10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
		FOR THE QUARTERLY PERIOD ENDED	DECEMBER 31, 2021
		OR
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
	FOR THE TRANSITION PERIOD FROM ______________TO_______________

Commission File Number: 001-00652

UNIVERSAL CORPORATION

(Exact name of registrant as specified in its charter)

Virginia			54-0414210
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification Number)
9201 Forest Hill Avenue,	Richmond,	Virginia	23235
(Address of principal executive offices)			(Zip Code)

804-359-9311

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Exchange Act:

Title of each class	Trading Symbol(s)	Name of Exchange on which registered
Common Stock, no par value	UVV	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yesþ No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer	þ	Accelerated filer	☐	Non-accelerated filer	☐
Smaller reporting company	☐	Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of January 31, 2022, the total number of shares of common stock outstanding was 24,608,283.

UNIVERSAL CORPORATION

FORM 10-Q

TABLE OF CONTENTS

Item No.		Page
	PART I - FINANCIAL INFORMATION
1.	Financial Statements	3
2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	30
3.	Quantitative and Qualitative Disclosures About Market Risk	38
4.	Controls and Procedures	39
	PART II - OTHER INFORMATION
1.	Legal Proceedings	40
1A.	Risk Factors	40
2.	Unregistered Sales of Equity Securities and Use of Proceeds	40
6.	Exhibits	41
	Signatures	42

2

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

UNIVERSAL CORPORATION

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(in thousands, except share and per share data)

	Three Months Ended December 31,				Nine Months Ended December 31,
	2021		2020		2021		2020
	(Unaudited)				(Unaudited)
Sales and other operating revenues	$	652,644	$	672,931	$	1,456,628	$	1,365,767
Costs and expenses
Cost of goods sold	521,171		533,431		1,169,999		1,103,744
Selling, general and administrative expenses	60,267		59,335		175,513		161,152
Other income	—		—		(2,532)		(4,173)
Restructuring and impairment costs	8,433		19,979		10,457		19,979
Operating income	62,773		60,186		103,191		85,065
Equity in pretax earnings (loss) of unconsolidated affiliates	2,084		1,506		5,056		2,089
Other non-operating income (expense)	56		30		158		(8)
Interest income	209		2		799		262
Interest expense	7,462		6,735		20,800		19,140
Income before income taxes and other items	57,660		54,989		88,404		68,268
Income taxes	13,505		14,548		18,582		12,678
Net income	44,155		40,441		69,822		55,590
Less: net loss (income) attributable to noncontrolling interests in subsidiaries	(9,215)		(7,168)		(9,015)		(7,541)
Net income attributable to Universal Corporation	$	34,940	$	33,273	$	60,807	$	48,049
Earnings per share:
Basic	$	1.41	$	1.35	$	2.46	$	1.95
Diluted	$	1.40	$	1.34	$	2.44	$	1.94
Weighted average common shares outstanding:
Basic	24,792,108		24,677,122		24,761,290		24,646,342
Diluted	24,949,091		24,818,918		24,912,644		24,764,439
Total comprehensive income, net of income taxes	$	45,862	$	55,681	$	72,277	$	84,950
Less: comprehensive (income) loss attributable to noncontrolling interests	(9,201)		(7,114)		(8,845)		(7,566)
Comprehensive income (loss) attributable to Universal Corporation	$	36,661	$	48,567	$	63,432	$	77,384
Dividends declared per common share	$	0.78	$	0.77	$	2.34	$	2.31

See accompanying notes.

3

UNIVERSAL CORPORATION     

CONSOLIDATED BALANCE SHEETS

(in thousands of dollars)

	December 31,		December 31,		March 31,
	2021		2020		2021
	(Unaudited)		(Unaudited)
ASSETS
Current assets
Cash and cash equivalents	$	99,305	$	95,405	$	197,221
Accounts receivable, net	400,132		354,676		367,482
Advances to suppliers, net	126,830		102,795		121,618
Accounts receivable—unconsolidated affiliates	1,909		6,197		584
Inventories—at lower of cost or net realizable value:
Tobacco	855,587		814,287		640,653
Other	161,704		144,333		145,965
Prepaid income taxes	23,590		18,174		15,029
Other current assets	76,255		68,928		66,806
Total current assets	1,745,312		1,604,795		1,555,358
Property, plant and equipment
Land	24,752		22,499		22,400
Buildings	296,642		268,377		284,430
Machinery and equipment	662,504		662,854		658,826
	983,898		953,730		965,656
Less accumulated depreciation	(636,042)		(621,928)		(616,146)
	347,856		331,802		349,510
Other assets
Operating lease right-of-use assets	34,139		34,717		31,230
Goodwill, net	214,023		180,655		173,051
Other intangibles, net	95,790		74,710		72,304
Investments in unconsolidated affiliates	81,040		85,610		84,218
Deferred income taxes	15,676		22,281		12,149
Pension asset	13,495		—		11,950
Other noncurrent assets	46,197		54,071		52,154
	500,360		452,044		437,056
Total assets	$	2,593,528	$	2,388,641	$	2,341,924

See accompanying notes.

4

UNIVERSAL CORPORATION     

CONSOLIDATED BALANCE SHEETS

(in thousands of dollars)

	December 31,		December 31,		March 31,
	2021		2020		2021
	(Unaudited)		(Unaudited)
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Notes payable and overdrafts	$	252,609	$	129,603	$	101,294
Accounts payable and accrued expenses	221,374		156,421		139,484
Accounts payable—unconsolidated affiliates	8,788		7,416		1,282
Customer advances and deposits	26,341		14,498		8,765
Accrued compensation	18,803		22,744		29,918
Income taxes payable	10,742		6,650		4,516
Current portion of operating lease liabilities	9,128		9,014		7,898
Current portion of long-term debt	—		—		—
Total current liabilities	547,785		346,346		293,157
Long-term debt	518,547		518,047		518,172
Pensions and other postretirement benefits	52,624		66,764		57,637
Long-term operating lease liabilities	22,612		22,709		19,725
Other long-term liabilities	49,235		71,346		59,814
Deferred income taxes	43,483		46,414		44,994
Total liabilities	1,234,286		1,071,626		993,499
Shareholders’ equity
Universal Corporation:
Preferred stock:
Series A Junior Participating Preferred Stock, no par value, 500,000 shares authorized, none issued or outstanding	—		—		—
Common stock, no par value, 100,000,000 shares authorized 24,607,384 shares issued and outstanding at December 31, 2021 (24,514,867 at December 31, 2020 and 24,514,867 at March 31, 2021)	330,306		325,350		326,673
Retained earnings	1,090,110		1,067,437		1,087,663
Accumulated other comprehensive loss	(104,412)		(122,262)		(107,037)
Total Universal Corporation shareholders' equity	1,316,004		1,270,525		1,307,299
Noncontrolling interests in subsidiaries	43,238		46,490		41,126
Total shareholders' equity	1,359,242		1,317,015		1,348,425
Total liabilities and shareholders' equity	$	2,593,528	$	2,388,641	$	2,341,924

See accompanying notes.

5

UNIVERSAL CORPORATION     

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands of dollars)

	Nine Months Ended December 31,
	2021		2020
	(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	69,822	$	55,590
Adjustments to reconcile net income to net cash used by operating activities:
Depreciation and amortization	39,110		32,626
Net provision for losses (recoveries) on advances to suppliers	2,864		2,753
Foreign currency remeasurement (gain) loss, net	6,829		(8,823)
Foreign currency exchange contracts	1,980		(7,723)
Restructuring and impairment costs	10,457		19,979
Restructuring payments	(3,787)		(5,179)
Change in estimated fair value of contingent consideration for FruitSmart acquisition	(2,532)		(4,173)
Other, net	1,814		5,260
Changes in operating assets and liabilities, net	(178,133)		(51,687)
Net cash provided (used) by operating activities	(51,576)		38,623
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment	(39,831)		(33,794)
Purchase of business, net of cash held by the business	(102,462)		(161,095)
Proceeds from sale of property, plant and equipment	12,609		4,086
Other	—		(800)
Net cash used by investing activities	(129,684)		(191,603)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of short-term debt, net	151,413		57,207
Issuance of long-term debt	—		150,000
Dividends paid to noncontrolling interests	(6,733)		(3,695)
Dividends paid on common stock	(57,241)		(56,301)
Other	(3,264)		(1,949)
Net cash provided (used) by financing activities	84,175		145,262
Effect of exchange rate changes on cash, restricted cash and cash equivalents	(831)		1,693
Net decrease in cash, restricted cash and cash equivalents	(97,916)		(6,025)
Cash, restricted cash and cash equivalents at beginning of year	203,221		107,430
Cash, restricted cash and cash equivalents at end of period	$	105,305	$	101,405
Supplemental Information:
Cash and cash equivalents	$	99,305	$	95,405
Restricted cash (Other noncurrent assets)	6,000		6,000
Total cash, restricted cash and cash equivalents	$	105,305	$	101,405

See accompanying notes.

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UNIVERSAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1.   BASIS OF PRESENTATION

Universal Corporation, which together with its subsidiaries is referred to herein as “Universal” or the “Company,” is a global business-to-business agri-products supplier to consumer product manufacturers. The Company is the leading global leaf tobacco supplier and provides high-quality plant-based ingredients to food and beverage end markets. Because of the seasonal nature of the Company’s business, the results of operations for any fiscal quarter will not necessarily be indicative of results to be expected for other quarters or a full fiscal year. All adjustments necessary to state fairly the results for the period have been included and were of a normal recurring nature. This Form 10-Q should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2021.

    The extent to which the ongoing COVID-19 pandemic will impact the Company's financial condition, results of operations and demand for its products and services will depend on future developments, which are highly uncertain and cannot be predicted. Such developments may include the ongoing geographic spread and mutations of COVID-19, the severity of the pandemic, the duration of the COVID-19 outbreak and the type and duration of actions that may be taken by various governmental authorities in response to the COVID-19 pandemic and the impact on the U.S. and the global economies, markets and supply chains. At December 31, 2021, it is not possible to predict the overall impact of the ongoing COVID-19 pandemic on the Company's business, financial condition, results of operations and demand for its products and services.

NOTE 2.   ACCOUNTING PRONOUNCEMENTS

Recently Adopted Pronouncements

In December 2019, the FASB issued Accounting Standards Update No. 2019-12, “Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes” (“ASU 2019-12”). ASU 2019-12 eliminates certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences related to changes in ownership of equity method investments and foreign subsidiaries. The updated guidance also simplifies aspects of accounting for franchise taxes and enacted changes in tax laws or rates, and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The guidance in ASU 2019-12 is effective for fiscal years beginning after December 15, 2020, although early adoption is permitted. The Company adopted the new standard effective April 1, 2021, which was the beginning of its fiscal year ending March 31, 2022. There was no material impact to the consolidated financial statements from the adoption of ASU 2019-12.

Pronouncements to be Adopted in Future Periods

In March 2020, the FASB issued Accounting Standards Update No. 2020-04, "Reference Rate Reform (Topic 848) - Facilitation of the Effects of Reference Rate Reform on Financial Reporting" ("ASU 2020-04"). ASU 2020-04 provides optional expedients and exceptions related to contract modifications and hedge accounting to address the transitions from the London Interbank Offered Rate ("LIBOR") and other interbank offered rates to alternative reference rates. The guidance permits an entity to consider contract modification due to reference rate reform to be an event that does not require contract remeasurement at the modification date or reassessment of a previous accounting determination. ASU 2020-04 also temporarily allows hedge relationships to continue without de-designation upon changes due to reference rate reform. The standard is effective upon issuance and can be applied as of March 12, 2020 through December 31, 2022. The Company is currently evaluating the impact that the guidance will have on its consolidated financial statements.

NOTE 3.   BUSINESS COMBINATION

Acquisition of Shank's Extracts, LLC

On October 4, 2021, the Company acquired 100% of the capital stock of Shank's Extract's, LLC. (“Shank's”), a flavors and extracts processing company, for approximately $100 million in cash and $2.4 million of additional working capital on-hand at the date of acquisition. The acquisition of Shank's diversifies the Company's product offerings and generates new opportunities for its plant-based ingredients platform.

The purchase price allocation for Shank's as of the date of acquisition was based on a preliminary valuation and is subject to revision as more detailed analyses are completed and additional information about the fair value of assets acquired and liabilities assumed becomes available. A portion of the goodwill recorded as part of the acquisition was attributable to the assembled workforce of Shank's. The goodwill and intangibles recognized for the Shank's acquisition are deductible for U.S.

7

income tax purposes. The transaction was treated as an asset acquisition for U.S. Federal tax purposes, resulting in a step-up of tax basis to fair value. The Company determined the Shank's operations are not material to the Company’s consolidated results. Therefore, pro forma information is not presented.

For the three and nine months ended December 31, 2021, the Company incurred $0.6 million and $2.3 million, respectively, for acquisition-related transaction costs for the purchase of Shank's. The acquisition-related costs were expensed as incurred and recorded in selling, general, and administrative expense on the consolidated statements of income.

In November 2021, the Company acquired the land and buildings utilized by Shank's operations for $13.3 million. The purchase of the land and buildings resulted in the elimination of the $8.5 million operating lease right-of-use asset and lease liability recognized on the acquisition date for Shank's.

Acquisition of Silva International, Inc.

On October 1, 2020, the Company acquired 100% of the capital stock of Silva International, Inc. (“Silva”), a natural, specialty dehydrated vegetable, fruit, and herb processing company serving global markets, for approximately $164 million in cash and $5.9 million of additional working capital on-hand at the date of acquisition. The acquisition of Silva diversifies the Company's product offerings and generates new opportunities for its plant-based ingredients platform.

A portion of the goodwill recorded as part of the acquisition was attributable to the assembled workforce of Silva. The goodwill recognized for the Silva acquisition is not deductible for U.S. income tax purposes. The tax basis of the assets acquired and liabilities assumed did not result in a step-up of tax basis. The Company determined the Silva operations are not material to the Company’s consolidated results. Therefore, pro forma information is not presented.

The Company continues to employ one of Silva's selling shareholders and as stipulated in the Silva purchase agreement has transferred $6 million to a third-party escrow account that may ultimately be earned by the selling shareholder upon completion of a post-combination service period. Since the compensation agreement for the selling shareholder who remains employed with the Company includes a post-combination service period, the Company has excluded the entire $6 million in the purchase price to be allocated. The $6 million in escrow is recognized as restricted cash in other noncurrent assets on the consolidated balance sheet at December 31, 2021. The contingent consideration arrangement for the selling shareholder includes a post-combination service requirement and forfeitable payment provisions, therefore under ASC Topic 805, "Business Combinations," must be treated as compensation expense. This expense is being recognized ratably over the requisite service period in selling, general, and administrative expense on the consolidated statements of income.

For the three and nine months ended December 31, 2021, the Company incurred $2.3 million and $3.9 million for acquisition-related transaction costs for the purchase of Silva, respectively. The acquisition-related costs were expensed as incurred and recorded in selling, general, and administrative expense on the consolidated statements of income.

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The following table summarizes the preliminary purchase price allocation of the assets acquired and liabilities assumed for the Shank's acquisition and final purchase price allocation for the Silva acquisition.

(in thousands of dollars)
	Shank's		Silva
	October 4, 2021		October 1, 2020
Assets
Cash and cash equivalents	$	754	$	8,126
Accounts receivable, net	6,643		17,885
Advances to suppliers, net	—		3,011
Inventory	15,792		33,162
Other current assets	415		833
Property, plant and equipment (net)	11,000		24,437
Operating lease right-of-use assets	8,531		—
Intangibles
Customer relationships	24,000		53,000
Developed technology	4,500		—
Trade names	—		7,800
Non-compete agreements	3,000		—
Goodwill	41,061		46,144
Total assets acquired	115,696		194,398
Liabilities
Accounts payable and accrued expenses	6,159		11,683
Customer advances and deposits	351		—
Accrued compensation	655		3,350
Income taxes payable	—		946
Current portion of operating lease liabilities	8,531		—
Deferred income taxes	—		14,419
Total liabilities assumed	15,696		30,398
Total assets acquired and liabilities assumed	$	100,000	$	164,000

NOTE 4.  RESTRUCTURING AND IMPAIRMENT COSTS

Universal continually reviews its business for opportunities to realize efficiencies, reduce costs, and realign its operations in response to business changes. Restructuring and impairment costs are periodically incurred in connection with those activities.

Tobacco Operations

As a result of efforts to exit the idled tobacco operations in Tanzania, the Company reevaluated the carrying values of property, plant, and equipment associated with the Tanzania operations. During the three months ended December 31, 2021, the Company determined the carrying value exceeded the estimated fair value of those assets and recognized a $9.4 million impairment charge.

During the three and nine months ended December 31, 2021, the Company also incurred $0.6 million and $2.2 million of termination costs for the Tobacco Operations segment, respectively.

During the three and nine months ended December 31, 2020, the Company incurred $2.6 million of termination and impairment costs associated with restructuring of tobacco buying and administrative operations in Africa, as well as a $0.9 million charge for the liquidation of an idled service entity in Tanzania, and $0.4 million of termination costs in North America.

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Ingredients Operations

During the nine months ended December 31, 2020, the Company committed to a plan to wind-down its subsidiary, Carolina Innovative Food Ingredients, Inc. ("CIFI"), a sweet potato processing operation located in Nashville, North Carolina. The CIFI operation was a start-up project initially undertaken by the Company in fiscal year 2015. The decision to wind down CIFI was consistent with the Company’s capital allocation strategy to focus on delivering shareholder value through building and enhancing a plant-based ingredients platform, which includes integrating and exploring the synergies of recently acquired businesses. The Company determined that CIFI was not a strategic fit for the platform’s long-term objectives. CIFI’s single-product focused processing facility and ongoing international pricing pressures, among other factors, created challenges that proved insurmountable. As a result of the decision to wind down the CIFI operations, the Company paid termination benefits totaling approximately $0.6 million to employees whose permanent positions were eliminated. In addition to the termination costs, the Company recognized various other costs associated with the wind-down of the CIFI facility. These costs include impairments of property, plant, and equipment (including the factory building), as well as inventory and supply write-downs. The total restructuring and impairment charge for the nine months ended December 31, 2020 for the CIFI operations wind-down was $16.1 million.

During the nine months ended December 31, 2021, the Company recognized $1.2 million of net gains on the sale of the remaining property, plant, and equipment associated with the wind-down of the CIFI operations that was announced in fiscal year 2021.

