Moody's changes VF outlook to negative

Moody's Investors Service said it changed V.F. Corp.'s outlook to negative from stable. At the same time, Moody's affirmed V.F.'s ratings, including the Baa2 senior unsecured rating, the (P)Baa2 senior unsecured shelf rating and senior unsecured medium-term note program rating, the (P)Ba1 preferred shelf rating and the (P)Baa3 subordinate shelf rating.

“The change in outlook to negative reflects the unfavorable tax appeal ruling related to V.F.'s Timberland acquisition in 2011 and the continued risk associated with the turnaround of Vans, which have resulted in V.F.'s credit metrics to remain weak for its Baa2 unsecured rating. In October 2022, the company paid $875.7 million for tax and interest which was recorded previously as a tax receivable but will no longer be realized given the appellate court's ruling. Funds recognized from any positive resolution were expected by Moody's to repay a significant portion of its $1 billion unrated delay-draw term due in December 2024,” Moody’s said in a press release.

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