Covetrus (CVET) 10-Q 12 Nov 19 2019 Q3 Quarterly report Financial data

DEI

DEI - shares	9 Months Ended
	Sep. 30, 2019	Nov. 08, 2019
Entity [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2019
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2019
Entity Registrant Name	COVETRUS, INC.
Entity Central Index Key	0001752836
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	false
Entity Shell Company	false
Entity Current Reporting Status	Yes
Entity Common Stock, Shares Outstanding		112,122,608

CONSOLIDATED AND COMBINED BALAN

CONSOLIDATED AND COMBINED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 29, 2018
Current assets:
Cash and cash equivalents	$ 68	$ 23
Accounts receivable, net of allowance of $7 and $7	466	431
Inventory, net	598	564
Other receivables	77	49
Prepaid expenses and other	35	19
Total current assets	1,244	1,086
Non-current assets:
Property and equipment, net of accumulated depreciation of $90 and $74	104	69
Operating lease right-of-use assets, net (Note 13)	75	0
Goodwill (Note 5)	1,156	750
Other intangibles, net (Note 5)	679	208
Investments and other	70	120
Total assets	3,328	2,233
Current liabilities:
Accounts payable	483	441
Current maturities of long-term debt and other borrowings (Note 11)	47	1
Accrued expenses:
Payroll and related	51	37
Taxes	26	17
Other	144	77
Total current liabilities	751	573
Non-current liabilities:
Long-term debt and other borrowings, net (Note 11)	1,141	24
Deferred taxes	11	16
Other liabilities	86	35
Total liabilities	1,989	648
Commitments and contingencies (Note 8)
Redeemable non-controlling interests (Note 7)	10	92
Shareholders' equity:
Common stock, $0.01 par value per share, 675,000,000 shares authorized as of September 30, 2019; 112,054,273 shares issued and outstanding as of September 30, 2019	1	0
Net parent investment	0	1,576
Accumulated other comprehensive loss (Note 9)	(102)	(83)
Additional paid-in capital	2,369	0
Accumulated deficit	(939)	0
Total shareholders’ equity	1,329	1,493
Total liabilities, redeemable non-controlling interests, and shareholders’ equity	$ 3,328	$ 2,233

CONSOLIDATED AND COMBINED BAL_2

CONSOLIDATED AND COMBINED BALANCE SHEETS (UNAUDITED) - Parenthetical - USD ($) $ in Millions	Sep. 30, 2019	Dec. 29, 2018
Statement of Financial Position [Abstract]
Accounts receivable, reserves	$ 7	$ 7
Property and equipment, accumulated depreciation	90	74
Other intangibles, accumulated amortization	$ 328	$ 241
Common stock, par value (in usd per share)	$ 0.01
Common stock, shares authorized (in shares)	675,000,000
Common stock, shares issued (in shares)	112,054,273
Common stock, shares outstanding (in shares)	112,054,273

CONSOLIDATED AND COMBINED STATE

CONSOLIDATED AND COMBINED STATEMENT OF OPERATIONS (UNAUDITED) - USD ($) shares in Millions, $ in Millions	3 Months Ended			9 Months Ended
	Sep. 30, 2019		Sep. 30, 2018	Sep. 30, 2019		Sep. 30, 2018
Income Statement [Abstract]
Net sales (Note 2)	$ 1,018		$ 923	$ 2,968		$ 2,875
Cost of sales	821		757	2,391		2,350
Gross profit	197		166	577		525
Operating expenses:
Selling, general and administrative	216		132	610		413
Restructuring costs	0		0	0		8
Goodwill impairment (Note 5)	939		0	939		0
Operating (loss) income	(958)		34	(972)		104
Other income (expense):
Interest income	1		1	4		4
Interest expense	(16)		0	(42)		(2)
Other, net	4		0	18		1
(Loss) income before taxes and equity in earnings of affiliates	(969)		35	(992)		107
Income tax benefit (expense) (Note 10)	60		(19)	60		(33)
Equity in earnings of affiliates	0		0	0		1
Net (loss) income	(909)		16	(932)		75
Less: net loss (income) attributable to redeemable non-controlling interests	3		0	3		(8)
Net (loss) income attributable to Covetrus	$ (906)	[1]	$ 16	$ (929)	[1]	$ 67
(Loss) earnings per share attributable to Covetrus: (Note 4)
Basic (in usd per share)	$ (8.09)		$ 0.22	$ (8.76)		$ 0.94
Diluted (in usd per share)	$ (8.09)		$ 0.22	$ (8.76)		$ 0.94
Weighted average common shares outstanding:
Basic (in shares)	112		71	106		71
Diluted (in shares)	112		72	106		72
[1]	(a) Net income earned from January 1, 2019 through February 7, 2019 is attributed to the former parent as it was the sole shareholder prior to February 7, 2019 (b) See discussion in Note 3 - Business Acquisitions

CONSOLIDATED AND COMBINED STA_2

CONSOLIDATED AND COMBINED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Statement of Comprehensive Income [Abstract]
Net (loss) income	$ (909)	$ 16	$ (932)	$ 75
Other comprehensive (loss) income, net of tax: (Note 9)
Foreign currency translation loss	(22)	(5)	(18)	(31)
Unrealized loss on derivative instruments	(2)	0	(2)	0
Pension adjustment gain	0	0	1	0
Total other comprehensive loss	(24)	(5)	(19)	(31)
Comprehensive (loss) income	(933)	11	(951)	44
Comprehensive loss (income) attributable to redeemable non-controlling interests:
Net loss (income)	3	0	3	(8)
Foreign currency translation (gain) loss	0	0	(1)	2
Less: comprehensive loss (income) attributable to redeemable non-controlling interests	3	0	2	(6)
Comprehensive (loss) income attributable to Covetrus	$ (930)	$ 11	$ (949)	$ 38

CONSOLIDATED AND COMBINED STA_3

CONSOLIDATED AND COMBINED STATEMENT OF EQUITY (UNAUDITED) - USD ($) $ in Millions		Total	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Other Comprehensive Loss	Net Parent Investment
Beginning balance (in shares) at Dec. 30, 2017			0
Beginning balance at Dec. 30, 2017		$ 1,257	$ 0	$ 0	$ 0	$ (42)	$ 1,299
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income attributable to Covetrus		67					67
Net increase (decrease) in parent investment		260					260
Other comprehensive loss		(31)				(31)
Ending balance (in shares) at Sep. 30, 2018			0
Ending balance at Sep. 30, 2018		1,556	$ 0	0	0	(73)	1,629
Beginning balance (in shares) at Jun. 30, 2018			0
Beginning balance at Jun. 30, 2018		1,541	$ 0	0	0	(68)	1,609
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income attributable to Covetrus		16					16
Net increase (decrease) in parent investment		4					4
Other comprehensive loss		(5)				(5)
Ending balance (in shares) at Sep. 30, 2018			0
Ending balance at Sep. 30, 2018		1,556	$ 0	0	0	(73)	1,629
Beginning balance (in shares) at Dec. 29, 2018			0
Beginning balance at Dec. 29, 2018		1,493	$ 0	0	0	(83)	1,576
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income attributable to Covetrus	[1]	(929)			(939)		10
Dividend to Henry Schein		(1,174)		(21)			(1,153)
Issuance of shares at Separation (including share sale investors) (in shares)			71,693,426
Issuance of shares at Separation (including Share Sale investors)		1	$ 1	609			(609)
Issuance of shares in connection with the Acquisition (in shares)	[2]		39,742,089
Issuance of shares in connection with the Acquisition	[2]	1,772		1,772
Shares held in escrow expected to be canceled	[3]	(30)		(30)
Net increase (decrease) in parent investment		176					176
Exercise of stock options (in shares)			618,758
Exercise of stock options		4		4
Share-based compensation		35		35
Other comprehensive loss		$ (19)				(19)
Ending balance (in shares) at Sep. 30, 2019		112,054,273	112,054,273
Ending balance at Sep. 30, 2019		$ 1,329	$ 1	2,369	(939)	(102)	0
Beginning balance (in shares) at Jun. 30, 2019			111,932,491
Beginning balance at Jun. 30, 2019		2,247	$ 1	2,357	(33)	(78)	0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income attributable to Covetrus	[1]	(906)			(906)		0
Exercise of stock options (in shares)			121,782
Exercise of stock options		2		2
Share-based compensation		10		10
Other comprehensive loss		$ (24)				(24)
Ending balance (in shares) at Sep. 30, 2019		112,054,273	112,054,273
Ending balance at Sep. 30, 2019		$ 1,329	$ 1	$ 2,369	$ (939)	$ (102)	$ 0
[1]	(a) Net income earned from January 1, 2019 through February 7, 2019 is attributed to the former parent as it was the sole shareholder prior to February 7, 2019 (b) See discussion in Note 3 - Business Acquisitions
[2]	(b) See discussion in Note 3 - Business Acquisitions
[3]	(a) Net income earned from January 1, 2019 through February 7, 2019 is attributed to the former parent as it was the sole shareholder prior to February 7, 2019

CONSOLIDATED AND COMBINED STA_4

CONSOLIDATED AND COMBINED STATEMENT OF CASH FLOWS (UNAUDITED) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Cash flows from operating activities:
Net (loss) income	$ (932)	$ 75
Adjustments to reconcile net (loss) income to net cash provided by (used for) operating activities:
Depreciation and amortization	113	49
Amortization of right-of-use assets	16	0
Goodwill impairment (Note 5)	939	0
Share-based compensation	35	6
(Benefit) provision for deferred income taxes	(72)	1
Equity in earnings of affiliates	0	(1)
Other	(3)	0
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable, net	(25)	(13)
Inventory, net	(23)	25
Other assets and liabilities	(36)	(52)
Accounts payable and accrued expenses	21	(28)
Net cash provided by operating activities	33	62
Cash flows from investing activities:
Purchases of property and equipment	(30)	(15)
Payments related to equity investments and business acquisitions, net of cash acquired	(26)	(8)
Net cash used for investing activities	(56)	(23)
Cash flows from financing activities:
Proceeds from issuance of debt	1,220	0
Principal payments of debt	(43)	(2)
Debt issuance costs	(24)	0
Dividend paid to Henry Schein	(1,174)	0
Issuance of common shares in connection with options	4	0
Net transfers from parent	165	359
Distributions to non-controlling shareholders	0	(10)
Maravet acquisition payment	9	0
Acquisitions of non-controlling interests in subsidiaries	(74)	(380)
Net cash provided by (used for) financing activities	65	(33)
Effect of exchange rate changes on cash and cash equivalents	3	(1)
Net change in cash and cash equivalents	45	5
Cash and cash equivalents, beginning of period	23	17
Cash and cash equivalents, end of period	68	22
Supplemental disclosures of cash flows information:
Interest	35	0
Income taxes	$ 16	$ 7