A summary of the restructuring and impairment costs recorded for the three and nine months ended December 31, 2021 and December 31, 2020 were as follows:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands)	2021		2020		2021		2020
Restructuring costs:
Employee termination benefits	$	627	$	2,625	$	2,174	$	2,625
Other	—		1,766		(24)		1,766
Total restructuring costs	627		4,391		2,150		4,391
Impairment costs:
Property, plant and equipment	7,806		13,886		8,307		13,886
Inventory	—		1,702		—		1,702
Total impairment costs	7,806		15,588		8,307		15,588
Total restructuring and impairment costs	$	8,433	$	19,979	$	10,457	$	19,979

NOTE 5.  REVENUE FROM CONTRACTS WITH CUSTOMERS

The majority of the Company’s consolidated revenue consists of sales of processed leaf tobacco to customers. The Company also earns revenue from processing leaf tobacco owned by customers and from various other services provided to customers. Additionally, the Company has fruit and vegetable processing operations, as well as flavor and extract services that provide customers with a range of food ingredient products. Payment terms with customers vary depending on customer creditworthiness, product types, services provided, and other factors. Contract durations and payment terms for all revenue categories generally do not exceed one year. Therefore, the Company has applied a practical expedient to not adjust the transaction price for the effects of financing components, as the Company expects that the period from the time the revenue for a transaction is recognized to the time the customer pays for the related good or service transferred will be one year or less. Below is a description of the major revenue-generating categories from contracts with customers.

Tobacco Sales

The majority of the Company’s business involves purchasing leaf tobacco from farmers in the origins where it is grown, processing and packing the tobacco in its factories, and then transferring ownership and control of the tobacco to customers. On a much smaller basis, the Company also sources processed tobacco from third-party suppliers for resale to customers. The contracts for tobacco sales with customers create a performance obligation to transfer tobacco to the customer. Transaction prices for the sale of tobaccos are primarily based on negotiated fixed prices, but the Company does have a small number of cost-plus contracts with certain customers. Cost-plus arrangements provide the Company reimbursement of the cost to purchase and process the

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tobacco, plus a contractually agreed-upon profit margin. The Company utilizes the most likely amount methodology under the accounting guidance to recognize revenue for cost-plus arrangements with customers. Shipping and handling costs under tobacco sales contracts with customers are treated as fulfillment costs and included in the transaction price. Taxes assessed by government authorities on the sale of leaf tobacco products are excluded from the transaction price. At the point in time that the customer obtains control over the tobacco, which is typically aligned with physical shipment under the contractual terms with the customer, the Company completes its performance obligation and recognizes the revenue for the sale.

Ingredient Sales

In recent fiscal years, the Company has diversified operations through acquisition of established companies that offer customers a wide range of both liquid and dehydrated fruit and vegetable ingredient products, flavors, and extracts. These operations procure raw materials from domestic and international growers and suppliers and through a variety of processing steps including sorting, cleaning, pressing, mixing, extracting, and blending to manufacture finished goods utilized in both human and pet food. The contracts for food ingredients with customers create a performance obligation to transfer the manufactured finished goods to the customer. Transaction prices for the sale of food ingredients are primarily based on negotiated fixed prices. At the point in time that the customer obtains control over the finished product, which is typically aligned with physical shipment under the contractual terms with the customer, the Company completes its performance obligation and recognizes the revenue for the sale.

Processing Revenue

Processing and packing of customer-owned tobacco and ingredients is a short-duration process. Processing charges are primarily based on negotiated fixed prices per unit of weight processed. Under normal operating conditions, customer-owned raw materials that are placed into the production line exits as processed and packed product and is then later transported to customer-designated transfer locations. The revenue for these services is recognized when the performance obligation is satisfied, which is generally when processing is completed. The Company’s operating history and contract analyses indicate that customer requirements for processed tobacco and food ingredients products are consistently met upon completion of processing.

Other Operating Sales and Revenue

From time to time, the Company enters into various arrangements with customers to provide other value-added services that may include blending, chemical and physical testing of products, storage, and tobacco cutting services for select manufacturers. These other arrangements and operations are a much smaller portion of the Company’s business, and are separate and distinct contractual agreements from the Company’s tobacco and food ingredients sales or third-party processing arrangements with customers. The transaction prices and timing of revenue recognition of these items are determined by the specifics of each contract.

Disaggregation of Revenue from Contracts with Customers

The following table disaggregates the Company’s revenue by significant revenue-generating category:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Tobacco sales	$	540,363	$	583,543	$	1,181,329	$	1,193,230
Ingredient sales	70,682		47,337		175,087		82,820
Processing revenue	19,647		18,831		52,391		47,605
Other sales and revenue from contracts with customers	16,988		14,867		41,733		32,671
Total revenue from contracts with customers	647,680		664,578		1,450,540		1,356,326
Other operating sales and revenues	4,964		8,353		6,088		9,441
Consolidated sales and other operating revenues	$	652,644	$	672,931	$	1,456,628	$	1,365,767

    Other operating sales and revenues consists principally of interest on advances to suppliers.

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NOTE 6. OTHER CONTINGENT LIABILITIES AND OTHER MATTERS

Other Contingent Liabilities

Other Contingent Liabilities (Letters of credit)

The Company had other contingent liabilities totaling approximately $1 million at December 31, 2021, primarily related to outstanding letters of credit.

Value-Added Tax Assessments in Brazil

As further discussed below, the Company’s local operating subsidiaries pay significant amounts of value-added tax (“VAT”) in connection with their operations, which generate tax credits that they normally are entitled to recover through offset, refund, or sale to third parties. In Brazil, VAT is assessed at the state level when green tobacco is transferred between states. The Company’s operating subsidiary there pays VAT when tobaccos grown in the states of Santa Catarina and Parana are transferred to its factory in the state of Rio Grande do Sul for processing. The subsidiary has received assessments for additional VAT plus interest and penalties from tax authorities for the states of Santa Catarina and Parana based on audits of the subsidiary’s VAT filings for specified periods. In June 2011, tax authorities for the state of Santa Catarina issued assessments for tax, interest, and penalties for periods from 2006 through 2009 totaling approximately $9 million. In September 2014, tax authorities for the state of Parana issued an assessment for tax, interest, and penalties for periods from 2009 through 2014 totaling approximately $10 million. Those amounts are based on the exchange rate for the Brazilian currency at December 31, 2021. Management of the operating subsidiary and outside counsel believe that errors were made by the tax authorities for both states in determining all or significant portions of these assessments and that various defenses support the subsidiary’s positions.

With respect to the Santa Catarina assessments, the subsidiary took appropriate steps to contest the full amount of the claims. As of December 31, 2021, a portion of the subsidiary’s arguments had been accepted, and the outstanding assessment had been reduced. The reduced assessment, together with the related accumulated interest through the end of the current reporting period, totaled approximately $9 million (at the December 31, 2021 exchange rate). The subsidiary is continuing to contest the full remaining amount of the assessment. While the range of reasonably possible loss is zero up to the full $9 million remaining assessment with interest, based on the strength of the subsidiary’s defenses, no loss within that range is considered probable at this time and no liability has been recorded at December 31, 2021.

With respect to the Parana assessment, management of the subsidiary and outside counsel challenged the full amount of the claim. A significant portion of the Parana assessment was based on positions taken by the tax authorities that management and outside counsel believe deviate significantly from the underlying statutes and relevant case law. In addition, under the law, the subsidiary’s tax filings for certain periods covered in the assessment were no longer open to any challenge by the tax authorities. In December 2015, the Parana tax authorities withdrew the initial claim and subsequently issued a new assessment covering the same tax periods, reflecting a substantial reduction from the original assessment. In fiscal year 2020, the Parana tax authorities acknowledged the statute of limitations related to claims prior to December 2010 had expired and reduced the assessment to $3 million (at the December 31, 2021 exchange rate). Notwithstanding the reduced assessment, management and outside counsel continue to believe that the new assessment is not supported by the underlying statutes and relevant case law and have challenged the full amount of the claim. The range of reasonably possible loss is considered to be zero up to the full $3 million assessment. However, based on the strength of the subsidiary's defenses, no loss within that range is considered probable at this time and no liability has been recorded at December 31, 2021.

In both states, the process for reaching a final resolution to the assessments is expected to be lengthy, and management is not currently able to predict when either case will be concluded. Should the subsidiary ultimately be required to pay any tax, interest, or penalties in either case, the portion paid for tax would generate VAT credits that the subsidiary may be able to recover.

Other Legal and Tax Matters

Various subsidiaries of the Company are involved in litigation and tax examinations incidental to their business activities.  While the outcome of these matters cannot be predicted with certainty, management is vigorously defending the matters and does not currently expect that any of them will have a material adverse effect on the Company’s business or financial position.  However, should one or more of these matters be resolved in a manner adverse to management’s current expectation, the effect on the Company’s results of operations for a particular fiscal reporting period could be material.

Advances to Suppliers

In many sourcing origins where the Company operates, it provides agronomy services and seasonal advances of seed, seedlings, fertilizer, and other supplies to tobacco farmers for crop production, or makes seasonal cash advances to farmers for the procurement of those inputs. These advances are short term, are repaid upon delivery of tobacco to the Company, and are

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reported in advances to suppliers in the consolidated balance sheets. In several origins, the Company has made long-term advances to tobacco farmers to finance curing barns and other farm infrastructure. In some years, due to low crop yields and other factors, individual farmers may not deliver sufficient volumes of tobacco to fully repay their seasonal advances, and the Company may extend repayment of those advances into future crop years. The long-term portion of advances is included in other noncurrent assets in the consolidated balance sheets. Both the current and the long-term portions of advances to suppliers are reported net of allowances recorded when the Company determines that amounts outstanding are not likely to be collected. Short-term and long-term advances to suppliers totaled $147 million at December 31, 2021, $122 million at December 31, 2020, and $144 million at March 31, 2021. The related valuation allowances totaled $17 million at December 31, 2021, $16 million at December 31, 2020, and $18 million at March 31, 2021, and were estimated based on the Company’s historical loss information and crop projections. The allowances were increased by net provisions of approximately $2.9 million and $2.8 million in the nine-month periods ended December 31, 2021 and 2020, respectively. These net recoveries and provisions are included in selling, general, and administrative expenses in the consolidated statements of income. Interest on advances is recognized in earnings upon the farmers’ delivery of tobacco in payment of principal and interest.

Recoverable Value-Added Tax Credits

In many foreign countries, the Company’s local operating subsidiaries pay significant amounts of VAT on purchases of unprocessed and processed tobacco, crop inputs, packing materials, and various other goods and services. In some countries, VAT is a national tax, and in other countries it is assessed at the state level. Items subject to VAT vary from jurisdiction to jurisdiction, as do the rates at which the tax is assessed. When tobacco is sold to customers in the country of origin, the operating subsidiaries generally collect VAT on those sales. The subsidiaries are normally permitted to offset their VAT payments against the collections and remit only the incremental VAT collections to the tax authorities. When tobacco is sold for export, VAT is normally not assessed. In countries where tobacco sales are predominately for export markets, VAT collections generated on downstream sales are often not sufficient to fully offset the subsidiaries’ VAT payments. In those situations, unused VAT credits can accumulate. Some jurisdictions have procedures that allow companies to apply for refunds of unused VAT credits from the tax authorities, but the refund process often takes an extended period of time and it is not uncommon for refund applications to be challenged or rejected in part on technical grounds. Other jurisdictions may permit companies to sell or transfer unused VAT credits to third parties in private transactions, although approval for such transactions must normally be obtained from the tax authorities, limits on the amounts that can be transferred may be imposed, and the proceeds realized may be heavily discounted from the face value of the credits. Due to these factors, local operating subsidiaries in some countries can accumulate significant balances of VAT credits over time. The Company reviews these balances on a regular basis and records valuation allowances on the credits to reflect amounts that are not expected to be recovered, as well as discounts anticipated on credits that are expected to be sold or transferred. At December 31, 2021, the aggregate balance of recoverable tax credits held by the Company’s subsidiaries totaled approximately $65 million ($53 million at December 31, 2020, and $49 million at March 31, 2021), and the related valuation allowances totaled approximately $20 million ($18 million at December 31, 2020, and $19 million at March 31, 2021). The net balances are reported in other current assets and other noncurrent assets in the consolidated balance sheets.

Long-Term Debt

In December 2020, the Company repaid $150 million of revolving credit borrowings used to finance the purchase of Silva with term loans under its existing senior unsecured bank credit facility. The Company increased the borrowings of the senior unsecured five-year and seven-year term loans by $75 million each. At December 31, 2021, the five-year term loan maturing December 2023 and the seven-year term loan maturing December 2025 had outstanding borrowings of $225 million and $295 million, respectively. Under the senior unsecured bank credit facility, the additional $150 million of terms loans bear interest at variable rates plus a margin based on the Company's credit metrics and interest payments remained unhedged at December 31, 2021. The Company maintains receive-floating/pay-fixed interest rates swap agreements for a portion of the outstanding five and seven-year term loans. See Note 11 for additional information on outstanding interest rate swap agreements.

Shelf Registration and Stock Repurchase Plan

In November 2020, the Company filed an undenominated automatic universal shelf registration statement with the U.S. Securities and Exchange Commission to provide for the future issuance of an undefined amount of securities as determined by the Company and offered in one or more prospectus supplements prior to issuance.

A stock repurchase plan, which was authorized by the Company's Board of Directors, became effective and was publicly announced on November 5, 2020. This stock repurchase plan authorizes the purchase of up to $100 million in common and/or preferred stock in open market or privately negotiated transactions through November 15, 2022 or when funds for the program have been exhausted, subject to market conditions and other factors. The program had $100 million of remaining capacity for repurchases of common and/or preferred stock at December 31, 2021.

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NOTE 7.   EARNINGS PER SHARE

    The following table sets forth the computation of basic and diluted earnings per share:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands, except share and per share data)	2021		2020		2021		2020
Basic Earnings Per Share
Numerator for basic earnings per share
Net income attributable to Universal Corporation	$	34,940	$	33,273	$	60,807	$	48,049
Denominator for basic earnings per share
Weighted average shares outstanding	24,792,108		24,677,122		24,761,290		24,646,342
Basic earnings per share	$	1.41	$	1.35	$	2.46	$	1.95
Diluted Earnings Per Share
Numerator for diluted earnings per share
Net income attributable to Universal Corporation	$	34,940	$	33,273	$	60,807	$	48,049
Denominator for diluted earnings per share:
Weighted average shares outstanding	24,792,108		24,677,122		24,761,290		24,646,342
Effect of dilutive securities
Employee and outside director share-based awards	156,983		141,796		151,354		118,097
Denominator for diluted earnings per share	24,949,091		24,818,918		24,912,644		24,764,439
Diluted earnings per share	$	1.40	$	1.34	$	2.44	$	1.94

NOTE 8.   INCOME TAXES

    The Company operates in the United States and many foreign countries and is subject to the tax laws of many jurisdictions. Changes in tax laws or the interpretation of tax laws can affect the Company’s earnings, as can the resolution of pending and contested tax issues. The Company's consolidated effective income tax rate is affected by a number of factors, including the mix and timing of domestic and foreign earnings, discrete items, and the effect of exchange rate changes on taxes.     

    The consolidated effective income tax rate for the three months and nine months ended December 31, 2021 was 23.4% and 21.0%, respectively. The consolidated effective income tax rate for the three and nine months ended December 31, 2021 was affected by a $1.2 million benefit related to finalizing the prior fiscal year U.S. tax return. The consolidated effective income tax rate for the nine months ended December 31, 2021 was affected by a $1.7 million benefit related to a final tax law ruling at a foreign subsidiary. Without these items, the consolidated effective income tax rate for the three and nine months ended December 31, 2021 would have been approximately 25.5% and 24.3%, respectively.

    The Company's consolidated effective income tax rate for the three and nine months ended December 31, 2020 was 26.5% and 18.6%, respectively. The Company recognized a $2.9 million income tax benefit in the three and nine months ended December 31, 2020 related to amending and finalizing of prior fiscal years' consolidated U.S. income tax returns. The consolidated income tax rate for the nine months ended December 31, 2020 was affected by a $4.4 million net tax benefit for final U.S. tax regulations issued for hybrid dividends paid by foreign subsidiaries. Without these discrete items, the consolidated effective income tax rate for the three and nine months ended December 31, 2020 would have been approximately 31.7% and 29.3%. Additionally, for the nine months ended December 31, 2020, the Company recognized $1.8 million of interest expense related to a settlement of an uncertain tax position at foreign subsidiary.

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NOTE 9.   GOODWILL AND OTHER INTANGIBLES

The Company's changes in goodwill at December 31, 2021 and 2020 consisted of the following:

(in thousands of dollars)	Nine Months Ended December 31,
	2021		2020
Balance at beginning of fiscal year	$	173,051	$	126,826
Acquisition of business(1)(2)	41,061		53,728
Foreign currency translation adjustment	(89)		101
Balance at end of period	$	214,023	$	180,655

(1) On October 4, 2021, the Company acquired 100% of the capital stock of Shank's for approximately $100 million in cash and $2.4 million of additional working capital on-hand at the date of acquisition. The Shank's acquisition resulted in $41.1 million of goodwill. See Note 3 for additional information.

(2) On October 1, 2020, the Company acquired 100% of the capital stock of Silva for approximately $164.0 million in cash and $5.9 million of working capital on-hand at the date of acquisition. The Silva acquisition resulted in $46.1 million of goodwill after the final purchase accounting was completed in the three months ended September 30, 2021. See Note 3 for additional information.

The Company's intangible assets primarily consist of capitalized customer-related intangibles, trade names, proprietary developed technology and noncompetition agreements. The Company's intangible assets subject to amortization consisted of the following at December 31, 2021 and 2020 and at March 31, 2021:

(in thousands, except useful life)				December 31, 2021
	Useful Life (years)			Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Customer relationships(1)	11	—	13	$	86,500	$	(8,030)	$	78,470
Trade names		5		11,100		(3,270)		7,830
Developed technology(1)		3		9,300		(3,286)		6,014
Noncompetition agreements(1)		5		4,000		(588)		3,412
Other		5		751		(687)		64
Total intangible assets				$	111,651	$	(15,861)	$	95,790

				December 31, 2020
	Useful Life (years)			Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Customer relationships(2)	11	—	13	$	62,500	$	(1,935)	$	60,565
Trade names(2)		5		11,100		(1,050)		10,050
Developed technology		3		4,800		(1,600)		3,200
Noncompetition agreements		5		1,000		(200)		800
Other		5		796		(701)		95
Total intangible assets				$	80,196	$	(5,486)	$	74,710

				March 31, 2021
	Useful Life (years)			Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Customer relationships	11	—	13	$	62,500	$	(3,323)	$	59,177
Trade names		5		11,100		(1,605)		9,495
Developed technology		3		4,800		(2,000)		2,800
Noncompetition agreements		5		1,000		(250)		750
Other		5		760		(678)		82
Total intangible assets				$	80,160	$	(7,856)	$	72,304

(1)On October 4, 2021, the Company acquired 100% of the capital stock of Shank's for approximately $100 million in cash and $2.4 million of additional working capital on-hand at the date of acquisition. The Shank's acquisition resulted in $31.5 million of intangible assets. See Note 3 for additional information.

