and with reference to comparable debt instruments with similar interest rates, credit ratings, and trading frequency, among other factors. The fair values of the Company's commercial paper notes and borrowings outstanding under its credit facilities, if any, are estimated using external pricing data, based on interest rates and credit ratings for similar issuances with the same remaining term as the Company's outstanding borrowings. Due to their short-term nature, the fair values of the Company's commercial paper notes and borrowings outstanding under its credit facilities, if any, generally approximate their carrying values. The following table summarizes the carrying values and the estimated fair values of the Company's debt instruments: June 27, 2020 March 28, 2020 Carrying Value (a) Fair Value (b) Carrying Value (a) Fair Value (b) (millions) $300 million 2.625% Senior Notes $ 299.9 $ 300.4 $ 299.6 $ 299.8 $400 million 3.750% Senior Notes 396.6 445.8 396.4 415.1 $500 million 1.700% Senior Notes 497.3 507.6 — — $750 million 2.950% Senior Notes 736.2 766.1 — — Borrowings outstanding under credit facilities — — 475.0 473.0 (a) See Note 10 for discussion of the carrying values of the Company's senior notes. (b) Based on Level 2 measurements. Unrealized gains or losses resulting from changes in the fair value of the Company's debt instruments do not result in the realization or expenditure of cash, unless the debt is retired prior to its maturity. Non-financial Assets and Liabilities The Company's non-financial assets, which primarily consist of goodwill, other intangible assets, property and equipment, and lease-related right-of-use ("ROU") assets, are not required to be measured at fair value on a recurring basis, and instead are reported at carrying value in its consolidated balance sheet. However, on a periodic basis or whenever events or changes in circumstances indicate that they may not be fully recoverable (and at least annually for goodwill and indefinite-lived intangible assets), the respective carrying value of non-financial assets are assessed for impairment and, if ultimately considered impaired, are adjusted and written down to their fair value, as estimated based on consideration of external market participant assumptions. During the three-month periods ended June 27, 2020 and June 29, 2019 , the Company recorded non-cash impairment charges to reduce the carrying values of certain long-lived assets to their estimated fair values. The fair values of these assets were determined based on Level 3 measurements, the related inputs of which included estimates of the amount and timing of the assets' net future discounted cash flows (including any potential sublease income for lease-related ROU assets), based on historical experience and consideration of current trends, market conditions, and comparable sales, as applicable. The following tables summarize non-cash impairment charges recorded by the Company during the fiscal periods presented in order to reduce the carrying values of certain long-lived assets to their estimated fair values as of the assessment date: Three Months Ended June 27, 2020 June 29, 2019 Long-Lived Asset Category Fair Value As of Impairment Date Total Impairments Fair Value As of Impairment Date Total Impairments (millions) Property and equipment, net N/A $ — $ — $ 0.9 Operating lease right-of-use assets (a) $ — 2.1 92.9 225.4 (a) Total impairment charges for the three months ended June 29, 2019 includes $225.1 million recorded in connection with the Company's adoption of ASU No. 2016-02, "Leases" as of the beginning of Fiscal 2020 which, net of related income tax benefits, reduced its opening retained earnings balance by $169.4 million . See Note 7 for additional discussion regarding non-cash impairment charges recorded by the Company within the consolidated statements of operations during the fiscal periods presented. No impairment charges associated with goodwill or other intangible assets were recorded during either of the three-month periods ended June 27, 2020 or June 29, 2019 . |
Financial Instruments
Financial Instruments | 3 Months Ended |
Jun. 27, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Instruments | Financial Instruments Derivative Financial Instruments The Company is exposed to changes in foreign currency exchange rates, primarily relating to certain anticipated cash flows and the value of the reported net assets of its international operations, as well as changes in the fair value of its fixed-rate debt obligations attributed to changes in a benchmark interest rate. Accordingly, the Company uses derivative financial instruments to manage and mitigate such risks. The Company does not use derivatives for speculative or trading purposes. The following table summarizes the Company's outstanding derivative instruments recorded on its consolidated balance sheets as of June 27, 2020 and March 28, 2020 : Notional Amounts Derivative Assets Derivative Liabilities Derivative Instrument (a) June 27, March 28, June 27, March 28, June 27, March 28, Balance Sheet Line (b) Fair Value Balance Sheet Line (b) Fair Value Balance Sheet Line (b) Fair Value Balance Sheet Line (b) Fair Value (millions) Designated Hedges : FC — Cash flow hedges $ 162.6 $ 229.0 PP $ 3.3 PP $ 7.4 AE $ 0.2 AE $ 0.4 IRS — Fixed-rate debt — 300.0 — — — AE 0.2 Net investment hedges (c) 689.6 683.6 ONCA 42.9 ONCA 48.6 ONCL 17.5 AE 4.0 Total Designated Hedges 852.2 1,212.6 46.2 56.0 17.7 4.6 Undesignated Hedges : FC — Undesignated hedges (d) 212.6 473.5 PP 0.4 PP 6.3 AE 0.5 AE 2.3 Total Hedges $ 1,064.8 $ 1,686.1 $ 46.6 $ 62.3 $ 18.2 $ 6.9 (a) FC = Forward foreign currency exchange contracts; IRS = Interest rate swap contracts. (b) PP = Prepaid expenses and other current assets; AE = Accrued expenses and other current liabilities; ONCA = Other non-current assets; ONCL = Other non-current liabilities. (c) Includes cross-currency swaps designated as hedges of the Company's net investment in certain foreign operations. (d) Relates to third-party and intercompany foreign currency-denominated exposures and balances. The Company presents the fair values of its derivative assets and liabilities recorded on its consolidated balance sheets on a gross basis, even when they are subject to master netting arrangements. However, if the Company were to offset and record the asset and liability balances of all of its derivative instruments on a net basis in accordance with the terms of each of its master netting arrangements, spread across ten separate counterparties, the amounts presented in the consolidated balance sheets as of June 27, 2020 and March 28, 2020 would be adjusted from the current gross presentation as detailed in the following table: June 27, 2020 March 28, 2020 Gross Amounts Presented in the Balance Sheet Gross Amounts Not Offset in the Balance Sheet that are Subject to Master Netting Agreements Net Amount Gross Amounts Presented in the Balance Sheet Gross Amounts Not Offset in the Balance Sheet that are Subject to Master Netting Agreements Net Amount (millions) Derivative assets $ 46.6 $ (0.5 ) $ 46.1 $ 62.3 $ (6.1 ) $ 56.2 Derivative liabilities 18.2 (0.5 ) 17.7 6.9 (6.1 ) 0.8 The Company's master netting arrangements do not require cash collateral to be pledged by the Company or its counterparties. See Note 3 for further discussion of the Company's master netting arrangements. The following tables summarize the pretax impact of gains and losses from the Company's designated derivative instruments on its consolidated financial statements for the three-month periods ended June 27, 2020 and June 29, 2019 : Gains (Losses) Recognized in OCI Three Months Ended June 27, June 29, (millions) Designated Hedges: FC — Cash flow hedges $ (3.0 ) $ (4.4 ) Net investment hedges — effective portion 0.7 (10.0 ) Net investment hedges — portion excluded from assessment of hedge effectiveness (16.8 ) 2.5 Total Designated Hedges $ (19.1 ) $ (11.9 ) Location and Amount of Gains (Losses) from Cash Flow Hedges Reclassified from AOCI to Earnings Three Months Ended June 27, June 29, Cost of goods sold Other income (expense), net Cost of goods sold Other income (expense), net (millions) Total amounts presented in the consolidated statements of operations in which the effects of related cash flow hedges are recorded $ (138.8 ) $ 2.1 $ (508.0 ) $ (4.1 ) Effects of cash flow hedging: FC — Cash flow hedges 1.7 (0.3 ) 6.2 0.2 Gains (Losses) from Net Investment Hedges Recognized in Earnings Location of Gains (Losses) Three Months Ended June 27, June 29, (millions) Net Investment Hedges Net investment hedges — portion excluded from assessment of hedge effectiveness (a) $ 2.7 $ 5.0 Interest expense Total Net Investment Hedges $ 2.7 $ 5.0 (a) Amounts recognized in other comprehensive income (loss) ("OCI") relating to the effective portion of the Company's net investment hedges would be recognized in earnings only upon the sale or liquidation of the hedged net investment. As of June 27, 2020 , it is estimated that $16.2 million of pretax net gains on both outstanding and matured derivative instruments designated and qualifying as cash flow hedges deferred in AOCI will be recognized in earnings over the next twelve months. Amounts ultimately recognized in earnings will depend on exchange rates in effect when outstanding derivative instruments are settled. The following table summarizes the pretax impact of gains and losses from the Company's undesignated derivative instruments on its consolidated financial statements for the three-month periods ended June 27, 2020 and June 29, 2019 : Gains (Losses) Recognized in Earnings Location of Gains (Losses) Recognized in Earnings Three Months Ended June 27, June 29, (millions) Undesignated Hedges: FC — Undesignated hedges $ 4.7 $ 1.9 Other income (expense), net Total Undesignated Hedges $ 4.7 $ 1.9 Risk Management Strategies Forward Foreign Currency Exchange Contracts The Company uses forward foreign currency exchange contracts to mitigate its risk related to exchange rate fluctuations on inventory transactions made in an entity's non-functional currency, the settlement of foreign currency-denominated balances, and the translation of certain foreign operations' net assets into U.S. dollars. As part of its overall strategy for managing the level of exposure to such exchange rate risk, relating primarily to the Euro, the Japanese Yen, the South Korean Won, the Australian Dollar, the Canadian Dollar, the British Pound Sterling, the Swiss Franc, and the Chinese Renminbi, the Company generally hedges a portion of its related exposures anticipated over the next twelve months using forward foreign currency exchange contracts with maturities of two months to one year to provide continuing coverage over the period of the respective exposure. Interest Rate Swap Contracts The Company periodically designates pay-floating rate, receive-fixed rate interest rate swap contracts as hedges against changes in the fair value of its fixed-rate debt attributed to changes in a benchmark interest rate. To the extent of their notional amount, such contracts effectively swap the fixed interest rate on certain of the Company's fixed-rate senior notes for a variable interest rate based on the 3-month London Interbank Offered Rate ("LIBOR") plus a fixed spread. Changes in the fair value of the Company's interest rate swap contracts were offset by changes in the fair value of the corresponding senior notes attributed to changes in the benchmark interest rate, with no resulting net impact reflected in earnings during any of the fiscal periods presented. The following table summarizes the carrying value of the hedged senior notes and the impacts of the related fair value hedging adjustments as of June 27, 2020 and March 28, 2020 : Carrying Value of the Hedged Item Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Value of the Hedged Item Hedged Item Balance Sheet Line in which the Hedged Item is Included June 27, March 28, June 27, March 28, (millions) $300 million 2.625% Senior Notes (a) Current portion of long-term debt $ 299.9 $ 299.6 $ — $ (0.2 ) (a) The interest rate swap contract designated as a fair value hedge of the Company's 2.625% Senior Notes was settled during the three months ended June 27, 2020 at a loss of $0.3 million . Cross-Currency Swap Contracts The Company periodically designates (i) pay-floating rate, receive-floating rate cross-currency swap contracts or (ii) pay-fixed rate, receive fixed-rate cross-currency swap contracts as hedges of its net investment in certain of its European subsidiaries. The Company's pay-floating rate, receive-floating rate cross-currency swap contracts swap U.S. Dollar-denominated variable interest rate payments based on the contract's notional amount and 3-month LIBOR plus a fixed spread (as paid under a corresponding interest rate swap contract discussed above) for Euro-denominated variable interest rate payments based on 3-month Euro Interbank Offered Rate ("EURIBOR") plus a fixed spread, which, in combination with the corresponding interest rate swap contract, economically converts a portion of the Company's fixed-rate US-denominated senior note obligations to floating-rate Euro-denominated obligations. The Company's pay-fixed rate, receive-fixed rate cross-currency swap contracts swap U.S. Dollar-denominated fixed interest rate payments based on the contract's notional amount and the fixed rate of interest payable on certain of the Company's senior notes for Euro-denominated fixed interest rate payments, thereby economically converting a portion of its fixed-rate US-denominated senior note obligations to fixed rate Euro-denominated obligations. See Note 3 for further discussion of the Company's accounting policies relating to its derivative financial instruments. Investments As of June 27, 2020 , the Company's investments were all classified as short-term and consisted of $209.3 million of time deposits and $50.0 million of commercial paper. The Company's investments as of March 28, 2020 were also all classified as short-term and consisted of $252.3 million of time deposits and $243.6 million of commercial paper. No significant realized or unrealized gains or losses on available-for-sale investments or impairment charges were recorded during any of the fiscal periods presented. Refer to Note 3 of the Fiscal 2020 10-K for further discussion of the Company's accounting policies relating to its investments. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Jun. 27, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company is involved, from time to time, in litigation, other legal claims, and proceedings involving matters associated with or incidental to its business, including, among other things, matters involving credit card fraud, trademark and other intellectual property, licensing, importation and exportation of its products, taxation, unclaimed property, and employee relations. The Company believes at present that the resolution of currently pending matters will not individually or in the aggregate have a material adverse effect on its consolidated financial statements. However, the Company's assessment of any current litigation or other legal claims could potentially change in light of the discovery of facts not presently known or determinations by judges, juries, or other finders of fact which are not in accord with management's evaluation of the possible liability or outcome of such litigation or claims. |
Equity
Equity | 3 Months Ended |
Jun. 27, 2020 | |
Equity [Abstract] | |