Business Overview and Significa

Business Overview and Significant Accounting Policies	9 Months Ended
	Sep. 30, 2019
Accounting Policies [Abstract]
Business Overview and Significant Accounting Policies	Business Overview and Significant Accounting Policies Business Covetrus, Inc. (“Covetrus,” “Company,” “we,” “our,” “us,” or “ourselves”) is a global animal-health technology and services company dedicated to empowering veterinary practice partners to drive improved health and financial outcomes supporting the companion, equine, and large animal veterinary markets. On February 7, 2019, Henry Schein, Inc. (“Henry Schein”) completed the spin-off of its animal-health business (the “Animal Health Business”) and transferred the applicable assets, liabilities, and ownership interests to us (the “Separation”). At the same time, we liquidated the investment of our sole shareholder, paid a cash dividend of $1.2 billion from loan proceeds, and sold $361 million in shares to institutional accredited investors (the “Share Sale”). The proceeds from the Share Sale were paid to us and distributed to Henry Schein (the “Distribution”). Subsequent to the Share Sale, Henry Schein distributed, on a pro rata basis, all of the shares of our common stock held by Henry Schein to its stockholders of record as of the close of business on January 17, 2019. We then acquired Direct Vet Marketing, Inc. (d/b/a Vets First Choice) (“Vets First Choice”) in an all-stock transaction (the “Acquisition”). Immediately following the Share Sale, Distribution, and Acquisition, on a fully diluted basis, (i) approximately 63% of our outstanding common stock was owned by (a) shareholders of Henry Schein and the Share Sale investors, and (b) certain employees of the Animal Health Business who held certain equity awards, and (ii) approximately 37% was owned by (a) shareholders of Vets First Choice, and (b) certain employees of Vets First Choice who held certain equity awards. On February 8, 2019, our common stock began regular-way trading under the symbol “CVET” on the Nasdaq Global Select Stock Market. Basis of Presentation We prepared the accompanying unaudited consolidated and combined financial statements in accordance with applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. Pursuant to those rules and regulations, we omitted certain information and disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). In our opinion, the accompanying consolidated and combined financial statements reflect all recurring adjustments and transactions necessary for a fair statement of our financial position, results of operations, and cash flows for the interim periods presented. Such operating results are not necessarily indicative of annual or future results. These consolidated and combined financial statements and notes thereto should be read in conjunction with the audited combined financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 29, 2018 filed with the SEC. Use of Estimates Preparing financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and accompanying notes. Changes in circumstances could cause actual results to differ materially from these estimates. The most significant estimates include our evaluation of doubtful accounts receivable, inventory reserves, customer returns, goodwill impairment, self-insurance reserves, supplier rebates, fair value of redeemable non-controlling interests, share-based compensation expense, purchase price allocations, and intangible assets acquired. Principles of Consolidation The accompanying unaudited consolidated and combined financial statements include the operations of the Company, as well as those of our wholly-owned and majority-owned subsidiaries from their respective dates of inception or acquisition. All significant intercompany transactions and balances are eliminated in consolidation. Investments in unconsolidated affiliates, which are 20% to 50% owned, or investments of less than 20% in which we have the ability to influence the operating or financial decisions, are accounted for under the equity method. All 2018 information is presented on a combined basis. The unaudited combined financial statements have been derived from the consolidated financial statements and accounting records of Henry Schein. The unaudited combined financial statements reflect the combined historical results of operations, financial position, and cash flows of the Animal Health Business as they were historically accounted for in conformity with GAAP. The unaudited combined financial statements include the accounts of the Animal Health Business and its controlled subsidiaries. Investments in unconsolidated affiliates, which are 20% to 50% owned, or investments of less than 20% in which the Animal Health Business had the ability to influence the operating or financial decisions, were accounted for under the equity method. All intracompany transactions have been eliminated. All intercompany transactions between the Animal Health Business and Henry Schein have been eliminated in these unaudited combined financial statements as such transactions were deemed to not have occurred between us and Henry Schein. The unaudited combined financial statements include expense allocations for (i) certain corporate functions historically provided by Henry Schein, including accounting, legal, information services, planning, compliance, investor relations, administration and communication, and similar costs, (ii) employee benefits and incentives, and (iii) share-based compensation. These expenses have been allocated to the Animal Health Business on the basis of direct usage when identifiable, with the remainder allocated on a pro rata basis of net sales, headcount, or other measures of the Animal Health Business and Henry Schein. The Animal Health Business believes the bases on which the expenses have been allocated are a reasonable reflection of the utilization of services provided to, or the benefit received by, the Animal Health Business during the periods presented. The allocations may not, however, reflect the actual expenses that the Animal Health Business would have incurred as a stand-alone company for the periods presented. Actual costs that may have been incurred if the Animal Health Business had been a stand-alone company would depend on a number of factors, including the chosen organizational structure, what functions were outsourced or performed by employees, and strategic decisions made in areas such as information technology and infrastructure. Following the Separation, these functions have been performed using our own resources or third-party service providers. For an interim period, however, some of these functions will continue to be provided by Henry Schein under transition services agreements, which are planned to extend for a period of up to 24 months following the closing of the Share Sale and Distribution. Fiscal Year During fiscal year 2018, we operated on a 52-53-week basis ending on the last Saturday of December. For fiscal year 2019, we adopted a last day of the calendar year accounting and operating cycle. We made this change on a prospective basis and did not adjust operating results for periods prior to 2019 as the result was not material. Accounting Pronouncements Adopted As of January 1, 2019, we adopted the following Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”): • ASU No. 2016-02, “Leases (Topic 842)”, introduces the balance sheet recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under previous guidance. We adopted the new lease standard using the transition option issued under the amendments in ASU No. 2018-11, “Leases (Topic 842): Targeted Improvements”, which allowed us to continue to apply the legacy guidance in Accounting Standards Codification (“ASC”) 840, “Leases”, in the comparative periods presented in the year of adoption. We elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed us to carry forward the historical lease classification. We made an accounting policy election to keep leases with an initial term of 12 months or less off of the balance sheet. We recognize those lease payments in the consolidated statement of operations on a straight-line basis over the lease term. The impact of the adoption was an increase to our operating lease assets and liabilities on January 1, 2019 of $67 million . The initial recognition of the right-of-use asset and lease liability represented a non-cash activity. See Note 13 - Leases . • ASU No. 2017-04, “Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”), eliminates step two from the quantitative goodwill impairment test. Under this guidance, annual or interim goodwill impairment testing is performed by comparing the fair value of the reporting units to the carrying value of those units. If the carrying value exceeds the fair value, an impairment charge is recognized, not to exceed the amount of goodwill allocated to each reporting unit. See Note 5 - Goodwill and Intangible Assets, Net and Note 6 - Fair Value for information about our interim impairment test performed during the three months ended September 30, 2019 . • ASU No. 2018-02, “Treatment of Stranded Tax Effects in Accumulated Other Comprehensive Income Resulting from the Tax Cuts and Jobs Act of 2017”, allows the reclassification of the income tax effects resulting from the Tax Cuts and Jobs Act of 2017 ("Tax Act") from accumulated comprehensive income to retained earnings. The adoption did not have a material impact on our consolidated financial statements and related disclosures. • ASU No. 2018-07, “Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting” (“ASU 2018-07”), expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. ASU 2018-07 simplifies the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees. The adoption did not have a material impact on our consolidated financial statements and related disclosures. As of July 1, 2019, we early adopted the following ASUs issued by the FASB: • ASU No. 2018-15, “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract” (“ASU 2018-15”), aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal use software license). The adoption did not have a material impact on our consolidated financial statements and related disclosures. • ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement” (“ASU 2018-13”), removed, modified, and added disclosure requirements for fair value assets and liabilities. The adoption did not have a material impact on our consolidated financial statements and related disclosures.

Revenue from Contracts with Cus

Revenue from Contracts with Customers	9 Months Ended
	Sep. 30, 2019
Revenue from Contract with Customer [Abstract]
Revenue from Contracts with Customers	Revenue from Contracts with Customers Disaggregation of Revenue The following table disaggregates our revenue by segment: Three Months Ended September 30, Nine Months Ended September 30, (In millions) 2019 2018 2019 2018 North America $ 543 $ 479 $ 1,592 $ 1,479 Europe 384 351 1,114 1,113 APAC & Emerging Markets 94 95 270 291 Eliminations (3 ) (2 ) (8 ) (8 ) Total net sales $ 1,018 $ 923 $ 2,968 $ 2,875 Contract Balances Contract balances represent amounts presented in the consolidated and combined balance sheets when we have either transferred goods or services to the customer or the customer has paid consideration to us under the contract. These contract balances include accounts receivable, contract assets, and contract liabilities. Accounts Receivable The carrying amount of accounts receivable is reduced by an allowance that reflects our best estimate of the amounts that will not be collected. In addition to reviewing delinquent accounts receivable, we consider many factors in estimating our allowance for doubtful accounts including historical data, experience, customer types, creditworthiness, and economic trends. From time to time, we adjust our assumptions for anticipated changes in any of these or other factors expected to affect collectability. Contract Assets Contract assets include amounts related to any conditional right to consideration for work completed as of the reporting date and generally represent amounts owed to us by customers, but not yet billed. Contract assets are transferred to Accounts receivable when the right becomes unconditional. Current contract assets are included in Prepaid expenses and other and non-current contract assets are included in Investments and other within the consolidated and combined balance sheets. The contract assets primarily relate to the bundled arrangements for the sale of equipment and consumables and sales of term software licenses. Current and non-current contract asset balances as of September 30, 2019 and December 29, 2018 were not material. Contract Liabilities Contract liabilities are comprised of advance payments and deferred revenue amounts. Contract liabilities are transferred to revenue once the performance obligation has been satisfied. Current contract liabilities are included in Accrued expenses - Other and non-current contract liabilities are included in Other liabilities within the consolidated and combined balance sheets. The contract liabilities primarily relate to advance payments from customers and upfront payments for service arrangements provided over time. At September 30, 2019 and December 29, 2018 , the current portion of contract liabilities of $26 million and $18 million , respectively, were reported in Accrued expenses - Other. Amounts related to non-current contract liabilities were not material. Performance Obligations Estimated future revenues expected to be generated from long-term contracts with unsatisfied performance obligations as of September 30, 2019 , were not material.

Business Acquisitions

Business Acquisitions	9 Months Ended
	Sep. 30, 2019
Business Combinations [Abstract]
Business Acquisitions	Business Acquisitions Vets First Choice On February 7, 2019, we acquired Vets First Choice. See Note 1 - Business Overview and Significant Accounting Policies . During the three months ended June 30, 2019, we recorded a measurement period adjustment, which was made to reflect the facts and circumstances in existence as of the acquisition date. This adjustment reflects a reduction to the purchase price of $30 million , offset by a corresponding decrease to goodwill. This measurement period adjustment relates to the expected cancellation of approximately 700,000 Covetrus shares issued to Vets First Choice shareholders that are held in escrow. The estimated consideration and fair value in the tables below have been updated to reflect this measurement period adjustment. The acquisition date fair value of the consideration transferred consisted of the following: (In millions, except share and per share data) Estimated Consideration Total Covetrus shares issued to Vets First Choice shareholders (a) 39,041,070 Per share price (in actuals) (b) $ 43.05 Total fair value of shares issued to Vets First Choice shareholders $ 1,681 Fair value of Vets First Choice replacement stock option awards attributable to pre-acquisition service 62 Vets First Choice debt repaid at close 24 Vets First Choice expenses paid at close 18 Less: Vets First Choice cash used to fund transaction (9 ) Total consideration $ 1,776 (a) Amount reflects shares expected to be canceled (b) Closing price on February 7, 2019, Covetrus shares trading on a when-issued basis (Nasdaq: CVET) The purchase price was allocated to the underlying assets acquired and liabilities assumed based upon their estimated fair values at the date of acquisition. The following table summarizes the allocation of the purchase price to the assets acquired and liabilities assumed: (In millions) Estimated Fair Value Fair value of net assets acquired $ 14 Goodwill 1,328 Intangible assets 545 Deferred tax liabilities (111 ) Total acquisition cost $ 1,776 The size of the Acquisition necessitates use of the one-year measurement period to adequately analyze all the factors used in establishing the asset and liability fair values as of the acquisition date, including, but not limited to intangible assets and deferred tax liabilities. We determined the estimated fair value of the identifiable intangible assets after review and consideration of relevant information including discounted cash flow analysis, market data, and management’s estimates. We engaged an independent valuation firm to assist in determining the fair value of the acquired intangible assets. The value attributed to the other identifiable intangible assets included $20 million in trademarks and trade names, $50 million in product formulas, $125 million in customer relationships, and $350 million in developed technologies. These intangible assets are being amortized over a weighted average period of seven years . The goodwill from this transaction arose as a result of our expected ability to leverage existing and new marketing opportunities across a larger revenue base. The goodwill from this transaction is not deductible for tax purposes. See Note 5 - Goodwill and Other Intangible Assets, Net . The following unaudited pro forma financial information presents the results of operations for the three and nine months ended September 30, 2019 and 2018 , as if the Acquisition had occurred as of December 31, 2017. The unaudited pro forma results reflect certain adjustments for items that are not expected to have a continuing impact, such as adjustments for transaction costs incurred, management fees, and purchase accounting. The information presented below has been prepared for comparative purposes only and does not purport to be indicative of either future results of operations or the results of operations that would have occurred had the Acquisition been consummated on December 31, 2017: Three Months Ended September 30, Nine Months Ended September 30, (In millions, except per share data) 2019 2018 2019 2018 Net sales $ 1,018 $ 976 $ 2,992 $ 3,024 Net loss $ (909 ) $ (23 ) $ (942 ) $ (43 ) Net loss attributable to Covetrus $ (906 ) $ (23 ) $ (939 ) $ (43 ) Loss per common share attributable to Covetrus: Basic $ (8.09 ) $ (0.32 ) $ (8.85 ) $ (0.61 ) Diluted $ (8.09 ) $ (0.32 ) $ (8.85 ) $ (0.61 ) Maravet S.A. On April 24, 2019 , we acquired the remaining 50% equity interest in Maravet S.A. ("Maravet"), an animal-health distributor in Romania, for $26 million , and as of September 30, 2019 , we have $17 million related to this acquisition included in Accrued expenses - Other within the consolidated balance sheet. We recognized a gain of $11 million on our previously held equity investment and have preliminarily ascribed $26 million to goodwill and $22 million to identifiable intangible assets based upon estimated fair values at the acquisition date. The purchase price allocation is preliminary and subject to change during the measurement period. The goodwill from this transaction is not deductible for tax purposes. See Note 5 - Goodwill and Other Intangible Assets, Net . During the three months ended September 30, 2019 , we completed an acquisition in Europe which was not material to our financial statements.