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(2)On October 1, 2020, the Company acquired 100% of the capital stock of Silva for approximately $164.0 million in cash and $5.9 million of working capital on-hand at the date of acquisition. The Silva acquisition resulted in $60.8 million of intangible assets. See Note 3 for additional information.

Intangible assets are amortized on a straight-line basis over the asset's estimated useful economic life as noted above.

The Company's amortization expense for intangible assets for the three and nine months ended December 31, 2021 and 2020 was:

(in thousands of dollars)	Three Months Ended December 31,				Nine Months Ended December 31,
	2021		2020		2021		2020
Amortization Expense	$	3,207	$	2,404	$	8,005	$	4,021

Amortization expense for the developed technology intangible asset is recorded in cost of goods sold in the consolidated income statements of income. The amortization expense for other intangible assets is recorded in selling, general, and administrative expenses in the consolidated statements of income.

As of December 31, 2021, the expected future amortization expense for intangible assets is as follows:

Fiscal Year (in thousands of dollars)
2022 (excluding the nine months ended December 31, 2021)	$	3,228
2023	12,495
2024	11,247
2025	11,812
2026 and thereafter	57,008
Total expected future amortization expense	$	95,790

NOTE 10.   LEASES

The Company, as a lessee, enters into operating leases for land, buildings, equipment, and vehicles. For all operating leases with terms greater than 12 months and with fixed payment arrangements, a lease liability and corresponding right-of-use asset are recognized in the balance sheet for the term of the lease by calculating the net present value of future lease payments. On the date of lease commencement, the present value of lease liabilities is determined by discounting the future lease payments by the Company’s collateralized incremental borrowing rate, adjusted for the lease term and currency of the lease payments. If a lease contains a renewal option that the Company is reasonably certain to exercise, the Company accounts for the original lease term and expected renewal term in the calculation of the lease liability and right-of-use asset.

The following table sets forth the right-of-use assets and lease liabilities for operating leases included in the Company’s consolidated balance sheet:

(in thousands of dollars)	December 31, 2021		December 31, 2020		March 31, 2021
Assets
Operating lease right-of-use assets	$	34,139	$	34,717	$	31,230
Liabilities
Current portion of operating lease liabilities	$	9,128	$	9,014	$	7,898
Long-term operating lease liabilities	22,612		22,709		19,725
Total operating lease liabilities	$	31,740	$	31,723	$	27,623

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The following table sets forth the location and amount of operating lease costs included in the Company's consolidated statement of income:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Income Statement Location
Cost of goods sold	$	2,805	$	3,401	$	8,104	$	9,531
Selling, general, and administrative expenses	2,536		2,520		7,102		7,176
Total operating lease costs(1)	$	5,341	$	5,921	$	15,206	$	16,707

(1)Includes variable operating lease costs.

The following table reconciles the undiscounted cash flows to the operating lease liabilities in the Company’s consolidated balance sheet:

(in thousands of dollars)	December 31, 2021
Maturity of Operating Lease Liabilities
2022 (excluding the nine months ended December 31, 2021)	$	2,743
2023	9,493
2024	7,526
2025	5,393
2026	3,116
2027 and thereafter	7,676
Total undiscounted cash flows for operating leases	$	35,947
Less: Imputed interest	(4,207)
Total operating lease liabilities	$	31,740

As of December 31, 2021, the Company had no leases that have not yet commenced.

The following table sets forth supplemental information related to operating leases:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands, except lease term and incremental borrowing rate)	2021		2020		2021			2020
Supplemental Cash Flow Information
Cash paid for amounts included in the measurement of operating lease liabilities	$	3,219	$	3,171	$	8,836		$	9,358
Right-of-use assets obtained in exchange for new operating leases	3,843		1,532		12,894			3,122
Weighted Average Remaining Lease Term (years)					5.31			5.33
Weighted Average Collateralized Incremental Borrowing Rate					3.84		%	4.21		%

As part of the acquisition of Shank's, the Company recognized $8.5 million of operating lease right-of-use assets and corresponding operating lease liabilities on the opening balance sheet related to leases of Shank's facilities. The facilities were subsequently purchased in the three months ended December 31, 2021 and therefore excluded from the lease disclosures above.

NOTE 11.   DERIVATIVES AND HEDGING ACTIVITIES

Universal is exposed to various risks in its worldwide operations and uses derivative financial instruments to manage two specific types of risks – interest rate risk and foreign currency exchange rate risk. Interest rate risk has been managed by entering into interest rate swap agreements, and foreign currency exchange rate risk has been managed by entering into forward and option foreign currency exchange contracts. However, the Company’s policy also permits other types of derivative instruments. In addition, foreign currency exchange rate risk is also managed through strategies that do not involve derivative instruments, such as using local borrowings and other approaches to minimize net monetary positions in non-functional currencies. The disclosures below provide additional information about the Company’s hedging strategies, the derivative instruments used, and the effects of

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these activities on the consolidated statements of income and comprehensive income and the consolidated balance sheets. In the consolidated statements of cash flows, the cash flows associated with all of these activities are reported in net cash provided by operating activities.

Cash Flow Hedging Strategy for Interest Rate Risk

In February 2019, the Company entered into receive-floating/pay-fixed interest rate swap agreements that were designated and qualify as hedges of the exposure to changes in interest payment cash flows created by fluctuations in variable interest rates on two outstanding non-amortizing bank term loans that were funded as part of a new bank credit facility in December 2018. Although no significant ineffectiveness is expected with this hedging strategy, the effectiveness of the interest rate swaps is evaluated on a quarterly basis. At December 31, 2021, the total notional amount of the interest rate swaps was $370 million, which corresponded with the original outstanding balance of the term loans. During the third quarter of fiscal year 2021, the Company converted $150 million from the balance in its revolving credit line into the existing term loans, splitting the balance equally between them. At December 31, 2021, the Company is not hedging the interest payments on the additional $150 million of term loans. The increase to the principal balance of the term loans does not have an impact to the effectiveness analysis of the interest rate swap agreements.

Previously, the Company had receive-floating/pay-fixed interest rate swap agreements that were designated and qualified as cash flow hedges for two outstanding non-amortizing bank loans that were repaid concurrent with closing on the new bank credit facility. Those swap agreements were subsequently terminated in February 2019 concurrent with the inception of the new swap agreements. The fair value of the previous swap agreements, approximately $5.4 million, was received from the counterparties upon termination and was amortized from accumulated other comprehensive loss into earnings as a reduction of interest expense through the original maturity dates of those agreements. As of December 31, 2021, the entire deferred gain has been amortized.

Cash Flow Hedging Strategy for Foreign Currency Exchange Rate Risk Related to Sales of Crop Inputs, Forecast Purchases of Tobacco, and Related Processing Costs

The majority of the tobacco production in most countries outside the United States where Universal operates is sold in export markets at prices denominated in U.S. dollars. However, sales of crop inputs (such as seeds and fertilizers) to farmers, purchases of tobacco from farmers, and most processing costs (such as labor and energy) in those countries are usually denominated in the local currency. Changes in exchange rates between the U.S. dollar and the local currencies where tobacco is grown and processed affect the ultimate U.S. dollar sales of crop inputs and cost of processed tobacco. From time to time, the Company enters into forward and option contracts to buy U.S. dollars and sell the local currency at future dates that coincide with the sale of crop inputs to farmers. In the case of forecast purchases of tobacco and the related processing costs, the Company enters into forward and option contracts to sell U.S. dollars and buy the local currency at future dates that coincide with the expected timing of a portion of the tobacco purchases and processing costs. These strategies offset the variability of future U.S. dollar cash flows for sales of crop inputs, tobacco purchases, and processing costs for the foreign currency notional amount hedged. These hedging strategies have been used mainly for tobacco purchases, processing costs, and sales of crop inputs in Brazil, although the Company has also entered into hedges for a portion of the tobacco purchases in Africa.

The aggregate U.S. dollar notional amount of forward and option contracts entered into for these purposes during the nine-month periods in fiscal years 2022 and 2021 was as follows:

	Nine Months Ended December 31,
(in millions of dollars)	2021		2020
Tobacco purchases	$	134.7	$	89.4
Processing costs	32.5		24.6
Crop input sales	20.8		23.5
Total	$	188.0	$	137.5

Fluctuations in exchange rates and in the amount and timing of fixed-price orders from customers for their purchases from individual crop years routinely cause variations in the U.S. dollar notional amount of forward contracts entered into from one year to the next. All contracts related to tobacco purchases and crop input sales were designated and qualified as hedges of the future cash flows associated with the forecast purchases of tobacco. As a result, changes in fair values of the forward contracts have been recognized in comprehensive income as they occurred, but only recognized in earnings as a component of cost of goods sold upon sale of the related tobacco to third-party customers. In fiscal year 2022, only non-deliverable forward contracts were utilized for the sale of 2022 crop year inputs. Premium payments for option contracts entered into for the sale of crop inputs in fiscal year 2021 were expensed into earnings as incurred.

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The table below presents the expected timing of when the remaining accumulated other comprehensive gains and losses as of December 31, 2021 for cash flows hedges of tobacco purchases and crop input sales will be recognized in earnings.

Hedging Program	Crop Year	Geographic Location(s)	Fiscal Year Earnings
Tobacco purchases	2023	Brazil	2024
Tobacco purchases	2022	Brazil, Africa	2023
Tobacco purchases	2021	Brazil, Africa	2022
Tobacco purchases	2020	Brazil	2022
Crop input sales	2022	Brazil	2023
Crop input sales	2021	Brazil	2022

Forward contracts related to processing costs have not been designated as hedges, and gains and losses on those contracts have been recognized in earnings on a mark-to-market basis.

Hedging Strategy for Foreign Currency Exchange Rate Risk Related to Net Local Currency Monetary Assets and Liabilities of Foreign Subsidiaries

Most of the Company’s foreign subsidiaries transact the majority of their sales in U.S. dollars and finance the majority of their operating requirements with U.S. dollar borrowings, and therefore use the U.S. dollar as their functional currency. These subsidiaries normally have certain monetary assets and liabilities on their balance sheets that are denominated in the local currency. Those assets and liabilities can include cash and cash equivalents, accounts receivable and accounts payable, advances to farmers and suppliers, deferred income tax assets and liabilities, recoverable value-added taxes, operating lease liabilities, and other items. Net monetary assets and liabilities denominated in the local currency are remeasured into U.S. dollars each reporting period, generating gains and losses that the Company records in earnings as a component of selling, general, and administrative expenses. The level of net monetary assets or liabilities denominated in the local currency normally fluctuates throughout the year based on the operating cycle, but it is most common for monetary assets to exceed monetary liabilities, sometimes by a significant amount. When this situation exists and the local currency weakens against the U.S. dollar, remeasurement losses are generated. Conversely, remeasurement gains are generated on a net monetary asset position when the local currency strengthens against the U.S. dollar. To manage a portion of its exposure to currency remeasurement gains and losses, the Company enters into forward contracts to buy or sell the local currency at future dates coinciding with expected changes in the overall net local currency monetary asset position of the subsidiary. Gains and losses on the forward contracts are recorded in earnings as a component of selling, general, and administrative expenses for each reporting period as they occur, and thus directly offset the related remeasurement losses or gains in the consolidated statements of income for the notional amount hedged. The Company does not designate these contracts as hedges for accounting purposes. The contracts are generally arranged to hedge the subsidiary's projected exposure to currency remeasurement risk for specified periods of time, and new contracts are entered as necessary throughout the year to replace previous contracts as they mature. The Company is currently using forward currency contracts to manage its exposure to currency remeasurement risk in Brazil.  The total notional amounts of contracts outstanding at December 31, 2021 and 2020, and March 31, 2021, were approximately $59.6 million, $13.3 million, and $16.6 million, respectively. To further mitigate currency remeasurement exposure, the Company’s foreign subsidiaries may utilize short-term local currency financing during certain periods. This strategy, while not involving the use of derivative instruments, is intended to minimize the subsidiary’s net monetary position by financing a portion of the local currency monetary assets with local currency monetary liabilities, thus hedging a portion of the overall position.

Several of the Company’s foreign subsidiaries transact the majority of their sales and finance the majority of their operating requirements in their local currency, and therefore use their respective local currencies as the functional currency for reporting purposes. From time to time, these subsidiaries sell tobacco to customers in transactions that are not denominated in the functional currency. In those situations, the subsidiaries routinely enter into forward exchange contracts to offset currency risk for the period of time that a fixed-price order and the related trade account receivable are outstanding with the customer. The contracts are not designated as hedges for accounting purposes.

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Effect of Derivative Financial Instruments on the Consolidated Statements of Income

The table below outlines the effects of the Company’s use of derivative financial instruments on the consolidated statements of income:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Cash Flow Hedges - Interest Rate Swap Agreements
Derivative
Effective Portion of Hedge
Gain (loss) recorded in accumulated other comprehensive loss	$	3,967	$	953	$	2,318	$	(3,020)
Gain (loss) reclassified from accumulated other comprehensive loss into earnings	$	(2,263)	$	(2,206)	$	(6,743)	$	(6,233)
Gain on terminated interest rate swaps amortized from accumulated other comprehensive loss into earnings	$	353	$	353	$	1,061	$	1,061
Location of gain (loss) reclassified from accumulated other comprehensive loss into earnings	Interest expense
Ineffective Portion of Hedge
Gain (loss) recognized in earnings	$	—	$	—	$	—	$	—
Location of gain (loss) recognized in earnings	Selling, general and administrative expenses
Hedged Item
Description of hedged item	Floating rate interest payments on term loan
Cash Flow Hedges - Foreign Currency Exchange Contracts
Derivative
Effective Portion of Hedge
Gain (loss) recorded in accumulated other comprehensive loss	$	480	$	5,757	$	3,479	$	3,973
Gain (loss) reclassified from accumulated other comprehensive loss into earnings	$	2,274	$	(2,362)	$	3,563	$	(9,575)
Location of gain (loss) reclassified from accumulated other comprehensive loss into earnings	Cost of goods sold
Ineffective Portion and Early De-designation of Hedges
Gain (loss) recognized in earnings	$	—	$	—	$	451	$	—
Location of gain (loss) recognized in earnings	Selling, general and administrative expenses
Hedged Item
Description of hedged item	Forecast purchases of tobacco in Brazil and Africa
Derivatives Not Designated as Hedges - Foreign Currency Exchange Contracts
Gain (loss) recognized in earnings	$	174	$	922	$	3,939	$	506
Location of gain (loss) recognized in earnings	Selling, general and administrative expenses

For the interest rate swap agreements, the effective portion of the gain or loss on the derivative is recorded in accumulated other comprehensive loss and any ineffective portion is recorded in selling, general and administrative expenses.

For the forward foreign currency exchange contracts designated as cash flow hedges of tobacco purchases in Brazil and Africa and the crop input sales in Brazil, a net hedge loss of approximately $1.3 million remained in accumulated other comprehensive loss at December 31, 2021. That balance reflects gains and losses on contracts related to the 2023, 2022, 2021, and 2020 Brazil crops, the 2022 and 2021 Africa crops, and the 2022 and 2021 Brazil crop input sales, less the amounts reclassified to earnings related to tobacco sold through December 31, 2021. Based on the hedging strategy, as the gain or loss is

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recognized in earnings, it is expected to be offset by a change in the direct cost for the tobacco or by a change in sales prices if the strategy has been mandated by the customer. Generally, margins on the sale of the tobacco will not be significantly affected.

Effect of Derivative Financial Instruments on the Consolidated Balance Sheets

The table below outlines the effects of the Company’s derivative financial instruments on the consolidated balance sheets at December 31, 2021 and 2020, and March 31, 2021:

	Derivatives in a Fair Value Asset Position							Derivatives in a Fair Value Liability Position
	Balance Sheet Location	Fair Value as of						Balance Sheet Location	Fair Value as of
(in thousands of dollars)		December 31, 2021		December 31, 2020		March 31, 2021			December 31, 2021		December 31, 2020		March 31, 2021
Derivatives Designated as Hedging Instruments
Interest rate swap agreements	Other non-current assets	$	—	$	—	$	—	Other long-term liabilities	$	16,658	$	33,950	$	25,719
Foreign currency exchange contracts	Other current assets	2,169		5,688		1,137		Accounts payable and accrued expenses	3,952		911		1,031
Total		$	2,169	$	5,688	$	1,137		$	20,610	$	34,861	$	26,750
Derivatives Not Designated as Hedging Instruments
Foreign currency exchange contracts	Other current assets	$	1,390	$	1,625	$	435	Accounts payable and accrued expenses	$	1,298	$	324	$	791
Total		$	1,390	$	1,625	$	435		$	1,298	$	324	$	791

Substantially all of the Company's foreign exchange derivative instruments are subject to master netting arrangements whereby the right to offset occurs in the event of default by a participating party. The Company has elected to present these contracts on a gross basis in the consolidated balance sheets.

NOTE 12.   FAIR VALUE MEASUREMENTS

Universal measures certain financial and nonfinancial assets and liabilities at fair value based on applicable accounting guidance. The financial assets and liabilities measured at fair value include money market funds, trading securities associated with deferred compensation plans, interest rate swap agreements, forward foreign currency exchange contracts and acquisition-related contingent consideration obligations. The application of the fair value guidance to nonfinancial assets and liabilities primarily includes the determination of fair values for goodwill and long-lived assets when indicators of potential impairment are present.

    Under the accounting guidance, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The framework for measuring fair value is based on a fair value hierarchy that distinguishes between observable inputs and unobservable inputs. Observable inputs are based on market data obtained from independent sources. Unobservable inputs require the Company to make its own assumptions about the value placed on an asset or liability by market participants because little or no market data exists.

There are three levels within the fair value hierarchy:

Level	Description
1	quoted prices in active markets for identical assets or liabilities that the Company has the ability to access as of the reporting date;
2	quoted prices in active markets for similar assets or liabilities, or 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; and
3	unobservable inputs for the asset or liability.

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    As permitted under the accounting guidance, the Company uses net asset value per share ("NAV") as a practical expedient to measure the fair value of its money market funds. The fair values for those funds are presented under the heading "NAV" in the tables that follow in this disclosure. In measuring the fair value of liabilities, the Company considers the risk of non-performance in determining fair value. Universal has not elected to report at fair value any financial instruments or any other assets or liabilities that are not required to be reported at fair value under current accounting guidance.