Equity | Equity Class B Common Stock Conversion During the three months ended June 29, 2019 , the Lauren Family, L.L.C., a limited liability company managed by the children of Mr. Ralph Lauren, converted 0.5 million shares of Class B common stock into an equal number of shares of Class A common stock pursuant to the terms of the security. These conversions occurred in advance of a sales plan providing for the sale of such shares of Class A common stock pursuant to Rule 10b5-1 subject to the conditions set forth therein. These transactions resulted in a reclassification within equity and had no effect on the Company's consolidated balance sheet. Common Stock Repurchase Program A summary of the Company's repurchases of Class A common stock under its common stock repurchase program is as follows: Three Months Ended June 27, June 29, (millions) Cost of shares repurchased $ — $ 150.0 Number of shares repurchased — 1.3 On May 13, 2019 , the Company's Board of Directors approved an expansion of the Company's existing common stock repurchase program that allowed it to repurchase up to an additional $600 million of Class A common stock. As of June 27, 2020 , the remaining availability under the Company's Class A common stock repurchase program was approximately $580 million . Repurchases of shares of Class A common stock are subject to certain restrictions under the Company's Global Credit Facility and more generally overall business and market conditions. Accordingly, as a result of current business disruptions related to the COVID-19 pandemic, effective beginning in the first quarter of Fiscal 2021 the Company temporarily suspended its common stock repurchase program as a preemptive action to preserve cash and strengthen its liquidity position. In addition, during the three-month periods ended June 27, 2020 and June 29, 2019 , 0.5 million and 0.4 million shares of Class A common stock, respectively, at a cost of $33.9 million and $41.1 million , respectively, were surrendered to or withheld by the Company in satisfaction of withholding taxes in connection with the vesting of awards under the Company's long-term stock incentive plans. Repurchased and surrendered shares are accounted for as treasury stock at cost and held in treasury for future use. Dividends Except as discussed below, the Company has maintained a regular quarterly cash dividend program on its common stock since 2003. On May 13, 2019 , the Company's Board of Directors approved an increase to the Company's quarterly cash dividend on its common stock from $0.625 to $0.6875 per share. As a result of current business disruptions related to the COVID-19 pandemic, effective beginning in the first quarter of Fiscal 2021 the Company temporarily suspended its quarterly cash dividend program as a preemptive action to preserve cash and strengthen its liquidity position. Any decision to declare and pay dividends in the future will be made at the discretion of the Company's Board of Directors and will depend on the Company's results of operations, cash requirements, financial condition, and other factors that the Board of Directors may deem relevant, including economic and market conditions. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Jun. 27, 2020 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) The following table presents OCI activity, net of tax, accumulated in equity: Foreign Currency Translation Gains (Losses) (a) Net Unrealized Gains (Losses) on Cash Flow Hedges (b) Net Unrealized Gains (Losses) on Defined Benefit Plans (c) Total Accumulated Other Comprehensive Income (Loss) (millions) Balance at March 28, 2020 $ (130.4 ) $ 18.0 $ (5.8 ) $ (118.2 ) Other comprehensive income (loss), net of tax: OCI before reclassifications 13.0 (2.8 ) (0.1 ) 10.1 Amounts reclassified from AOCI to earnings — (1.2 ) — (1.2 ) Other comprehensive income (loss), net of tax 13.0 (4.0 ) (0.1 ) 8.9 Balance at June 27, 2020 $ (117.4 ) $ 14.0 $ (5.9 ) $ (109.3 ) Balance at March 30, 2019 $ (118.5 ) $ 20.2 $ (5.1 ) $ (103.4 ) Other comprehensive income (loss), net of tax: OCI before reclassifications 8.9 (3.9 ) (0.1 ) 4.9 Amounts reclassified from AOCI to earnings (4.9 ) (5.8 ) — (10.7 ) Other comprehensive income (loss), net of tax 4.0 (9.7 ) (0.1 ) (5.8 ) Balance at June 29, 2019 $ (114.5 ) $ 10.5 $ (5.2 ) $ (109.2 ) (a) OCI before reclassifications to earnings related to foreign currency translation gains (losses) includes income tax benefits of $4.7 million and $2.0 million for the three-month periods ended June 27, 2020 and June 29, 2019 , respectively. OCI before reclassifications to earnings for the three-month periods ended June 27, 2020 and June 29, 2019 include losses of $12.2 million (net of a $3.9 million income tax benefit) and $5.7 million (net of a $1.8 million income tax benefit), respectively, related to changes in the fair values of instruments designated as hedges of the Company's net investment in certain foreign operations (see Note 12 ). Amounts reclassified from AOCI to earnings related to foreign currency translation gains (losses) for the three months ended June 29, 2019 relate to the reclassification to retained earnings of income tax effects stranded in AOCI. (b) OCI before reclassifications to earnings related to net unrealized gains (losses) on cash flow hedges are presented net of income tax benefits of $0.2 million and $0.5 million for the three-month periods ended June 27, 2020 and June 29, 2019 , respectively. The tax effects on amounts reclassified from AOCI to earnings are presented in a table below. (c) Activity is presented net of taxes, which were immaterial for both periods presented. The following table presents reclassifications from AOCI to earnings for cash flow hedges, by component: Three Months Ended Location of Gains (Losses) Reclassified from AOCI to Earnings June 27, June 29, (millions) Gains (losses) on cash flow hedges (a) : FC — Cash flow hedges $ 1.7 $ 6.2 Cost of goods sold FC — Cash flow hedges (0.3 ) 0.2 Other income (expense), net Tax effect (0.2 ) (0.6 ) Income tax benefit (provision) Net of tax $ 1.2 $ 5.8 (a) FC = Forward foreign currency exchange contracts. |
Stock-based Compensation
Stock-based Compensation | 3 Months Ended |
Jun. 27, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-based Compensation | Stock-based Compensation The Company's stock-based compensation awards are currently issued under the 2019 Incentive Plan, which was approved by its stockholders on August 1, 2019. However, any prior awards granted under either the Company's 2010 Incentive Plan or 1997 Incentive Plan remain subject to the terms of those plans as applicable. Any awards that expire, are forfeited, or are surrendered to the Company in satisfaction of taxes are available for issuance under the 2019 Incentive Plan. Refer to Note 18 of the Fiscal 2020 10-K for a detailed description of the Company's stock-based compensation awards, including information related to vesting terms, service, performance, and market conditions and payout percentages. Impact on Results A summary of total stock-based compensation expense and the related income tax benefits recognized during the three-month periods ended June 27, 2020 and June 29, 2019 is as follows: Three Months Ended June 27, June 29, (millions) Compensation expense $ 15.1 $ 23.0 Income tax benefit (3.1 ) (3.6 ) The Company issues its annual grants of stock-based compensation awards in the first half of each fiscal year. Due to the timing of the annual grants and other factors, including the timing and magnitude of forfeiture and performance goal achievement adjustments, as well as changes to the size and composition of the eligible employee population, stock-based compensation expense recognized during any given fiscal period is not indicative of the level of compensation expense expected to be incurred in future periods. Restricted Stock Awards and Service-based RSUs Restricted stock awards were granted to non-employee directors prior to Fiscal 2019. Effective beginning Fiscal 2019, non-employee directors are now granted service-based RSUs in lieu of restricted shares. The fair values of service-based RSUs granted to certain of the Company's senior executives and other employees, as well as non-employee directors, are based on the fair value of the Company's Class A common stock on the date of grant, adjusted to reflect the absence of dividends for any awards for which dividend equivalent amounts do not accrue while outstanding and unvested. The weighted-average grant date fair values of service-based RSU awards granted were $59.72 and $109.72 per share during the three-month periods ended June 27, 2020 and June 29, 2019 , respectively. A summary of restricted stock and service-based RSU activity during the three months ended June 27, 2020 is as follows: Number of Shares/Units Restricted Stock Service-based RSUs (thousands) Unvested at March 28, 2020 4 1,094 Granted — 645 Vested (4 ) (353 ) Forfeited — (20 ) Unvested at June 27, 2020 — 1,366 Performance-based RSUs The fair values of the Company's performance-based RSUs granted to its senior executives and other key employees are based on the fair value of the Company's Class A common stock on the date of grant, adjusted to reflect the absence of dividends for any awards for which dividend equivalent amounts do not accrue while outstanding and unvested. The weighted-average grant date fair values of performance-based RSUs granted was $102.69 per share during the three months ended June 29, 2019 . No such awards were granted during the three months ended June 27, 2020 as the Company has elected to temporarily issue service-based RSUs in lieu of performance-based RSUs as a result of business disruptions and uncertainty created by the COVID-19 pandemic. A summary of performance-based RSU activity during the three months ended June 27, 2020 is as follows: Number of Performance-based RSUs (thousands) Unvested at March 28, 2020 934 Granted — Change due to performance condition achievement 185 Vested (720 ) Forfeited (27 ) Unvested at June 27, 2020 372 Market-based RSUs The Company grants market-based RSUs, which are based on TSR performance, to its senior executives and other key employees. The Company estimates the fair value of its TSR awards on the date of grant using a Monte Carlo simulation, which models multiple stock price paths of the Company's Class A common stock and that of its peer group to evaluate and determine its ultimate expected relative TSR performance ranking. Compensation expense, net of estimated forfeitures, is recorded regardless of whether, and the extent to which, the market condition is ultimately satisfied. The weighted-average grant date fair values of market-based RSUs granted was $139.02 per share during the three months ended June 29, 2019 . No such awards were granted during the three months ended June 27, 2020 as the Company has elected to temporarily issue service-based RSUs in lieu of market-based RSUs as a result of business disruptions and uncertainty created by the COVID-19 pandemic. The assumptions used to estimate the fair value of TSR awards granted during the three months ended June 29, 2019 were as follows: Three Months Ended June 29, Expected term (years) 2.8 Expected volatility 30.8 % Expected dividend yield 2.4 % Risk-free interest rate 1.7 % A summary of market-based RSU activity during the three months ended June 27, 2020 is as follows: Number of Market-based RSUs (thousands) Unvested at March 28, 2020 234 Granted — Change due to market condition achievement — Vested — Forfeited — Unvested at June 27, 2020 234 Stock Options A summary of stock option activity under all plans during the three months ended June 27, 2020 is as follows: Number of Options (thousands) Options outstanding at March 28, 2020 518 Granted — Exercised — Cancelled/Forfeited (34 ) Options outstanding at June 27, 2020 484 |
Segment Information
Segment Information | 3 Months Ended |
Jun. 27, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company has three reportable segments based on its business activities and organization: • North America — The North America segment primarily consists of sales of Ralph Lauren branded apparel, footwear, accessories, home furnishings, and related products made through the Company's retail and wholesale businesses in the U.S. and Canada, excluding Club Monaco. In North America, the Company's retail business is primarily comprised of its Ralph Lauren stores, its factory stores, and its digital commerce site, www.RalphLauren.com. The Company's wholesale business in North America is comprised primarily of sales to department stores, and to a lesser extent, specialty stores. • Europe — The Europe segment primarily consists of sales of Ralph Lauren branded apparel, footwear, accessories, home furnishings, and related products made through the Company's retail and wholesale businesses in Europe, the Middle East, and Latin America, excluding Club Monaco. In Europe, the Company's retail business is primarily comprised of its Ralph Lauren stores, its factory stores, its concession-based shop-within-shops, and its various digital commerce sites. The Company's wholesale business in Europe is comprised of a varying mix of sales to both department stores and specialty stores, depending on the country, as well as to various third-party digital partners. • Asia — The Asia segment primarily consists of sales of Ralph Lauren branded apparel, footwear, accessories, home furnishings, and related products made through the Company's retail and wholesale businesses in Asia, Australia, and New Zealand. The Company's retail business in Asia is primarily comprised of its Ralph Lauren stores, its factory stores, its concession-based shop-within-shops, and its digital commerce sites, www.RalphLauren.co.jp (which launched in June 2020) and www.RalphLauren.cn. In addition, the Company sells its products online through various third-party digital partner commerce sites. In Asia, the Company's wholesale business is comprised primarily of sales to department stores, with related products distributed through shop-within-shops. No operating segments were aggregated to form the Company's reportable segments. In addition to these reportable segments, the Company also has other non-reportable segments, which primarily consist of (i) sales of Club Monaco branded products made through its retail and wholesale businesses in the U.S., Canada, and Europe, and its licensing alliances in Europe and Asia, and (ii) royalty revenues earned through its global licensing alliances, excluding Club Monaco. The Company's segment reporting structure is consistent with how it establishes its overall business strategy, allocates resources, and assesses performance of its business. The accounting policies of the Company's segments are consistent with those described in Notes 2 and 3 of the Fiscal 2020 10-K. Sales and transfers between segments are generally recorded at cost and treated as transfers of inventory. All intercompany revenues are eliminated in consolidation and are not reviewed when evaluating segment performance. Each segment's performance is evaluated based upon net revenues and operating income before restructuring-related charges, impairment of assets, and certain other one-time items, if any. Certain corporate overhead expenses related to global functions, most notably the Company's executive office, information technology, finance and accounting, human resources, and legal departments, largely remain at corporate. Additionally, other costs that cannot be allocated to the segments based on specific usage are also maintained at corporate, including corporate advertising and marketing expenses, depreciation and amortization of corporate assets, and other general and administrative expenses resulting from corporate-level activities and projects. Net revenues and operating income (loss) for each of the Company's segments are as follows: Three Months Ended June 27, June 29, (millions) Net revenues: North America $ 165.1 $ 719.4 Europe 120.7 360.8 Asia 171.9 258.6 Other non-reportable segments 29.8 90.0 Total net revenues $ 487.5 $ 1,428.8 Three Months Ended June 27, June 29, (millions) Operating income (loss) (a) : North America $ (24.8 ) $ 150.1 Europe (16.9 ) 79.4 Asia 10.1 48.1 Other non-reportable segments 0.9 32.9 (30.7 ) 310.5 Unallocated corporate