Earnings Per Share

Earnings Per Share	9 Months Ended
	Sep. 30, 2019
Earnings Per Share [Abstract]
Earnings Per Share	Earnings Per Share On February 7, 2019, Henry Schein distributed approximately 71 million shares of Covetrus common stock to its shareholders. The computation of basic earnings per common share (“EPS”) for periods prior to the Separation was calculated using the shares distributed by Henry Schein on February 7, 2019. The weighted average number of shares outstanding for diluted EPS for the periods prior to the Separation also include approximately 1 million of diluted common share equivalents for restricted stock and restricted stock units as these share-based awards were previously issued by Henry Schein and outstanding at the time of the Separation and were assumed by Covetrus following the Separation. Basic EPS is computed by dividing net income (loss) available to common shareholders by the weighted average number of shares of common stock outstanding during the period. In addition, the shares of common stock issuable pursuant to restricted stock awards, restricted stock units, and stock options outstanding under our 2019 Omnibus Incentive Compensation Plan (the “Plan”) are included in the diluted EPS calculation to the extent they are dilutive. The following is a reconciliation of the numerator and denominator of the basic and diluted EPS computation for net income (loss) per share: Three Months Ended September 30, Nine Months Ended September 30, (In millions, except per share amounts) 2019 2018 2019 2018 Numerator: Net (loss) income attributable to Covetrus $ (906 ) $ 16 $ (929 ) $ 67 Denominator: Basic Weighted average common shares outstanding 112 71 106 71 Diluted shares Effect of dilutive shares (a) — 1 — 1 Diluted shares 112 72 106 72 (Loss) earnings per share attributable to Covetrus: Basic $ (8.09 ) $ 0.22 $ (8.76 ) $ 0.94 Diluted $ (8.09 ) $ 0.22 $ (8.76 ) $ 0.94 (a) Shares from share-based awards are not included for periods with a net loss because they would be anti-dilutive

Goodwill and Other Intangible A

Goodwill and Other Intangible Assets, Net	9 Months Ended
	Sep. 30, 2019
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill and Other Intangible Assets, Net	Goodwill and Other Intangible Assets, Net Goodwill During the first quarter of 2019, in connection with the Separation and the Acquisition, we made significant changes to our organizational and reporting structure. With these changes, we revised our reportable segments. Goodwill was reallocated to the new reporting segments. See Note 14 - Segment Data. In August 2019, we released our results for the three and six months ended June 30, 2019, which failed to meet expectations, and included a downward revision to our previously provided full year guidance for the year ended December 31, 2019. We experienced a sustained decline in our share price and a resulting decrease in our market capitalization. These events triggered an interim impairment review as of August 31, 2019. We tested for goodwill impairment by quantitatively comparing the fair values of our reporting units to their carrying amounts. See Note 6 - Fair Value . Based on our analysis, we determined that the carrying value of our reporting units exceeded their fair values so we recorded a non-tax-deductible goodwill impairment charge totaling $939 million , which was included within the consolidated statement of operations for the three and nine months ended September 30, 2019 . The change in the Goodwill balances by segment for the nine months ended September 30, 2019 and for the year ended December 29, 2018 were as follows: (In millions) North America Europe APAC & Emerging Markets Total Balance at December 30, 2017 (a) $ 528 $ 182 $ 50 $ 760 Foreign currency translation (1 ) (11 ) (1 ) (13 ) Goodwill additions 2 1 — 3 Balance at December 29, 2018 (a) 529 172 49 750 Foreign currency translation — (8 ) (1 ) (9 ) Goodwill additions (b) 1,284 54 16 1,354 Goodwill impairment (657 ) (218 ) (64 ) (939 ) Balance at September 30, 2019 $ 1,156 $ — $ — $ 1,156 Accumulated impairment at September 30, 2019 $ (657 ) $ (218 ) $ (64 ) $ (939 ) (a) Recast to conform to 2019 presentation (b) Includes goodwill adjustment of $30 million related to Vets First Choice - see Note 3 - Business Acquisitions There were no accumulated impairment charges at December 29, 2018. Other Intangible Assets, Net We periodically review our long-lived assets for indications of impairment and to determine if the carrying value is recoverable and exceeds fair value. The carrying amount of long-lived assets is not recoverable if it exceeds the sum of undiscounted cash flows expected as a result from use and eventual disposition of the asset. Because an interim goodwill assessment was completed, we also performed an interim assessment of long-lived assets as of August 31, 2019. The results of our analysis indicated that the long-lived assets were recoverable as of the assessment date and did not require further impairment review. Other intangible assets, net includes customer lists, non-compete arrangements, patents, product development, and trademarks. The following table presents the balances within the consolidated and combined balance sheet as of: (In millions) September 30, 2019 December 29, 2018 Gross definite-lived intangible assets $ 1,007 $ 449 Less: Accumulated amortization (328 ) (241 ) Net definite-lived intangible assets $ 679 $ 208 The following table presents our amortization expense: Three Months Ended September 30, Nine Months Ended September 30, (In millions) 2019 2018 2019 2018 Amortization expense $ 34 $ 12 $ 93 $ 37

Fair Value

Fair Value	9 Months Ended
	Sep. 30, 2019
Fair Value Disclosures [Abstract]
Fair Value	Fair Value GAAP defines fair value as the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. GAAP establishes a fair value hierarchy that distinguishes between (i) market participant assumptions developed based on market data obtained from independent sources (observable inputs), and (ii) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). We have certain financial assets and liabilities that are measured at fair value on a recurring basis, certain nonfinancial assets and liabilities that may be measured at fair value on a non-recurring basis, and certain financial assets and liabilities that are not measured at fair value in our consolidated and combined balance sheets but the fair value is disclosed. The fair value disclosures of these assets and liabilities are based on a three-level hierarchy, which is defined as follows: • Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities • Level 2 - Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability • Level 3 - Unobservable inputs for the asset or liability There were no transfers between levels within the fair value hierarchy and no changes in valuation techniques during the three and nine months ended September 30, 2019 . Assets and Liabilities that are Measured at Fair Value on a Recurring Basis Derivative Contracts Our derivatives at September 30, 2019 consist of five over-the-counter interest rate swap contracts which are not traded through an exchange. Accordingly, our interest rate swaps are classified as Level 2 instruments. We use widely accepted valuation tools to determine fair value, such as discounting cash flows to calculate a present value for the derivatives. These instruments are carried at fair value as of September 30, 2019 . See Note 12 - Derivatives and Financial Instruments . For the year ended December 29, 2018, we had derivative contracts that were deemed to be immaterial. Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis Assets that are measured at fair value on a nonrecurring basis primarily relate to property and equipment, right-of-use assets, intangible assets, and goodwill. We do not periodically adjust carrying value to fair value for these assets; rather, the carrying value of the asset is reduced to its fair value when we determine that impairment has occurred. At August 31, 2019, assets measured at fair value on a nonrecurring basis consisted of goodwill. The fair value measurement of goodwill was measured using third-party valuation models and was determined using both the market approach and income approach, which includes discounted expected cash flows. As the discounted cash flows include unobservable inputs that were significant to the fair value measurement, the fair value was classified as a Level 3 measurement within the fair value hierarchy. See Note 5 - Goodwill and Other Intangible Assets, Net . Assets and Liabilities that are not Measured at Fair Value Financial Assets and Liabilities The carrying amounts reported on the consolidated and combined balance sheets for Cash and cash equivalents, Accounts receivable, Other receivables, Accounts payable, and Accrued expenses approximate their fair value due to the short maturity of those instruments. Investments in Affiliates There are no quoted market prices available for investments in affiliates, however, we believe the carrying amounts are a reasonable estimate of fair value. Long-term Debt Our Long-term debt is classified as a Level 2 instrument. The carrying amount of the term loan approximates fair value given its recent issuance and the underlying interest rate applied to such amounts outstanding is currently reset to market rate on a monthly basis. See Note 11 - Debt.

Redeemable Non-controlling Inte

Redeemable Non-controlling Interests	9 Months Ended
	Sep. 30, 2019
Noncontrolling Interest [Abstract]
Redeemable Non-controlling Interests	Redeemable Non-controlling Interests Some minority equity owners in certain of our subsidiaries have the right, at certain times, to require us to acquire their ownership interest in those entities at fair value. ASC 480, “Distinguishing Liabilities from Equity,” is applicable for non-controlling interests where we are, or may be, required to purchase all or a portion of the outstanding interest in a subsidiary from the non-controlling interest holder under the terms of a put option contained in contractual agreements. The following table presents the components of change and balances of Redeemable non-controlling interests within the consolidated and combined balance sheet as follows: (In millions) Nine Months Ended September 30, 2019 Year Ended Balance at beginning of period $ 92 $ 367 Decrease in redeemable non-controlling interests due to redemptions (74 ) (383 ) Increase in redeemable non-controlling interests due to business acquisitions — 6 Net (loss) income attributable to redeemable non-controlling interests (3 ) 7 Dividends paid — (10 ) Effect of foreign currency translation gain (loss) attributable to redeemable non-controlling interests 1 (2 ) Change in fair value of redeemable non-controlling interests (6 ) 107 Balance at end of period $ 10 $ 92

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies We are involved in various legal proceedings that arise in the ordinary course of business. Substantial judgment is required in predicting the outcome of these legal proceedings, many of which take years to adjudicate. We accrue estimated costs for a contingency when we believe that a loss is probable and can be reasonably estimated. No material accrued loss contingencies were recorded as of September 30, 2019 . Securities Litigation Matter On September 30, 2019, the City of Hollywood (Florida) Police Officers' Retirement System filed a putative securities class action lawsuit in the United States District Court for the Eastern District of New York, purportedly on behalf of purchasers of Covetrus common stock from February 8, 2019 through August 12, 2019, against the Company, Henry Schein, Inc., our former Chief Executive Officer and President, and our Chief Financial Officer (“Defendants”). The complaint alleges that Defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 by making allegedly false and misleading statements, and omissions, primarily regarding the Company’s financial prospects and the integration costs relating to the business combination involving the Animal Health Business and Vets First Choice. The suit seeks unspecified damages, fees, interest, and costs. We intend to defend the matter vigorously. Given the uncertainty of litigation, the preliminary stage of the case, and the legal standards that must be met for, among other things, class certification and success on the merits, we cannot estimate the reasonably possible loss or range of loss that may result from this action.