Recurring Fair Value Measurements

At December 31, 2021 and 2020, and at March 31, 2021, the Company had certain financial assets and financial liabilities that were required to be measured and reported at fair value on a recurring basis. These assets and liabilities are listed in the tables below and are classified based on how their values were determined under the fair value hierarchy or the NAV practical expedient:

	December 31, 2021
			Fair Value Hierarchy
(in thousands of dollars)	NAV		Level 1		Level 2		Level 3		Total
Assets
Money market funds	$	335	$	—	$	—	$	—	$	335
Trading securities associated with deferred compensation plans	—		14,794		—		—		14,794
Interest rate swap agreements	—		—		—		—		—
Foreign currency exchange contracts	—		—		3,559		—		3,559
Total financial assets measured and reported at fair value	$	335	$	14,794	$	3,559	$	—	$	18,688
Liabilities
Interest rate swap agreements	—		—		16,658		—		16,658
Foreign currency exchange contracts	—		—		5,250		—		5,250
Total financial liabilities measured and reported at fair value	$	—	$	—	$	21,908	$	—	$	21,908

	December 31, 2020
			Fair Value Hierarchy
(in thousands of dollars)	NAV		Level 1		Level 2		Level 3		Total
Assets
Money market funds	$	380	$	—	$	—	$	—	$	380
Trading securities associated with deferred compensation plans	—		15,703		—		—		15,703
Foreign currency exchange contracts	—		—		7,313		—		7,313
Total financial assets measured and reported at fair value	$	380	$	15,703	$	7,313	$	—	$	23,396
Liabilities
Acquisition-related contingent consideration obligations - long term	$	—	$	—	$	—	$	2,532	2,532
Interest rate swap agreements	—		—		33,950		—		33,950
Foreign currency exchange contracts	—		—		1,235		—		1,235
Total financial liabilities measured and reported at fair value	$	—	$	—	$	35,185	$	2,532	$	37,717

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	March 31, 2021
			Fair Value Hierarchy
(in thousands of dollars)	NAV		Level 1		Level 2		Level 3		Total
Assets
Money market funds	$	1,992	$	—	$	—	$	—	$	1,992
Trading securities associated with deferred compensation plans	—		15,735		—		—		15,735
Foreign currency exchange contracts	—		—		1,572		—		1,572
Total financial assets measured and reported at fair value	$	1,992	$	15,735	$	1,572	$	—	$	19,299
Liabilities
Acquisition-related contingent consideration obligations - long-term	$	—	$	—	$	—	$	2,532	$	2,532
Interest rate swap agreements	—		—		25,719		—		25,719
Foreign currency exchange contracts	—		—		1,822		—		1,822
Total financial liabilities measured and reported at fair value	$	—	$	—	$	27,541	$	2,532	$	30,073

Money market funds

The fair value of money market funds, which are reported in cash and cash equivalents in the consolidated balance sheets, is based on NAV, which is the amount at which the funds are redeemable and is used as a practical expedient for fair value. These funds are not classified in the fair value hierarchy, but are disclosed as part of the fair value table above.

Trading securities associated with deferred compensation plans

Trading securities represent mutual fund investments that are matched to employee deferred compensation obligations. These investments are bought and sold as employees defer compensation, receive distributions, or make changes in the funds underlying their accounts. Quoted market prices (Level 1) are used to determine the fair values of the mutual funds.

Interest rate swap agreements

The fair values of interest rate swap agreements are determined based on dealer quotes using a discounted cash flow model matched to the contractual terms of each instrument. Since inputs to the model are observable and significant judgment is not required in determining the fair values, interest rate swaps are classified within Level 2 of the fair value hierarchy.

Foreign currency exchange contracts

The fair values of forward and option foreign currency exchange contracts are also determined based on dealer quotes using a discounted cash flow model matched to the contractual terms of each instrument. Since inputs to the model are observable and significant judgment is not required in determining the fair values, forward and option foreign currency exchange contracts are classified within Level 2 of the fair value hierarchy.

Acquisition-related contingent consideration obligations

The Company estimates the fair value of acquisition-related contingent consideration obligations by applying an income approach model that utilizes probability-weighted discounted cash flows. The Company acquired FruitSmart, Inc. in fiscal year 2020 and recognized a contingent consideration liability of $6.7 million on the date of acquisition. Each period the Company evaluates the fair value of the acquisition-related contingent consideration obligations. During the year ended March 31, 2021, the evaluation resulted in a reduction of $4.2 million of contingent consideration of the original $6.7 million liability recorded. During the three months ended September 30, 2021, an evaluation of the contingent liability resulted in a reduction of the remaining $2.5 million contingent consideration recorded. Significant judgment is applied to this model and therefore the acquisition-related contingent consideration obligation was classified within Level 3 of the fair value hierarchy.

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A reconciliation of the change in the balance of the acquisition-related contingent consideration obligation (Level 3) for the nine months ended December 31, 2021 and 2020 is provided below.

(in thousands of dollars)	Nine Months Ended December 31,
	2021		2020
Balance beginning of year	$	2,532	$	6,705
Change in fair value of contingent consideration liability	(2,532)		(4,173)
Balance at end of period	$	—	$	2,532

Long-term Debt

The following table summarizes the fair and carrying value of the Company’s long-term debt, including the current portion at each of the balance sheet dates December 31, 2021, and 2020 and March 31, 2021:

(in millions of dollars)	December 31, 2021		December 31, 2020		March 31, 2021
Fair market value of long term obligations	$	517	$	516	$	517
Carrying value of long term obligations	$	520	$	520	$	520

The Company estimates the fair value of its long-term debt using Level 2 inputs which are based upon quoted market prices for the same or similar obligations or on calculations that are based on the current interest rates available to the Company for debt of similar terms and maturities.

Nonrecurring Fair Value Measurements

    Assets and liabilities that are measured at fair value on a nonrecurring basis primarily relate to long-lived assets, right-of-use operating lease assets and liabilities, goodwill and intangibles, and other current and noncurrent assets. These assets and liabilities fair values are also evaluated for impairment when potential indicators of impairment exist. Accordingly, the nonrecurring measurement of the fair value of these assets and liabilities are classified within Level 3 of the fair value hierarchy.

Acquisition Accounting for Business Combinations

The Company accounts for acquisitions qualifying under ASC 805, "Business Combinations," which requires, among other things, that the assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. The fair values of consideration transferred and net assets acquired are determined using a combination of Level 2 and Level 3 inputs as specified in the fair value hierarchy in ASC 820, “Fair Value Measurements and Disclosures.” The Company believes that the fair values assigned to the assets acquired and liabilities assumed are based on reasonable assumptions.

Long-Lived Assets

The Company reviews long-lived assets for impairment whenever events, changes in business conditions, or other circumstances provide an indication that such assets may be impaired.

Tanzania

Due to business changes that affected the leaf tobacco market in Tanzania and the Company's operations there, an impairment charge of the long-lived assets in Tanzania was recorded in fiscal year 2019 to reduce their carrying value to fair value at March 31, 2019. As a result of efforts to sell the idled Tanzania operations, in the third quarter of fiscal year 2022 an additional impairment charge of $9.4 million was recorded. The remaining long-lived assets consist principally of the Company's office building, processing facility and land. The aggregate fair value and carrying value of the long-lived assets following the impairment adjustments is approximately $3 million at December 31, 2021.

NOTE 13.   PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS

The Company sponsors several defined benefit pension plans covering eligible U.S. salaried employees and certain foreign and other employee groups. These plans provide retirement benefits based primarily on employee compensation and years of service. The Company also sponsors defined benefit plans that provide postretirement health and life insurance benefits

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for eligible U.S. employees attaining specific age and service levels, although postretirement life insurance is no longer provided for active employees.

The components of the Company’s net periodic benefit cost were as follows:

	Pension Benefits				Other Postretirement Benefits
	Three Months Ended December 31,				Three Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Service cost	$	1,678	$	1,603	$	43	$	48
Interest cost	2,212		2,403		265		286
Expected return on plan assets	(3,373)		(3,676)		(21)		(24)
Net amortization and deferral	976		1,120		(115)		(139)
Net periodic benefit cost	$	1,493	$	1,450	$	172	$	171

	Pension Benefits				Other Postretirement Benefits
	Nine Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Service cost	$	4,981	$	4,691	$	137	$	145
Interest cost	6,725		7,316		745		859
Expected return on plan assets	(10,145)		(11,032)		(65)		(72)
Net amortization and deferral	2,928		3,361		(346)		(424)
Net periodic benefit cost	$	4,489	$	4,336	$	471	$	508

During the nine months ended December 31, 2021, the Company made contributions of approximately $4.9 million to its pension plans. Additional contributions of $1.3 million are expected during the remaining three months of fiscal year 2022.

NOTE 14.   STOCK-BASED COMPENSATION

Universal’s shareholders have approved the Executive Stock Plan (“Plan”) under which officers, directors, and employees of the Company may receive grants and awards of common stock, restricted stock, restricted stock units (“RSUs”), performance share units (“PSUs”), stock appreciation rights, incentive stock options, and non-qualified stock options. The Company’s practice is to award grants of stock-based compensation to officers on an annual basis at the first regularly-scheduled meeting of the Compensation Committee of the Board of Directors (the “Compensation Committee”) in the fiscal year following the public release of the Company’s financial results for the prior year. The Compensation Committee administers the Company’s Plan consistently, following previously defined guidelines. In recent years, the Compensation Committee has awarded only grants of RSUs and PSUs. Awards of restricted stock, RSUs, and PSUs are currently outstanding under the Plan.

The RSUs granted to employees vest in either three or five years from the grant date and are then paid out in shares of common stock. Under the terms of the RSU awards, grantees receive dividend equivalents in the form of additional RSUs that vest and are paid out on the same date as the original RSU grant. The PSUs vest at the end of a performance period of three years that begins with the year of the grant, are paid out in shares of common stock shortly after the vesting date, and do not carry rights to dividends or dividend equivalents prior to vesting. Shares ultimately paid out under PSU grants are dependent on the achievement of predetermined performance measures established by the Compensation Committee and can range from zero to 150% of the stated award. The Company’s outside directors receive RSUs following the annual meeting of shareholders. RSUs awarded to outside directors vest in one or three years from the grant date. Restricted shares vest upon the individual’s retirement from service as a director.

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During the nine-month periods ended December 31, 2021 and 2020, Universal issued the following stock-based awards, representing the regular annual grants to officers and outside directors of the Company:

	Nine Months Ended December 31,
	2021		2020
RSUs:
Number granted	72,860		80,650
Grant date fair value	$	56.31	$	43.42
PSUs:
Number granted	48,650		63,050
Grant date fair value	$	47.95	$	34.33

Fair value expense for restricted stock units is recognized ratably over the period from grant date to the earlier of: (1) the vesting date of the award, or (2) the date the grantee is eligible to retire without forfeiting the award. For employees who are already eligible to retire at the date an award is granted, the total fair value of all non-forfeitable awards is recognized as expense at the date of grant. As a result, Universal typically incurs higher stock compensation expense in the first quarter of each fiscal year when grants are awarded to officers than in the other three quarters. For PSUs, the Company generally recognizes fair value expense ratably over the performance and vesting period based on management’s judgment of the ultimate award that is likely to be paid out based on the achievement of the predetermined performance measures. The Company accounts for forfeitures of stock-based awards as they occur. For the nine-month periods ended December 31, 2021 and 2020, the Company recorded total stock-based compensation expense of approximately $5.3 million and $5.0 million, respectively. The Company expects to recognize stock-based compensation expense of approximately $1.2 million during the remaining three months of fiscal year 2022.

NOTE 15. OPERATING SEGMENTS

As a result of recent acquisitions of plant-based ingredients companies, during the three months ended December 31, 2020 management evaluated the Company’s global business activities, including product and service offerings to its customers, as well as senior management’s operational and financial responsibilities. This assessment included an analysis of how its chief operating decision maker measures business performance and allocates resources. As a result of this analysis, senior management determined the Company conducts operations across two reportable operating segments, Tobacco Operations and Ingredients Operations.

The Tobacco Operations segment activities involve selecting, procuring, processing, packing, storing, shipping, and financing leaf tobacco for sale to, or for the account of, manufacturers of consumer tobacco products throughout the world. Through various operating subsidiaries located in tobacco-growing countries around the world and significant ownership interests in unconsolidated affiliates, the Company processes and/or sells flue-cured and burley tobaccos, dark air-cured tobaccos, and oriental tobaccos. Flue-cured, burley, and oriental tobaccos are used principally in the manufacture of cigarettes, and dark air-cured tobaccos are used mainly in the manufacture of cigars, pipe tobacco, and smokeless tobacco products. Some of these tobacco types are also increasingly used in the manufacture of non-combustible tobacco products that are intended to provide consumers with an alternative to traditional combustible products. The Tobacco Operations segment also provides physical and chemical product testing and smoke testing for tobacco customers. A substantial portion of the Company’s Tobacco Operations' revenues are derived from sales to a limited number of large, multinational cigarette and cigar manufacturers.

The Ingredients Operations segment provides its customers with a broad variety of plant-based ingredients for both human and pet consumption. The Ingredients Operations segment utilizes a variety of value-added manufacturing processes converting raw materials into a wide spectrum of fruit and vegetable juices, concentrates, dehydrated products, flavors, and extracts. Customers for the Ingredients Operations segment include large multinational food and beverage companies, smaller independent manufacturers, and retail organizations. FruitSmart, Silva, and Shank's are the primary operations for the Ingredients Operations segment. FruitSmart manufactures fruit and vegetable juices, purees, concentrates, essences, fibers, seeds, seed oils, and seed powders. Silva is primarily a dehydrated product manufacturer of fruit and vegetable based flakes, dices, granules, powders, and blends. Shank's manufactures flavors and extracts and also offers bottling and custom packaging for customers. In fiscal year 2021, the Company announced the wind-down of CIFI, a greenfield operation that primarily manufactured both dehydrated and liquid sweet potato products.

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The Company currently evaluates the performance of its segments based on operating income after allocated overhead expenses, plus equity in the pretax earnings of unconsolidated affiliates. Operating results for the Company’s reportable segments for each period presented in the consolidated statements of income and comprehensive income were as follows.

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
SALES AND OTHER OPERATING REVENUES
Tobacco Operations	$	578,002	$	623,852	$	1,268,610	$	1,278,844
Ingredients Operations	74,642		49,079		188,018		86,923
Consolidated sales and other operating revenues	$	652,644	$	672,931	$	1,456,628	$	1,365,767
OPERATING INCOME
Tobacco Operations	$	69,796	$	84,122	$	105,599	$	107,658
Ingredients Operations	3,494		(2,451)		10,573		(4,698)
Segment operating income	73,290		81,671		116,172		102,960
Deduct: Equity in pretax (earnings) loss of unconsolidated affiliates (1)	(2,084)		(1,506)		(5,056)		(2,089)
Restructuring and impairment costs (2)	(8,433)		(19,979)		(10,457)		(19,979)
Add: Other income (loss)(3)	—		—		2,532		4,173
Consolidated operating income	$	62,773	$	60,186	$	103,191	$	85,065

(1)Equity in pretax earnings (loss) of unconsolidated affiliates is included in segment operating income (Tobacco Operations), but is reported below consolidated operating income and excluded from that total in the consolidated statements of income and comprehensive income.

(2)Restructuring and impairment costs are excluded from segment operating income, but are included in consolidated operating income in the consolidated statements of income and comprehensive income. See Note 4 for additional information.

(3)Other income represents the reversal of a portion of the contingent consideration liability associated with the acquisition of FruitSmart. See Note 12 for additional information.

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NOTE 16. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

    The following table summarizes the changes in the accumulated balances for each component of accumulated other comprehensive income (loss) attributable to the Company for the nine months ended December 31, 2021 and 2020:

	Nine Months Ended December 31,
(in thousands of dollars)	2021		2020
Foreign currency translation:
Balance at beginning of year	$	(35,135)	$	(42,923)
Other comprehensive income (loss) attributable to Universal Corporation:
Net gain (loss) on foreign currency translation	(4,685)		13,232
Less: Net (gain) loss on foreign currency translation attributable to noncontrolling interests	170		25
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes	(4,515)		13,257
Balance at end of period	$	(39,650)	$	(29,666)
Foreign currency hedge:
Balance at beginning of year	$	(414)	$	(12,226)
Other comprehensive income (loss) attributable to Universal Corporation:
Net gain (loss) on derivative instruments (net of tax (expense) benefit of $(301) and $(1,092))	730		6,423
Reclassification of (gain) loss to earnings (net of tax expense (benefit) of $748 and $(1,914)) (1)	(2,265)		6,682
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes	(1,535)		13,105
Balance at end of period	$	(1,949)	$	879
Interest rate hedge:
Balance at beginning of year	$	(19,480)	$	(27,402)
Other comprehensive income (loss) attributable to Universal Corporation:
Net gain (loss) on derivative instruments (net of tax (expense) benefit of $(487) and $634)	1,832		(2,386)
Reclassification of (gain) loss to earnings (net of tax expense (benefit) of $(1,193) and $(1,086)) (2)	4,488		4,086
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes	6,320		1,700
Balance at end of period	$	(13,160)	$	(25,702)
Pension and other postretirement benefit plans:
Balance at beginning of year	$	(52,008)	$	(69,046)
Other comprehensive income (loss) attributable to Universal Corporation:
Amortization included in earnings (net of tax expense (benefit) of $(524) and $(561))(3)	2,355		1,273
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes	2,355		1,273
Balance at end of period	$	(49,653)	$	(67,773)
Total accumulated other comprehensive loss at end of period	$	(104,412)	$	(122,262)

(1)    Gain (loss) on foreign currency cash flow hedges related to forecast purchases of tobacco and crop input sales is reclassified from accumulated other comprehensive income (loss) to cost of goods sold when the tobacco is sold to customers. See Note 11 for additional information.

(2)    Gain (loss) on interest rate cash flow hedges is reclassified from accumulated other comprehensive income (loss) to interest expense when the related interest payments are made on the underlying debt, or as amortized to interest expense over the period to original maturity for terminated swap agreements. See Note 11 for additional information.

(3)    This accumulated other comprehensive income (loss) component is included in the computation of net periodic benefit cost. See Note 13 for additional information.