expenses (130.3 ) (137.6 ) Unallocated restructuring and other charges (b) (7.0 ) (29.6 ) Total operating income (loss) $ (168.0 ) $ 143.3 (a) Segment operating income (loss) during the three months ended June 27, 2020 reflects bad debt expense reversals of $15.5 million and $1.0 million related to North America and Europe, respectively, primarily related to adjustments to reserves previously established in connection with COVID-19 business disruptions. Segment operating income (loss) and unallocated corporate expenses during the three-month periods ended June 27, 2020 and June 29, 2019 also included asset impairment charges (see Note 7 ), which are detailed below: Three Months Ended June 27, June 29, (millions) Asset impairment charges: North America $ (0.2 ) $ — Asia (1.3 ) — Other non-reportable segments (0.6 ) — Unallocated corporate expenses — (1.2 ) Total asset impairment charges $ (2.1 ) $ (1.2 ) (b) The three-month periods ended June 27, 2020 and June 29, 2019 included certain unallocated restructuring and other charges (see Note 8 ), which are detailed below: Three Months Ended June 27, June 29, (millions) Unallocated restructuring and other charges: North America-related $ (0.1 ) $ (0.7 ) Europe-related — (1.8 ) Asia-related 0.2 (0.5 ) Other non-reportable segment-related (1.1 ) — Corporate operations-related (1.6 ) (4.0 ) Unallocated restructuring charges (2.6 ) (7.0 ) Other charges (see Note 8) (4.4 ) (22.6 ) Total unallocated restructuring and other charges $ (7.0 ) $ (29.6 ) Depreciation and amortization expense for the Company's segments is as follows: Three Months Ended June 27, June 29, (millions) Depreciation and amortization expense: North America $ 18.1 $ 18.9 Europe 7.7 7.6 Asia 14.2 15.0 Other non-reportable segments 1.1 1.3 Unallocated corporate 22.6 23.4 Total depreciation and amortization expense $ 63.7 $ 66.2 Net revenues by geographic location of the reporting subsidiary are as follows: Three Months Ended June 27, June 29, (millions) Net revenues (a) : The Americas (b) $ 194.7 $ 810.4 Europe (c) 120.9 359.5 Asia (d) 171.9 258.9 Total net revenues $ 487.5 $ 1,428.8 (a) Net revenues for certain of the Company's licensed operations are included within the geographic location of the reporting subsidiary which holds the respective license. (b) Includes the U.S., Canada, and Latin America. Net revenues earned in the U.S. during the three-month periods ended June 27, 2020 and June 29, 2019 were $186.1 million and $760.1 million , respectively. (c) Includes the Middle East. (d) Includes Australia and New Zealand. |
Additional Financial Informatio
Additional Financial Information | 3 Months Ended |
Jun. 27, 2020 | |
Supplemental Cash Flow Information [Abstract] | |
Additional Financial Information | Additional Financial Information Reconciliation of Cash, Cash Equivalents, and Restricted Cash A reconciliation of cash, cash equivalents, and restricted cash as of June 27, 2020 and March 28, 2020 from the consolidated balance sheets to the consolidated statements of cash flows is as follows: June 27, March 28, (millions) Cash and cash equivalents $ 2,451.3 $ 1,620.4 Restricted cash included within prepaid expenses and other current assets 1.4 1.4 Restricted cash included within other non-current assets 8.2 8.0 Total cash, cash equivalents, and restricted cash $ 2,460.9 $ 1,629.8 Restricted cash relates to cash held in escrow with certain banks as collateral, primarily to secure guarantees in connection with certain international tax matters and real estate leases. Cash Interest and Taxes Cash paid for interest and income taxes is as follows: Three Months Ended June 27, June 29, (millions) Cash paid for interest $ 3.3 $ 2.4 Cash paid for income taxes 18.9 22.3 Non-cash Transactions Operating lease ROU assets recorded in connection with the recognition of new lease liabilities were $13.1 million during the three months ended June 27, 2020 . Operating and finance lease ROU assets recorded in connection with the recognition of new lease liabilities were $17.7 million and $64.0 million , respectively, during the three months ended June 29, 2019 . Non-cash investing activities also included capital expenditures incurred but not yet paid of $26.4 million and $44.2 million for the three-month periods ended June 27, 2020 and June 29, 2019 , respectively. Non-cash financing activities during the three months ended June 29, 2019 included the conversion of 0.5 million shares of Class B common stock into an equal number of shares of Class A common stock, as discussed in Note 14 . There were no other significant non-cash investing or financing activities for any of the fiscal periods presented. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Jun. 27, 2020 | |
Accounting Policies [Abstract] | |
Basis of Consolidation | Basis of Consolidation These unaudited interim consolidated financial statements present the consolidated financial position, income (loss), comprehensive income (loss), and cash flows of the Company, including all entities in which the Company has a controlling financial interest and is determined to be the primary beneficiary. All significant intercompany balances and transactions have been eliminated in consolidation. |
Fiscal Periods | Fiscal Periods The Company utilizes a 52-53 week fiscal year ending on the Saturday closest to March 31. As such, fiscal year 2021 will end on March 27, 2021 and will be a 52-week period ("Fiscal 2021 "). Fiscal year 2020 ended on March 28, 2020 and was also a 52-week period ("Fiscal 2020 "). The first quarter of Fiscal 2021 ended on June 27, 2020 and was a 13-week period. The first quarter of Fiscal 2020 ended on June 29, 2019 and was also a 13-week period. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and notes thereto. Actual results could differ materially from those estimates. Significant estimates inherent in the preparation of the consolidated financial statements include reserves for bad debt, customer returns, discounts, end-of-season markdowns, operational chargebacks, and certain cooperative advertising allowances; the realizability of inventory; reserves for litigation and other contingencies; useful lives and impairments of long-lived tangible and intangible assets; fair value measurements; accounting for income taxes and related uncertain tax positions; valuation of stock-based compensation awards and related forfeiture rates; reserves for restructuring activity; and accounting for business combinations, among others. |
Reclassifications | Reclassifications |
Revenue Recognition | Revenue Recognition The Company recognizes revenue across all channels of the business when it satisfies its performance obligations by transferring control of promised products or services to its customers, which occurs either at a point in time or over time, depending on when the customer obtains the ability to direct the use of and obtain substantially all of the remaining benefits from the products or services. The amount of revenue recognized considers terms of sale that create variability in the amount of consideration that the Company ultimately expects to be entitled to in exchange for the products or services, and is subject to an overall constraint that a significant revenue reversal will not occur in future periods. Sales and other related taxes collected from customers and remitted to government authorities are excluded from revenue. Revenue from the Company's retail business is recognized when the customer takes physical possession of the products, which occurs either at the point of sale for merchandise purchased at the Company's retail stores and concession-based shop-within-shops, or upon receipt of shipment for merchandise ordered through direct-to-consumer digital commerce sites. Such revenues are recorded net of estimated returns based on historical trends. Payment is due at the point of sale. Gift cards issued to customers by the Company are recorded as a liability until they are redeemed, at which point revenue is recognized. The Company also estimates and recognizes revenue for gift card balances not expected to ever be redeemed (referred to as "breakage") to the extent that it does not have a legal obligation to remit the value of such unredeemed gift cards to the relevant jurisdiction as unclaimed or abandoned property. Such estimates are based upon historical redemption trends, with breakage income recognized in proportion to the pattern of actual customer redemptions. Revenue from the Company's wholesale business is generally recognized upon shipment of products, at which point title passes and risk of loss is transferred to the customer. In certain arrangements where the Company retains the risk of loss during shipment, revenue is recognized upon receipt of products by the customer. Wholesale revenue is recorded net of estimates of returns, discounts, end-of-season markdowns, operational chargebacks, and certain cooperative advertising allowances. Returns and allowances require pre-approval from management and discounts are based on trade terms. Estimates for end-of-season markdown reserves are based on historical trends, actual and forecasted seasonal results, an evaluation of current economic and market conditions, retailer performance, and, in certain cases, contractual terms. Estimates for operational chargebacks are based on actual customer notifications of order fulfillment discrepancies and historical trends. The Company reviews and refines these estimates on at least a quarterly basis. The Company's historical estimates of these amounts have not differed materially from actual results. Deferred Income |
Shipping and Handling Costs | Shipping and Handling Costs Costs associated with shipping goods to the Company's customers are accounted for as fulfillment activities and reflected as a component of selling, general, and administrative ("SG&A") expenses in the consolidated statements of operations. Costs of preparing merchandise for sale, such as picking, packing, warehousing, and order charges ("handling costs"), are also included in SG&A expenses. Shipping and handling costs billed to customers are included in revenue. |
Net Income per Common Share | Net Income (Loss) per Common Share Basic net income (loss) per common share is computed by dividing net income (loss) attributable to common shares by the weighted-average number of common shares outstanding during the period. Weighted-average common shares include shares of the Company's Class A and Class B common stock. Diluted net income (loss) per common share adjusts basic net income (loss) per common share for the dilutive effects of outstanding restricted stock units ("RSUs"), stock options, and any other potentially dilutive instruments, only in the periods in which such effects are dilutive. |
Accounts Receivable | Accounts Receivable In the normal course of business, the Company extends credit to wholesale customers that satisfy defined credit criteria. Payment is generally due within 30 to 120 days and does not include a significant financing component. Accounts receivable is recorded at amortized cost, which approximates fair value, and is presented in the Company's consolidated balance sheets net of certain reserves and allowances. These reserves and allowances consist of (i) reserves for returns, discounts, end-of-season markdowns, operational chargebacks, and certain cooperative advertising allowances (see the " Revenue Recognition " section above for further discussion of related accounting policies) and (ii) allowances for doubtful accounts. |
Inventories | Inventories |
Cloud Computing | Implementation Costs Incurred in Cloud Computing Arrangements For cloud computing arrangements that are a service contract, the Company capitalizes certain implementation costs incurred (depending on their nature) during the application development stage of the related project, and expenses costs during the preliminary project and post-implementation stages as they are incurred. Capitalized implementation costs are expensed on a straight-line basis over the reasonably certain term of the hosting arrangement, beginning when the module is ready for its intended use. The Company's cloud computing arrangements relate to various areas, including certain retail store and digital commerce operations, and corporate and administrative functions. Capitalized amounts related to such arrangements are recorded within prepaid expenses and other current assets and within other non-current assets in the consolidated balance sheets (see Note 6 |
Derivative Financial Instruments | Derivative Financial Instruments The Company records derivative financial instruments on its consolidated balance sheets at fair value. Changes in the fair value of derivative instruments that are designated and qualify for hedge accounting are either (i) offset through earnings against the changes in fair value of the related hedged assets, liabilities, or firm commitments or (ii) recognized in equity as a component of accumulated other comprehensive income (loss) ("AOCI") until the hedged item is recognized in earnings, depending on whether the instrument is hedging against changes in fair value or cash flows and net investments, respectively. Each derivative instrument that qualifies for hedge accounting is expected to be highly effective in offsetting the risk associated with the related exposure. For each instrument that is designated as a hedge, the Company documents the related risk management objective and strategy, including identification of the hedging instrument, the hedged item, and the risk exposure, as well as how hedge effectiveness will be assessed over the instrument's term. To assess hedge effectiveness at the inception of a hedging relationship, the Company generally uses regression analysis, a statistical method, to compare changes in the fair value of the derivative instrument to changes in the fair value or cash flows of the related hedged item. The extent to which a hedging instrument has been and is expected to remain highly effective in achieving offsetting changes in fair value or cash flows is assessed by the Company on at least a quarterly basis. Given its use of derivative instruments, the Company is exposed to the risk that counterparties to such contracts will fail to meet their contractual obligations. To mitigate such counterparty credit risk, the Company has a policy of only entering into contracts with carefully selected financial institutions based upon an evaluation of their credit ratings and certain other factors, adhering to established limits for credit exposure. The Company's established policies and procedures for mitigating credit risk from derivative transactions include ongoing review and assessment of its counterparties' creditworthiness. The Company also enters into master netting arrangements with counterparties, when possible, to further mitigate credit risk. In the event of default or termination (as such terms are defined within the respective master netting arrangement), these arrangements allow the Company to net-settle amounts payable and receivable related to multiple derivative transactions with the same counterparty. The master netting arrangements specify a number of events of default and termination, including the failure to make timely payments. The fair values of the Company's derivative instruments are recorded on its consolidated balance sheets on a gross basis. For cash flow reporting purposes, proceeds received or amounts paid upon the settlement of a derivative instrument are classified in the same manner as the related item being hedged, primarily within cash flows from operating activities for its forward foreign exchange contracts and within cash flows from investing activities for its cross-currency swap contracts, both as discussed below. Cash Flow Hedges The Company uses forward foreign currency exchange contracts to mitigate its risk related to exchange rate