TRANSACTIONS WITH FORMER PARENT |
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Mar. 28, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
TRANSACTIONS WITH FORMER PARENT | TRANSACTIONS WITH FORMER PARENT
Prior to the Separation, the Company's financial statements were prepared on a carve-out basis and were derived from the consolidated financial statements and accounting records of VF. Refer to Note 1 to the Company's financial statements for a discussion of the methodology used to allocate corporate-related costs for purposes of preparing these financial statements on a carve-out basis. The following discussion summarizes activity between the Company and VF.
Sales and Purchases To and From Former Parent
The Company's sales to VF were $10.6 million for the three months ended March 2019, which were included within "net revenues" in the Company's statements of operations. The Company's cost of goods sold included items purchased from VF totaling $0.3 million for the three months ended March 2019. At March 2020, December 2019 and March 2019, the aggregate amount of inventories purchased from VF that remained on the Company's balance sheets was approximately $0.3 million, $0.4 million and $1.2 million, respectively.
Notes To and From Former Parent
All notes to and from former parent were settled in connection with the Separation. At March 2019, the Company had notes receivable from former parent of $517.9 million, with VF as the counterparty. The weighted-average interest rate for these notes was approximately 3.7% at March 2019.
At March 2019, the Company had notes payable to former parent of $241.9 million, with VF as the counterparty. The weighted-average interest rate for these notes was approximately 3.7% at March 2019.
The Company recorded net interest income related to these notes of $2.3 million for the three months ended March 2019, which is reflected within "interest income from former parent, net" in the Company's statement of operations.
Due To and From Former Parent
All amounts due to and from former parent were settled in connection with the Separation. Balances that were due to and from former parent were generated by (i) the sale of trade accounts receivable to VF, (ii) hedging agreements with VF, and (iii) sourcing payable to VF.
As discussed in Note 4 to the Company's financial statements, the Company sold certain of its trade accounts receivable to VF, who then sold them to a financial institution and periodically remitted cash back to the Company.
Prior to the Separation, the Company did not enter into derivative contracts with external counterparties. However, VF entered into derivative contracts with external counterparties to hedge certain foreign currency transactions with exposure to the euro, Mexican peso, Polish zloty, Canadian dollar, and other currencies. The Company entered into offsetting internal contracts with VF with maturities up to 20 months, and cash settled with VF on any asset or liability that arose under these contracts.
The following table presents components of due from former parent, current:
The following table presents components of due from former parent, noncurrent:
The following table presents components of due to former parent, current:
Net Transfers To and From VF
Net transfers to and from VF are included within "former parent investment" in the statements of (deficit) equity.
The following table presents components of the transfers to and from VF:
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