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NOTE 17. CHANGES IN SHAREHOLDERS' EQUITY AND NONCONTROLLING INTERESTS IN SUBSIDIARIES

A reconciliation of the changes in Universal Corporation shareholders’ equity and noncontrolling interests in subsidiaries for the three and nine months ended December 31, 2021 and 2020 is as follows:

	Three Months Ended December 31, 2021						Three Months Ended December 31, 2020
(in thousands of dollars)	Universal Corporation		Non-controlling Interests		Total		Universal Corporation		Non-controlling Interests		Total
Balance at beginning of three-month period	$	1,297,332	$	36,094	$	1,333,426	$	1,239,500	$	39,376	$	1,278,876
Changes in common stock
Accrual of stock-based compensation	1,204		—		1,204		1,334		—		1,334
Dividend equivalents on RSUs	266		—		266		255		—		255
Changes in retained earnings
Net income	34,940		9,215		44,155		33,273		7,168		40,441
Cash dividends declared
Common stock	(19,193)		—		(19,193)		(18,877)		—		(18,877)
Dividend equivalents on RSUs	(266)		—		(266)		(254)		—		(254)
Other comprehensive income (loss)	1,721		(14)		1,707		15,294		(54)		15,240
Other changes in noncontrolling interests
Dividends paid to noncontrolling shareholders	—		(2,057)		(2,057)		—		—		—
Balance at end of period	$	1,316,004	$	43,238	$	1,359,242	$	1,270,525	$	46,490	$	1,317,015

	Nine Months Ended December 31, 2021						Nine Months Ended December 31, 2020
(in thousands of dollars)	Universal Corporation		Non-controlling Interests		Total		Universal Corporation		Non-controlling Interests		Total
Balance at beginning of year	$	1,307,299	$	41,126	$	1,348,425	$	1,246,665	$	42,619	$	1,289,284
Changes in common stock
Accrual of stock-based compensation	5,289		—		5,289		5,042		—		5,042
Withholding of shares from stock-based compensation for grantee income taxes	(2,458)		—		(2,458)		(1,949)		—		(1,949)
Dividend equivalents on RSUs	802		—		802		755		—		755
Changes in retained earnings
Net income	60,807		9,015		69,822		48,049		7,541		55,590
Cash dividends declared
Common stock	(57,558)		—		(57,558)		(56,617)		—		(56,617)
Dividend equivalents on RSUs	(802)		—		(802)		(755)		—		(755)
Other comprehensive income (loss)	2,625		(170)		2,455		29,335		25		29,360
Other changes in noncontrolling interests
Dividends paid to noncontrolling shareholders	—		(6,733)		(6,733)		—		(3,695)		(3,695)
Balance at end of period	$	1,316,004	$	43,238	$	1,359,242	$	1,270,525	$	46,490	$	1,317,015

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Unless the context otherwise requires, the terms “we,” “our,” “us” or “Universal” or the “Company” refer to Universal Corporation together with its subsidiaries. This Quarterly Report on Form 10-Q and the following “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Among other things, these statements relate to the Company’s financial condition, results of operation, and future business plans, operations, opportunities, and prospects. In addition, the Company and its representatives may from time to time make written or oral forward-looking statements, including statements contained in other filings with the Securities and Exchange Commission and in reports to shareholders. These forward-looking statements are generally identified by the use of words such as we “expect,” “believe,” “anticipate,” “could,” “should,” “may,” “plan,” “will,” “predict,” “estimate,” and similar expressions or words of similar import. These forward-looking statements are based upon management’s current knowledge and assumptions about future events and involve risks and uncertainties that could cause actual results, performance, or achievements to be materially different from any anticipated results, prospects, performance, or achievements expressed or implied by such forward-looking statements. Such risks and uncertainties include, but are not limited to: impacts of the ongoing COVID-19 pandemic; success in pursuing strategic investments or acquisitions and integration of new businesses and the impact of these new businesses on future results; product purchased not meeting quality and quantity requirements; reliance on a few large customers; our ability to maintain effective information systems and safeguard confidential information; anticipated levels of demand for and supply of our products and services; costs incurred in providing these products and services; timing of shipments to customers; changes in market structure; government regulation; product taxation; industry consolidation and evolution; changes in exchange rates and interest rates; impacts of regulation and litigation on our customers; industry-specific risks related to our plant-based ingredient businesses; exposure to certain regulatory and financial risks related to climate change; changes in estimates and assumptions underlying our critical accounting policies; the promulgation and adoption of new accounting standards; new government regulations and interpretation of existing standards and regulations; and general economic, political, market, and weather conditions. For a further description of factors that may cause actual results to differ materially from such forward-looking statements, see Item 1A, “Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended March 31, 2021. We caution investors not to place undue reliance on any forward-looking statements as these statements speak only as of the date when made, and we undertake no obligation to update any forward-looking statements made in this report. This Form 10-Q should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended March 31, 2021.

Results of Operations

Amounts described as net income (loss) and earnings (loss) per diluted share in the following discussion are attributable to Universal Corporation and exclude earnings related to non-controlling interests in subsidiaries. Adjusted operating income (loss), adjusted net income (loss) attributable to Universal Corporation, adjusted diluted earnings (loss) per share, and the total for segment operating income (loss) referred to in this discussion are non-GAAP financial measures. These measures are not financial measures calculated in accordance with GAAP and should not be considered as substitutes for operating income (loss), net income (loss) attributable to Universal Corporation, diluted earnings (loss) per share, cash from operating activities or any other operating or financial performance measure calculated in accordance with GAAP, and may not be comparable to similarly-titled measures reported by other companies. A reconciliation of adjusted operating income (loss) to consolidated operating (income), adjusted net income (loss) attributable to Universal Corporation to consolidated net income (loss) attributable to Universal Corporation and adjusted diluted earnings (loss) per share to diluted earnings (loss) per share are provided in Other Items below. In addition, we have provided a reconciliation of the total for segment operating income (loss) to consolidated operating income (loss) in Note 15. "Operating Segments" to the consolidated financial statements. Management evaluates the consolidated Company and segment performance excluding certain significant charges or credits. We believe these non-GAAP financial measures, which exclude items that we believe are not indicative of our core operating results, provide investors with important information that is useful in understanding our business results and trends.

Overview

Our operations produced solid results in the nine months ended December 31, 2021. We are especially pleased by the strong results from our Ingredients Operations segment. That segment is developing nicely and was bolstered by our acquisition of Shank’s on October 4, 2021. Shank’s adds valuable capabilities to the segment, including flavors and extracts, custom packaging, bottling, and product development.

We continued to experience the impact of tobacco shipment timing on our results in the nine months and quarter ended December 31, 2021. Tobacco shipments through the nine months ended December 31, 2021, were lower, compared to the same period in fiscal year 2021, in part due to elevated tobacco shipments in the third quarter of fiscal year 2021 related to earlier customer mandated shipment timing. Logistical challenges due to continued limitations in worldwide shipping availability

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stemming from the ongoing COVID-19 pandemic also slowed tobacco shipments in the nine months ended December 31, 2021. However, despite the shipment timing variations and logistical challenges, we believe that our tobacco business remains robust with strong customer demand, and our uncommitted tobacco inventory levels remain well within our target range.

Our businesses have performed well managing global supply chain constraints, particularly shipping availability. However, due to continued lack of containers, trucks, and vessels in certain geographies, we expect that some tobacco shipments from certain origins will be pushed into fiscal year 2023.

Inflationary pressures including higher freight and labor expenses have driven up our costs in both our tobacco and ingredients operations. We are also seeing higher raw materials costs for both tobacco and ingredients products, and we have been working diligently to build these increased costs into our product costs and customer contracts. Despite rising prices, we believe demand remains strong for both our tobacco and ingredients products. While it is still very early, we are also forecasting smaller crops in several key origins for fiscal year 2023.

Sustainability has long been a core tenant of how we conduct our business, and we work to clearly communicate our sustainability goals and efforts. We published our fiscal year 2021 Sustainability Report in December 2021, and it is available on our website, www.universalcorp.com. We are excited about our measurable sustainability goals and targets outlined in the report and are committed to continue to build on our global sustainability programs to reinforce the sustainability of our supply chains.

FINANCIAL HIGHLIGHTS
	Nine Months Ended December 31,						Change
(in millions of dollars, except per share data)	2021			2020			$		%
Consolidated Results
Sales and other operating revenue	$	1,456.6		$	1,365.8		$	90.9	7	%
Cost of goods sold	$	1,170.0		$	1,103.7		$	66.3	6	%
Gross Profit Margin	19.7		%	19.2		%			50 bps
Selling, general and administrative expenses	$	175.5		$	161.2		$	14.4	9	%
Restructuring and impairment costs	$	10.5		$	20.0		$	(9.5)	(48)	%
Operating income (as reported)	$	103.2		$	85.1		$	18.1	21	%
Adjusted operating income (non-GAAP)*	$	116.5		$	107.6		$	8.9	8	%
Diluted earnings per share (as reported)	$	2.44		$	1.94		$	0.50	26	%
Adjusted diluted earnings per share (non-GAAP)*	$	2.76		$	2.59		$	0.17	7	%
Segment Results
Tobacco operations sales and other operating revenues	$	1,268.6		$	1,278.8		$	(10.2)	(1)	%
Tobacco operations operating income	$	105.6		$	107.7		$	(2.1)	(2)	%
Ingredients operations sales and other operating revenues	$	188.0		$	86.9		$	101.1	116	%
Ingredient operations operating income	$	10.6		$	(4.7)		$	15.3	325	%

*See Reconciliation of Certain Non-GAAP Financial Measures in Other Items below.

Net income for the nine months ended December 31, 2021, was $60.8 million, or $2.44 per diluted share, compared with $48.0 million, or $1.94 per diluted share, for the nine months ended December 31, 2020. Excluding restructuring and impairment costs and certain other non-recurring items, detailed in Other Items below, net income and diluted earnings per share increased by $4.5 million and $0.17, respectively, for the nine months ended December 31, 2021, compared to the nine months ended December 31, 2020. Operating income of $103.2 million for the nine months ended December 31, 2021, increased by $18.1 million, compared to operating income of $85.1 million for the nine months ended December 31, 2020. Adjusted operating income, detailed in Other Items below, of $116.5 million increased by $8.9 million for the nine months ended December 31, 2021, compared to adjusted operating income of $107.6 million for the nine months ended December 31, 2020.

Net income for the quarter ended December 31, 2021, was $34.9 million, or $1.40 per diluted share, compared with $33.3 million, or $1.34 per diluted share, for the quarter ended December 31, 2020. Excluding restructuring and impairment costs and certain other non-recurring items, detailed in Other Items below, net income and diluted earnings per share decreased by $9.7

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million and $0.39, respectively, for the quarter ended December 31, 2021, compared to the quarter ended December 31, 2020. Operating income of $62.8 million for the quarter ended December 31, 2021, increased by $2.6 million, compared to operating income of $60.2 million for the quarter ended December 31, 2020. Adjusted operating income, detailed in Other Items below, of $74.9 million decreased by $10.4 million for the third quarter of fiscal year 2022, compared to adjusted operating income of $85.2 million for the third quarter of fiscal year 2021.

Consolidated revenues increased by $90.9 million to $1.5 billion for the nine months ended December 31, 2021, compared to the same period in fiscal year 2021, on the addition of the businesses acquired in the Ingredients Operations segment and a better product mix and higher sales prices in the Tobacco Operations segment. In the quarter ended December 31, 2021, consolidated revenues decreased by $20.3 million to $652.6 million, compared to the quarter ended December 31, 2020, on lower tobacco sales volumes offset in part by a better tobacco product mix and higher tobacco sales prices as well as the inclusion of the Shank’s acquisition in the Ingredients Operations segment.

Tobacco Operations

Operating income for the Tobacco Operations segment decreased by $2.1 million to $105.6 million and by $14.3 million to $69.8 million, respectively, for the nine months and quarter ended December 31, 2021, compared to the same periods in fiscal year 2021. Tobacco Operations segment results declined largely due to tobacco shipment timing, partially offset by a favorable product mix consisting of a higher percentage of lamina tobacco as well as increased value-added services to customers in the nine months and quarter ended December 31, 2021, compared to the nine months and quarter ended December 31, 2020. Africa sales volumes were lower in the nine months and quarter ended December 31, 2021, compared to the same periods in fiscal year 2021, on smaller burley crops as well as slower shipment timing. Sales volumes for Brazil were lower in the nine months ended December 31, 2021, compared to the same period in the prior year, when high volumes of lower margin carryover tobaccos shipped. Vessel and container availability has also been limited in Brazil in fiscal year 2022, which has slowed shipments. In Asia, although trading volumes were down on high freight costs, our operations saw a more favorable product mix, as well as increased value-added services for customers during the nine months and quarter ended December 31, 2021, compared to the same periods in the prior fiscal year. Our operations in Europe experienced higher energy costs in the quarter and nine months ended December 31, 2021, compared to the same periods in the prior fiscal year. Selling, general, and administrative expenses for the Tobacco Operations segment were higher in the nine months and quarter ended December 31, 2021, compared to the nine months and quarter ended December 31, 2020, primarily due to unfavorable foreign currency exchange comparisons, mainly remeasurement. Revenues for the Tobacco Operations segment of $1.3 billion for the nine months and $578.0 million for the quarter ended December 31, 2021, were down $10.2 million and $45.8 million, respectively, compared to the same periods in the prior fiscal year, on lower sales volumes partially offset by a more favorable product mix as well as higher sales prices.

Ingredients Operations

Operating income for the Ingredients Operations segment was $10.6 million and $3.5 million, respectively, for the nine months and quarter ended December 31, 2021, compared to operating losses of $4.7 million and $2.5 million, respectively, for the nine months and quarter ended December 31, 2020. Results for the segment include our October 2020 acquisition of Silva and our October 2021 acquisition of Shank’s. For both the nine months and quarter ended December 31, 2021, our Ingredients Operations saw strong volumes in both human and pet food categories as well as some rebound in demand from sectors that have been impacted by the ongoing COVID-19 pandemic. In addition, the segment saw strong sales of organic-based products, certain dehydrated products, and flavors and extracts. Selling, general, and administrative expenses for the segment increased in the nine months and quarter ended December 31, 2021, compared to the same periods in the prior fiscal year, on the addition of the acquired businesses. Revenues for the Ingredients Operations segment increased by $101.1 million to $188.0 million and by $25.6 million to $74.6 million, respectively, for the nine months and quarter ended December 31, 2021, compared to the nine months and quarter ended December 31, 2020, primarily on the addition of the revenues for the acquired businesses.

COVID-19 Pandemic Impact

On March 11, 2020, the World Health Organization declared the coronavirus (“COVID-19”) a pandemic. Foreign governmental organizations and governmental organizations in the United States have taken various actions to combat the spread of COVID-19 and its subsequent variants, including imposing stay-at-home orders, closing “non-essential” businesses and their operations, and restricting international travel. We continue to closely monitor developments related to the ongoing COVID-19 pandemic and have taken and continue to take steps intended to mitigate the potential risks and impacts to us. It is paramount that our employees who operate our businesses are safe and informed. We have assessed and regularly update our existing business continuity plans for our business in the context of this pandemic. For example, we have taken precautions during the pandemic with regard to employee and facility hygiene, imposed travel limitations on our employees, implemented work-from-home procedures, and we continue to assess and reevaluate protocols designed to protect our employees, customers and the public.

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We continue to work with our suppliers to mitigate the impacts to our supply chain due to the ongoing pandemic. To date, we have not experienced a material impact to our supply chain, although the ongoing COVID-19 pandemic resulted in delays in certain operations during fiscal year 2021. Since March 2020, we have at times also experienced increased volatility in foreign currency exchange rates, which we believe is in part related to the continued uncertainties from COVID-19, as well as actions taken by governments and central banks in response to COVID-19. We are currently seeing and monitoring some logistical constraints around worldwide vessel and container availability and increased costs stemming from the ongoing COVID-19 pandemic.

We believe we currently have sufficient liquidity to meet our current obligations and our business operations remain fundamentally unchanged other than shipping delays, which could continue to impact quarterly comparisons. This is, however, a rapidly evolving situation, and we cannot predict the extent, resurgence, or duration of the ongoing COVID-19 pandemic, the effects of it on the global, national or local economy, including the impacts on our ability to access capital, or its effects on our business, financial position, results of operations, and cash flows. We continue to monitor developments affecting our employees, customers and operations. We will take additional steps and reevaluate current protocols to address the spread of COVID-19 and its impacts, as necessary, and remain thankful for the hard work of our employees and the continued support of our customers, growers, and other partners during these challenging times.

Other Items

Cost of goods sold in the nine months ended December 31, 2021, increased by 6% to $1.2 billion and decreased by 2% to $521.2 million in the quarter ended December 31, 2021, compared with the same periods in the prior fiscal year, as a result of the acquisitions in our Ingredients Operations segment as well as variances in volumes and product mix in the Tobacco Operations segment. Selling, general, and administrative costs for the nine months and quarter ended December 31, 2021, increased by $14.4 million to $175.5 million and by $0.9 million to $60.3 million, respectively, compared to the same periods in the prior fiscal year, on additional costs from the acquisitions in the Ingredients Operations segment as well as unfavorable foreign currency comparisons, mainly remeasurement, partially offset by lower compensation costs in the Tobacco Operations segment. Unfavorable foreign currency comparisons were approximately $11.5 million and $5.0 million, respectively, in the nine months and quarter ended December 31, 2021, compared to the same periods in the prior year. Interest expense for the nine months and quarter ended December 31, 2021, increased by $1.7 million to $20.8 million and by $0.7 million to $7.5 million, respectively, largely on higher average debt balances and interest rates.

For the nine months and quarter ended December 31, 2021, the Company’s effective tax rate on pre-tax income was 21.0% and 23.4% respectively. In the nine months ended December 31, 2021, the Company recognized a $1.7 million income tax benefit related to a final tax ruling at a foreign subsidiary and a $1.2 million benefit in the third fiscal quarter of 2022 due to finalizing the prior year U.S. tax return. Without these income tax benefits, the adjusted effective tax rate for the nine months and quarter ended December 31, 2021, would have been 24.2% and 25.5%, respectively.

For the nine months and quarter ended December 31, 2020, our consolidated effective tax rate was 18.6% and 26.5%, respectively. For the nine months ended December 31, 2020, income tax expense included a $4.4 million benefit for final tax regulations regarding the treatment of dividends paid by foreign subsidiaries and a $2.9 million benefit in the third fiscal quarter of 2021 due to amending and finalizing prior year U.S. tax returns. Without these income tax benefits, the consolidated effective tax rate for the nine months and quarter ended December 31, 2020, would have been approximately 29.3% and 31.7%, respectively.

Reconciliation of Certain Non-GAAP Financial Measures

The following tables set forth certain non-recurring items included in reported results to reconcile adjusted operating income to consolidated operating income and adjusted net income to net income attributable to Universal Corporation:

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Adjusted Operating Income Reconciliation
	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands)	2021		2020		2021		2020
As Reported: Consolidated operating income	$	62,773	$	60,186	$	103,191	$	85,065
Purchase accounting adjustment (1)	3,057		2,800		3,057		2,800
Transaction costs for acquisitions(2)	597		2,252		2,310		3,915
Restructuring and impairment costs(3)	8,433		19,979		10,457		19,979
Fair value adjustment to contingent consideration for FruitSmart acquisition(4)	—		—		(2,532)		(4,173)
Adjusted operating income	$	74,860	$	85,217	$	116,483	$	107,586
Adjusted Net Income and Diluted Earnings Per Share
(in thousands and reported net of income taxes)	Three Months Ended December 31,				Nine Months Ended December 31,
	2021		2020		2021		2020
As Reported: Net income available to Universal Corporation	$	34,940	$	33,273	$	60,807	$	48,049
Purchase accounting adjustment (1)	2,415		2,800		2,415		2,800
Transaction costs for acquisitions(2)	482		2,252		2,195		3,915
Restructuring and impairment costs(3)	6,874		16,100		7,879		16,100
Fair value adjustment to contingent consideration for FruitSmart acquisition(4)	—		—		(2,532)		(4,173)
Interest (income) expense related to tax matters at foreign subsidiaries	—		—		(470)		1,849
Income tax benefit on a final tax ruling (fiscal year 2022) and dividends paid from foreign subsidiaries (fiscal year 2021)(5)	—		—		(1,686)		(4,421)
Adjusted net income available to Universal Corporation	$	44,711	$	54,425	$	68,608	$	64,119
As reported: Diluted earnings per share	$	1.40	$	1.34	$	2.44	$	1.94
As adjusted: Diluted earnings per share	$	1.80	$	2.19	$	2.76	$	2.59

(1)The Company recognized an increase in cost of goods sold in the third quarters of fiscal year 2022 and 2021, relating to the expensing of fair value adjustments to inventory associated with the acquisition accounting for Shank's (effective October 4, 2021) and Silva (effective October 1, 2020). The adjustment related to the Silva acquisition is not deductible for U.S. income tax purposes.

