Covetrus admits ‘self-inflicted missteps,’ records $1 billion ‘goodwill’ charge

Portland-based Covetrus Inc. used the release of its third-quarter earnings report Tuesday to send a message to investors that the company is aware of its problems and is trying to set things right.

The veterinary technology and services firm reported revenue and net income from operations for the quarter that exceeded analysts’ expectations, while recording a massive “goodwill” impairment charge of nearly $1 billion in an attempt to square the company’s value on paper with its present reality.

Goodwill is an intangible asset whose dollar value is based on the perceived potential of a company to make money in the future. Decreasing the value of a company’s goodwill has no effect on operations, but the company still must record the impairment as a net loss. Read more

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