fluctuations on inventory transactions made in an entity's non-functional currency. To the extent designated as cash flow hedges, related gains or losses on such instruments are initially deferred in equity as a component of AOCI and are subsequently recognized within cost of goods sold in the consolidated statements of operations when the related inventory is sold. If a derivative instrument is dedesignated or if hedge accounting is discontinued because the instrument is not expected to be highly effective in hedging the designated exposure, any further gains (losses) are recognized in earnings each period within other income (expense), net. Upon discontinuance of hedge accounting, the cumulative change in fair value of the derivative instrument recorded in AOCI is recognized in earnings when the related hedged item affects earnings, consistent with the hedging strategy, unless the related forecasted transaction is probable of not occurring, in which case the accumulated amount is immediately recognized within other income (expense), net. Hedges of Net Investments in Foreign Operations The Company periodically uses cross-currency swap contracts to reduce risk associated with exchange rate fluctuations on certain of its net investments in foreign subsidiaries. Changes in the fair values of such derivative instruments that are designated as hedges of net investments in foreign operations are recorded in equity as a component of AOCI in the same manner as foreign currency translation adjustments. In assessing the effectiveness of such hedges, the Company uses a method based on changes in spot rates to measure the impact of foreign currency exchange rate fluctuations on both its foreign subsidiary net investment and the related hedging instrument. Under this method, changes in the fair value of the hedging instrument other than those due to changes in the spot rate are initially recorded in AOCI as a translation adjustment and are amortized into earnings as interest expense using a systematic and rational method over the instrument's term. Changes in fair value associated with the effective portion (i.e., those due to changes in the spot rate) are recorded in AOCI as a translation adjustment and are released and recognized in earnings only upon the sale or liquidation of the hedged net investment. Fair Value Hedges Changes in the fair value of a derivative instrument that is designated as a fair value hedge, along with offsetting changes in the fair value of the related hedged item attributable to the hedged risk, are recorded in earnings. To the extent that the change in the fair value of the hedged item does not fully offset the change in the fair value of the hedging instrument, the resulting net impact is reflected in earnings within the income statement line item associated with the hedged item. Undesignated Hedges The Company uses undesignated hedges primarily to hedge foreign currency exchange rate risk related to third-party and intercompany balances and exposures. Changes in the fair value of undesignated derivative instruments are recognized in earnings each period within other income (expense), net. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Jun. 27, 2020 | |
Summary of Significant Accounting Policies (Tables) [Abstract] | |
Contractually-Guaranteed Minimum Royalties | As of June 27, 2020 , contractually-guaranteed minimum royalty amounts expected to be recognized as revenue during future periods were as follows: Contractually-Guaranteed Minimum Royalties (a) (millions) Remainder of Fiscal 2021 $ 56.7 Fiscal 2022 67.3 Fiscal 2023 43.6 Fiscal 2024 26.6 Fiscal 2025 and thereafter 1.1 Total $ 195.3 (a) Amounts presented do not contemplate anticipated contract renewals or royalties earned in excess of the contractually-guaranteed minimums. |
Disaggregation of Revenue | The following tables disaggregate the Company's net revenues into categories that depict how the nature, amount, timing, and uncertainty of revenues and cash flows are affected by economic factors for the fiscal periods presented: Three Months Ended June 27, 2020 June 29, 2019 North America Europe Asia Other Total North America Europe Asia Other Total (millions) Sales Channel (a) : Retail $ 142.6 $ 79.2 $ 166.5 $ 6.5 $ 394.8 $ 403.1 $ 218.5 $ 246.5 $ 49.5 $ 917.6 Wholesale 22.5 41.5 5.4 0.5 69.9 316.3 142.3 12.1 1.8 472.5 Licensing — — — 22.8 22.8 — — — 38.7 38.7 Total $ 165.1 $ 120.7 $ 171.9 $ 29.8 $ 487.5 $ 719.4 $ 360.8 $ 258.6 $ 90.0 $ 1,428.8 (a) Net revenues from the Company's retail and wholesale businesses are recognized at a point in time. Net revenues from the Company's licensing business are recognized over time. |
Shipping and Handling Charges | A summary of shipping and handling costs for the fiscal periods presented is as follows: Three Months Ended June 27, June 29, (millions) Shipping costs $ 8.4 $ 9.9 Handling costs 26.5 36.2 |
Summary of Basic and Diluted shares | The weighted-average number of common shares outstanding used to calculate basic net income (loss) per common share is reconciled to shares used to calculate diluted net income (loss) per common share as follows: Three Months Ended June 27, June 29, (millions) Basic shares 73.1 78.2 Dilutive effect of RSUs and stock options — (a) 1.7 Diluted shares 73.1 79.9 (a) Incremental shares of 1.6 million attributable to outstanding RSUs were excluded from the computation of diluted shares for the three months ended June 27, 2020 , as such shares would not be dilutive as a result of the net loss incurred. |
Sales Returns and Allowances [Member] | |
Summary of Significant Accounting Policies (Tables) [Abstract] | |
Rollforward of activity in the Company's allowance for doubtful accounts and its aggregate reserves for returns, discounts, end-of-season markdowns, operational chargebacks, and certain cooperative advertising allowances | A rollforward of the activity in the Company's reserves for returns, discounts, end-of-season markdowns, operational chargebacks, and certain cooperative advertising allowances is presented below: Three Months Ended June 27, June 29, (millions) Beginning reserve balance $ 204.7 $ 176.5 Amount charged against revenue to increase reserve 11.3 113.9 Amount credited against customer accounts to decrease reserve (33.9 ) (125.9 ) Foreign currency translation 1.9 1.0 Ending reserve balance $ 184.0 $ 165.5 |
Allowance for Doubtful Accounts | |
Summary of Significant Accounting Policies (Tables) [Abstract] | |
Rollforward of activity in the Company's allowance for doubtful accounts and its aggregate reserves for returns, discounts, end-of-season markdowns, operational chargebacks, and certain cooperative advertising allowances | A rollforward of the activity in the Company's allowance for doubtful accounts is presented below: Three Months Ended June 27, June 29, (millions) Beginning reserve balance $ 71.5 $ 15.7 Amount recorded to expense to increase (decrease) reserve (a) (16.5 ) 0.1 Amount written-off against customer accounts to decrease reserve — (1.0 ) Foreign currency translation 0.9 0.2 Ending reserve balance $ 55.9 $ 15.0 (a) Amounts recorded to bad debt expense are included within SG&A expenses in the consolidated statements of operations. |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Jun. 27, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment, net | Property and equipment, net consists of the following: June 27, March 28, (millions) Land and improvements $ 15.3 $ 15.3 Buildings and improvements 311.6 309.0 Furniture and fixtures 637.7 629.5 Machinery and equipment 383.2 378.8 Capitalized software 547.4 543.3 Leasehold improvements 1,213.6 1,194.5 Construction in progress 33.0 37.5 3,141.8 3,107.9 Less: accumulated depreciation (2,196.0 ) (2,128.4 ) Property and equipment, net $ 945.8 $ 979.5 |
Other Assets and Liabilities (T
Other Assets and Liabilities (Tables) | 3 Months Ended |
Jun. 27, 2020 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of prepaid expenses and other current assets | Prepaid expenses and other current assets consist of the following: June 27, March 28, (millions) Prepaid inventory $ 41.8 $ 0.2 Non-trade receivables 32.8 27.0 Other taxes receivable 22.3 24.7 Prepaid software maintenance 15.7 14.8 Inventory return asset 10.5 8.9 Cloud computing arrangement implementation costs 9.3 8.4 Prepaid advertising and marketing 7.1 10.1 Prepaid occupancy expense 5.8 6.7 Derivative financial instruments 3.7 13.7 Other prepaid expenses and current assets 51.6 46.3 Total prepaid expenses and other current assets $ 200.6 $ 160.8 |
Schedule of other non-current assets | Other non-current assets consist of the following: June 27, March 28, (millions) Derivative financial instruments $ 42.9 $ 48.6 Security deposits 29.2 29.4 Restricted cash 8.2 8.0 Cloud computing arrangement implementation costs 5.1 4.9 Other non-current assets 20.6 21.0 Total other non-current assets $ 106.0 $ 111.9 |
Schedule of accrued expenses and other current liabilities | Accrued expenses and other current liabilities consist of the following: June 27, March 28, (millions) Accrued inventory $ 181.5 $ 167.1 Accrued operating expenses 181.0 176.4 Accrued payroll and benefits 149.5 186.2 Other taxes payable 65.0 47.9 Accrued capital expenditures 26.4 29.1 Restructuring reserve 17.1 25.5 Deferred income 15.0 14.6 Finance lease obligations 9.4 9.8 Derivative financial instruments 0.7 6.9 Dividends payable — 49.8 Other accrued expenses and current liabilities 11.6 3.8 Total accrued expenses and other current liabilities $ 657.2 $ 717.1 |
Schedule of non-current liabilities | Other non-current liabilities consist of the following: June 27, March 28, (millions) Finance lease obligations $ 189.7 $ 189.4 Deferred lease incentives and obligations 55.8 57.8 Accrued benefits and deferred compensation 18.6 19.5 Derivative financial instruments 17.5 — Deferred tax liabilities 10.5 10.0 Other non-current liabilities 33.7 31.8 Total other non-current liabilities $ 325.8 $ 308.5 |
Restructuring and Other Charg_2
Restructuring and Other Charges (Tables) - Fiscal 2019 Restructuring Plan | 3 Months Ended |
Jun. 27, 2020 | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and Related Costs | A summary of the charges recorded in connection with the Fiscal 2019 Restructuring Plan during the fiscal period presented, as well as the cumulative charges recorded since its inception, is as follows: Three Months Ended June 29, Cumulative Charges (millions) Cash-related restructuring charges: Severance and benefit costs $ 5.9 $ 90.3 Lease termination and store closure costs 0.3 2.3 Other cash charges 0.8 10.8 Total cash-related restructuring charges 7.0 103.4 Non-cash charges: Impairment of assets (see Note 7) 1.2 19.0 Inventory-related charges (a) 0.6 8.2 Accelerated stock-based compensation expense (b) — 3.6 Loss on sale of property (c) — 11.6 Total non-cash charges 1.8 42.4 Total charges $ 8.8 $ 145.8 (a) Inventory-related charges are recorded within cost of goods sold in the consolidated statements of operations. (b) Accelerated stock-based compensation expense, which is recorded within restructuring and other charges in the consolidated statements of operations, was recorded in connection with vesting provisions associated with certain separation agreements. (c) Loss on sale of property, which was recorded within restructuring and other charges in the consolidated statements of operations, was incurred in connection with the sale of one of the Company's distribution centers in North America. |
Schedule of Restructuring Reserve by Type of Cost | A summary of current period activity in the restructuring reserve related to the Fiscal 2019 Restructuring Plan is as follows: Severance and Benefit Costs Lease Termination and Store Closure Costs Other Cash Charges Total (millions) Balance at March 28, 2020 $ 23.5 $ — $ 0.6 $ 24.1 Additions charged to expense — — — — Cash payments charged against reserve (8.0 ) — (0.6 ) (8.6 ) Balance at June 27, 2020 $ 15.5 $ — $ — $ 15.5 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Jun. 27, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Debt Instruments | Debt consists of the following: June 27, March 28, (millions) $300 million 2.625% Senior Notes (a) $ 299.9 $ 299.6 $400 million 3.750% Senior Notes (b) 396.6 396.4 $500 million 1.700% Senior Notes (c) 497.3 — $750 million 2.950% Senior Notes (d) 736.2 — Borrowings outstanding under credit facilities — 475.0 Total debt 1,930.0 1,171.0 Less: short-term debt and current portion of long-term debt 299.9 774.6 Total long-term debt $ 1,630.1 $ 396.4 (a) The carrying value of the 2.625% Senior Notes is presented net of unamortized debt issuance costs and original issue discount of $0.1 million and $0.2 million as of June 27, 2020 and March 28, 2020 , respectively. The carrying value of the 2.625% Senior Notes as of March 28, 2020 also reflects an adjustment of $0.2 million associated with a related interest rate swap contract (see Note 12 ). (b) The carrying value of the 3.750% Senior Notes is presented net of unamortized debt issuance costs and original issue discount of $3.4 million and $3.6 million as of June 27, 2020 and March 28, 2020 , respectively. (c) The carrying value of the 1.700% Senior Notes is presented net of unamortized debt issuance costs and original issue discount of $2.7 million as of June 27, 2020 . (d) The carrying value of the 2.950% Senior Notes is presented net of unamortized debt issuance costs and original issue discount of $13.8 million as of June 27, 2020 . |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Jun. 27, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair value of financial assets and liabilities measured and recorded at fair value on recurring basis | The following table summarizes the Company's financial assets and liabilities that are measured and recorded at fair value on a recurring basis, excluding accrued interest components: June 27, March 28, (millions) Investments in commercial paper (a)(b) $ 50.0 $ 243.6 Derivative assets (a) 46.6 62.3 Derivative liabilities (a) 18.2 6.9 (a) Based on Level 2 measurements. (b) Amounts are included within short-term investments in the consolidated balance sheet. |
Carrying value and the estimated fair value of the Company's debt obligations | The following table summarizes the carrying values and the estimated fair values of the Company's debt instruments: June 27, 2020 March 28, 2020 Carrying Value (a) Fair Value (b) Carrying Value (a) Fair Value (b) (millions) $300 million 2.625% Senior Notes $ 299.9 $ 300.4 $ 299.6 $ 299.8 $400 million 3.750% Senior Notes 396.6 445.8 396.4 415.1 $500 million 1.700% Senior Notes 497.3 507.6 — — $750 million 2.950% Senior Notes 736.2 766.1 — — Borrowings outstanding under credit facilities — — 475.0 473.0 (a) See Note 10 for discussion of the carrying values of the Company's senior notes. (b) Based on Level 2 measurements. |
Fair value measurements, nonrecurring | The following tables summarize non-cash impairment charges recorded by the Company during the fiscal periods presented in order to reduce the carrying values of certain long-lived assets to their estimated fair values as of the assessment date: Three Months Ended June 27, 2020 June 29, 2019 Long-Lived Asset Category Fair Value As of Impairment Date Total Impairments Fair Value As of Impairment Date Total Impairments (millions) Property and equipment, net N/A $ — $ — $ 0.9 Operating lease right-of-use assets (a) $ — 2.1 92.9 225.4 (a) Total impairment charges for the three months ended June 29, 2019 includes $225.1 million recorded in connection with the Company's adoption of ASU No. 2016-02, "Leases" as of the beginning of Fiscal 2020 which, net of related income tax benefits, reduced its opening retained earnings balance by $169.4 million . |
Financial Instruments (Tables)
Financial Instruments (Tables) | 3 Months Ended |