Accumulated Other Comprehensive

Accumulated Other Comprehensive Income (Loss)	9 Months Ended
	Sep. 30, 2019
Equity [Abstract]
Accumulated Other Comprehensive Income (Loss)	Accumulated Other Comprehensive Income (Loss) Comprehensive income (loss) includes certain gains and losses that are excluded from net income (loss) under GAAP; as such amounts are recorded directly as an adjustment to total equity. Our comprehensive income (loss) is primarily comprised of net income (loss), foreign currency translation gain (loss), unrealized gain (loss) on derivative instruments, and pension adjustment gain. The following table presents Accumulated other comprehensive income (loss) ("AOCI"), net of applicable taxes, as of: September 30, December 29, (In millions) 2019 2018 Attributable to redeemable non-controlling interests: Foreign currency translation adjustment $ — $ 1 Attributable to Covetrus: Foreign currency translation loss (101 ) (83 ) Unrealized loss on derivative instruments (2 ) — Pension adjustment gain 1 — Accumulated other comprehensive loss (102 ) (83 ) Total accumulated other comprehensive loss $ (102 ) $ (82 ) The following table presents the changes in AOCI by component, net of applicable taxes: Nine Months Ended September 30, (In millions) 2019 2018 Net (loss) income $ (932 ) $ 75 Foreign currency translation loss (18 ) (31 ) Unrealized loss on derivative instruments (2 ) — Pension adjustment gain 1 — Comprehensive (loss) income $ (951 ) $ 44 We recognized foreign currency translation losses as a component of comprehensive income due to changes in foreign exchange rates from the beginning of the period to the end of the period. The consolidated and combined financial statements are denominated in the U.S. dollar currency. Fluctuations in the value of foreign currencies as compared to the U.S. dollar may have a significant impact on Comprehensive income (loss). See Note 12 - Derivatives and Financial Instruments . The tax effect on accumulated unrealized losses on derivative instruments and unrealized gains on pensions was immaterial as of September 30, 2019 . The following table presents the components of total comprehensive income (loss), net of applicable taxes: Nine Months Ended September 30, (In millions) 2019 2018 Comprehensive (loss) income attributable to Covetrus $ (949 ) $ 38 Comprehensive (loss) income attributable to redeemable non-controlling interests (2 ) 6 Comprehensive (loss) income $ (951 ) $ 44

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2019
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes Income tax benefit for the three months ended September 30, 2019 was $60 million on a loss before taxes of $969 million for a consolidated effective tax rate of 6.2% . Income tax benefit for the nine months ended September 30, 2019 was $60 million on a loss before taxes of $992 million for a consolidated effective tax rate of 6.0% . Income tax expense for the three months ended September 30, 2018 was $19 million on income before taxes of $35 million for a consolidated effective tax rate of 54.3% . Income tax expense for the nine months ended September 30, 2018 was $33 million on income before taxes of $107 million for a consolidated effective tax rate of 30.8% . The difference between our effective tax rate and the federal statutory tax rate for the nine months ended September 30, 2019 and 2018 primarily relates to the goodwill impairment recorded discretely in the three months ended September 30, 2019 , as well as non-deductible stock compensation expense, the federal tax impact of international operations included as Global Intangible Low-Taxed Income (“GILTI”), and limitations on the ability to utilize associated foreign tax credits.

Debt

Debt	9 Months Ended
	Sep. 30, 2019
Debt Disclosure [Abstract]
Debt	Debt On February 7, 2019, we entered into a $1.5 billion syndicated credit agreement with a five -year term (the “Credit Facility”). The Credit Facility includes a $1.2 billion term loan, which was primarily used to pay a dividend to Henry Schein, and a $300 million revolving line of credit for working capital and general corporate purposes that includes up to $35 million for the issuance of letters of credit. Subject to certain conditions, we may borrow at least an additional $265 million . We paid $24 million of debt issuance costs, which we deferred and amortize on an effective yield basis to interest expense. We issued $19 million in letters of credit, reducing the borrowing capacity of the revolving line of credit to $281 million at September 30, 2019 . There were no borrowings from the revolving line of credit as of September 30, 2019 . The term loan and revolving line of credit bear interest on a floating rate basis at our option and incur fees as follows: • LIBOR (ranging from 1 month to 12 months) subject to a floor of 0.00% – plus a margin ranging from 1.25% to 2.25% per annum based on our leverage ratio at the end of the prior quarter. • Alternative base rate subject to a floor of 1.00% – plus a margin ranging from 0.25% to 1.25% per annum based on our leverage ratio at the end of the prior quarter. • Unused capacity under the revolving line of credit loan incurs a fee ranging from 0.175% to 0.350% per annum based on our leverage ratio at the end of the prior quarter. • Additionally, customary letter of credit fees, as well as fronting fees, are incurred for letters of credit outstanding. Through September 30, 2019 , the spreads on LIBOR and alternative base rate borrowings were held constant at 2.00% and 1.00% , respectively, for both the term loan and revolving line of credit. The commitment fee for the revolving line of credit was held constant at 0.30% . Starting March 31, 2020, the term loan amortizes in quarterly installments equal to 5.00% per annum of the initial borrowed amount and requires full payment at maturity of all amounts owed. No amortizing payments are required for the revolving line of credit, however all amounts owed are due at maturity. We have the option to prepay both the term loan and revolving line of credit without penalty, subject to certain conditions. Mandatory prepayments are required in an amount equal to the net cash proceeds of (i) certain assets sales, (ii) certain debt offerings, and (iii) certain insurance recovery and condemnation events. In addition, if the aggregate balance of loans outstanding exceeds the lender's commitments made to the revolving line of credit at any time, then the amount of such excess is required to be prepaid. The Credit Facility limits or restricts our ability to (i) incur additional indebtedness, (ii) make dividends and other restricted payments, (iii) incur additional liens, (iv) consolidate, merge, sell, or otherwise dispose of all or substantially all assets, (v) make investments, (vi) transfer or sell assets, (vii) enter into restrictive agreements, (viii) change the nature of the business, and (ix) enter into certain transactions with affiliates. Starting April 1, 2019, we were required to maintain a leverage ratio of less than 5.50 :1.00. The leverage ratio covenant decreases annually, down to 3.75 :1.00 in 2022. We must also maintain a net interest coverage ratio of no less than 3.00 :1.00 at the end of each quarter. We were in compliance with all financial covenants as of and for the three months ended September 30, 2019 . The Credit Facility is guaranteed by Covetrus, the subsidiary borrower, and its subsidiary guarantors. We have pledged substantially all tangible and intangible assets, as well as our ownership interests in certain subsidiary companies, in support of the Credit Facility. As of September 30, 2019 , we had total debt of $1.2 billion , offset by $20 million of unamortized deferred debt issuance costs. For the three and nine months ended September 30, 2019 , we recognized $16 million and $42 million , respectively, in interest expense.

Derivatives and Financial Instr

Derivatives and Financial Instruments	9 Months Ended
	Sep. 30, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Instruments and Financial Instruments	Derivatives and Financial Instruments We are exposed to the impact of changes in interest rates in the normal course of business. Our financial risk management program is designed to manage the exposure arising from cash flow variability and uses derivative financial instruments to minimize this risk. We do not enter into derivative financial instruments for trading or speculative purposes. In July and August 2019, we executed interest rate swap contracts with two-year terms and notional amounts aggregating $500 million that are designated as cash flow hedges to manage interest rate risk on our floating rate debt. These interest rate swap contracts adjust the amount of our total debt that is subject to variable interest rates by effectively fixing the borrowing rates on our floating rate debt discussed in Note 11 - Debt . The following table discloses the fair value and balance sheet location of our derivative instruments: Liability Derivatives (In millions) Balance Sheet Location September 30, 2019 December 29, 2018 Cash Flow Hedging Instruments: Interest rate swap contracts Other liabilities $ 2 $ — We test the effectiveness of interest rate hedges quarterly by applying a hypothetical derivative method using regression analysis. Since our hedging contracts are deemed highly effective as of September 30, 2019 , hedge gains and losses were initially reported as a component of other comprehensive income and subsequently recorded in the consolidated statement of operations when the hedged exposure was recognized. The effect of cash flow hedges on Other comprehensive (loss) income was as follows: Amount of Loss (In millions) Three Months Ended September 30, 2019 Nine Months Ended September 30, 2019 Cash Flow Hedging Instruments: Losses recognized in Other comprehensive (loss) income $ (2 ) $ (2 ) During the three months ended September 30, 2019 , immaterial gains were reclassified out of Other comprehensive (loss) income into Interest expense within the consolidated statement of operations. The net amount of deferred gains on cash flow hedges that are expected to be reclassified from AOCI into Interest expense within the next twelve months is not material.

Leases

Leases	9 Months Ended
	Sep. 30, 2019
Leases [Abstract]
Leases	Leases We have office space, warehouse facilities, vehicles, and equipment under non-cancelable operating leases with third parties. The leases have remaining lease terms of one year to eight years . Leases with an initial term of 12 months or less are not recognized on the balance sheet. We recognize lease expense for these leases on a straight-line basis over the lease term. For purposes of calculating operating lease liabilities, lease terms may be deemed to include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Rent expense charged to operations under operating leases during the three and nine months ended September 30, 2019 was $6 million and $18 million , respectively. Variable rent and short-term lease expenses were not material. The following table presents the lease balances within the consolidated balance sheet and other supplemental information related to our operating leases as of: (In millions, except lease terms and discount rates) September 30, 2019 Operating Leases: Operating lease right-of-use assets, net $ 75 Accrued expenses, other $ 19 Other liabilities 58 Total operating lease liabilities $ 77 Weighted average remaining lease term 6.0 years Weighted average discount rate 3.7 % Supplemental cash flow information related to leases was as follows: Three Months Ended Nine Months Ended (In millions) September 30, 2019 September 30, 2019 Cash paid for amounts included in the measurement of operating lease liabilities $ 6 $ 18 Right-of-use assets obtained in exchange for new operating lease liabilities $ 20 $ 91 The following table presents the maturity of our operating lease liabilities as of September 30, 2019 : (In millions) Operating Leases 2019 (remainder of year) $ 6 2020 21 2021 17 2022 10 2023 8 Thereafter 25 Total minimum lease payments 87 Less: amount representing interest (10 ) Present value of net minimum lease payments 77 Less: current portion of operating lease obligation (19 ) Long-term operating lease obligation $ 58 As of September 30, 2019 , we had additional operating leases of $131 million , which have not yet commenced, related to our new corporate headquarters and full-service veterinary pharmacy in Maine and compounding pharmacy in Arizona. These operating leases are expected to commence in fiscal year 2020 with lease terms of 13 to 20 years . Financing lease balances as of September 30, 2019 and December 29, 2018 were not material.

Segment Data

Segment Data	9 Months Ended
	Sep. 30, 2019
Segment Reporting [Abstract]
Segment Data	Segment Data In connection with the Separation and the Acquisition, we made significant changes to our organizational management and reporting structure. As a result, we revised our reportable segments to reflect how the chief operating decision maker (the chief executive officer) (the “CODM”) currently reviews financial information and makes operating decisions. This resulted in a change in the operating segments from (i) supply chain, and (ii) technology and value-added services to (i) North America, (ii) Europe, and (iii) APAC & Emerging Markets. While the historical business was focused on driving growth through specific product and service offerings to its customers, the Separation and the Acquisition allowed for the integration of the different products and service offerings, along with prescription management, data analytics, and insights through veterinary practice management software, into one multi-channel veterinary platform. We will focus on delivering the integrated platform of products and services to our customers on a geographical basis. During the second quarter of 2019, our CODM began evaluating segment profit (loss) solely based on adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”). In the prior period, our CODM was using both operating income and Adjusted EBITDA for measurement purposes, thus operating income was presented as it most closely reflected the measurement principle applied to our consolidated and combined financial statements. We do not allocate certain items managed at the corporate level to our segments. All intersegment balances and transactions have been eliminated in consolidation. The following tables reflects the segment recast for the prior-year period and reconciles Adjusted EBITDA for reportable segments to consolidated net income (loss) attributable to Covetrus: At and For the Three Months Ended September 30, 2019 (In millions) North America Europe APAC & Emerging Markets Corporate Eliminations Total Net sales $ 543 $ 384 $ 94 $ — $ (3 ) $ 1,018 Adjusted EBITDA $ 39 $ 15 $ 5 $ (10 ) $ — $ 49 Total assets $ 2,848 $ 622 $ 121 $ 1,108 $ (1,371 ) $ 3,328 Reconciliation of Net Loss Attributable to Covetrus to Adjusted EBITDA: Net loss attributable to Covetrus $ (906 ) Plus: Depreciation and amortization 41 Plus: Interest expense, net 16 Less: Income tax benefit (60 ) Earnings before interest, taxes, depreciation and amortization (909 ) Plus: Share-based compensation 10 Plus: Formation of Covetrus 14 Plus: IT infrastructure 2 Plus: Goodwill impairment 939 Less: Minority interest in goodwill impairment (3 ) Less: Other income items (4 ) Adjusted EBITDA $ 49 At and For the Three Months Ended September 30, 2018 (In millions) North America Europe APAC & Emerging Markets Corporate Eliminations Total Net sales $ 479 $ 351 $ 95 $ — $ (2 ) $ 923 Adjusted EBITDA $ 42 $ 16 $ 5 $ (10 ) $ — $ 53 Total assets $ 1,310 $ 688 $ 196 $ 12 $ (4 ) $ 2,202 Reconciliation of Net Income Attributable to Covetrus to Adjusted EBITDA: Net income attributable to Covetrus $ 16 Plus: Depreciation and amortization 16 Plus: Income tax expense 19 Earnings before interest, taxes, depreciation and amortization 51 Plus: Share-based compensation $ 2 Adjusted EBITDA $ 53 For the Nine Months Ended September 30, 2019 (In millions) North America Europe APAC & Emerging Markets Corporate Eliminations Total Net sales $ 1,592 $ 1,114 $ 270 $ — $ (8 ) $ 2,968 Adjusted EBITDA $ 117 $ 50 $ 14 $ (27 ) $ — $ 154 Reconciliation of Net Loss Attributable to Covetrus to Adjusted EBITDA: Net loss attributable to Covetrus $ (929 ) Plus: Depreciation and amortization 113 Plus: Interest expense, net 41 Less: Income tax benefit (60 ) Earnings before interest, taxes, depreciation and amortization (835 ) Plus: Share-based compensation 35 Plus: Formation of Covetrus 27 Plus: Carve-out operating expenses 5 Plus: IT infrastructure 4 Plus: Goodwill impairment 939 Less: Minority interest in goodwill impairment (3 ) Less: Other income items (18 ) Adjusted EBITDA $ 154 For the Nine Months Ended September 30, 2018 (In millions) North America Europe APAC & Emerging Markets Corporate Eliminations Total Net sales $ 1,479 $ 1,113 $ 291 $ — $ (8 ) $ 2,875 Adjusted EBITDA $ 121 $ 56 $ 16 $ (29 ) $ — $ 164 Reconciliation of Net Income Attributable to Covetrus to Adjusted EBITDA: Net income attributable to Covetrus $ 67 Plus: Depreciation and amortization 49 Plus: Interest expense, net 1 Plus: Income tax expense 33 Earnings before interest, taxes, depreciation and amortization 150 Plus: Share-based compensation 6 Plus: Restructuring costs 8 Adjusted EBITDA $ 164