(2)The Company incurred selling, general, and administrative expenses for due diligence and other transaction costs associated with the acquisitions of Shank's and Silva. A portion of these costs is not deductible for U.S. income tax purposes..

(3)Restructuring and impairment costs are included in Consolidated operating income in the consolidated statements of income, but excluded for purposes of Adjusted operating income, Adjusted net income available to Universal Corporation, and Adjusted diluted earnings per share. See Note 4 for additional information.

(4)The Company reversed the contingent consideration liability for the FruitSmart acquisition, as a result of certain performance metrics that did not meet the required threshold stipulated in the purchase agreement.

(5)The Company recognized income tax benefits related to a favorable final income tax ruling at a foreign subsidiary (fiscal year 2022) and final U.S. tax regulations on certain dividends paid by foreign subsidiaries (fiscal year 2021).

Liquidity and Capital Resources

Overview

After significant seasonal working capital investment in our tobacco operations in the first half of the fiscal year, we generally see tobacco inventory levels and other working capital items decrease in the second half of our fiscal year as tobacco crops in Africa, South America, and North America are being shipped. We saw the beginning of the seasonal contraction in our working capital requirements by the end of the third quarter of fiscal year 2022, however, that contraction has been smaller than in fiscal year 2021 largely due to tobacco shipment timing. We funded our working capital needs in the nine months ended

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December 31, 2021, using a combination of cash on hand, short-term borrowings, customer advances, and operating cash flows. We expect tobacco crop shipments to continue to be weighted to the second half of the fiscal year with significant shipments expected in our fourth fiscal quarter.

Our liquidity and operating capital resource requirements are predominantly short term in nature and primarily relate to working capital for tobacco crop purchases. Working capital needs are seasonal within each geographic region. The geographic dispersion and the timing of working capital needs permit us to predict our general level of cash requirements, although tobacco crop size, prices paid to farmers, shipment and delivery timing, and currency fluctuations affect requirements each year. Peak working capital requirements are generally reached during the first and second fiscal quarters. Each geographic area follows a cycle of buying, processing, and shipping tobacco, and in many regions, we also provide agricultural materials to farmers during the growing season. The timing of the elements of each cycle is influenced by such factors as local weather conditions and individual customer shipping requirements, which may change the level or the duration of crop financing. Despite a predominance of short-term needs, we maintain a portion of our total debt as long-term to reduce liquidity risk. We also periodically have large cash balances that we utilize to meet our working capital requirements.

To date, the ongoing COVID-19 pandemic has not had a material impact on our operations, although we are seeing logistical constraints around worldwide vessel and container availability and increased costs stemming from the ongoing COVID-19 pandemic. We currently anticipate our current cash balances, cash flows from operations, and our available sources of liquidity will be sufficient to meet our cash requirements for at least the next twelve months. This is, however, a rapidly evolving situation, and we cannot predict the extent, resurgence, or duration of the ongoing COVID-19 pandemic, the effects of it on the global, national or local economies, including the impacts on our ability to access capital, or its effects on our business, financial position, results of operations, and cash flows. We continue to monitor developments affecting our employees, customers and operations.

Our balance sheet at December 31, 2021, also reflects our acquisition of Shank’s on October 4, 2021. The acquisition was financed using a combination of cash on hand and borrowings under our committed revolving credit facility.

Operating Activities

We used $51.6 million in net cash flows from our operations during the nine months ended December 31, 2021. That amount was higher than during the same period last fiscal year when we generated $38.6 million in net cash flows largely due to tobacco shipment timing. Tobacco inventory levels increased by $214.9 million from March 31, 2021 levels to $855.6 million at December 31, 2021, on seasonal leaf purchases. Tobacco inventory levels were $41.3 million above December 31, 2020 levels, mainly due to shipment timing. We generally do not purchase material quantities of tobacco on a speculative basis. However, when we contract directly with tobacco farmers, we are often obligated to buy all stalk positions, which may contain less marketable leaf styles. At December 31, 2021, our uncommitted tobacco inventories were $132.0 million, or about 15% of total tobacco inventory, compared to $139.2 million, or about 22% of our March 31, 2021 tobacco inventory, and $155.7 million, or about 19% of our December 31, 2020 tobacco inventory. While we target committed inventory levels of 80% or more of total tobacco inventory, the level of these uncommitted inventory percentages is influenced by timing of farmer deliveries of new crops, as well as the receipt of customer orders.

Our balance sheet accounts reflected seasonal patterns in the nine months ended December 31, 2021, on deliveries of tobacco crops by farmers in both South America, Africa, and North America. Cash and cash equivalent balances decreased by $97.9 million from March 31, 2021 levels, as we used cash, including collections on receivables, to fund seasonal working capital needs. Accounts receivable were $400.1 million at December 31, 2021, an increase of $32.6 million from March 31, 2021, mainly on seasonal increases. Goodwill and other intangibles and notes payable and overdrafts were up by $64.5 million and $151.3 million, respectively, compared from March 31, 2021 levels, mainly due the Shank’s acquisition in our Ingredients Operations segment. Accounts payable and accrued expenses increased by $81.9 million from March 31, 2021 levels, primarily on tobacco purchases.

Accounts receivable were up $45.5 million for the nine months ended December 31, 2021, compared to the same period in the prior fiscal year, on the timing of tobacco shipments. Notes payable and overdrafts increased by $123.0 million in the nine months ended December 31, 2021, compared to the same period in the prior fiscal year, largely on the Shank’s acquisition. Accounts payable and accrued expenses were up $65.0 million in the nine months ended December 31, 2021, compared to the same period in the prior fiscal year, primarily on tobacco purchases.

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Investing Activities

Our capital allocation strategy focuses on four strategic priorities: strengthening and investing for growth in our leaf tobacco business; increasing our strong dividend; exploring growth opportunities for our plant-based ingredients platform that utilize our assets and capabilities; and returning excess capital to our shareholders. In deciding where to invest capital resources, we look for opportunities where we believe we can earn an adequate return as well as leverage our assets and expertise or enhance our farmer base. In line with our capital allocation strategy, we acquired Shank’s for approximately $100 million on October 4, 2021. In the quarter ended December 31, 2021, we also spent approximately $13 million to purchase the real property assets related to the Shank’s acquisition. The acquisition expands our plant-based ingredients platform, adding to our product offerings and growing the value-added services available to our customers by adding flavors and extracts, custom packaging, bottling, and product development capabilities.

Our capital expenditures are generally limited to those that add value, replace or maintain equipment, increase efficiency, or position us for future growth. During the nine months ended December 31, 2021 and 2020, we invested about $39.8 million and $33.8 million, respectively, in our property, plant and equipment. Depreciation expense was approximately $30.4 million and $28.6 million for the nine months ended December 31, 2021 and 2020, respectively. Typically, our capital expenditures for maintenance projects are less than $30 million per fiscal year. In addition, from time to time, we undertake projects that require capital expenditures when we identify opportunities to improve efficiencies, add value for our customers, and position ourselves for future growth. We currently expect to spend approximately $45 to $55 million over the next twelve months on capital projects for maintenance of our facilities and other investments to grow and improve our businesses.

Our Board of Directors approved our current share repurchase program in November 2020. The program authorizes the purchase of up to $100 million of our common stock through November 15, 2022. Under the current authorization, we may purchase shares from time to time on the open market or in privately negotiated transactions at prices not exceeding prevailing market rates. Repurchases of shares under the repurchase program may vary based on management discretion, as well as changes in cash flow generation and availability. During the three months ended December 31, 2021, we did not purchase any shares of common stock. As of December 31, 2021, approximately 24.6 million shares of our common stock were outstanding and our available authorization under our current share repurchase program was $100 million.

Financing Activities

On October 4, 2021, we acquired Shank’s for approximately $100 million. In the quarter ended December 31, 2021, we also spent approximately $13 million to purchase the real property assets related to the Shank’s acquisition. We financed the acquisition and real property assets using cash-on-hand and borrowings under our committed revolving credit facility.

We consider the sum of notes payable and overdrafts, long-term debt (including any current portion), and customer advances and deposits, less cash, cash equivalents, and short-term investments on our balance sheet to be our net debt. We also consider our net debt plus shareholders' equity to be our net capitalization. Net debt as a percentage of net capitalization was approximately 35% at December 31, 2021, up from the December 31, 2020 level of approximately 31%, largely on higher debt balances due in part to the Shank’s acquisition in October 2021, and up from the March 31, 2021 level of approximately 25% on the acquisition and seasonal working capital borrowings. As of December 31, 2021, we had $99.3 million in cash and cash equivalents, our short-term debt totaled $252.6 million, and we were in compliance with all covenants of our debt agreements, which require us to maintain certain levels of tangible net worth and observe restrictions on debt levels.

As of December 31, 2021, we had $260 million available under a committed revolving credit facility that will mature in December 2023, and we had about $188 million in unused, uncommitted credit lines. We also maintain an effective, undenominated universal shelf registration statement that provides for future issuance of additional debt or equity securities. We have no long-term debt maturing until fiscal year 2024. Our seasonal working capital requirements for our tobacco business typically increase significantly between March and September and decline after mid-year. Available capital resources from our cash balances, committed credit facility, and uncommitted credit lines exceed our normal working capital needs and currently anticipated capital expenditure requirements over the next twelve months.

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Derivatives

From time to time, we use interest rate swap agreements to manage our exposure to changes in interest rates. At December 31, 2021, the fair value of our outstanding interest rate swap agreements was a liability of about $17 million, and the notional amount swapped was $370 million. We entered into these agreements to eliminate the variability of cash flows in the interest payments on a portion of our variable-rate term loans. Under the swap agreements we receive variable rate interest and pay fixed rate interest. The swaps are accounted for as cash flow hedges.

We also use derivative instruments from time to time to hedge certain foreign currency exposures, primarily related to forecasted purchases of tobacco, related processing costs, and crop input sales in Brazil, as well as our net monetary balance sheet exposures in local currency there. We generally account for our hedges of forecasted tobacco purchases as cash flow hedges. At December 31, 2021, the fair value of our open hedges was a net liability of about $1.8 million. We had forward contracts outstanding that were not designated as hedges, and the fair value of those contracts was a net asset of approximately $0.1 million at December 31, 2021.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Currency

The international leaf tobacco trade generally is conducted in U.S. dollars, thereby limiting foreign exchange risk to that which is related to leaf purchase and production costs, overhead, and income taxes in the source country. We also provide farmer advances that are directly related to leaf purchases and are denominated in the local currency. Any currency gains or losses on those advances are usually offset by decreases or increases in the cost of tobacco, which is priced in the local currency. However, the effect of the offset may not occur until a subsequent quarter or fiscal year. Most of our tobacco operations are accounted for using the U.S. dollar as the functional currency. Because there are no forward foreign exchange markets in many of our major countries of tobacco origin, we often manage our foreign exchange risk by matching funding for inventory purchases with the currency of sale, which is usually the U.S. dollar, and by minimizing our net local currency monetary position in individual countries. We are vulnerable to currency remeasurement gains and losses to the extent that monetary assets and liabilities denominated in local currency do not offset each other. In addition to foreign exchange gains and losses, we are exposed to changes in the cost of tobacco due to changes in the value of the local currency in relation to the U.S. dollar. We routinely enter forward currency exchange contracts to hedge against the effects of currency movements on purchases of tobacco to reduce the volatility of costs. In addition, from time-to-time we enter forward contracts to hedge balance sheet exposures.

In certain tobacco markets that are primarily domestic, we use the local currency as the functional currency. Examples of these markets are Poland and the Philippines. In other markets, such as Western Europe, where export sales have been primarily in local currencies, we also use the local currency as the functional currency. In each case, reported earnings are affected by the translation of the local currency into the U.S. dollar.

Interest Rates

We generally use both fixed and floating interest rate debt to finance our operations. Changes in market interest rates expose us to changes in cash flows for floating rate instruments and to changes in fair value for fixed-rate instruments. We normally maintain a proportion of our debt in both variable and fixed interest rates to manage this exposure, and from time to time we may enter hedge agreements to swap the interest rates. In addition, our customers may pay market rates of interest for inventory purchased on order, which could mitigate a portion of the floating interest rate exposure. We also periodically have large cash balances and may receive deposits from customers, both of which we use to fund seasonal purchases of tobacco, reducing our financing needs. Excluding the portion of our bank term loans that have been converted to fixed-rate borrowings with interest rate swaps, debt carried at variable interest rates was approximately $403 million at December 31, 2021. Although a hypothetical 1% change in short-term interest rates would result in a change in annual interest expense of approximately $4.0 million, that amount would be at least partially mitigated by changes in charges to customers.

Derivatives Policies

Hedging interest rate exposure using swaps and hedging foreign exchange exposure using forward contracts are specifically contemplated to manage risk in keeping with management's policies. We may use derivative instruments, such as swaps, forwards, or futures, which are based directly or indirectly upon interest rates and currencies to manage and reduce the risks inherent in interest rate and currency fluctuations. When we use foreign currency derivatives to mitigate our exposure to exchange rate fluctuations, we may choose not to designate them as hedges for accounting purposes, which may result in the effects of the derivatives being recognized in our earnings in periods different from the items that created the exposure.

We do not utilize derivatives for speculative purposes, and we do not enter into market risk-sensitive instruments for trading purposes. Derivatives are transaction specific so that a specific debt instrument, forecast purchase, contract, or invoice determines the amount, maturity, and other specifics of the hedge. We routinely review counterparty risk as part of our derivative program.

38

ITEM 4. CONTROLS AND PROCEDURES

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in reports we file under the Securities Exchange Act of 1934 (the “Exchange Act”), as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to management, including our Chief Executive Officer (our Principal Executive Officer) and Chief Financial Officer (our Principal Financial Officer), as appropriate, to allow for timely decisions regarding required disclosure.

We have excluded Shank's Extracts, LLC ("Shank's"), our wholly-owned subsidiary we acquired on October 4, 2021, which is included in our Consolidated Financial Statements, from our assessment of internal control over financial reporting as of December 31, 2021. Shank's represented 5% of consolidated total assets as of December 31, 2021 and 1% of consolidated sales and other operating revenues for the nine months ending December 31, 2021. Our Chief Executive Officer and Chief Financial Officer evaluated, with the participation of other members of management, the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on this evaluation, management concluded that our disclosure controls and procedures were effective.

There have been no changes in our internal control over financial reporting during our last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

39

PART II. OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

Other Legal Matters

Some of our subsidiaries are involved in litigation or legal matters incidental to their business activities.  While the outcome of these matters cannot be predicted with certainty, we are vigorously defending them and do not currently expect that any of them will have a material adverse effect on our business or financial position. However, should one or more of these matters be resolved in a manner adverse to our current expectation, the effect on our results of operations for a particular fiscal reporting period could be material.

ITEM 1A. RISK FACTORS

As of the date of this report, there are no material changes to the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended March 31, 2021 (the "2021 Annual Report on Form 10-K"). In evaluating our risks, readers should carefully consider the risk factors discussed in our 2021 Annual Report on Form 10-K, which could materially affect our business, financial condition or operating results, in addition to the other information set forth in this report and in our other filings with the Securities and Exchange Commission.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

    As indicated in the following table, we did not repurchase shares of our common stock during the three-month period ended December 31, 2021:

Period (1)	Total Number of Shares Repurchased	Average Price Paid Per Share (2)		Total Number of Shares Repurchased as Part of Publicly Announced Plans or Programs (3)	Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (3)
October 1-31, 2021	—	$	—	—	$	100,000,000
November 1-30, 2021	—	—		—	100,000,000
December 1-31, 2021	—	—		—	100,000,000
Total	—	$	—	—	$	100,000,000

(1)Repurchases are based on the date the shares were traded. This presentation differs from the consolidated statement of cash flows, where the cost of share repurchases is based on the date the transactions were settled.

(2)Amounts listed for average price paid per share include broker commissions paid in the transactions.

(3)A stock repurchase plan, which was authorized by our Board of Directors, became effective and was publicly announced on November 5, 2020. This stock repurchase plan authorizes the purchase of up to $100 million in common and/or preferred stock in open market or privately negotiated transactions through November 15, 2022 or when we have exhausted the funds authorized for the program, subject to market conditions and other factors.