Jun. 27, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Company's outstanding derivative instruments on a gross basis as recorded on its consolidated balance sheets | The following table summarizes the Company's outstanding derivative instruments recorded on its consolidated balance sheets as of June 27, 2020 and March 28, 2020 : Notional Amounts Derivative Assets Derivative Liabilities Derivative Instrument (a) June 27, March 28, June 27, March 28, June 27, March 28, Balance Sheet Line (b) Fair Value Balance Sheet Line (b) Fair Value Balance Sheet Line (b) Fair Value Balance Sheet Line (b) Fair Value (millions) Designated Hedges : FC — Cash flow hedges $ 162.6 $ 229.0 PP $ 3.3 PP $ 7.4 AE $ 0.2 AE $ 0.4 IRS — Fixed-rate debt — 300.0 — — — AE 0.2 Net investment hedges (c) 689.6 683.6 ONCA 42.9 ONCA 48.6 ONCL 17.5 AE 4.0 Total Designated Hedges 852.2 1,212.6 46.2 56.0 17.7 4.6 Undesignated Hedges : FC — Undesignated hedges (d) 212.6 473.5 PP 0.4 PP 6.3 AE 0.5 AE 2.3 Total Hedges $ 1,064.8 $ 1,686.1 $ 46.6 $ 62.3 $ 18.2 $ 6.9 (a) FC = Forward foreign currency exchange contracts; IRS = Interest rate swap contracts. (b) PP = Prepaid expenses and other current assets; AE = Accrued expenses and other current liabilities; ONCA = Other non-current assets; ONCL = Other non-current liabilities. (c) Includes cross-currency swaps designated as hedges of the Company's net investment in certain foreign operations. (d) Relates to third-party and intercompany foreign currency-denominated exposures and balances. |
Offsetting Assets | The Company presents the fair values of its derivative assets and liabilities recorded on its consolidated balance sheets on a gross basis, even when they are subject to master netting arrangements. However, if the Company were to offset and record the asset and liability balances of all of its derivative instruments on a net basis in accordance with the terms of each of its master netting arrangements, spread across ten separate counterparties, the amounts presented in the consolidated balance sheets as of June 27, 2020 and March 28, 2020 would be adjusted from the current gross presentation as detailed in the following table: June 27, 2020 March 28, 2020 Gross Amounts Presented in the Balance Sheet Gross Amounts Not Offset in the Balance Sheet that are Subject to Master Netting Agreements Net Amount Gross Amounts Presented in the Balance Sheet Gross Amounts Not Offset in the Balance Sheet that are Subject to Master Netting Agreements Net Amount (millions) Derivative assets $ 46.6 $ (0.5 ) $ 46.1 $ 62.3 $ (6.1 ) $ 56.2 Derivative liabilities 18.2 (0.5 ) 17.7 6.9 (6.1 ) 0.8 |
Gains (losses) recognized in AOCI or earnings from derivatives designated as hedging instruments | The following tables summarize the pretax impact of gains and losses from the Company's designated derivative instruments on its consolidated financial statements for the three-month periods ended June 27, 2020 and June 29, 2019 : Gains (Losses) Recognized in OCI Three Months Ended June 27, June 29, (millions) Designated Hedges: FC — Cash flow hedges $ (3.0 ) $ (4.4 ) Net investment hedges — effective portion 0.7 (10.0 ) Net investment hedges — portion excluded from assessment of hedge effectiveness (16.8 ) 2.5 Total Designated Hedges $ (19.1 ) $ (11.9 ) Location and Amount of Gains (Losses) from Cash Flow Hedges Reclassified from AOCI to Earnings Three Months Ended June 27, June 29, Cost of goods sold Other income (expense), net Cost of goods sold Other income (expense), net (millions) Total amounts presented in the consolidated statements of operations in which the effects of related cash flow hedges are recorded $ (138.8 ) $ 2.1 $ (508.0 ) $ (4.1 ) Effects of cash flow hedging: FC — Cash flow hedges 1.7 (0.3 ) 6.2 0.2 Gains (Losses) from Net Investment Hedges Recognized in Earnings Location of Gains (Losses) Three Months Ended June 27, June 29, (millions) Net Investment Hedges Net investment hedges — portion excluded from assessment of hedge effectiveness (a) $ 2.7 $ 5.0 Interest expense Total Net Investment Hedges $ 2.7 $ 5.0 (a) Amounts recognized in other comprehensive income (loss) ("OCI") relating to the effective portion of the Company's net investment hedges would be recognized in earnings only upon the sale or liquidation of the hedged net investment. |
Gains (losses) recognized in earnings from derivatives not designated as hedging instruments | The following table summarizes the pretax impact of gains and losses from the Company's undesignated derivative instruments on its consolidated financial statements for the three-month periods ended June 27, 2020 and June 29, 2019 : Gains (Losses) Recognized in Earnings Location of Gains (Losses) Recognized in Earnings Three Months Ended June 27, June 29, (millions) Undesignated Hedges: FC — Undesignated hedges $ 4.7 $ 1.9 Other income (expense), net Total Undesignated Hedges $ 4.7 $ 1.9 |
Fair Value Hedging Adjustments | The following table summarizes the carrying value of the hedged senior notes and the impacts of the related fair value hedging adjustments as of June 27, 2020 and March 28, 2020 : Carrying Value of the Hedged Item Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Value of the Hedged Item Hedged Item Balance Sheet Line in which the Hedged Item is Included June 27, March 28, June 27, March 28, (millions) $300 million 2.625% Senior Notes (a) Current portion of long-term debt $ 299.9 $ 299.6 $ — $ (0.2 ) (a) The interest rate swap contract designated as a fair value hedge of the Company's 2.625% Senior Notes was settled during the three months ended June 27, 2020 at a loss of $0.3 million . |
Equity (Tables)
Equity (Tables) | 3 Months Ended |
Jun. 27, 2020 | |
Equity [Abstract] | |
Summary of Repurchased Common Stock | A summary of the Company's repurchases of Class A common stock under its common stock repurchase program is as follows: Three Months Ended June 27, June 29, (millions) Cost of shares repurchased $ — $ 150.0 Number of shares repurchased — 1.3 |
Accumulated Other Comrehensive
Accumulated Other Comrehensive Income (Loss) (Tables) | 3 Months Ended |
Jun. 27, 2020 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The following table presents OCI activity, net of tax, accumulated in equity: Foreign Currency Translation Gains (Losses) (a) Net Unrealized Gains (Losses) on Cash Flow Hedges (b) Net Unrealized Gains (Losses) on Defined Benefit Plans (c) Total Accumulated Other Comprehensive Income (Loss) (millions) Balance at March 28, 2020 $ (130.4 ) $ 18.0 $ (5.8 ) $ (118.2 ) Other comprehensive income (loss), net of tax: OCI before reclassifications 13.0 (2.8 ) (0.1 ) 10.1 Amounts reclassified from AOCI to earnings — (1.2 ) — (1.2 ) Other comprehensive income (loss), net of tax 13.0 (4.0 ) (0.1 ) 8.9 Balance at June 27, 2020 $ (117.4 ) $ 14.0 $ (5.9 ) $ (109.3 ) Balance at March 30, 2019 $ (118.5 ) $ 20.2 $ (5.1 ) $ (103.4 ) Other comprehensive income (loss), net of tax: OCI before reclassifications 8.9 (3.9 ) (0.1 ) 4.9 Amounts reclassified from AOCI to earnings (4.9 ) (5.8 ) — (10.7 ) Other comprehensive income (loss), net of tax 4.0 (9.7 ) (0.1 ) (5.8 ) Balance at June 29, 2019 $ (114.5 ) $ 10.5 $ (5.2 ) $ (109.2 ) (a) OCI before reclassifications to earnings related to foreign currency translation gains (losses) includes income tax benefits of $4.7 million and $2.0 million for the three-month periods ended June 27, 2020 and June 29, 2019 , respectively. OCI before reclassifications to earnings for the three-month periods ended June 27, 2020 and June 29, 2019 include losses of $12.2 million (net of a $3.9 million income tax benefit) and $5.7 million (net of a $1.8 million income tax benefit), respectively, related to changes in the fair values of instruments designated as hedges of the Company's net investment in certain foreign operations (see Note 12 ). Amounts reclassified from AOCI to earnings related to foreign currency translation gains (losses) for the three months ended June 29, 2019 relate to the reclassification to retained earnings of income tax effects stranded in AOCI. (b) OCI before reclassifications to earnings related to net unrealized gains (losses) on cash flow hedges are presented net of income tax benefits of $0.2 million and $0.5 million for the three-month periods ended June 27, 2020 and June 29, 2019 , respectively. The tax effects on amounts reclassified from AOCI to earnings are presented in a table below. (c) Activity is presented net of taxes, which were immaterial for both periods presented. |
Reclassification out of Accumulated Other Comprehensive Income (Loss) | The following table presents reclassifications from AOCI to earnings for cash flow hedges, by component: Three Months Ended Location of Gains (Losses) Reclassified from AOCI to Earnings June 27, June 29, (millions) Gains (losses) on cash flow hedges (a) : FC — Cash flow hedges $ 1.7 $ 6.2 Cost of goods sold FC — Cash flow hedges (0.3 ) 0.2 Other income (expense), net Tax effect (0.2 ) (0.6 ) Income tax benefit (provision) Net of tax $ 1.2 $ 5.8 (a) FC = Forward foreign currency exchange contracts. |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 3 Months Ended |
Jun. 27, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Summary of the total compensation expense and the associated income tax benefits recognized related to stock-based compensation arrangements | A summary of total stock-based compensation expense and the related income tax benefits recognized during the three-month periods ended June 27, 2020 and June 29, 2019 is as follows: Three Months Ended June 27, June 29, (millions) Compensation expense $ 15.1 $ 23.0 Income tax benefit (3.1 ) (3.6 ) |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of the stock option activity under all plans | A summary of stock option activity under all plans during the three months ended June 27, 2020 is as follows: Number of Options (thousands) Options outstanding at March 28, 2020 518 Granted — Exercised — Cancelled/Forfeited (34 ) Options outstanding at June 27, 2020 484 |
Restricted Stock And Service Based Restricted Stock Units [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of restricted stock and restricted stock unit activity | A summary of restricted stock and service-based RSU activity during the three months ended June 27, 2020 is as follows: Number of Shares/Units Restricted Stock Service-based RSUs (thousands) Unvested at March 28, 2020 4 1,094 Granted — 645 Vested (4 ) (353 ) Forfeited — (20 ) Unvested at June 27, 2020 — 1,366 |
Performance-based restricted stock units [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of restricted stock and restricted stock unit activity | A summary of performance-based RSU activity during the three months ended June 27, 2020 is as follows: Number of Performance-based RSUs (thousands) Unvested at March 28, 2020 934 Granted — Change due to performance condition achievement 185 Vested (720 ) Forfeited (27 ) Unvested at June 27, 2020 372 |
Market-based restricted stock units [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of restricted stock and restricted stock unit activity | A summary of market-based RSU activity during the three months ended June 27, 2020 is as follows: Number of Market-based RSUs (thousands) Unvested at March 28, 2020 234 Granted — Change due to market condition achievement — Vested — Forfeited — Unvested at June 27, 2020 234 |
Schedule of Share Based Payment Award with Market Condition Valuation Assumptions [Table Text Block] | The assumptions used to estimate the fair value of TSR awards granted during the three months ended June 29, 2019 were as follows: Three Months Ended June 29, Expected term (years) 2.8 Expected volatility 30.8 % Expected dividend yield 2.4 % Risk-free interest rate 1.7 % |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Jun. 27, 2020 | |
Segment Reporting [Abstract] | |
Net revenues by segment | Net revenues and operating income (loss) for each of the Company's segments are as follows: Three Months Ended June 27, June 29, (millions) Net revenues: North America $ 165.1 $ 719.4 Europe 120.7 360.8 Asia 171.9 258.6 Other non-reportable segments 29.8 90.0 Total net revenues $ 487.5 $ 1,428.8 |
Net operating income by segment | Three Months Ended June 27, June 29, (millions) Operating income (loss) (a) : North America $ (24.8 ) $ 150.1 Europe (16.9 ) 79.4 Asia 10.1 48.1 Other non-reportable segments 0.9 32.9 (30.7 ) 310.5 Unallocated corporate expenses (130.3 ) (137.6 ) Unallocated restructuring and other charges (b) (7.0 ) (29.6 ) Total operating income (loss) $ (168.0 ) $ 143.3 (a) Segment operating income (loss) during the three months ended June 27, 2020 reflects bad debt expense reversals of $15.5 million and $1.0 million related to North America and Europe, respectively, primarily related to adjustments to reserves previously established in connection with COVID-19 business disruptions. Segment operating income (loss) and unallocated corporate expenses during the three-month periods ended June 27, 2020 and June 29, 2019 also included asset impairment charges (see Note 7 ), which are detailed below: Three Months Ended June 27, June 29, (millions) Asset impairment charges: North America $ (0.2 ) $ — Asia (1.3 ) — Other non-reportable segments (0.6 ) — Unallocated corporate expenses — (1.2 ) Total asset impairment charges $ (2.1 ) $ (1.2 ) (b) The three-month periods ended June 27, 2020 and June 29, 2019 included certain unallocated restructuring and other charges (see Note 8 ), which are detailed below: Three Months Ended June 27, June 29, (millions) Unallocated restructuring and other charges: North America-related $ (0.1 ) $ (0.7 ) Europe-related — (1.8 ) Asia-related 0.2 (0.5 ) Other non-reportable segment-related (1.1 ) — Corporate operations-related (1.6 ) (4.0 ) Unallocated restructuring charges (2.6 ) (7.0 ) Other charges (see Note 8) (4.4 ) (22.6 ) Total unallocated restructuring and other charges $ (7.0 ) $ (29.6 ) |
Asset impairment charges by segment | Segment operating income (loss) and unallocated corporate expenses during the three-month periods ended June 27, 2020 and June 29, 2019 also included asset impairment charges (see Note 7 ), which are detailed below: Three Months Ended June 27, June 29, (millions) Asset impairment charges: North America $ (0.2 ) $ — Asia (1.3 ) — Other non-reportable segments (0.6 ) — Unallocated corporate expenses — (1.2 ) Total asset impairment charges $ (2.1 ) $ (1.2 ) |
Schedule of unallocated restructuring and related costs | The three-month periods ended June 27, 2020 and June 29, 2019 included certain unallocated restructuring and other charges (see Note 8 ), which are detailed below: Three Months Ended June 27, June 29, (millions) Unallocated restructuring and other charges: North America-related $ (0.1 ) $ (0.7 ) Europe-related — (1.8 ) Asia-related 0.2 (0.5 ) Other non-reportable segment-related (1.1 ) — Corporate operations-related (1.6 ) (4.0 ) Unallocated restructuring charges (2.6 ) (7.0 ) Other charges (see Note 8) (4.4 ) (22.6 ) Total unallocated restructuring and other charges $ (7.0 ) $ (29.6 ) |
Depreciation and amortization by segment | Depreciation and amortization expense for the Company's segments is as follows: Three Months Ended June 27, June 29, (millions) Depreciation and amortization expense: North America $ 18.1 $ 18.9 Europe 7.7 7.6 Asia 14.2 15.0 Other non-reportable segments 1.1 1.3 Unallocated corporate 22.6 23.4 Total depreciation and amortization expense $ 63.7 $ 66.2 |
Net revenues by geographic location | Net revenues by geographic location of the reporting subsidiary are as follows: Three Months Ended June 27, June 29, (millions) Net revenues (a) : The Americas (b) $ 194.7 $ 810.4 Europe (c) 120.9 359.5 Asia (d) 171.9 258.9 Total net revenues $ 487.5 $ 1,428.8 (a) Net revenues for certain of the Company's licensed operations are included within the geographic location of the reporting subsidiary which holds the respective license. (b) Includes the U.S., Canada, and Latin America. Net revenues earned in the U.S. during the three-month periods ended June 27, 2020 and June 29, 2019 were $186.1 million and $760.1 million , respectively. (c) Includes the Middle East. (d) Includes Australia and New Zealand. |