Share-Based Compensation

Share-Based Compensation	9 Months Ended
	Sep. 30, 2019
Share-based Payment Arrangement, Disclosure [Abstract]
Share-Based Compensation	Share-based Compensation In connection with the Separation and the Acquisition, all outstanding restricted stock awards, restricted stock units, and stock options were exchanged for economically equivalent awards of Covetrus. Restricted stock awards and restricted stock units of 327,447 and stock options of 3,914,694 were issued in connection with the exchange. We currently issue shares of restricted stock, restricted stock units, and options to purchase common stock under the Plan. The Plan provides for the grant of incentive stock options, non-qualified stock options, stock awards, stock units, stock appreciation rights, other share-based awards, and cash awards. Awards issued under the Plan may not have a term greater than 10 years from the date of grant and generally vest ratably over a three -year period. We utilize the Black-Scholes option pricing model to determine the fair value of options granted and have elected the accrual method for recognizing compensation costs. The fair value of share-based payment awards calculated using the Black-Scholes model varies based on share price, award exercise price, stock volatility, expected term, risk free interest rate, expected dividends, and the assumptions used in determining these variables. During the three and nine months ended September 30, 2019 , we granted 166,467 and 1,256,139 , respectively, of restricted stock awards and restricted stock units, and 22,540 and 1,003,494 , respectively, of stock options with a weighted average fair value of $8.21 and $12.15 per share, respectively, determined using the Black-Scholes option pricing model. For the three and nine months ended September 30, 2019 , we recorded share-based compensation expense of $10 million and $35 million , respectively, in connection with share-based payment awards.

Business Overview and Signifi_2

Business Overview and Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2019
Accounting Policies [Abstract]
Business	Business Covetrus, Inc. (“Covetrus,” “Company,” “we,” “our,” “us,” or “ourselves”) is a global animal-health technology and services company dedicated to empowering veterinary practice partners to drive improved health and financial outcomes supporting the companion, equine, and large animal veterinary markets. On February 7, 2019, Henry Schein, Inc. (“Henry Schein”) completed the spin-off of its animal-health business (the “Animal Health Business”) and transferred the applicable assets, liabilities, and ownership interests to us (the “Separation”). At the same time, we liquidated the investment of our sole shareholder, paid a cash dividend of $1.2 billion from loan proceeds, and sold $361 million in shares to institutional accredited investors (the “Share Sale”). The proceeds from the Share Sale were paid to us and distributed to Henry Schein (the “Distribution”). Subsequent to the Share Sale, Henry Schein distributed, on a pro rata basis, all of the shares of our common stock held by Henry Schein to its stockholders of record as of the close of business on January 17, 2019. We then acquired Direct Vet Marketing, Inc. (d/b/a Vets First Choice) (“Vets First Choice”) in an all-stock transaction (the “Acquisition”). Immediately following the Share Sale, Distribution, and Acquisition, on a fully diluted basis, (i) approximately 63% of our outstanding common stock was owned by (a) shareholders of Henry Schein and the Share Sale investors, and (b) certain employees of the Animal Health Business who held certain equity awards, and (ii) approximately 37% was owned by (a) shareholders of Vets First Choice, and (b) certain employees of Vets First Choice who held certain equity awards. On February 8, 2019, our common stock began regular-way trading under the symbol “CVET” on the Nasdaq Global Select Stock Market.
Basis of Presentation	Basis of Presentation We prepared the accompanying unaudited consolidated and combined financial statements in accordance with applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. Pursuant to those rules and regulations, we omitted certain information and disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). In our opinion, the accompanying consolidated and combined financial statements reflect all recurring adjustments and transactions necessary for a fair statement of our financial position, results of operations, and cash flows for the interim periods presented. Such operating results are not necessarily indicative of annual or future results. These consolidated and combined financial statements and notes thereto should be read in conjunction with the audited combined financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 29, 2018 filed with the SEC.
Use of Estimates	Use of Estimates Preparing financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and accompanying notes. Changes in circumstances could cause actual results to differ materially from these estimates. The most significant estimates include our evaluation of doubtful accounts receivable, inventory reserves, customer returns, goodwill impairment, self-insurance reserves, supplier rebates, fair value of redeemable non-controlling interests, share-based compensation expense, purchase price allocations, and intangible assets acquired.
Principles of Consolidation	Principles of Consolidation The accompanying unaudited consolidated and combined financial statements include the operations of the Company, as well as those of our wholly-owned and majority-owned subsidiaries from their respective dates of inception or acquisition. All significant intercompany transactions and balances are eliminated in consolidation. Investments in unconsolidated affiliates, which are 20% to 50% owned, or investments of less than 20% in which we have the ability to influence the operating or financial decisions, are accounted for under the equity method. All 2018 information is presented on a combined basis. The unaudited combined financial statements have been derived from the consolidated financial statements and accounting records of Henry Schein. The unaudited combined financial statements reflect the combined historical results of operations, financial position, and cash flows of the Animal Health Business as they were historically accounted for in conformity with GAAP. The unaudited combined financial statements include the accounts of the Animal Health Business and its controlled subsidiaries. Investments in unconsolidated affiliates, which are 20% to 50% owned, or investments of less than 20% in which the Animal Health Business had the ability to influence the operating or financial decisions, were accounted for under the equity method. All intracompany transactions have been eliminated. All intercompany transactions between the Animal Health Business and Henry Schein have been eliminated in these unaudited combined financial statements as such transactions were deemed to not have occurred between us and Henry Schein. The unaudited combined financial statements include expense allocations for (i) certain corporate functions historically provided by Henry Schein, including accounting, legal, information services, planning, compliance, investor relations, administration and communication, and similar costs, (ii) employee benefits and incentives, and (iii) share-based compensation. These expenses have been allocated to the Animal Health Business on the basis of direct usage when identifiable, with the remainder allocated on a pro rata basis of net sales, headcount, or other measures of the Animal Health Business and Henry Schein. The Animal Health Business believes the bases on which the expenses have been allocated are a reasonable reflection of the utilization of services provided to, or the benefit received by, the Animal Health Business during the periods presented. The allocations may not, however, reflect the actual expenses that the Animal Health Business would have incurred as a stand-alone company for the periods presented. Actual costs that may have been incurred if the Animal Health Business had been a stand-alone company would depend on a number of factors, including the chosen organizational structure, what functions were outsourced or performed by employees, and strategic decisions made in areas such as information technology and infrastructure. Following the Separation, these functions have been performed using our own resources or third-party service providers. For an interim period, however, some of these functions will continue to be provided by Henry Schein under transition services agreements, which are planned to extend for a period of up to 24 months following the closing of the Share Sale and Distribution.
Fiscal Year	Fiscal Year During fiscal year 2018, we operated on a 52-53-week basis ending on the last Saturday of December. For fiscal year 2019, we adopted a last day of the calendar year accounting and operating cycle. We made this change on a prospective basis and did not adjust operating results for periods prior to 2019 as the result was not material.
Accounting Pronouncements Adopted and Recently Issued Accounting Standards	Accounting Pronouncements Adopted As of January 1, 2019, we adopted the following Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”): • ASU No. 2016-02, “Leases (Topic 842)”, introduces the balance sheet recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under previous guidance. We adopted the new lease standard using the transition option issued under the amendments in ASU No. 2018-11, “Leases (Topic 842): Targeted Improvements”, which allowed us to continue to apply the legacy guidance in Accounting Standards Codification (“ASC”) 840, “Leases”, in the comparative periods presented in the year of adoption. We elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed us to carry forward the historical lease classification. We made an accounting policy election to keep leases with an initial term of 12 months or less off of the balance sheet. We recognize those lease payments in the consolidated statement of operations on a straight-line basis over the lease term. The impact of the adoption was an increase to our operating lease assets and liabilities on January 1, 2019 of $67 million . The initial recognition of the right-of-use asset and lease liability represented a non-cash activity. See Note 13 - Leases . • ASU No. 2017-04, “Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”), eliminates step two from the quantitative goodwill impairment test. Under this guidance, annual or interim goodwill impairment testing is performed by comparing the fair value of the reporting units to the carrying value of those units. If the carrying value exceeds the fair value, an impairment charge is recognized, not to exceed the amount of goodwill allocated to each reporting unit. See Note 5 - Goodwill and Intangible Assets, Net and Note 6 - Fair Value for information about our interim impairment test performed during the three months ended September 30, 2019 . • ASU No. 2018-02, “Treatment of Stranded Tax Effects in Accumulated Other Comprehensive Income Resulting from the Tax Cuts and Jobs Act of 2017”, allows the reclassification of the income tax effects resulting from the Tax Cuts and Jobs Act of 2017 ("Tax Act") from accumulated comprehensive income to retained earnings. The adoption did not have a material impact on our consolidated financial statements and related disclosures. • ASU No. 2018-07, “Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting” (“ASU 2018-07”), expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. ASU 2018-07 simplifies the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees. The adoption did not have a material impact on our consolidated financial statements and related disclosures. As of July 1, 2019, we early adopted the following ASUs issued by the FASB: • ASU No. 2018-15, “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract” (“ASU 2018-15”), aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal use software license). The adoption did not have a material impact on our consolidated financial statements and related disclosures. • ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement” (“ASU 2018-13”), removed, modified, and added disclosure requirements for fair value assets and liabilities. The adoption did not have a material impact on our consolidated financial statements and related disclosures.
Contract Balances	Contract Balances Contract balances represent amounts presented in the consolidated and combined balance sheets when we have either transferred goods or services to the customer or the customer has paid consideration to us under the contract. These contract balances include accounts receivable, contract assets, and contract liabilities. Accounts Receivable The carrying amount of accounts receivable is reduced by an allowance that reflects our best estimate of the amounts that will not be collected. In addition to reviewing delinquent accounts receivable, we consider many factors in estimating our allowance for doubtful accounts including historical data, experience, customer types, creditworthiness, and economic trends. From time to time, we adjust our assumptions for anticipated changes in any of these or other factors expected to affect collectability. Contract Assets Contract assets include amounts related to any conditional right to consideration for work completed as of the reporting date and generally represent amounts owed to us by customers, but not yet billed. Contract assets are transferred to Accounts receivable when the right becomes unconditional. Current contract assets are included in Prepaid expenses and other and non-current contract assets are included in Investments and other within the consolidated and combined balance sheets. The contract assets primarily relate to the bundled arrangements for the sale of equipment and consumables and sales of term software licenses. Current and non-current contract asset balances as of September 30, 2019 and December 29, 2018 were not material. Contract Liabilities Contract liabilities are comprised of advance payments and deferred revenue amounts. Contract liabilities are transferred to revenue once the performance obligation has been satisfied. Current contract liabilities are included in Accrued expenses - Other and non-current contract liabilities are included in Other liabilities within the consolidated and combined balance sheets. The contract liabilities primarily relate to advance payments from customers and upfront payments for service arrangements provided over time. At September 30, 2019 and December 29, 2018 , the current portion of contract liabilities of $26 million and $18 million , respectively, were reported in Accrued expenses - Other. Amounts related to non-current contract liabilities were not material.
Fair Value	Assets and Liabilities that are Measured at Fair Value on a Recurring Basis Derivative Contracts Our derivatives at September 30, 2019 consist of five over-the-counter interest rate swap contracts which are not traded through an exchange. Accordingly, our interest rate swaps are classified as Level 2 instruments. We use widely accepted valuation tools to determine fair value, such as discounting cash flows to calculate a present value for the derivatives. These instruments are carried at fair value as of September 30, 2019 . See Note 12 - Derivatives and Financial Instruments . For the year ended December 29, 2018, we had derivative contracts that were deemed to be immaterial. Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis Assets that are measured at fair value on a nonrecurring basis primarily relate to property and equipment, right-of-use assets, intangible assets, and goodwill. We do not periodically adjust carrying value to fair value for these assets; rather, the carrying value of the asset is reduced to its fair value when we determine that impairment has occurred. At August 31, 2019, assets measured at fair value on a nonrecurring basis consisted of goodwill. The fair value measurement of goodwill was measured using third-party valuation models and was determined using both the market approach and income approach, which includes discounted expected cash flows. As the discounted cash flows include unobservable inputs that were significant to the fair value measurement, the fair value was classified as a Level 3 measurement within the fair value hierarchy. See Note 5 - Goodwill and Other Intangible Assets, Net . Assets and Liabilities that are not Measured at Fair Value Financial Assets and Liabilities The carrying amounts reported on the consolidated and combined balance sheets for Cash and cash equivalents, Accounts receivable, Other receivables, Accounts payable, and Accrued expenses approximate their fair value due to the short maturity of those instruments. Investments in Affiliates There are no quoted market prices available for investments in affiliates, however, we believe the carrying amounts are a reasonable estimate of fair value. Long-term Debt Our Long-term debt is classified as a Level 2 instrument. The carrying amount of the term loan approximates fair value given its recent issuance and the underlying interest rate applied to such amounts outstanding is currently reset to market rate on a monthly basis. See Note 11 - Debt.