40

 ITEM 6.   EXHIBITS

31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350.*
32.2	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350.*
101	Interactive Data File (submitted electronically herewith).*
	101.INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. 101.SCH XBRL Taxonomy Extension Schema Document 101.CAL XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF XBRL Taxonomy Extension Definition Linkbase Document 101.LAB XBRL Taxonomy Extension Label Linkbase Document 101.PRE XBRL Taxonomy Extension Presentation Linkbase Document In accordance with Rule 406T of Regulation S-T, the XBRL related information in Exhibit 101 to this Quarterly Report on Form 10-Q shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section and shall not be part of any registration or other document filed under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

    __________

    *Filed herewith

41

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date:	February 2, 2022	UNIVERSAL CORPORATION
		(Registrant)
		/s/ Johan C. Kroner
		Johan C. Kroner, Senior Vice President and Chief Financial Officer
		(Principal Financial Officer)
		/s/ Scott J. Bleicher
		Scott J. Bleicher, Vice President and Controller
		(Principal Accounting Officer)

42

EX-31.1

Exhibit 31.1

CERTIFICATION

I, George C. Freeman, III, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Universal Corporation for the period ended December 31, 2021;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of the annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	February 2, 2022	/s/ George C. Freeman, III
		George C. Freeman, III
		Chairman, President, and Chief Executive Officer
		(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Johan C. Kroner, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Universal Corporation for the period ended December 31, 2021;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of the annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	February 2, 2022	/s/ Johan C. Kroner
		Johan C. Kroner
		Senior Vice President and Chief Financial Officer
		(Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of Universal Corporation (the “Company”) on Form 10-Q for the period ended December 31, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”) and pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, I, George C. Freeman, III, certify, to the best of my knowledge and belief, that:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	February 2, 2022	/s/ George C. Freeman, III
		George C. Freeman, III
		Chairman, President, and Chief Executive Officer
		(Principal Executive Officer)

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of Universal Corporation (the “Company”) on Form 10-Q for the period ended December 31, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”) and pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, I, Johan C. Kroner, certify, to the best of my knowledge and belief, that:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	February 2, 2022	/s/ Johan C. Kroner
		Johan C. Kroner
		Senior Vice President and Chief Financial Officer
		(Principal Financial Officer)

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document Information - shares	9 Months Ended
	Dec. 31, 2021	Jan. 31, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Amendment Flag	false
Document Period End Date	Dec. 31, 2021
Entity File Number	001-00652
Entity Registrant Name	UNIVERSAL CORPORATION
Entity Incorporation, State or Country Code	VA
Entity Tax Identification Number	54-0414210
Entity Address, Address Line One	9201 Forest Hill Avenue,
Entity Address, City or Town	Richmond,
Entity Address, State or Province	VA
Entity Address, Postal Zip Code	23235
City Area Code	804
Local Phone Number	359-9311
Title of 12(b) Security	Common Stock, no par value
Trading Symbol	UVV
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		24,608,283
Entity Central Index Key	0000102037
Current Fiscal Year End Date	--03-31
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2022

XML

Consolidated Statements Of Income And Comprehensive Income - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Income Statement [Abstract]
Sales and other operating revenues		$ 652,644	$ 672,931	$ 1,456,628	$ 1,365,767
Costs and expenses
Cost of goods sold		521,171	533,431	1,169,999	1,103,744
Selling, general and administrative expenses		60,267	59,335	175,513	161,152
Other income	[1]	0	0	(2,532)	(4,173)
Restructuring and impairment costs	[2]	8,433	19,979	10,457	19,979
Operating income		62,773	60,186	103,191	85,065
Equity in pretax earnings (loss) of unconsolidated affiliates	[3]	2,084	1,506	5,056	2,089
Other non-operating income (expense)		56	30	158	(8)
Interest income		209	2	799	262
Interest expense		7,462	6,735	20,800	19,140
Income before income taxes and other items		57,660	54,989	88,404	68,268
Income taxes		13,505	14,548	18,582	12,678
Net income		44,155	40,441	69,822	55,590
Less: net loss (income) attributable to noncontrolling interests in subsidiaries		(9,215)	(7,168)	(9,015)	(7,541)
Net income attributable to Universal Corporation		$ 34,940	$ 33,273	$ 60,807	$ 48,049
Earnings per share:
Basic		$ 1.41	$ 1.35	$ 2.46	$ 1.95
Diluted		$ 1.40	$ 1.34	$ 2.44	$ 1.94
Weighted average common shares outstanding:
Basic		24,792,108	24,677,122	24,761,290	24,646,342
Diluted		24,949,091	24,818,918	24,912,644	24,764,439
Total comprehensive income (loss)
Total comprehensive income, net of income taxes		$ 45,862	$ 55,681	$ 72,277	$ 84,950
Less: comprehensive (income) loss attributable to noncontrolling interests		(9,201)	(7,114)	(8,845)	(7,566)
Comprehensive income (loss) attributable to Universal Corporation		$ 36,661	$ 48,567	$ 63,432	$ 77,384
Dividends declared per common share		$ 0.78	$ 0.77	$ 2.34	$ 2.31

[1] Other income represents the reversal of a portion of the contingent consideration liability associated with the acquisition of FruitSmart. See Note 12 for additional information.

[2] Restructuring and impairment costs are excluded from segment operating income, but are included in consolidated operating income in the consolidated statements of income and comprehensive income. See Note 4 for additional information.

[3] Equity in pretax earnings (loss) of unconsolidated affiliates is included in segment operating income (Tobacco Operations), but is reported below consolidated operating income and excluded from that total in the consolidated statements of income and comprehensive income.

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
ASSETS
Cash and cash equivalents	$ 99,305	$ 197,221	$ 95,405
Accounts receivable, net	400,132	367,482	354,676
Advances to suppliers, net	126,830	121,618	102,795
Accounts receivable—unconsolidated affiliates	1,909	584	6,197
Inventories—at lower of cost or net realizable value:
Tobacco	855,587	640,653	814,287
Other	161,704	145,965	144,333
Prepaid income taxes	23,590	15,029	18,174
Other current assets	76,255	66,806	68,928
Total current assets	1,745,312	1,555,358	1,604,795
Property, plant and equipment
Land	24,752	22,400	22,499
Buildings	296,642	284,430	268,377
Machinery and equipment	662,504	658,826	662,854
Total property, plant and equipment	983,898	965,656	953,730
Less accumulated depreciation	(636,042)	(616,146)	(621,928)
Property, plant and equipment, net	347,856	349,510	331,802
Other assets
Operating lease right-of-use assets	34,139	31,230	34,717
Goodwill, net	214,023	173,051	180,655
Other intangibles, net	95,790	72,304	74,710
Investments in unconsolidated affiliates	81,040	84,218	85,610
Deferred income taxes	15,676	12,149	22,281
Pension asset	13,495	11,950	0
Other noncurrent assets	46,197	52,154	54,071
Total other assets	500,360	437,056	452,044
Total assets	2,593,528	2,341,924	2,388,641
LIABILITIES AND SHAREHOLDERS' EQUITY
Notes payable and overdrafts	252,609	101,294	129,603
Accounts payable and accrued expenses	221,374	139,484	156,421
Accounts payable—unconsolidated affiliates	8,788	1,282	7,416
Customer advances and deposits	26,341	8,765	14,498
Accrued compensation	18,803	29,918	22,744
Income taxes payable	10,742	4,516	6,650
Current portion of operating lease liabilities	9,128	7,898	9,014
Current portion of long-term debt	0	0	0
Total current liabilities	547,785	293,157	346,346
Long-term debt	518,547	518,172	518,047
Pensions and other postretirement benefits	52,624	57,637	66,764
Long-term operating lease liabilities	22,612	19,725	22,709
Other long-term liabilities	49,235	59,814	71,346
Deferred income taxes	43,483	44,994	46,414
Total liabilities	1,234,286	993,499	1,071,626
Shareholders' equity
Series A Junior Participating Preferred Stock, no par value, 500,000 shares authorized, none issued or outstanding	0	0	0
Common stock, no par value, 100,000,000 shares authorized 24,607,384 shares issued and outstanding at December 31, 2021 (24,514,867 at December 31, 2020 and 24,514,867 at March 31, 2021)	330,306	326,673	325,350
Retained earnings	1,090,110	1,087,663	1,067,437
Accumulated other comprehensive loss	(104,412)	(107,037)	(122,262)
Total Universal Corporation shareholders' equity	1,316,004	1,307,299	1,270,525
Noncontrolling interests in subsidiaries	43,238	41,126	46,490
Total shareholders' equity	1,359,242	1,348,425	1,317,015
Total liabilities and shareholders' equity	$ 2,593,528	$ 2,341,924	$ 2,388,641

XML

Consolidated Balance Sheets (Parenthetical) - shares	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
Common Stock [Member]
Common stock, shares authorized	100,000,000	100,000,000	100,000,000
Common stock, shares issued	24,607,384	24,514,867	24,514,867
Common stock, shares outstanding	24,607,384	24,514,867	24,514,867
Series A Junior Participating Preferred Stock [Member]
Preferred stock, shares authorized	500,000	500,000	500,000
Preferred stock, shares issued	0	0	0
Preferred stock, shares outstanding	0	0	0

XML

Consolidated Statements Of Cash Flows - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income		$ 44,155	$ 40,441	$ 69,822	$ 55,590
Adjustments to reconcile net income to net cash used by operating activities:
Depreciation and amortization				39,110	32,626
Net provision for losses (recoveries) on advances to suppliers				2,864	2,753
Foreign currency remeasurement (gain) loss, net				6,829	(8,823)
Foreign currency exchange contracts				1,980	(7,723)
Restructuring and impairment costs	[1]	8,433	19,979	10,457	19,979
Restructuring payments				(3,787)	(5,179)
Change in estimated fair value of contingent consideration for FruitSmart acquisition				2,532	4,173
Other, net				1,814	5,260
Changes in operating assets and liabilities, net				(178,133)	(51,687)
Net cash provided (used) by operating activities				(51,576)	38,623
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment				(39,831)	(33,794)
Purchase of business, net of cash held by the business				(102,462)	(161,095)
Proceeds from sale of property, plant and equipment				12,609	4,086
Other				0	(800)
Net cash used by investing activities				(129,684)	(191,603)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of short-term debt, net				151,413	57,207
Issuance of long-term debt				0	150,000
Dividends paid to noncontrolling interests		(2,057)	0	(6,733)	(3,695)
Dividends paid on common stock				(57,241)	(56,301)
Other				(3,264)	(1,949)
Net cash provided (used) by financing activities				84,175	145,262
Effect of Exchange Rate on Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents				(831)	1,693
Net decrease in cash, restricted cash and cash equivalents				(97,916)	(6,025)
Cash, restricted cash and cash equivalents at beginning of year				203,221	107,430
Cash, restricted cash and cash equivalents at end of period		105,305	101,405	105,305	101,405
Supplemental Cash Flow Information [Abstract]
Cash and cash equivalents		99,305	95,405	99,305	95,405
Restricted cash (Other noncurrent assets)		6,000	6,000	6,000	6,000
Total cash, restricted cash and cash equivalents		$ 105,305	$ 101,405	$ 105,305	$ 101,405

[1] Restructuring and impairment costs are excluded from segment operating income, but are included in consolidated operating income in the consolidated statements of income and comprehensive income. See Note 4 for additional information.

XML

Basis Of Presentation	9 Months Ended
	Dec. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis Of Presentation	BASIS OF PRESENTATION Universal Corporation, which together with its subsidiaries is referred to herein as “Universal” or the “Company,” is a global business-to-business agri-products supplier to consumer product manufacturers. The Company is the leading global leaf tobacco supplier and provides high-quality plant-based ingredients to food and beverage end markets. Because of the seasonal nature of the Company’s business, the results of operations for any fiscal quarter will not necessarily be indicative of results to be expected for other quarters or a full fiscal year. All adjustments necessary to state fairly the results for the period have been included and were of a normal recurring nature. This Form 10-Q should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2021.    The extent to which the ongoing COVID-19 pandemic will impact the Company's financial condition, results of operations and demand for its products and services will depend on future developments, which are highly uncertain and cannot be predicted. Such developments may include the ongoing geographic spread and mutations of COVID-19, the severity of the pandemic, the duration of the COVID-19 outbreak and the type and duration of actions that may be taken by various governmental authorities in response to the COVID-19 pandemic and the impact on the U.S. and the global economies, markets and supply chains. At December 31, 2021, it is not possible to predict the overall impact of the ongoing COVID-19 pandemic on the Company's business, financial condition, results of operations and demand for its products and services.

XML

Accounting Pronouncements

9 Months Ended

Dec. 31, 2021

Accounting Standards Update and Change in Accounting Principle [Abstract]

Accounting Pronouncements

ACCOUNTING PRONOUNCEMENTS

Recently Adopted Pronouncements

In December 2019, the FASB issued Accounting Standards Update No. 2019-12, “Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes” (“ASU 2019-12”). ASU 2019-12 eliminates certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences related to changes in ownership of equity method investments and foreign subsidiaries. The updated guidance also simplifies aspects of accounting for franchise taxes and enacted changes in tax laws or rates, and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The guidance in ASU 2019-12 is effective for fiscal years beginning after December 15, 2020, although early adoption is permitted. The Company adopted the new standard effective April 1, 2021, which was the beginning of its fiscal year ending March 31, 2022. There was no material impact to the consolidated financial statements from the adoption of ASU 2019-12.

Pronouncements to be Adopted in Future Periods

In March 2020, the FASB issued Accounting Standards Update No. 2020-04, "Reference Rate Reform (Topic 848) - Facilitation of the Effects of Reference Rate Reform on Financial Reporting" ("ASU 2020-04"). ASU 2020-04 provides optional expedients and exceptions related to contract modifications and hedge accounting to address the transitions from the London Interbank Offered Rate ("LIBOR") and other interbank offered rates to alternative reference rates. The guidance permits an entity to consider contract modification due to reference rate reform to be an event that does not require contract remeasurement at the modification date or reassessment of a previous accounting determination. ASU 2020-04 also temporarily allows hedge relationships to continue without de-designation upon changes due to reference rate reform. The standard is effective upon issuance and can be applied as of March 12, 2020 through December 31, 2022. The Company is currently evaluating the impact that the guidance will have on its consolidated financial statements.

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Business Combinations

9 Months Ended

Dec. 31, 2021

Business Combinations [Abstract]

Business Combination Disclosure [Text Block]

BUSINESS COMBINATION

Acquisition of Shank's Extracts, LLC

On October 4, 2021, the Company acquired 100% of the capital stock of Shank's Extract's, LLC. (“Shank's”), a flavors and extracts processing company, for approximately $100 million in cash and $2.4 million of additional working capital on-hand at the date of acquisition. The acquisition of Shank's diversifies the Company's product offerings and generates new opportunities for its plant-based ingredients platform.

The purchase price allocation for Shank's as of the date of acquisition was based on a preliminary valuation and is subject to revision as more detailed analyses are completed and additional information about the fair value of assets acquired and liabilities assumed becomes available. A portion of the goodwill recorded as part of the acquisition was attributable to the assembled workforce of Shank's. The goodwill and intangibles recognized for the Shank's acquisition are deductible for U.S.

income tax purposes. The transaction was treated as an asset acquisition for U.S. Federal tax purposes, resulting in a step-up of tax basis to fair value. The Company determined the Shank's operations are not material to the Company’s consolidated results. Therefore, pro forma information is not presented.

For the three and nine months ended December 31, 2021, the Company incurred $0.6 million and $2.3 million, respectively, for acquisition-related transaction costs for the purchase of Shank's. The acquisition-related costs were expensed as incurred and recorded in selling, general, and administrative expense on the consolidated statements of income.

In November 2021, the Company acquired the land and buildings utilized by Shank's operations for $13.3 million. The purchase of the land and buildings resulted in the elimination of the $8.5 million operating lease right-of-use asset and lease liability recognized on the acquisition date for Shank's.

Acquisition of Silva International, Inc.

On October 1, 2020, the Company acquired 100% of the capital stock of Silva International, Inc. (“Silva”), a natural, specialty dehydrated vegetable, fruit, and herb processing company serving global markets, for approximately $164 million in cash and $5.9 million of additional working capital on-hand at the date of acquisition. The acquisition of Silva diversifies the Company's product offerings and generates new opportunities for its plant-based ingredients platform.

A portion of the goodwill recorded as part of the acquisition was attributable to the assembled workforce of Silva. The goodwill recognized for the Silva acquisition is not deductible for U.S. income tax purposes. The tax basis of the assets acquired and liabilities assumed did not result in a step-up of tax basis. The Company determined the Silva operations are not material to the Company’s consolidated results. Therefore, pro forma information is not presented.

The Company continues to employ one of Silva's selling shareholders and as stipulated in the Silva purchase agreement has transferred $6 million to a third-party escrow account that may ultimately be earned by the selling shareholder upon completion of a post-combination service period. Since the compensation agreement for the selling shareholder who remains employed with the Company includes a post-combination service period, the Company has excluded the entire $6 million in the purchase price to be allocated. The $6 million in escrow is recognized as restricted cash in other noncurrent assets on the consolidated balance sheet at December 31, 2021. The contingent consideration arrangement for the selling shareholder includes a post-combination service requirement and forfeitable payment provisions, therefore under ASC Topic 805, "Business Combinations," must be treated as compensation expense. This expense is being recognized ratably over the requisite service period in selling, general, and administrative expense on the consolidated statements of income.

For the three and nine months ended December 31, 2021, the Company incurred $2.3 million and $3.9 million for acquisition-related transaction costs for the purchase of Silva, respectively. The acquisition-related costs were expensed as incurred and recorded in selling, general, and administrative expense on the consolidated statements of income.

The following table summarizes the preliminary purchase price allocation of the assets acquired and liabilities assumed for the Shank's acquisition and final purchase price allocation for the Silva acquisition.

(in thousands of dollars)
	Shank's		Silva
	October 4, 2021		October 1, 2020
Assets
Cash and cash equivalents	$	754	$	8,126
Accounts receivable, net	6,643		17,885
Advances to suppliers, net	—		3,011
Inventory	15,792		33,162
Other current assets	415		833
Property, plant and equipment (net)	11,000		24,437
Operating lease right-of-use assets	8,531		—
Intangibles
Customer relationships	24,000		53,000
Developed technology	4,500		—
Trade names	—		7,800
Non-compete agreements	3,000		—
Goodwill	41,061		46,144
Total assets acquired	115,696		194,398
Liabilities
Accounts payable and accrued expenses	6,159		11,683
Customer advances and deposits	351		—
Accrued compensation	655		3,350
Income taxes payable	—		946
Current portion of operating lease liabilities	8,531		—
Deferred income taxes	—		14,419
Total liabilities assumed	15,696		30,398
Total assets acquired and liabilities assumed	$	100,000	$	164,000

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Restructuring and Related Activities

9 Months Ended

Dec. 31, 2021

Restructuring and Related Activities [Abstract]

Restructuring and Impairment Costs Disclosure

RESTRUCTURING AND IMPAIRMENT COSTS

Universal continually reviews its business for opportunities to realize efficiencies, reduce costs, and realign its operations in response to business changes. Restructuring and impairment costs are periodically incurred in connection with those activities.

Tobacco Operations

As a result of efforts to exit the idled tobacco operations in Tanzania, the Company reevaluated the carrying values of property, plant, and equipment associated with the Tanzania operations. During the three months ended December 31, 2021, the Company determined the carrying value exceeded the estimated fair value of those assets and recognized a $9.4 million impairment charge.

During the three and nine months ended December 31, 2021, the Company also incurred $0.6 million and $2.2 million of termination costs for the Tobacco Operations segment, respectively.

During the three and nine months ended December 31, 2020, the Company incurred $2.6 million of termination and impairment costs associated with restructuring of tobacco buying and administrative operations in Africa, as well as a $0.9 million charge for the liquidation of an idled service entity in Tanzania, and $0.4 million of termination costs in North America.