Additional Financial Informat_2
Additional Financial Information (Tables) | 3 Months Ended |
Jun. 27, 2020 | |
Supplemental Cash Flow Information [Abstract] | |
Schedule of Cash, Cash Equivalents, and Restricted Cash | A reconciliation of cash, cash equivalents, and restricted cash as of June 27, 2020 and March 28, 2020 from the consolidated balance sheets to the consolidated statements of cash flows is as follows: June 27, March 28, (millions) Cash and cash equivalents $ 2,451.3 $ 1,620.4 Restricted cash included within prepaid expenses and other current assets 1.4 1.4 Restricted cash included within other non-current assets 8.2 8.0 Total cash, cash equivalents, and restricted cash $ 2,460.9 $ 1,629.8 |
Cash Interest and Taxes | Cash paid for interest and income taxes is as follows: Three Months Ended June 27, June 29, (millions) Cash paid for interest $ 3.3 $ 2.4 Cash paid for income taxes 18.9 22.3 |
Description of Business (Detail
Description of Business (Details) | 3 Months Ended |
Jun. 27, 2020Segment | |
Description of Business [Abstract] | |
Number of reportable segments | 3 |
Basis of Presentation Basis of
Basis of Presentation Basis of Presentation (Details) $ in Millions | Jun. 27, 2020USD ($) |
1.700% & 2.950% Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument, Face Amount | $ 1,250 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) $ in Millions | Jun. 27, 2020USD ($) |
Accounting Policies [Abstract] | |
Contractually-Guaranteed Minimum Royalties - Remainder of Fiscal 2021 | $ 56.7 |
Contractually-Guaranteed Minimum Royalties - Fiscal 2022 | 67.3 |
Contractually-Guaranteed Minimum Royalties - Fiscal 2023 | 43.6 |
Contractually-Guaranteed Minimum Royalties - Fiscal 2024 | 26.6 |
Contractually-Guaranteed Minimum Royalties - Fiscal 2025 and Thereafter | 1.1 |
Contractually-Guaranteed Minimum Royalties - Total | $ 195.3 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details 1) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Net revenues | $ 487.5 | $ 1,428.8 |
North America segment [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 165.1 | 719.4 |
Europe segment [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 120.7 | 360.8 |
Asia segment [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 171.9 | 258.6 |
Other Non-Reportable Segment-Related [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 29.8 | 90 |
Transferred at Point in Time [Member] | Retail [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 394.8 | 917.6 |
Transferred at Point in Time [Member] | Retail [Member] | North America segment [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 142.6 | 403.1 |
Transferred at Point in Time [Member] | Retail [Member] | Europe segment [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 79.2 | 218.5 |
Transferred at Point in Time [Member] | Retail [Member] | Asia segment [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 166.5 | 246.5 |
Transferred at Point in Time [Member] | Retail [Member] | Other Non-Reportable Segment-Related [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 6.5 | 49.5 |
Transferred at Point in Time [Member] | Wholesale [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 69.9 | 472.5 |
Transferred at Point in Time [Member] | Wholesale [Member] | North America segment [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 22.5 | 316.3 |
Transferred at Point in Time [Member] | Wholesale [Member] | Europe segment [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 41.5 | 142.3 |
Transferred at Point in Time [Member] | Wholesale [Member] | Asia segment [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 5.4 | 12.1 |
Transferred at Point in Time [Member] | Wholesale [Member] | Other Non-Reportable Segment-Related [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 0.5 | 1.8 |
Transferred over Time [Member] | Licensing [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 22.8 | 38.7 |
Transferred over Time [Member] | Licensing [Member] | North America segment [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 0 | 0 |
Transferred over Time [Member] | Licensing [Member] | Europe segment [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 0 | 0 |
Transferred over Time [Member] | Licensing [Member] | Asia segment [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | 0 | 0 |
Transferred over Time [Member] | Licensing [Member] | Other Non-Reportable Segment-Related [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net revenues | $ 22.8 | $ 38.7 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details 2) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Accounting Policies [Abstract] | ||
Shipping Costs | $ 8.4 | $ 9.9 |
Handling Costs | $ 26.5 | $ 36.2 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Details 3) - shares shares in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Summary of basic and diluted shares | ||
Basic shares | 73.1 | 78.2 |
Dilutive effect of RSUs and stock options | 0 | 1.7 |
Diluted shares | 73.1 | 79.9 |
Incremental shares excluded due to net loss | 1.6 | |
Summary of Significant Accounting Policies (Textual) [Abstract] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0.8 | 1 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies (Details 4) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Sales Returns and Allowances [Member] | ||
Rollforward of activity in the Company's allowance for doubtful accounts and its aggregate reserves for returns, discounts, end-of-season markdowns and operational chargebacks | ||
Beginning reserve balance | $ 204.7 | $ 176.5 |
Amount charged against revenue to increase reserve | 11.3 | 113.9 |
Amount credited against customer accounts to decrease reserve | (33.9) | (125.9) |
Foreign currency translation | 1.9 | 1 |
Ending reserve balance | 184 | 165.5 |
Allowance for Doubtful Accounts | ||
Rollforward of activity in the Company's allowance for doubtful accounts and its aggregate reserves for returns, discounts, end-of-season markdowns and operational chargebacks | ||
Beginning reserve balance | 71.5 | 15.7 |
Amount recorded to expense to increase (decrease) reserve | (16.5) | 0.1 |
Amount credited against customer accounts to decrease reserve | 0 | (1) |
Foreign currency translation | 0.9 | 0.2 |
Ending reserve balance | $ 55.9 | $ 15 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies (Details Textual) $ in Millions | 3 Months Ended | 12 Months Ended | |
Jun. 27, 2020USD ($)Customer | Jun. 29, 2019USD ($) | Mar. 28, 2020USD ($) | |
Summary of Significant Accounting Policies (Textual) [Abstract] | |||
Deferred income | $ 15.1 | $ 14.6 | |
Amount of revenue recognized that was previously reported as deferred income | $ 3.4 | ||
Wholesale customer payment terms | 30 to 120 days | ||
Number Of Key Department Store Customers | Customer | 3 | ||
Inventory, Net | $ 773.2 | $ 988.6 | $ 736.2 |
Hosting Arrangement, Service Contract, Implementation Cost, Expense, Amortization | $ 2.5 | $ 0.8 | |
Total Net Revenue [Member] | |||
Summary of Significant Accounting Policies (Textual) [Abstract] | |||
Contribution of Key Wholesale Customers | 18.00% | ||
Accounts Receivable [Member] | |||
Summary of Significant Accounting Policies (Textual) [Abstract] | |||
Contribution of Key Wholesale Customers | 16.00% |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Mar. 28, 2020 | |
Property and equipment, net | |||
Land and improvements | $ 15.3 | $ 15.3 | |
Buildings and improvements | 311.6 | 309 | |
Furniture and fixtures | 637.7 | 629.5 | |
Machinery and equipment | 383.2 | 378.8 | |
Capitalized software | 547.4 | 543.3 | |
Leasehold improvements | 1,213.6 | 1,194.5 | |
Construction in progress | 33 | 37.5 | |
Property and equipment, gross | 3,141.8 | 3,107.9 | |
Less: accumulated depreciation | (2,196) | (2,128.4) | |
Property and equipment, net | 945.8 | $ 979.5 | |
Operating costs and expenses | |||
Depreciation expense | $ 58.5 | $ 60.3 |
Other Assets and Liabilities (D
Other Assets and Liabilities (Details) - USD ($) $ in Millions | Jun. 27, 2020 | Mar. 28, 2020 |
Prepaid Expense and Other Assets, Current | ||
Prepaid inventory | $ 41.8 | $ 0.2 |
Non-trade receivables | 32.8 | 27 |
Other taxes receivable | 22.3 | 24.7 |
Prepaid software maintenance | 15.7 | 14.8 |
Inventory return asset | 10.5 | 8.9 |
Cloud computing arrangement implementation costs, current | 9.3 | 8.4 |
Prepaid advertising and marketing | 7.1 | 10.1 |
Prepaid occupancy costs | 5.8 | 6.7 |
Derivative financial instruments, current | 3.7 | 13.7 |
Other prepaid expenses and other current assets | 51.6 | 46.3 |
Prepaid expenses and other current assets | 200.6 | 160.8 |
Other Assets, Noncurrent | ||
Derivative financial instruments, noncurrent | 42.9 | 48.6 |
Security deposits | 29.2 | 29.4 |
Restricted cash, noncurrent | 8.2 | 8 |
Cloud computing arrangement implementation costs, noncurrent | 5.1 | 4.9 |
Other non-current assets | 20.6 | 21 |
Total other non-current assets | 106 | 111.9 |
Accrued Expenses and Other Current Liabilities | ||
Accrued inventory | 181.5 | 167.1 |
Accrued operating expenses | 181 | 176.4 |
Accrued payroll and benefits | 149.5 | 186.2 |
Other taxes payable | 65 | 47.9 |
Accrued capital expenditures | 26.4 | 29.1 |
Restructuring reserve, current | 17.1 | 25.5 |
Deferred income | 15 | 14.6 |
Finance lease obligations, current | 9.4 | 9.8 |
Derivative financial instruments, current | 0.7 | 6.9 |
Dividends payable | 0 | 49.8 |
Other accrued expenses and current liabilities | 11.6 | 3.8 |
Total accrued expenses and other current liabilities | 657.2 | 717.1 |
Other Non-Current Liabilities | ||
Finance lease obligations, noncurrent | 189.7 | 189.4 |
Deferred lease incentives and obligations | 55.8 | 57.8 |
Accrued benefits and deferred compensation, noncurrent | 18.6 | 19.5 |
Derivative financial instruments, noncurrent | 17.5 | 0 |
Deferred tax liabilities | 10.5 | 10 |
Other non-current liabilities | 33.7 | 31.8 |
Total other non-current liabilities | $ 325.8 | $ 308.5 |
Impairment of Assets (Details T
Impairment of Assets (Details Textual) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Impaired Assets to be Disposed of by Method Other than Sale [Line Items] | ||
Asset Impairment Charges | $ 2.1 | $ 1.2 |
Other non-restructuring related [Member] | ||
Impaired Assets to be Disposed of by Method Other than Sale [Line Items] | ||
Asset Impairment Charges | $ 2.1 | |
Fiscal 2019 Restructuring Plan | ||
Impaired Assets to be Disposed of by Method Other than Sale [Line Items] | ||
Asset Impairment Charges | $ 1.2 |
Restructuring and Other Charg_3
Restructuring and Other Charges (Details) - Fiscal 2019 Restructuring Plan - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Restructuring Cost and Reserve [Line Items] | ||
Cash-related restructuring charges | $ 0 | $ 7 |
Cash-related Restructuring Charges, Cost Incurred to Date | 103.4 | |
Non-cash charges | 1.8 | |
Non-cash Charges, Cost Incurred to Date | 42.4 | |
Restructuring and non-cash charges | 8.8 | |
Restructuring and Related Cost, Cost Incurred to Date | 145.8 | |
Severance and benefit costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Cash-related restructuring charges | 0 | 5.9 |
Cash-related Restructuring Charges, Cost Incurred to Date | 90.3 | |
Lease termination and store closure costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Cash-related restructuring charges | 0 | 0.3 |
Cash-related Restructuring Charges, Cost Incurred to Date | 2.3 | |
Other cash charges | ||
Restructuring Cost and Reserve [Line Items] | ||
Cash-related restructuring charges | 0 | 0.8 |
Cash-related Restructuring Charges, Cost Incurred to Date | 10.8 | |
Impairment of assets | ||
Restructuring Cost and Reserve [Line Items] | ||
Non-cash charges | 1.2 | |
Non-cash Charges, Cost Incurred to Date | 19 | |
Inventory-related charges | ||
Restructuring Cost and Reserve [Line Items] | ||
Non-cash charges | 0.6 | |
Non-cash Charges, Cost Incurred to Date | 8.2 | |
Accelerated stock-based compensation expense | ||
Restructuring Cost and Reserve [Line Items] | ||
Non-cash charges | 0 | |
Non-cash Charges, Cost Incurred to Date | 3.6 | |
Loss on sale of property | ||
Restructuring Cost and Reserve [Line Items] | ||
Non-cash charges | $ 0 | |
Non-cash Charges, Cost Incurred to Date | $ 11.6 |
Restructuring and Other Charg_4
Restructuring and Other Charges (Details 1) - Fiscal 2019 Restructuring Plan - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Restructuring Reserve [Roll Forward] | ||
Beginning Reserve Balance | $ 24.1 | |
Additions charged to expense | 0 | $ 7 |
Cash payments charged against reserve | (8.6) | |
Ending Reserve Balance | 15.5 | |
Severance and benefit costs | ||
Restructuring Reserve [Roll Forward] | ||
Beginning Reserve Balance | 23.5 | |
Additions charged to expense | 0 | 5.9 |
Cash payments charged against reserve | (8) | |
Ending Reserve Balance | 15.5 | |
Lease termination and store closure costs | ||
Restructuring Reserve [Roll Forward] | ||
Beginning Reserve Balance | 0 | |
Additions charged to expense | 0 | 0.3 |
Cash payments charged against reserve | 0 | |
Ending Reserve Balance | 0 | |
Other cash charges | ||
Restructuring Reserve [Roll Forward] | ||
Beginning Reserve Balance | 0.6 | |
Additions charged to expense | 0 | $ 0.8 |
Cash payments charged against reserve | (0.6) | |
Ending Reserve Balance | $ 0 |
Restructuring and Other Charg_5
Restructuring and Other Charges (Details Textual) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Restructuring Cost and Reserve [Line Items] | ||
Other Charges | $ 4.4 | $ 22.6 |
Corporate Jet Donation [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Other Charges | 20.8 | |
Charges primarily related to rent and occupancy costs associated with previously exited real estate locations [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Other Charges | 4.4 | $ 1.8 |
Other Restructuring Plans | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 4.4 | |
Payments for Restructuring | 1.6 | |
Other Restructuring Plans | Primarily severance and benefit costs [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Cash-related restructuring charges | 2.6 | |
Other Restructuring Plans | Inventory-related charges | ||
Restructuring Cost and Reserve [Line Items] | ||
Non-cash charges | $ 1.3 |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) $ in Millions | 3 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Mar. 28, 2020 | |
Income Tax Disclosure [Abstract] | |||
Effective tax rate | 26.00% | 20.10% | |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 21.00% | |
Non-current liability for unrecognized tax benefits | $ 91.7 | $ 88.9 | |
Unrecognized tax benefits that, if recognized, would affect the effective tax rate | $ 70.8 | $ 71.7 |
Debt (Details)
Debt (Details) - USD ($) $ in Millions | Jun. 27, 2020 | Mar. 28, 2020 |
Debt Instrument [Line Items] | ||
Borrowings outstanding under credit facilities | $ 0 | $ 475 |
Total debt | 1,930 | 1,171 |
Short-term debt and current portion of long-term debt | 299.9 | 774.6 |
Long-term debt | 1,630.1 | 396.4 |
2.625% Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Senior Note, Carrying Value, Current | 299.9 | 299.6 |
Cumulative amount of fair value hedging adjustment included in carrying value of hedged item | 0 | (0.2) |
Unamortized Debt Issuance Costs | (0.1) | (0.2) |
3.750% Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Senior Notes, Carrying Value, Noncurrent | 396.6 | 396.4 |
Unamortized Debt Issuance Costs | (3.4) | (3.6) |
1.700% Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Senior Notes, Carrying Value, Noncurrent | 497.3 | 0 |
Unamortized Debt Issuance Costs | (2.7) | |
2.950% Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Senior Notes, Carrying Value, Noncurrent | 736.2 | $ 0 |