Revenue from Contracts with C_2

Revenue from Contracts with Customers (Tables)	9 Months Ended
	Sep. 30, 2019
Revenue from Contract with Customer [Abstract]
Disaggregation of Revenue	The following table disaggregates our revenue by segment: Three Months Ended September 30, Nine Months Ended September 30, (In millions) 2019 2018 2019 2018 North America $ 543 $ 479 $ 1,592 $ 1,479 Europe 384 351 1,114 1,113 APAC & Emerging Markets 94 95 270 291 Eliminations (3 ) (2 ) (8 ) (8 ) Total net sales $ 1,018 $ 923 $ 2,968 $ 2,875

Business Acquisitions (Tables)

Business Acquisitions (Tables)	9 Months Ended
	Sep. 30, 2019
Business Combinations [Abstract]
Schedule of Business Acquisitions, by Acquisition	The acquisition date fair value of the consideration transferred consisted of the following: (In millions, except share and per share data) Estimated Consideration Total Covetrus shares issued to Vets First Choice shareholders (a) 39,041,070 Per share price (in actuals) (b) $ 43.05 Total fair value of shares issued to Vets First Choice shareholders $ 1,681 Fair value of Vets First Choice replacement stock option awards attributable to pre-acquisition service 62 Vets First Choice debt repaid at close 24 Vets First Choice expenses paid at close 18 Less: Vets First Choice cash used to fund transaction (9 ) Total consideration $ 1,776 (a) Amount reflects shares expected to be canceled (b) Closing price on February 7, 2019, Covetrus shares trading on a when-issued basis (Nasdaq: CVET)
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed	The purchase price was allocated to the underlying assets acquired and liabilities assumed based upon their estimated fair values at the date of acquisition. The following table summarizes the allocation of the purchase price to the assets acquired and liabilities assumed: (In millions) Estimated Fair Value Fair value of net assets acquired $ 14 Goodwill 1,328 Intangible assets 545 Deferred tax liabilities (111 ) Total acquisition cost $ 1,776
Business Acquisition, Pro Forma Information	The following unaudited pro forma financial information presents the results of operations for the three and nine months ended September 30, 2019 and 2018 , as if the Acquisition had occurred as of December 31, 2017. The unaudited pro forma results reflect certain adjustments for items that are not expected to have a continuing impact, such as adjustments for transaction costs incurred, management fees, and purchase accounting. The information presented below has been prepared for comparative purposes only and does not purport to be indicative of either future results of operations or the results of operations that would have occurred had the Acquisition been consummated on December 31, 2017: Three Months Ended September 30, Nine Months Ended September 30, (In millions, except per share data) 2019 2018 2019 2018 Net sales $ 1,018 $ 976 $ 2,992 $ 3,024 Net loss $ (909 ) $ (23 ) $ (942 ) $ (43 ) Net loss attributable to Covetrus $ (906 ) $ (23 ) $ (939 ) $ (43 ) Loss per common share attributable to Covetrus: Basic $ (8.09 ) $ (0.32 ) $ (8.85 ) $ (0.61 ) Diluted $ (8.09 ) $ (0.32 ) $ (8.85 ) $ (0.61 )

Earnings Per Share (Tables)

Earnings Per Share (Tables)	9 Months Ended
	Sep. 30, 2019
Earnings Per Share [Abstract]
Reconciliation of Basic Shares to Diluted Shares	The following is a reconciliation of the numerator and denominator of the basic and diluted EPS computation for net income (loss) per share: Three Months Ended September 30, Nine Months Ended September 30, (In millions, except per share amounts) 2019 2018 2019 2018 Numerator: Net (loss) income attributable to Covetrus $ (906 ) $ 16 $ (929 ) $ 67 Denominator: Basic Weighted average common shares outstanding 112 71 106 71 Diluted shares Effect of dilutive shares (a) — 1 — 1 Diluted shares 112 72 106 72 (Loss) earnings per share attributable to Covetrus: Basic $ (8.09 ) $ 0.22 $ (8.76 ) $ 0.94 Diluted $ (8.09 ) $ 0.22 $ (8.76 ) $ 0.94 (a) Shares from share-based awards are not included for periods with a net loss because they would be anti-dilutive

Goodwill and Other Intangible_2

Goodwill and Other Intangible Assets, Net (Tables)	9 Months Ended
	Sep. 30, 2019
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of Goodwill	The change in the Goodwill balances by segment for the nine months ended September 30, 2019 and for the year ended December 29, 2018 were as follows: (In millions) North America Europe APAC & Emerging Markets Total Balance at December 30, 2017 (a) $ 528 $ 182 $ 50 $ 760 Foreign currency translation (1 ) (11 ) (1 ) (13 ) Goodwill additions 2 1 — 3 Balance at December 29, 2018 (a) 529 172 49 750 Foreign currency translation — (8 ) (1 ) (9 ) Goodwill additions (b) 1,284 54 16 1,354 Goodwill impairment (657 ) (218 ) (64 ) (939 ) Balance at September 30, 2019 $ 1,156 $ — $ — $ 1,156 Accumulated impairment at September 30, 2019 $ (657 ) $ (218 ) $ (64 ) $ (939 ) (a) Recast to conform to 2019 presentation (b) Includes goodwill adjustment of $30 million related to Vets First Choice - see Note 3 - Business Acquisitions
Schedule of Finite-Lived Intangible Assets	The following table presents the balances within the consolidated and combined balance sheet as of: (In millions) September 30, 2019 December 29, 2018 Gross definite-lived intangible assets $ 1,007 $ 449 Less: Accumulated amortization (328 ) (241 ) Net definite-lived intangible assets $ 679 $ 208
Finite-lived Intangible Assets Amortization Expense	The following table presents our amortization expense: Three Months Ended September 30, Nine Months Ended September 30, (In millions) 2019 2018 2019 2018 Amortization expense $ 34 $ 12 $ 93 $ 37

Redeemable Non-controlling In_2

Redeemable Non-controlling Interests (Tables)	9 Months Ended
	Sep. 30, 2019
Noncontrolling Interest [Abstract]
Redeemable Non-controlling Interests	The following table presents the components of change and balances of Redeemable non-controlling interests within the consolidated and combined balance sheet as follows: (In millions) Nine Months Ended September 30, 2019 Year Ended Balance at beginning of period $ 92 $ 367 Decrease in redeemable non-controlling interests due to redemptions (74 ) (383 ) Increase in redeemable non-controlling interests due to business acquisitions — 6 Net (loss) income attributable to redeemable non-controlling interests (3 ) 7 Dividends paid — (10 ) Effect of foreign currency translation gain (loss) attributable to redeemable non-controlling interests 1 (2 ) Change in fair value of redeemable non-controlling interests (6 ) 107 Balance at end of period $ 10 $ 92

Accumulated Other Comprehensi_2

Accumulated Other Comprehensive Income (Loss) (Tables)	9 Months Ended
	Sep. 30, 2019
Equity [Abstract]
Schedule of Accumulated Other Comprehensive Loss	The following table presents Accumulated other comprehensive income (loss) ("AOCI"), net of applicable taxes, as of: September 30, December 29, (In millions) 2019 2018 Attributable to redeemable non-controlling interests: Foreign currency translation adjustment $ — $ 1 Attributable to Covetrus: Foreign currency translation loss (101 ) (83 ) Unrealized loss on derivative instruments (2 ) — Pension adjustment gain 1 — Accumulated other comprehensive loss (102 ) (83 ) Total accumulated other comprehensive loss $ (102 ) $ (82 ) The following table presents the changes in AOCI by component, net of applicable taxes: Nine Months Ended September 30, (In millions) 2019 2018 Net (loss) income $ (932 ) $ 75 Foreign currency translation loss (18 ) (31 ) Unrealized loss on derivative instruments (2 ) — Pension adjustment gain 1 — Comprehensive (loss) income $ (951 ) $ 44
Comprehensive Income	The following table presents the components of total comprehensive income (loss), net of applicable taxes: Nine Months Ended September 30, (In millions) 2019 2018 Comprehensive (loss) income attributable to Covetrus $ (949 ) $ 38 Comprehensive (loss) income attributable to redeemable non-controlling interests (2 ) 6 Comprehensive (loss) income $ (951 ) $ 44

Derivatives and Financial Ins_2

Derivatives and Financial Instruments (Tables)	9 Months Ended
	Sep. 30, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value	The following table discloses the fair value and balance sheet location of our derivative instruments: Liability Derivatives (In millions) Balance Sheet Location September 30, 2019 December 29, 2018 Cash Flow Hedging Instruments: Interest rate swap contracts Other liabilities $ 2 $ —
Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location	The effect of cash flow hedges on Other comprehensive (loss) income was as follows: Amount of Loss (In millions) Three Months Ended September 30, 2019 Nine Months Ended September 30, 2019 Cash Flow Hedging Instruments: Losses recognized in Other comprehensive (loss) income $ (2 ) $ (2 )

Leases (Tables)