Unamortized Debt Issuance Costs | $ (13.8) |
Debt (Details Textual)
Debt (Details Textual) - USD ($) $ in Millions | Sep. 26, 2018 | Jun. 27, 2020 |
2.125% Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Face Amount | $ 300 | |
Debt Instrument, Maturity Date | Sep. 26, 2018 | |
Interest Rate on Debt | 2.125% | |
2.625% Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Face Amount | $ 300 | |
Debt Instrument, Maturity Date | Aug. 18, 2020 | |
Long-term debt, net of discount | 99.795% | |
Interest Rate on Debt | 2.625% | |
3.750% Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Face Amount | $ 400 | |
Debt Instrument, Maturity Date | Sep. 15, 2025 | |
Long-term debt, net of discount | 99.521% | |
Interest Rate on Debt | 3.75% | |
1.700% Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Face Amount | $ 500 | |
Debt Instrument, Maturity Date | Jun. 15, 2022 | |
Long-term debt, net of discount | 99.88% | |
Interest Rate on Debt | 1.70% | |
2.950% Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Face Amount | $ 750 | |
Debt Instrument, Maturity Date | Jun. 15, 2030 | |
Long-term debt, net of discount | 98.995% | |
Interest Rate on Debt | 2.95% | |
Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Redemption Price, Percentage | 100.00% | |
Debt Instrument, Restrictive Covenants | The Indenture contains certain covenants that restrict the Company's ability, subject to specified exceptions, to incur certain liens; enter into sale and leaseback transactions; consolidate or merge with another party; or sell, lease, or convey all or substantially all of the Company's property or assets to another party. However, the Indenture does not contain any financial covenants. | |
Global Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Repayments of Lines of Credit | $ 475 |
Debt (Details Textual 1)
Debt (Details Textual 1) - 3 months ended Jun. 27, 2020 ¥ in Millions, $ in Millions, ₩ in Billions | USD ($)Quarter | KRW (₩) | CNY (¥) |
Credit Facilities (Textual) [Abstract] | |||
Commercial Paper | $ 0 | ||
Maximum expected combined borrowings outstanding - Commercial Paper Program and Global Credit Facility | 500 | ||
Commercial Paper [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Maximum borrowing capacity | $ 500 | ||
Commercial Paper [Member] | Maximum [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Short-term Debt, Terms | 397 days | ||
Global Credit Facility [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Maximum borrowing capacity | $ 1,000 | ||
Borrowing capacity under unsecured revolving line of credit | $ 500 | ||
Line of credit facility, expiration date | Aug. 12, 2024 | ||
Borrowings outstanding under revolving credit facilities | $ 0 | ||
Line of credit facility, contingent liability for outstanding LOCs | $ 8.8 | ||
Commitment fee, percentage | 0.065% | ||
Credit facility covenant terms | The Global Credit Facility contains a number of covenants that, among other things, restrict the Company's ability, subject to specified exceptions, to incur additional debt; incur liens; sell or dispose of assets; merge with or acquire other companies; liquidate or dissolve itself; engage in businesses that are not in a related line of business; make loans, advances, or guarantees; engage in transactions with affiliates; and make certain investments. As originally implemented, the Global Credit Facility also required the Company to maintain a maximum ratio of Adjusted Debt to Consolidated EBITDAR (the "leverage ratio") of no greater than 4.25 as of the date of measurement for the four most recent consecutive fiscal quarters. Adjusted Debt is defined generally as consolidated debt outstanding, including finance lease obligations, plus all operating lease obligations. Consolidated EBITDAR is defined generally as consolidated net income plus (i) income tax expense, (ii) net interest expense, (iii) depreciation and amortization expense, (iv) operating lease cost, (v) restructuring and other non-recurring expenses, and (vi) acquisition-related costs. | ||
Credit Facility covenant compliance | no Event of Default (as such term is defined pursuant to the Global Credit Facility) has occurred under the Company's Global Credit Facility | ||
Maximum Ratio Of Adjusted Debt To Consolidated EBITDAR As Of Date Of Measurement For Four Consecutive Quarters | 4.25 | ||
Leverage Ratio Number Of Consecutive Fiscal Quarters Used | Quarter | 4 | ||
Global Credit Facility Amendment [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Commitment fee, percentage | 0.25% | ||
Credit facility covenant terms | Additionally, the leverage ratio requirements have been waived until the quarter ending September 30, 2021. The maximum permitted leverage ratio for that fiscal quarter would be 5.25. For the fiscal quarters ending December 31, 2021 and March 31, 2022, the maximum permitted leverage ratio would be 4.75. For each fiscal quarter ending on or after June 30, 2022, the leverage ratio test would return to 4.25. The Amendment also (a) imposes a new requirement that would remain in effect until the Ratings-Based Toggle Date that the aggregate amount of unrestricted cash of the Company and its subsidiaries plus the undrawn amounts available under the Global Credit Facility may not be less than $750 million, (b) restricts the amount of dividends and distributions on, or purchases, redemptions, retirements or acquisitions of, the Company's stock until the Specified Period Termination Date (as defined below), (c) until March 31, 2021, amends the material adverse change representation to disregard pandemic-related impacts to the business, and (d) until the Specified Period Termination Date, adds certain other restrictions on indebtedness incurred by the Company and its subsidiaries and investments and acquisitions by the Company and its subsidiaries. | ||
Minimum Liquidity Covenant | $ 750 | ||
Maximum Ratio of Adjusted Debt to Consolidated EBITDAR As Of Date Of Measurement For Two Consecutive Quarters | 4.25 | ||
364 Day Facility [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Borrowing capacity under unsecured revolving line of credit | $ 500 | ||
Line of credit facility, expiration date | May 25, 2021 | ||
China Credit Facility [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Maximum borrowing capacity | $ 7 | ¥ 50 | |
Line of credit facility, expiration date | Apr. 3, 2021 | ||
South Korea Credit Facility [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Maximum borrowing capacity | $ 25 | ₩ 30 | |
Line of credit facility, expiration date | Oct. 30, 2020 | ||
Pan-Asia Credit Facilities [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Borrowings outstanding under revolving credit facilities | $ 0 | ||
Weighted Average Overnight Federal Funds Rate [Member] | Global Credit Facility [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Percentage of variable rate | 0.50% | ||
London Interbank Offered Rate (LIBOR) [Member] | Global Credit Facility [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Percentage of variable rate | 1.00% | ||
Adjusted LIBOR [Member] | Global Credit Facility [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Percentage of variable rate | 0.75% | ||
Adjusted LIBOR [Member] | Global Credit Facility Amendment [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Percentage of variable rate | 1.875% | ||
Alternate base rate [Member] | Global Credit Facility Amendment [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Percentage of variable rate | 0.875% | ||
Quarter Ending September 30, 2021 [Member] | Global Credit Facility Amendment [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Maximum Ratio Of Adjusted Debt To Consolidated EBITDAR As Of Date Of Measurement For Four Consecutive Quarters | 5.25 | ||
Quarters Ending December 31, 2021 and March 31, 2022 [Member] | Global Credit Facility Amendment [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Maximum Ratio Of Adjusted Debt To Consolidated EBITDAR As Of Date Of Measurement For Four Consecutive Quarters | 4.75 | ||
Quarter Ending June 30, 2022 [Member] | Global Credit Facility Amendment [Member] | |||
Credit Facilities (Textual) [Abstract] | |||
Maximum Ratio Of Adjusted Debt To Consolidated EBITDAR As Of Date Of Measurement For Four Consecutive Quarters | 4.25 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | Jun. 27, 2020 | Mar. 28, 2020 |
Financial assets recorded at fair value: | ||
Derivative Asset, Fair Value | $ 46.6 | $ 62.3 |
Financial liabilities recorded at fair value: | ||
Derivative Liability, Fair Value | 18.2 | 6.9 |
Fair Value, Inputs, Level 2 [Member] | Fair Value, Recurring [Member] | ||
Financial assets recorded at fair value: | ||
Derivative Asset, Fair Value | 46.6 | 62.3 |
Financial liabilities recorded at fair value: | ||
Derivative Liability, Fair Value | 18.2 | 6.9 |
Fair Value, Inputs, Level 2 [Member] | Fair Value, Recurring [Member] | Commercial Paper [Member] | ||
Financial assets recorded at fair value: | ||
Investments, Fair Value Disclosure | $ 50 | $ 243.6 |
Fair Value Measurements (Deta_2
Fair Value Measurements (Details 1) - USD ($) $ in Millions | Jun. 27, 2020 | Mar. 28, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Borrowings outstanding under credit facilities | $ 0 | $ 475 |
2.625% Senior Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior Note, Carrying Value, Current | 299.9 | 299.6 |
3.750% Senior Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior Notes, Carrying Value, Noncurrent | 396.6 | 396.4 |
1.700% Senior Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior Notes, Carrying Value, Noncurrent | 497.3 | 0 |
2.950% Senior Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior Notes, Carrying Value, Noncurrent | 736.2 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Line of Credit Facility, Fair Value of Amount Outstanding | 0 | 473 |
Fair Value, Inputs, Level 2 [Member] | 2.625% Senior Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior Notes, Fair Value | 300.4 | 299.8 |
Fair Value, Inputs, Level 2 [Member] | 3.750% Senior Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior Notes, Fair Value | 445.8 | 415.1 |
Fair Value, Inputs, Level 2 [Member] | 1.700% Senior Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior Notes, Fair Value | 507.6 | 0 |
Fair Value, Inputs, Level 2 [Member] | 2.950% Senior Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior Notes, Fair Value | $ 766.1 | $ 0 |
Fair Value Measurements (Deta_3
Fair Value Measurements (Details 2) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cumulative adjustment from adoption of new accounting standards | $ (164.5) | |
Property, Plant and Equipment [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value as of Impairment Date | 0 | |
Impairment of Long-Lived Assets | $ 0 | 0.9 |
Operating Lease, Right-of-Use Asset [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value as of Impairment Date | 0 | 92.9 |
Impairment of Long-Lived Assets | $ 2.1 | 225.4 |
Accounting Standards Update 2016-02 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cumulative adjustment from adoption of new accounting standards | 169.4 | |
Accounting Standards Update 2016-02 [Member] | Operating Lease, Right-of-Use Asset [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impairment of Long-Lived Assets | $ 225.1 |
Fair Value Measurements (Deta_4
Fair Value Measurements (Details Textual) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Fair Value Disclosures [Abstract] | ||
Goodwill and other intangible asset impairment charges | $ 0 | $ 0 |
Financial Instruments (Details)
Financial Instruments (Details) - USD ($) $ in Millions | Jun. 27, 2020 | Mar. 28, 2020 |
Notional Amounts of Derivative Financial Instruments | ||
Notional amount of hedges | $ 1,064.8 | $ 1,686.1 |
Derivative Assets | ||
Derivative Asset, Fair Value | 46.6 | 62.3 |
Derivative Liabilities | ||
Derivative Liability, Fair Value | 18.2 | 6.9 |
Designated [Member] | ||
Notional Amounts of Derivative Financial Instruments | ||
Notional amount of hedges | 852.2 | 1,212.6 |
Derivative Assets | ||
Derivative Asset, Fair Value | 46.2 | 56 |
Derivative Liabilities | ||
Derivative Liability, Fair Value | 17.7 | 4.6 |
Designated [Member] | Interest Rate Swap [Member] | ||
Notional Amounts of Derivative Financial Instruments | ||
Notional amount of hedges | 0 | 300 |
Derivative Assets | ||
Interest Rate Fair Value Hedge Asset at Fair Value | 0 | 0 |
Derivative Liabilities | ||
Interest Rate Fair Value Hedge Liability at Fair Value | 0 | |
Designated [Member] | Interest Rate Swap [Member] | Accrued Expenses and Other Current Liabilities [Member] | ||
Derivative Liabilities | ||
Interest Rate Fair Value Hedge Liability at Fair Value | 0.2 | |
Undesignated [Member] | Foreign Exchange Forward [Member] | ||
Notional Amounts of Derivative Financial Instruments | ||
Notional amount of hedges | 212.6 | 473.5 |
Undesignated [Member] | Foreign Exchange Forward [Member] | Prepaid Expenses and Other Current Assets [Member] | ||
Derivative Assets | ||
Derivative Asset, Fair Value | 0.4 | 6.3 |
Undesignated [Member] | Foreign Exchange Forward [Member] | Accrued Expenses and Other Current Liabilities [Member] | ||
Derivative Liabilities | ||
Derivative Liability, Fair Value | 0.5 | 2.3 |
Cash Flow Hedging [Member] | Designated [Member] | Foreign Exchange Forward [Member] | ||
Notional Amounts of Derivative Financial Instruments | ||
Notional amount of hedges | 162.6 | 229 |
Cash Flow Hedging [Member] | Designated [Member] | Foreign Exchange Forward [Member] | Prepaid Expenses and Other Current Assets [Member] | ||
Derivative Assets | ||
Foreign Currency Cash Flow Hedge Asset at Fair Value | 3.3 | 7.4 |
Cash Flow Hedging [Member] | Designated [Member] | Foreign Exchange Forward [Member] | Accrued Expenses and Other Current Liabilities [Member] | ||
Derivative Liabilities | ||
Foreign Currency Cash Flow Hedge Liability at Fair Value | 0.2 | 0.4 |
Net Investment Hedging [Member] | Designated [Member] | ||
Notional Amounts of Derivative Financial Instruments | ||
Notional amount of hedges | 689.6 | 683.6 |
Net Investment Hedging [Member] | Designated [Member] | Other Noncurrent Assets [Member] | ||
Derivative Assets | ||
Derivative Instruments in Hedges, Net Investment in Foreign Operations, Assets, Fair Value | 42.9 | 48.6 |
Net Investment Hedging [Member] | Designated [Member] | Accrued Expenses and Other Current Liabilities [Member] | ||
Derivative Liabilities | ||
Derivative Instruments in Hedges, Net Investment in Foreign Operations, Liabilities, Fair Value | $ 4 | |
Net Investment Hedging [Member] | Designated [Member] | Other Noncurrent Liabilities [Member] | ||
Derivative Liabilities | ||
Derivative Instruments in Hedges, Net Investment in Foreign Operations, Liabilities, Fair Value | $ 17.5 |
Financial Instruments (Details
Financial Instruments (Details 1) - USD ($) $ in Millions | Jun. 27, 2020 | Mar. 28, 2020 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Derivative asset, gross amount in the balance sheet | $ 46.6 | $ 62.3 |
Gross amount of derivatives assets subject to master netting arrangements not offset | (0.5) | (6.1) |
Derivative asset, net basis | 46.1 | 56.2 |
Derivative liability, gross amount in the balance sheet | 18.2 | 6.9 |
Gross amount of derivative liabilities subject to master netting arrangements not offset | (0.5) | (6.1) |
Derivative liability, net basis | $ 17.7 | $ 0.8 |
Financial Instruments (Detail_2
Financial Instruments (Details 2) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Reclassification of hedge gain (loss) from accumulated OCI into income | ||
Cost of goods sold | $ (138.8) | $ (508) |
Other income (expense), net | 2.1 | (4.1) |
Designated as Hedging Instrument [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax | (19.1) | (11.9) |
Designated as Hedging Instrument [Member] | Net Investment Hedging [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative, Excluded Component, Gain (Loss), Recognized in Earnings | 2.7 | 5 |