Leases (Tables)	9 Months Ended
	Sep. 30, 2019
Leases [Abstract]
Supplemental Balance Sheet Information	The following table presents the lease balances within the consolidated balance sheet and other supplemental information related to our operating leases as of: (In millions, except lease terms and discount rates) September 30, 2019 Operating Leases: Operating lease right-of-use assets, net $ 75 Accrued expenses, other $ 19 Other liabilities 58 Total operating lease liabilities $ 77 Weighted average remaining lease term 6.0 years Weighted average discount rate 3.7 %
Schedule of Supplemental Cash Flow Information Related to Leases	Supplemental cash flow information related to leases was as follows: Three Months Ended Nine Months Ended (In millions) September 30, 2019 September 30, 2019 Cash paid for amounts included in the measurement of operating lease liabilities $ 6 $ 18 Right-of-use assets obtained in exchange for new operating lease liabilities $ 20 $ 91
Operating Lease Maturities	The following table presents the maturity of our operating lease liabilities as of September 30, 2019 : (In millions) Operating Leases 2019 (remainder of year) $ 6 2020 21 2021 17 2022 10 2023 8 Thereafter 25 Total minimum lease payments 87 Less: amount representing interest (10 ) Present value of net minimum lease payments 77 Less: current portion of operating lease obligation (19 ) Long-term operating lease obligation $ 58

Segment Data (Tables)

Segment Data (Tables)	9 Months Ended
	Sep. 30, 2019
Segment Reporting [Abstract]
Schedule of Segment Reporting Information, by Segment	The following tables reflects the segment recast for the prior-year period and reconciles Adjusted EBITDA for reportable segments to consolidated net income (loss) attributable to Covetrus: At and For the Three Months Ended September 30, 2019 (In millions) North America Europe APAC & Emerging Markets Corporate Eliminations Total Net sales $ 543 $ 384 $ 94 $ — $ (3 ) $ 1,018 Adjusted EBITDA $ 39 $ 15 $ 5 $ (10 ) $ — $ 49 Total assets $ 2,848 $ 622 $ 121 $ 1,108 $ (1,371 ) $ 3,328 Reconciliation of Net Loss Attributable to Covetrus to Adjusted EBITDA: Net loss attributable to Covetrus $ (906 ) Plus: Depreciation and amortization 41 Plus: Interest expense, net 16 Less: Income tax benefit (60 ) Earnings before interest, taxes, depreciation and amortization (909 ) Plus: Share-based compensation 10 Plus: Formation of Covetrus 14 Plus: IT infrastructure 2 Plus: Goodwill impairment 939 Less: Minority interest in goodwill impairment (3 ) Less: Other income items (4 ) Adjusted EBITDA $ 49 At and For the Three Months Ended September 30, 2018 (In millions) North America Europe APAC & Emerging Markets Corporate Eliminations Total Net sales $ 479 $ 351 $ 95 $ — $ (2 ) $ 923 Adjusted EBITDA $ 42 $ 16 $ 5 $ (10 ) $ — $ 53 Total assets $ 1,310 $ 688 $ 196 $ 12 $ (4 ) $ 2,202 Reconciliation of Net Income Attributable to Covetrus to Adjusted EBITDA: Net income attributable to Covetrus $ 16 Plus: Depreciation and amortization 16 Plus: Income tax expense 19 Earnings before interest, taxes, depreciation and amortization 51 Plus: Share-based compensation $ 2 Adjusted EBITDA $ 53 For the Nine Months Ended September 30, 2019 (In millions) North America Europe APAC & Emerging Markets Corporate Eliminations Total Net sales $ 1,592 $ 1,114 $ 270 $ — $ (8 ) $ 2,968 Adjusted EBITDA $ 117 $ 50 $ 14 $ (27 ) $ — $ 154 Reconciliation of Net Loss Attributable to Covetrus to Adjusted EBITDA: Net loss attributable to Covetrus $ (929 ) Plus: Depreciation and amortization 113 Plus: Interest expense, net 41 Less: Income tax benefit (60 ) Earnings before interest, taxes, depreciation and amortization (835 ) Plus: Share-based compensation 35 Plus: Formation of Covetrus 27 Plus: Carve-out operating expenses 5 Plus: IT infrastructure 4 Plus: Goodwill impairment 939 Less: Minority interest in goodwill impairment (3 ) Less: Other income items (18 ) Adjusted EBITDA $ 154 For the Nine Months Ended September 30, 2018 (In millions) North America Europe APAC & Emerging Markets Corporate Eliminations Total Net sales $ 1,479 $ 1,113 $ 291 $ — $ (8 ) $ 2,875 Adjusted EBITDA $ 121 $ 56 $ 16 $ (29 ) $ — $ 164 Reconciliation of Net Income Attributable to Covetrus to Adjusted EBITDA: Net income attributable to Covetrus $ 67 Plus: Depreciation and amortization 49 Plus: Interest expense, net 1 Plus: Income tax expense 33 Earnings before interest, taxes, depreciation and amortization 150 Plus: Share-based compensation 6 Plus: Restructuring costs 8 Adjusted EBITDA $ 164

Business Overview and Signifi_3

Business Overview and Significant Accounting Policies (Details) - USD ($) $ in Millions	Feb. 07, 2019	Sep. 30, 2019	Jan. 01, 2019	Dec. 29, 2018
Business Acquisition [Line Items]
Operating lease right-of-use assets, net		$ 75		$ 0
Operating lease liability		$ 77
VFC
Business Acquisition [Line Items]
Percentage ownership, noncontrolling interest	37.00%
ASU 2016-02
Business Acquisition [Line Items]
Operating lease right-of-use assets, net			$ 67
Operating lease liability			$ 67
Henry Schein
Business Acquisition [Line Items]
Cash dividend paid to sole shareholder	$ 1,200
Percentage ownership, parent	63.00%
Share Sale Investors
Business Acquisition [Line Items]
Issuance of common shares in connection with the Merger	$ 361

Revenue from Contracts with C_3

Revenue from Contracts with Customers - Disaggregation of Revenue (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Disaggregation of Revenue [Line Items]
Net sales	$ 1,018	$ 923	$ 2,968	$ 2,875
North America
Disaggregation of Revenue [Line Items]
Net sales	543	479	1,592	1,479
Europe
Disaggregation of Revenue [Line Items]
Net sales	384	351	1,114	1,113
APAC & Emerging Markets
Disaggregation of Revenue [Line Items]
Net sales	94	95	270	291
Eliminations
Disaggregation of Revenue [Line Items]
Net sales	$ (3)	$ (2)	$ (8)	$ (8)

Revenue from Contracts with C_4

Revenue from Contracts with Customers - Narrative (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 29, 2018
Revenue from Contract with Customer [Abstract]
Current contract liabilities	$ 26	$ 18

Business Acquisitions - Conside

Business Acquisitions - Consideration Transferred Vets First Choice (Details) - VFC $ / shares in Units, $ in Millions	Feb. 07, 2019USD ($)$ / sharesshares
Business Acquisition [Line Items]
Total Covetrus shares issued to VFC shareholders (in shares) | shares	39,041,070
Per share price (in actuals) | $ / shares	$ 43.05
Total fair value of shares issued to Vets First Choice shareholders	$ 1,681
Fair value of Vets First Choice replacement stock option awards attributable to pre-acquisition service	62
Vets First Choice debt repaid at close	24
Vets First Choice expenses paid at close	18
Less: Vets First Choice cash used to fund transaction	(9)
Total consideration	$ 1,776

Business Acquisitions - Summary

Business Acquisitions - Summary of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions	Sep. 30, 2019	Feb. 07, 2019	Dec. 29, 2018	Dec. 30, 2017
Business Acquisition [Line Items]
Goodwill	$ 1,156		$ 750	$ 760
VFC
Business Acquisition [Line Items]
Fair value of net assets acquired		$ 14
Goodwill		1,328
Intangible assets		545
Deferred tax liabilities		(111)
Total acquisition cost		$ 1,776

Business Acquisitions - Narrati

Business Acquisitions - Narrative (Details) - USD ($) shares in Millions, $ in Millions	3 Months Ended	9 Months Ended
	Jun. 30, 2019	Sep. 30, 2019	Apr. 24, 2019	Feb. 07, 2019
VFC
Business Acquisition [Line Items]
Reduction to purchase price, goodwill	$ 30	$ 30
Shares expected to be canceled (in shares)	0.7
Other intangible assets				$ 545
Weighted average amortization period		7 years
Maravet
Business Acquisition [Line Items]
Business combination, accrued expenses		$ 17
Other intangible assets			$ 22
Trademarks and Trade Names | VFC
Business Acquisition [Line Items]
Other intangible assets				20
Product Formulas | VFC
Business Acquisition [Line Items]
Other intangible assets				50
Customer Relationships | VFC
Business Acquisition [Line Items]
Other intangible assets				125
Developed Technology | VFC
Business Acquisition [Line Items]
Other intangible assets				$ 350

Business Acquisitions - Pro For

Business Acquisitions - Pro Forma Information (Details) - VFC - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Business Acquisition, Pro Forma Information [Abstract]
Net sales	$ 1,018	$ 976	$ 2,992	$ 3,024
Net loss	(909)	(23)	(942)	(43)
Net loss attributable to Covetrus	$ (906)	$ (23)	$ (939)	$ (43)
Loss per common share attributable to Covetrus:
Basic (in usd per share)	$ (8.09)	$ (0.32)	$ (8.85)	$ (0.61)
Diluted (in usd per share)	$ (8.09)	$ (0.32)	$ (8.85)	$ (0.61)

Business Acquisitions - Consi_2

Business Acquisitions - Consideration Transferred Maravet (Details) - USD ($) $ in Millions	Apr. 24, 2019	Sep. 30, 2019	Dec. 29, 2018	Dec. 30, 2017
Business Acquisition [Line Items]
Gain on affiliate investment		$ 11
Goodwill		$ 1,156	$ 750	$ 760
Maravet
Business Acquisition [Line Items]
Business acquisition, percentage of voting interests acquired	50.00%
Consideration transferred	$ 26
Goodwill	26
Intangible assets	$ 22

Earnings Per Share - Narrative

Earnings Per Share - Narrative (Details) - shares shares in Millions	Feb. 07, 2019	Feb. 06, 2019	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Diluted common share equivalents for restricted stock (in shares)		1	0	1	0	1
Henry Schein
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares distributed to stockholders (in shares)	71

Earnings Per Share - Reconcilia

Earnings Per Share - Reconciliation of Basic Shares to Diluted Shares (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	1 Months Ended	3 Months Ended			9 Months Ended
	Feb. 06, 2019	Sep. 30, 2019		Sep. 30, 2018	Sep. 30, 2019		Sep. 30, 2018
Earnings Per Share [Abstract]
Net (loss) income attributable to Covetrus		$ (906)	[1]	$ 16	$ (929)	[1]	$ 67
Basic shares (in shares)		112		71	106		71
Effect of dilutive shares (in shares)	1	0		1	0		1
Diluted shares (in shares)		112		72	106		72
Basic (in usd per share)		$ (8.09)		$ 0.22	$ (8.76)		$ 0.94
Diluted (in usd per share)		$ (8.09)		$ 0.22	$ (8.76)		$ 0.94
[1]	(a) Net income earned from January 1, 2019 through February 7, 2019 is attributed to the former parent as it was the sole shareholder prior to February 7, 2019 (b) See discussion in Note 3 - Business Acquisitions

Goodwill and Other Intangible_3

Goodwill and Other Intangible Assets, Net - Goodwill Rollforward (Details) - USD ($) $ in Millions	3 Months Ended			9 Months Ended		12 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 29, 2018
Goodwill [Line Items]
Accumulated impairment	$ (939)			$ (939)
Goodwill [Roll Forward]
Beginning Balance				750	$ 760	$ 760
Foreign currency translation				(9)		(13)
Goodwill additions				1,354		3
Goodwill impairment	(939)		$ 0	(939)	0
Ending Balance	1,156			1,156		750
Goodwill, Impairment Loss, Non-Deductible For Tax Purposes				939
North America
Goodwill [Line Items]
Accumulated impairment	(657)			(657)
Goodwill [Roll Forward]
Beginning Balance				529	528	528
Foreign currency translation				0		(1)
Goodwill additions				1,284		2
Goodwill impairment				(657)
Ending Balance	1,156			1,156		529
Europe
Goodwill [Line Items]
Accumulated impairment	(218)			(218)
Goodwill [Roll Forward]
Beginning Balance				172	182	182
Foreign currency translation				(8)		(11)
Goodwill additions				54		1
Goodwill impairment				(218)
Ending Balance	0			0		172
APAC & Emerging Markets
Goodwill [Line Items]
Accumulated impairment	(64)			(64)
Goodwill [Roll Forward]
Beginning Balance				49	$ 50	50
Foreign currency translation				(1)		(1)
Goodwill additions				16		0
Goodwill impairment				(64)
Ending Balance	$ 0			0		$ 49
VFC
Goodwill [Line Items]
Reduction to purchase price, goodwill		$ 30		$ 30