Designated as Hedging Instrument [Member] | Foreign Exchange Forward [Member] | Cash Flow Hedging [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax | (3) | (4.4) |
Designated as Hedging Instrument [Member] | Reclassification out of Accumulated Other Comprehensive Income (Loss) [Member] | Foreign Exchange Forward [Member] | Cash Flow Hedging [Member] | ||
Reclassification of hedge gain (loss) from accumulated OCI into income | ||
Cost of goods sold | 1.7 | 6.2 |
Other income (expense), net | (0.3) | 0.2 |
Effective portion [Member] | Designated as Hedging Instrument [Member] | Net Investment Hedging [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax | 0.7 | (10) |
Portion excluded from assessment of hedge effectiveness [Member] | Designated as Hedging Instrument [Member] | Net Investment Hedging [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax | (16.8) | 2.5 |
Derivative, Excluded Component, Gain (Loss), Recognized in Earnings | $ 2.7 | $ 5 |
Financial Instruments (Detail_3
Financial Instruments (Details 3) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (Loss) on Foreign Currency Derivative Instruments Not Designated as Hedging Instruments | $ 4.7 | $ 1.9 |
Foreign Exchange Forward [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (Loss) on Foreign Currency Derivative Instruments Not Designated as Hedging Instruments | $ 4.7 | $ 1.9 |
Financial Instruments (Detail_4
Financial Instruments (Details 4) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Mar. 28, 2020 | |
Schedule of Fair Value Hedging Adjustments [Line Items] | ||
Fair value hedge settlement | $ (0.3) | |
2.625% Senior Notes [Member] | ||
Schedule of Fair Value Hedging Adjustments [Line Items] | ||
Senior Note, Carrying Value, Current | 299.9 | $ 299.6 |
Cumulative amount of fair value hedging adjustment included in carrying value of hedged item | $ 0 | $ (0.2) |
Financial Instruments (Detail_5
Financial Instruments (Details Textual) $ in Millions | 3 Months Ended | |
Jun. 27, 2020USD ($)counterparty | Jun. 29, 2019USD ($) | |
Derivative [Line Items] | ||
Number of counterparties to master netting arrangements | counterparty | 10 | |
Net gains (losses) deferred in AOCI for derivative financial instruments expected to be recognized in the earnings over the next 12 months | $ 16.2 | |
Interest Rate Swap [Member] | ||
Derivative [Line Items] | ||
Net impact on earnings of fair value hedges | $ 0 | $ 0 |
Maximum [Member] | Foreign Exchange Forward [Member] | ||
Derivative [Line Items] | ||
Derivative, Term of Contract | 1 year | |
Minimum [Member] | Foreign Exchange Forward [Member] | ||
Derivative [Line Items] | ||
Derivative, Term of Contract | 2 months |
Financial Instruments (Detail_6
Financial Instruments (Details Textual 1) - USD ($) $ in Millions | Jun. 27, 2020 | Mar. 28, 2020 |
Bank Time Deposits [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Short-term Investments | $ 209.3 | $ 252.3 |
Commercial Paper [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Short-term Investments | $ 50 | $ 243.6 |
Equity (Details)
Equity (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Equity, Class of Treasury Stock [Line Items] | ||
Cost of shares repurchased | $ 33.9 | $ 191.1 |
Stock Repurchase Program, Authorized Amount | 600 | |
Stock Repurchase Program, Remaining Authorized Repurchase Amount | 580 | |
General repurchase program [Member] | ||
Equity, Class of Treasury Stock [Line Items] | ||
Cost of shares repurchased | $ 0 | $ 150 |
Number of shares repurchased | 0 | 1.3 |
Withholding in satisfaction of taxes on vested equity award [Member] | ||
Equity, Class of Treasury Stock [Line Items] | ||
Cost of shares repurchased | $ 33.9 | $ 41.1 |
Number of shares repurchased | 0.5 | 0.4 |
Equity (Details Textual)
Equity (Details Textual) - $ / shares shares in Millions | 3 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Mar. 30, 2019 | |
Equity [Abstract] | |||
Conversion of Stock, Shares Converted | 0.5 | ||
Dividends (Textual) [Abstract] | |||
Dividends declared per share | $ 0 | $ 0.6875 | $ 0.625 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | ||
Accumulated Other Comprehensive Income (Loss), Net Of Tax [Roll Forward] | |||
Beginning balance | $ (118.2) | ||
OCI before reclassifications | 10.1 | $ 4.9 | |
Amounts reclassified from AOCI to earnings | (1.2) | (10.7) | |
Other comprehensive income (loss), net of tax | 8.9 | (5.8) | |
Ending balance | (109.3) | ||
Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Tax | (4.7) | (2) | |
Gain (Loss) on Derivative Used in Net Investment Hedge, after Tax | (12.2) | (5.7) | |
Gain (Loss) on Derivative Used in Net Investment Hedge, Tax | (3.9) | (1.8) | |
Other Comprehensive Income (Loss), Cash Flow Hedges, Tax | (0.2) | (0.5) | |
Foreign Currency Translation Gains (Losses) [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net Of Tax [Roll Forward] | |||
Beginning balance | (130.4) | (118.5) | |
OCI before reclassifications | 13 | 8.9 | |
Amounts reclassified from AOCI to earnings | 0 | (4.9) | |
Other comprehensive income (loss), net of tax | 13 | 4 | |
Ending balance | (117.4) | (114.5) | |
Net Unrealized Gains (Losses) on Cash Flow Hedges [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net Of Tax [Roll Forward] | |||
Beginning balance | 18 | 20.2 | |
OCI before reclassifications | (2.8) | (3.9) | |
Amounts reclassified from AOCI to earnings | (1.2) | (5.8) | |
Other comprehensive income (loss), net of tax | (4) | (9.7) | |
Ending balance | 14 | 10.5 | |
Net Unrealized Gains (Losses) on Defined Benefit Plans [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net Of Tax [Roll Forward] | |||
Beginning balance | (5.8) | (5.1) | |
OCI before reclassifications | (0.1) | (0.1) | |
Amounts reclassified from AOCI to earnings | 0 | 0 | |
Other comprehensive income (loss), net of tax | (0.1) | (0.1) | |
Ending balance | (5.9) | (5.2) | |
AOCI [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net Of Tax [Roll Forward] | |||
Beginning balance | (118.2) | (103.4) | |
Other comprehensive income (loss), net of tax | [1] | 8.9 | (5.8) |
Ending balance | $ (109.3) | $ (109.2) | |
[1] | (b) Accumulated other comprehensive income (loss). |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) (Details 1) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income (Loss) on Derivatives [Line Items] | ||
Cost of goods sold | $ (138.8) | $ (508) |
Other income (expense), net | 2.1 | (4.1) |
Income tax provision | 44.9 | (29.5) |
Net income (loss) | (127.7) | 117.1 |
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Reclassification out of Accumulated Other Comprehensive Income (Loss) [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income (Loss) on Derivatives [Line Items] | ||
Income tax provision | (0.2) | (0.6) |
Net income (loss) | 1.2 | 5.8 |
Designated as Hedging Instrument [Member] | Foreign Exchange Forward [Member] | Cash Flow Hedging [Member] | Reclassification out of Accumulated Other Comprehensive Income (Loss) [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income (Loss) on Derivatives [Line Items] | ||
Cost of goods sold | 1.7 | 6.2 |
Other income (expense), net | $ (0.3) | $ 0.2 |
Stock-based Compensation (Detai
Stock-based Compensation (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Summary of the total compensation expense and the associated income tax benefits recognized related to stock-based compensation arrangements | ||
Compensation expense | $ 15.1 | $ 23 |
Income tax benefit | $ (3.1) | $ (3.6) |
Stock-based Compensation (Det_2
Stock-based Compensation (Details 1) - shares shares in Thousands | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Restricted Stock [Member] | ||
Summary of RSU activity | ||
Nonvested beginning balance | 4 | |
Granted | 0 | 0 |
Vested | (4) | |
Forfeited | 0 | |
Nonvested ending balance | 0 | |
Service-based restricted stock units [Member] | ||
Summary of RSU activity | ||
Nonvested beginning balance | 1,094 | |
Granted | 645 | |
Vested | (353) | |
Forfeited | (20) | |
Nonvested ending balance | 1,366 |
Stock-based Compensation (Det_3
Stock-based Compensation (Details 2) - Performance-based restricted stock units [Member] shares in Thousands | 3 Months Ended |
Jun. 27, 2020shares | |
Summary of RSU activity | |
Nonvested beginning balance | 934 |
Granted | 0 |
Change due to performance condition achievement | 185 |
Vested | (720) |
Forfeited | (27) |
Nonvested ending balance | 372 |
Stock-based Compensation (Det_4
Stock-based Compensation (Details 3) - TSR Shares [Member] | 3 Months Ended |
Jun. 29, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term (years) | 2 years 9 months 18 days |
Expected volatility | 30.80% |
Expected dividend yield | 2.40% |
Risk-free interest rate | 1.70% |
Stock-based Compensation (Det_5
Stock-based Compensation (Details 4) - Market-based restricted stock units [Member] shares in Thousands | 3 Months Ended |
Jun. 27, 2020shares | |
Summary of RSU activity | |
Nonvested beginning balance | 234 |
Granted | 0 |
Change due to market condition achievement | 0 |
Vested | 0 |
Forfeited | 0 |
Nonvested ending balance | 234 |
Stock-based Compensation (Det_6
Stock-based Compensation (Details 5) shares in Thousands | 3 Months Ended |
Jun. 27, 2020shares | |
Summary of the stock option activity | |
Options beginning outstanding | 518 |
Granted | 0 |
Exercised | 0 |
Cancelled/Forfeited | (34) |
Options ending outstanding | 484 |
Stock-based Compensation (Det_7
Stock-based Compensation (Details Textual) - $ / shares | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Service-based restricted stock units [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average grant date fair value of equity awards other than options | $ 59.72 | $ 109.72 |
Performance-based restricted stock units [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average grant date fair value of equity awards other than options | 102.69 | |
Market-based restricted stock units [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average grant date fair value of equity awards other than options | $ 139.02 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Net revenues by segment | ||
Net revenues | $ 487.5 | $ 1,428.8 |
North America segment [Member] | ||
Net revenues by segment | ||
Net revenues | 165.1 | 719.4 |
Europe segment [Member] | ||
Net revenues by segment | ||
Net revenues | 120.7 | 360.8 |
Asia segment [Member] | ||
Net revenues by segment | ||
Net revenues | 171.9 | 258.6 |
Other non-reportable segments [Member] | ||
Net revenues by segment | ||
Net revenues | $ 29.8 | $ 90 |
Segment Information (Details 1)
Segment Information (Details 1) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Operating income (loss) by segment | ||
Operating income (loss) | $ (168) | $ 143.3 |
Restructuring and other charges | (7) | (29.6) |
Accounts Receivable, Credit Loss Expense (Reversal) | (16.5) | 0.1 |
Unallocated charges [Member] | ||
Operating income (loss) by segment | ||
Unallocated corporate expenses | (130.3) | (137.6) |
Restructuring and other charges | (7) | (29.6) |
North America segment [Member] | ||
Operating income (loss) by segment | ||
Operating income (loss) | (24.8) | 150.1 |
Accounts Receivable, Credit Loss Expense (Reversal) | (15.5) | |
Europe segment [Member] | ||
Operating income (loss) by segment | ||
Operating income (loss) | (16.9) | 79.4 |
Accounts Receivable, Credit Loss Expense (Reversal) | (1) | |
Asia segment [Member] | ||
Operating income (loss) by segment | ||
Operating income (loss) | 10.1 | 48.1 |
Other non-reportable segments [Member] | ||
Operating income (loss) by segment | ||
Operating income (loss) | 0.9 | 32.9 |
Operating Segments [Member] | ||
Operating income (loss) by segment | ||
Operating income (loss) | $ (30.7) | $ 310.5 |
Segment Information (Details 2)
Segment Information (Details 2) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Segment Reporting Information [Line Items] | ||
Asset Impairment Charges | $ (2.1) | $ (1.2) |
Unallocated corporate expenses [Member] | ||
Segment Reporting Information [Line Items] | ||
Asset Impairment Charges | 0 | (1.2) |
North America segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Asset Impairment Charges | (0.2) | 0 |
Asia segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Asset Impairment Charges | (1.3) | 0 |
Other non-reportable segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Asset Impairment Charges | $ (0.6) | $ 0 |
Segment Information (Details 3)
Segment Information (Details 3) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Segment Reporting Information [Line Items] | ||
Unallocated restructuring charges | $ (2.6) | $ (7) |
Other Charges | (4.4) | (22.6) |
Restructuring and other charges | (7) | (29.6) |
North America-Related [Member] | ||
Segment Reporting Information [Line Items] | ||
Unallocated restructuring charges | (0.1) | (0.7) |
Europe-Related [Member] | ||
Segment Reporting Information [Line Items] | ||
Unallocated restructuring charges | 0 | (1.8) |
Asia-Related [Member] | ||
Segment Reporting Information [Line Items] | ||
Unallocated restructuring charges | 0.2 | (0.5) |
Other Non-Reportable Segment-Related [Member] | ||
Segment Reporting Information [Line Items] | ||
Unallocated restructuring charges | (1.1) | 0 |
Corporate-Related [Member] | ||
Segment Reporting Information [Line Items] | ||
Unallocated restructuring charges | $ (1.6) | $ (4) |
Segment Information (Details 4)
Segment Information (Details 4) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Segment Reporting Information [Line Items] | ||
Depreciation and amortization expense | $ 63.7 | $ 66.2 |
North America segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Depreciation and amortization expense | 18.1 | 18.9 |
Europe segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Depreciation and amortization expense | 7.7 | 7.6 |
Asia segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Depreciation and amortization expense | 14.2 | 15 |
Other non-reportable segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Depreciation and amortization expense | 1.1 | 1.3 |
Unallocated corporate expenses [Member] | ||
Segment Reporting Information [Line Items] | ||
Depreciation and amortization expense | $ 22.6 | $ 23.4 |
Segment Information (Details 5)
Segment Information (Details 5) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Revenues from External Customers [Line Items] | ||
Net revenues | $ 487.5 | $ 1,428.8 |
Americas [Member] | ||
Revenues from External Customers [Line Items] | ||
Net revenues | 194.7 | 810.4 |
Europe Member] | ||
Revenues from External Customers [Line Items] | ||
Net revenues | 120.9 | 359.5 |
Asia [Member] | ||
Revenues from External Customers [Line Items] | ||
Net revenues | 171.9 | 258.9 |
U.S. [Member] | ||
Revenues from External Customers [Line Items] | ||
Net revenues | $ 186.1 | $ 760.1 |
Segment Information (Details Te
Segment Information (Details Textual) | 3 Months Ended |
Jun. 27, 2020Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Additional Financial Informat_3
Additional Financial Information (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |||
Jun. 27, 2020 | Jun. 29, 2019 | Mar. 28, 2020 | Mar. 30, 2019 | |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract] | ||||
Cash and Cash Equivalents | $ 2,451.3 | $ 1,620.4 | ||
Restricted cash, current | 1.4 | 1.4 | ||
Restricted cash, noncurrent | 8.2 | 8 | ||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | 2,460.9 | $ 691.4 | $ 1,629.8 | $ 626.5 |
Cash Interest and Taxes | ||||
Cash paid for interest | 3.3 | 2.4 | ||
Cash paid for income taxes | 18.9 | 22.3 | ||
Additional Financial Information (Textual) [Abstract] | ||||
Right-of-use asset obtained in exchange for operating lease liability | 13.1 | 17.7 | ||
Right-of-use asset obtained in exchange for finance lease liability | 64 | |||
Capital expenditures incurred but not yet paid | $ 26.4 | $ 44.2 | ||
Conversion of Stock, Shares Converted | 0.5 |