Goodwill and Other Intangible_4

Goodwill and Other Intangible Assets, Net - Narrative (Details) $ in Millions	9 Months Ended
	Sep. 30, 2019USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
Impairment loss	$ 939
Accumulated impairment loss	$ 939

Goodwill and Other Intangible_5

Goodwill and Other Intangible Assets, Net - Finite Lived Intangible Assets (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 29, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Gross definite-lived intangible assets	$ 1,007	$ 449
Less: Accumulated amortization	(328)	(241)
Net definite-lived intangible assets	$ 679	$ 208

Goodwill and Other Intangible_6

Goodwill and Other Intangible Assets, Net - Amortization of Intangible Assets (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense	$ 34	$ 12	$ 93	$ 37

Redeemable Non-controlling In_3

Redeemable Non-controlling Interests - Summary of Redeemable Non-controlling Interests (Details) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2019	Dec. 29, 2018
Increase (Decrease) in Temporary Equity [Roll Forward]
Balance at beginning of period	$ 92	$ 367
Decrease in redeemable non-controlling interests due to redemptions	(74)	(383)
Increase in redeemable non-controlling interests due to business acquisitions	0	6
Net (loss) income attributable to redeemable non-controlling interests	(3)	7
Dividends paid	0	(10)
Effect of foreign currency translation gain (loss) attributable to redeemable non-controlling interests	1	(2)
Change in fair value of redeemable non-controlling interests	(6)	107
Balance at end of period	$ 10	$ 92

Accumulated Other Comprehensi_3

Accumulated Other Comprehensive Income (Loss) - Components of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 29, 2018
Foreign currency translation adjustment
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive loss	$ 0	$ 1
Foreign currency translation loss
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive loss	(101)	(83)
Unrealized loss on derivative instruments
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive loss	(2)	0
Pension adjustment gain
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive loss	1	0
Accumulated other comprehensive loss
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive loss	(102)	(83)
Total accumulated other comprehensive loss
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive loss	$ (102)	$ (82)

Accumulated Other Comprehensi_4

Accumulated Other Comprehensive Income (Loss) - Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Equity [Abstract]
Net (loss) income	$ (909)	$ 16	$ (932)	$ 75
Foreign currency translation loss			(18)	(31)
Unrealized loss on derivative instruments	(2)	0	(2)	0
Pension adjustment gain			1	0
Comprehensive (loss) income			(951)	44
Comprehensive (loss) income attributable to Covetrus	(930)	11	(949)	38
Comprehensive (loss) income attributable to redeemable non-controlling interests	(3)	0	(2)	6
Comprehensive (loss) income	$ (933)	$ 11	$ (951)	$ 44

Income Taxes - Narrative (Detai

Income Taxes - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Income Tax Disclosure [Abstract]
Income tax expense (benefit)	$ (60)	$ 19	$ (60)	$ 33
Income (loss) before taxes and equity in earnings of affiliates	$ (969)	$ 35	$ (992)	$ 107
Effective tax rate	6.20%	54.30%	6.00%	30.80%

Debt - Narrative (Details)

Debt - Narrative (Details)	Feb. 07, 2019USD ($)	Sep. 30, 2019USD ($)	Sep. 30, 2019USD ($)	Sep. 30, 2018USD ($)
Line of Credit Facility [Line Items]
Debt issuance costs			$ 24,000,000	$ 0
Credit Agreement
Line of Credit Facility [Line Items]
Syndicated credit agreement, amount	$ 1,500,000,000
Credit facility term			5 years
Debt issuance costs	24,000,000
Required net interest coverage ratio		3	3
Interest expense		$ 16,000,000	$ 42,000,000
Credit Agreement | Term Loan Facility
Line of Credit Facility [Line Items]
Maximum borrowing capacity	1,200,000,000
Borrowings under lines of credit		1,200,000,000	$ 1,200,000,000
Quarterly installment amortization rate			5.00%
Unamortized debt issuance costs		20,000,000	$ 20,000,000
Credit Agreement | Revolving Facility
Line of Credit Facility [Line Items]
Maximum borrowing capacity	300,000,000
Potential increases in borrowing capacity	265,000,000
Remaining borrowing capacity		281,000,000	281,000,000
Borrowings under lines of credit		0	$ 0
Unused capacity, commitment fee percentage			0.30%
Credit Agreement | Letter of Credit
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 35,000,000
Letters of credit outstanding		$ 19,000,000	$ 19,000,000
Credit Agreement | LIBOR
Line of Credit Facility [Line Items]
Interest rate floor		0.00%
Credit Agreement | Alternate Base Rate
Line of Credit Facility [Line Items]
Interest rate floor		1.00%
Credit Agreement | Alternate Base Rate | Term Loan Facility
Line of Credit Facility [Line Items]
Basis spread on variable rate		2.00%
Credit Agreement | Alternate Base Rate | Revolving Facility
Line of Credit Facility [Line Items]
Basis spread on variable rate		1.00%
Credit Agreement | Minimum | Revolving Facility
Line of Credit Facility [Line Items]
Unused capacity, commitment fee percentage			0.175%
Credit Agreement | Minimum | Alternate Base Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate		1.25%	0.25%
Credit Agreement | Maximum | Revolving Facility
Line of Credit Facility [Line Items]
Unused capacity, commitment fee percentage			0.35%
Credit Agreement | Maximum | LIBOR
Line of Credit Facility [Line Items]
Basis spread on variable rate		2.25%
Credit Agreement | Maximum | Alternate Base Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate			1.25%
April 1, 2019 | Credit Agreement
Line of Credit Facility [Line Items]
Required leverage ratio		5.50	5.50
2022 | Credit Agreement
Line of Credit Facility [Line Items]
Required leverage ratio		3.75	3.75

Derivatives and Financial Ins_3

Derivatives and Financial Instruments - Narrative (Details) $ in Millions	2 Months Ended	3 Months Ended		9 Months Ended
	Aug. 31, 2019USD ($)	Sep. 30, 2019USD ($)	Sep. 30, 2018USD ($)	Sep. 30, 2019USD ($)	Sep. 30, 2018USD ($)
Derivative [Line Items]
Number of Interest Rate Derivatives Held		5		5
Derivative, Term of Contract	2 years
Investment income		$ 1	$ 1	$ 4	$ 4
Cash Flow Hedging | Designated as Hedging Instrument | Interest Rate Swap
Derivative [Line Items]
Notional amount	$ 500

Derivatives and Financial Ins_4

Derivatives and Financial Instruments - Balance Sheet Location (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 29, 2018
Fair Value, Recurring | Cash Flow Hedging | Interest Rate Swap | Other Noncurrent Liabilities
Derivative [Line Items]
Interest rate swap contracts	$ 2	$ 0

Derivatives and Financial Ins_5

Derivatives and Financial Instruments - Income Statement Location (Details) - USD ($) $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2019
Designated as Hedging Instrument | Cash Flow Hedging | Interest income | Interest Rate Swap
Derivative [Line Items]
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), after Reclassification and Tax	$ (2)	$ (2)

Leases - Narrative (Details)

Leases - Narrative (Details) $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2019USD ($)	Sep. 30, 2019USD ($)
Lessee, Lease, Description [Line Items]
Operating lease cost	$ 6	$ 18
Leases not yet commenced	$ 131	$ 131
Minimum
Lessee, Lease, Description [Line Items]
Operating lease, remaining lease terms		1 year
Leases not yet commenced, term	13 years	13 years
Maximum
Lessee, Lease, Description [Line Items]
Operating lease, remaining lease terms		8 years
Leases not yet commenced, term	20 years	20 years

Leases - Supplemental Balance S

Leases - Supplemental Balance Sheet (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 29, 2018
Leases, Operating [Abstract]
Operating lease right-of-use assets, net	$ 75	$ 0
Accrued expenses, other	19
Other liabilities	58
Present value of net minimum lease payments	$ 77
Weighted Average Remaining Lease Term [Abstract]
Weighted average remaining lease term	6 years
Weighted Average Discount Rate [Abstract]
Weighted average discount rate	3.70%

Leases - Supplemental Cash Flow

Leases - Supplemental Cash Flow (Details) - USD ($) $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2019
Leases [Abstract]
Cash paid for amounts included in the measurement of operating lease liabilities	$ 6	$ 18
Right-of-use assets obtained in exchange for new operating lease liabilities	$ 20	$ 91

Leases - Lease Maturities (Deta

Leases - Lease Maturities (Details) $ in Millions	Sep. 30, 2019USD ($)
Operating Leases
2019 (remainder of year)	$ 6
2020	21
2021	17
2022	10
2023	8
Thereafter	25
Total minimum lease payments	87
Less: amount representing interest	(10)
Present value of net minimum lease payments	77
Less: current portion of operating lease obligation	(19)
Long-term operating lease obligation	$ 58

Segment Data - Operating Result

Segment Data - Operating Results by Segment (Details) - USD ($) $ in Millions	3 Months Ended			9 Months Ended
	Sep. 30, 2019		Sep. 30, 2018	Sep. 30, 2019		Sep. 30, 2018	Dec. 29, 2018
Segment Reporting Information [Line Items]
Net sales	$ 1,018		$ 923	$ 2,968		$ 2,875
Adjusted EBITDA	49		53	154		164
Total assets	3,328		2,202	3,328		2,202	$ 2,233
Net (loss) income attributable to Covetrus	(906)	[1]	16	(929)	[1]	67
Plus: Depreciation and amortization	41		16	113		49
Plus: Interest expense, net	16			41		1
Less: Income tax benefit	(60)		19	(60)		33
Earnings before interest, taxes, depreciation and amortization	(909)		51	(835)		150
Plus: Share-based compensation	10		2	35		6
Plus: Formation of Covetrus	14			27
Plus: Carve-out operating expenses				5
Plus: IT infrastructure	2			4
Plus: Goodwill impairment	939		0	939		0
Less: Minority interest in goodwill impairment	(3)			(3)
Less: Other income items	(4)			(18)
Plus: Restructuring costs	0		0	0		8
North America
Segment Reporting Information [Line Items]
Plus: Goodwill impairment				657
Europe
Segment Reporting Information [Line Items]
Plus: Goodwill impairment				218
APAC & Emerging Markets
Segment Reporting Information [Line Items]
Plus: Goodwill impairment				64
Operating Segments | North America
Segment Reporting Information [Line Items]
Net sales	543		479	1,592		1,479
Adjusted EBITDA	39		42	117		121
Total assets	2,848		1,310	2,848		1,310
Operating Segments | Europe
Segment Reporting Information [Line Items]
Net sales	384		351	1,114		1,113
Adjusted EBITDA	15		16	50		56
Total assets	622		688	622		688
Operating Segments | APAC & Emerging Markets
Segment Reporting Information [Line Items]
Net sales	94		95	270		291
Adjusted EBITDA	5		5	14		16
Total assets	121		196	121		196
Corporate
Segment Reporting Information [Line Items]
Net sales	0		0	0		0
Adjusted EBITDA	(10)		(10)	(27)		(29)
Total assets	1,108		12	1,108		12
Eliminations
Segment Reporting Information [Line Items]
Net sales	(3)		(2)	(8)		(8)
Adjusted EBITDA	0		0	0		0
Total assets	$ (1,371)		$ (4)	$ (1,371)		$ (4)
[1]	(a) Net income earned from January 1, 2019 through February 7, 2019 is attributed to the former parent as it was the sole shareholder prior to February 7, 2019 (b) See discussion in Note 3 - Business Acquisitions

Share-Based Compensation (Detai

Share-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Millions	Feb. 07, 2019	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Share-based Payment Arrangement, Disclosure [Abstract]
Restricted stock granted (in shares)	327,447	166,467		1,256,139
Options granted (in shares)	3,914,694	22,540		1,003,494
Expiration period				10 years
Vesting period				3 years
Weighted average grant date fair value (in usd per share)		$ 8.21		$ 12.15
Plus: Share-based compensation		$ 10	$ 2	$ 35	$ 6

Uncategorized Items - cvet-2019

Label	Element	Value
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ 3,000,000
Net Parent Investment [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ 3,000,000