Ingredients Operations

During the nine months ended December 31, 2020, the Company committed to a plan to wind-down its subsidiary, Carolina Innovative Food Ingredients, Inc. ("CIFI"), a sweet potato processing operation located in Nashville, North Carolina. The CIFI operation was a start-up project initially undertaken by the Company in fiscal year 2015. The decision to wind down CIFI was consistent with the Company’s capital allocation strategy to focus on delivering shareholder value through building and enhancing a plant-based ingredients platform, which includes integrating and exploring the synergies of recently acquired businesses. The Company determined that CIFI was not a strategic fit for the platform’s long-term objectives. CIFI’s single-product focused processing facility and ongoing international pricing pressures, among other factors, created challenges that proved insurmountable. As a result of the decision to wind down the CIFI operations, the Company paid termination benefits totaling approximately $0.6 million to employees whose permanent positions were eliminated. In addition to the termination costs, the Company recognized various other costs associated with the wind-down of the CIFI facility. These costs include impairments of property, plant, and equipment (including the factory building), as well as inventory and supply write-downs. The total restructuring and impairment charge for the nine months ended December 31, 2020 for the CIFI operations wind-down was $16.1 million.

During the nine months ended December 31, 2021, the Company recognized $1.2 million of net gains on the sale of the remaining property, plant, and equipment associated with the wind-down of the CIFI operations that was announced in fiscal year 2021.

A summary of the restructuring and impairment costs recorded for the three and nine months ended December 31, 2021 and December 31, 2020 were as follows:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands)	2021		2020		2021		2020
Restructuring costs:
Employee termination benefits	$	627	$	2,625	$	2,174	$	2,625
Other	—		1,766		(24)		1,766
Total restructuring costs	627		4,391		2,150		4,391
Impairment costs:
Property, plant and equipment	7,806		13,886		8,307		13,886
Inventory	—		1,702		—		1,702
Total impairment costs	7,806		15,588		8,307		15,588
Total restructuring and impairment costs	$	8,433	$	19,979	$	10,457	$	19,979

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Revenue from Contract with Customer

9 Months Ended

Dec. 31, 2021

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer

REVENUE FROM CONTRACTS WITH CUSTOMERS

The majority of the Company’s consolidated revenue consists of sales of processed leaf tobacco to customers. The Company also earns revenue from processing leaf tobacco owned by customers and from various other services provided to customers. Additionally, the Company has fruit and vegetable processing operations, as well as flavor and extract services that provide customers with a range of food ingredient products. Payment terms with customers vary depending on customer creditworthiness, product types, services provided, and other factors. Contract durations and payment terms for all revenue categories generally do not exceed one year. Therefore, the Company has applied a practical expedient to not adjust the transaction price for the effects of financing components, as the Company expects that the period from the time the revenue for a transaction is recognized to the time the customer pays for the related good or service transferred will be one year or less. Below is a description of the major revenue-generating categories from contracts with customers.

Tobacco Sales

The majority of the Company’s business involves purchasing leaf tobacco from farmers in the origins where it is grown, processing and packing the tobacco in its factories, and then transferring ownership and control of the tobacco to customers. On a much smaller basis, the Company also sources processed tobacco from third-party suppliers for resale to customers. The contracts for tobacco sales with customers create a performance obligation to transfer tobacco to the customer. Transaction prices for the sale of tobaccos are primarily based on negotiated fixed prices, but the Company does have a small number of cost-plus contracts with certain customers. Cost-plus arrangements provide the Company reimbursement of the cost to purchase and process the

tobacco, plus a contractually agreed-upon profit margin. The Company utilizes the most likely amount methodology under the accounting guidance to recognize revenue for cost-plus arrangements with customers. Shipping and handling costs under tobacco sales contracts with customers are treated as fulfillment costs and included in the transaction price. Taxes assessed by government authorities on the sale of leaf tobacco products are excluded from the transaction price. At the point in time that the customer obtains control over the tobacco, which is typically aligned with physical shipment under the contractual terms with the customer, the Company completes its performance obligation and recognizes the revenue for the sale.

Ingredient Sales

In recent fiscal years, the Company has diversified operations through acquisition of established companies that offer customers a wide range of both liquid and dehydrated fruit and vegetable ingredient products, flavors, and extracts. These operations procure raw materials from domestic and international growers and suppliers and through a variety of processing steps including sorting, cleaning, pressing, mixing, extracting, and blending to manufacture finished goods utilized in both human and pet food. The contracts for food ingredients with customers create a performance obligation to transfer the manufactured finished goods to the customer. Transaction prices for the sale of food ingredients are primarily based on negotiated fixed prices. At the point in time that the customer obtains control over the finished product, which is typically aligned with physical shipment under the contractual terms with the customer, the Company completes its performance obligation and recognizes the revenue for the sale.

Processing Revenue

Processing and packing of customer-owned tobacco and ingredients is a short-duration process. Processing charges are primarily based on negotiated fixed prices per unit of weight processed. Under normal operating conditions, customer-owned raw materials that are placed into the production line exits as processed and packed product and is then later transported to customer-designated transfer locations. The revenue for these services is recognized when the performance obligation is satisfied, which is generally when processing is completed. The Company’s operating history and contract analyses indicate that customer requirements for processed tobacco and food ingredients products are consistently met upon completion of processing.

Other Operating Sales and Revenue

From time to time, the Company enters into various arrangements with customers to provide other value-added services that may include blending, chemical and physical testing of products, storage, and tobacco cutting services for select manufacturers. These other arrangements and operations are a much smaller portion of the Company’s business, and are separate and distinct contractual agreements from the Company’s tobacco and food ingredients sales or third-party processing arrangements with customers. The transaction prices and timing of revenue recognition of these items are determined by the specifics of each contract.

Disaggregation of Revenue from Contracts with Customers

The following table disaggregates the Company’s revenue by significant revenue-generating category:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Tobacco sales	$	540,363	$	583,543	$	1,181,329	$	1,193,230
Ingredient sales	70,682		47,337		175,087		82,820
Processing revenue	19,647		18,831		52,391		47,605
Other sales and revenue from contracts with customers	16,988		14,867		41,733		32,671
Total revenue from contracts with customers	647,680		664,578		1,450,540		1,356,326
Other operating sales and revenues	4,964		8,353		6,088		9,441
Consolidated sales and other operating revenues	$	652,644	$	672,931	$	1,456,628	$	1,365,767

    Other operating sales and revenues consists principally of interest on advances to suppliers.

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Other Contingent Liabilities And Other Matters

9 Months Ended

Dec. 31, 2021

Other Contingent Liabilities And Other Matters [Abstract]

Guarantees, Other Contingent Liabilities, And Other Matters

CONTINGENT LIABILITIES AND OTHER MATTERS

Other Contingent Liabilities

Other Contingent Liabilities (Letters of credit)

The Company had other contingent liabilities totaling approximately $1 million at December 31, 2021, primarily related to outstanding letters of credit.

Value-Added Tax Assessments in Brazil

As further discussed below, the Company’s local operating subsidiaries pay significant amounts of value-added tax (“VAT”) in connection with their operations, which generate tax credits that they normally are entitled to recover through offset, refund, or sale to third parties. In Brazil, VAT is assessed at the state level when green tobacco is transferred between states. The Company’s operating subsidiary there pays VAT when tobaccos grown in the states of Santa Catarina and Parana are transferred to its factory in the state of Rio Grande do Sul for processing. The subsidiary has received assessments for additional VAT plus interest and penalties from tax authorities for the states of Santa Catarina and Parana based on audits of the subsidiary’s VAT filings for specified periods. In June 2011, tax authorities for the state of Santa Catarina issued assessments for tax, interest, and penalties for periods from 2006 through 2009 totaling approximately $9 million. In September 2014, tax authorities for the state of Parana issued an assessment for tax, interest, and penalties for periods from 2009 through 2014 totaling approximately $10 million. Those amounts are based on the exchange rate for the Brazilian currency at December 31, 2021. Management of the operating subsidiary and outside counsel believe that errors were made by the tax authorities for both states in determining all or significant portions of these assessments and that various defenses support the subsidiary’s positions.

With respect to the Santa Catarina assessments, the subsidiary took appropriate steps to contest the full amount of the claims. As of December 31, 2021, a portion of the subsidiary’s arguments had been accepted, and the outstanding assessment had been reduced. The reduced assessment, together with the related accumulated interest through the end of the current reporting period, totaled approximately $9 million (at the December 31, 2021 exchange rate). The subsidiary is continuing to contest the full remaining amount of the assessment. While the range of reasonably possible loss is zero up to the full $9 million remaining assessment with interest, based on the strength of the subsidiary’s defenses, no loss within that range is considered probable at this time and no liability has been recorded at December 31, 2021.

With respect to the Parana assessment, management of the subsidiary and outside counsel challenged the full amount of the claim. A significant portion of the Parana assessment was based on positions taken by the tax authorities that management and outside counsel believe deviate significantly from the underlying statutes and relevant case law. In addition, under the law, the subsidiary’s tax filings for certain periods covered in the assessment were no longer open to any challenge by the tax authorities. In December 2015, the Parana tax authorities withdrew the initial claim and subsequently issued a new assessment covering the same tax periods, reflecting a substantial reduction from the original assessment. In fiscal year 2020, the Parana tax authorities acknowledged the statute of limitations related to claims prior to December 2010 had expired and reduced the assessment to $3 million (at the December 31, 2021 exchange rate). Notwithstanding the reduced assessment, management and outside counsel continue to believe that the new assessment is not supported by the underlying statutes and relevant case law and have challenged the full amount of the claim. The range of reasonably possible loss is considered to be zero up to the full $3 million assessment. However, based on the strength of the subsidiary's defenses, no loss within that range is considered probable at this time and no liability has been recorded at December 31, 2021.

In both states, the process for reaching a final resolution to the assessments is expected to be lengthy, and management is not currently able to predict when either case will be concluded. Should the subsidiary ultimately be required to pay any tax, interest, or penalties in either case, the portion paid for tax would generate VAT credits that the subsidiary may be able to recover.

Other Legal and Tax Matters

Various subsidiaries of the Company are involved in litigation and tax examinations incidental to their business activities.  While the outcome of these matters cannot be predicted with certainty, management is vigorously defending the matters and does not currently expect that any of them will have a material adverse effect on the Company’s business or financial position.  However, should one or more of these matters be resolved in a manner adverse to management’s current expectation, the effect on the Company’s results of operations for a particular fiscal reporting period could be material.

Advances to Suppliers

In many sourcing origins where the Company operates, it provides agronomy services and seasonal advances of seed, seedlings, fertilizer, and other supplies to tobacco farmers for crop production, or makes seasonal cash advances to farmers for the procurement of those inputs. These advances are short term, are repaid upon delivery of tobacco to the Company, and are

reported in advances to suppliers in the consolidated balance sheets. In several origins, the Company has made long-term advances to tobacco farmers to finance curing barns and other farm infrastructure. In some years, due to low crop yields and other factors, individual farmers may not deliver sufficient volumes of tobacco to fully repay their seasonal advances, and the Company may extend repayment of those advances into future crop years. The long-term portion of advances is included in other noncurrent assets in the consolidated balance sheets. Both the current and the long-term portions of advances to suppliers are reported net of allowances recorded when the Company determines that amounts outstanding are not likely to be collected. Short-term and long-term advances to suppliers totaled $147 million at December 31, 2021, $122 million at December 31, 2020, and $144 million at March 31, 2021. The related valuation allowances totaled $17 million at December 31, 2021, $16 million at December 31, 2020, and $18 million at March 31, 2021, and were estimated based on the Company’s historical loss information and crop projections. The allowances were increased by net provisions of approximately $2.9 million and $2.8 million in the nine-month periods ended December 31, 2021 and 2020, respectively. These net recoveries and provisions are included in selling, general, and administrative expenses in the consolidated statements of income. Interest on advances is recognized in earnings upon the farmers’ delivery of tobacco in payment of principal and interest.

Recoverable Value-Added Tax Credits

In many foreign countries, the Company’s local operating subsidiaries pay significant amounts of VAT on purchases of unprocessed and processed tobacco, crop inputs, packing materials, and various other goods and services. In some countries, VAT is a national tax, and in other countries it is assessed at the state level. Items subject to VAT vary from jurisdiction to jurisdiction, as do the rates at which the tax is assessed. When tobacco is sold to customers in the country of origin, the operating subsidiaries generally collect VAT on those sales. The subsidiaries are normally permitted to offset their VAT payments against the collections and remit only the incremental VAT collections to the tax authorities. When tobacco is sold for export, VAT is normally not assessed. In countries where tobacco sales are predominately for export markets, VAT collections generated on downstream sales are often not sufficient to fully offset the subsidiaries’ VAT payments. In those situations, unused VAT credits can accumulate. Some jurisdictions have procedures that allow companies to apply for refunds of unused VAT credits from the tax authorities, but the refund process often takes an extended period of time and it is not uncommon for refund applications to be challenged or rejected in part on technical grounds. Other jurisdictions may permit companies to sell or transfer unused VAT credits to third parties in private transactions, although approval for such transactions must normally be obtained from the tax authorities, limits on the amounts that can be transferred may be imposed, and the proceeds realized may be heavily discounted from the face value of the credits. Due to these factors, local operating subsidiaries in some countries can accumulate significant balances of VAT credits over time. The Company reviews these balances on a regular basis and records valuation allowances on the credits to reflect amounts that are not expected to be recovered, as well as discounts anticipated on credits that are expected to be sold or transferred. At December 31, 2021, the aggregate balance of recoverable tax credits held by the Company’s subsidiaries totaled approximately $65 million ($53 million at December 31, 2020, and $49 million at March 31, 2021), and the related valuation allowances totaled approximately $20 million ($18 million at December 31, 2020, and $19 million at March 31, 2021). The net balances are reported in other current assets and other noncurrent assets in the consolidated balance sheets.

Long-Term Debt

In December 2020, the Company repaid $150 million of revolving credit borrowings used to finance the purchase of Silva with term loans under its existing senior unsecured bank credit facility. The Company increased the borrowings of the senior unsecured five-year and seven-year term loans by $75 million each. At December 31, 2021, the five-year term loan maturing December 2023 and the seven-year term loan maturing December 2025 had outstanding borrowings of $225 million and $295 million, respectively. Under the senior unsecured bank credit facility, the additional $150 million of terms loans bear interest at variable rates plus a margin based on the Company's credit metrics and interest payments remained unhedged at December 31, 2021. The Company maintains receive-floating/pay-fixed interest rates swap agreements for a portion of the outstanding five and seven-year term loans. See Note 11 for additional information on outstanding interest rate swap agreements.

Shelf Registration and Stock Repurchase Plan

In November 2020, the Company filed an undenominated automatic universal shelf registration statement with the U.S. Securities and Exchange Commission to provide for the future issuance of an undefined amount of securities as determined by the Company and offered in one or more prospectus supplements prior to issuance.

A stock repurchase plan, which was authorized by the Company's Board of Directors, became effective and was publicly announced on November 5, 2020. This stock repurchase plan authorizes the purchase of up to $100 million in common and/or preferred stock in open market or privately negotiated transactions through November 15, 2022 or when funds for the program have been exhausted, subject to market conditions and other factors. The program had $100 million of remaining capacity for repurchases of common and/or preferred stock at December 31, 2021.

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Earnings Per Share

9 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

Earnings Per Share

EARNINGS PER SHARE

    The following table sets forth the computation of basic and diluted earnings per share:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands, except share and per share data)	2021		2020		2021		2020
Basic Earnings Per Share
Numerator for basic earnings per share
Net income attributable to Universal Corporation	$	34,940	$	33,273	$	60,807	$	48,049
Denominator for basic earnings per share
Weighted average shares outstanding	24,792,108		24,677,122		24,761,290		24,646,342
Basic earnings per share	$	1.41	$	1.35	$	2.46	$	1.95
Diluted Earnings Per Share
Numerator for diluted earnings per share
Net income attributable to Universal Corporation	$	34,940	$	33,273	$	60,807	$	48,049
Denominator for diluted earnings per share:
Weighted average shares outstanding	24,792,108		24,677,122		24,761,290		24,646,342
Effect of dilutive securities
Employee and outside director share-based awards	156,983		141,796		151,354		118,097
Denominator for diluted earnings per share	24,949,091		24,818,918		24,912,644		24,764,439
Diluted earnings per share	$	1.40	$	1.34	$	2.44	$	1.94

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Income Taxes

9 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

INCOME TAXES

    The Company operates in the United States and many foreign countries and is subject to the tax laws of many jurisdictions. Changes in tax laws or the interpretation of tax laws can affect the Company’s earnings, as can the resolution of pending and contested tax issues. The Company's consolidated effective income tax rate is affected by a number of factors, including the mix and timing of domestic and foreign earnings, discrete items, and the effect of exchange rate changes on taxes.     

    The consolidated effective income tax rate for the three months and nine months ended December 31, 2021 was 23.4% and 21.0%, respectively. The consolidated effective income tax rate for the three and nine months ended December 31, 2021 was affected by a $1.2 million benefit related to finalizing the prior fiscal year U.S. tax return. The consolidated effective income tax rate for the nine months ended December 31, 2021 was affected by a $1.7 million benefit related to a final tax law ruling at a foreign subsidiary. Without these items, the consolidated effective income tax rate for the three and nine months ended December 31, 2021 would have been approximately 25.5% and 24.3%, respectively.

    The Company's consolidated effective income tax rate for the three and nine months ended December 31, 2020 was 26.5% and 18.6%, respectively. The Company recognized a $2.9 million income tax benefit in the three and nine months ended December 31, 2020 related to amending and finalizing of prior fiscal years' consolidated U.S. income tax returns. The consolidated income tax rate for the nine months ended December 31, 2020 was affected by a $4.4 million net tax benefit for final U.S. tax regulations issued for hybrid dividends paid by foreign subsidiaries. Without these discrete items, the consolidated effective income tax rate for the three and nine months ended December 31, 2020 would have been approximately 31.7% and 29.3%. Additionally, for the nine months ended December 31, 2020, the Company recognized $1.8 million of interest expense related to a settlement of an uncertain tax position at foreign subsidiary.

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Goodwill and Other Intangibles Goodwill and Other Intangibles

9 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets Disclosure [Text Block]

GOODWILL AND OTHER INTANGIBLES

The Company's changes in goodwill at December 31, 2021 and 2020 consisted of the following:

(in thousands of dollars)	Nine Months Ended December 31,
	2021		2020
Balance at beginning of fiscal year	$	173,051	$	126,826
Acquisition of business(1)(2)	41,061		53,728
Foreign currency translation adjustment	(89)		101
Balance at end of period	$	214,023	$	180,655

(1) On October 4, 2021, the Company acquired 100% of the capital stock of Shank's for approximately $100 million in cash and $2.4 million of additional working capital on-hand at the date of acquisition. The Shank's acquisition resulted in $41.1 million of goodwill. See Note 3 for additional information.

(2) On October 1, 2020, the Company acquired 100% of the capital stock of Silva for approximately $164.0 million in cash and $5.9 million of working capital on-hand at the date of acquisition. The Silva acquisition resulted in $46.1 million of goodwill after the final purchase accounting was completed in the three months ended September 30, 2021. See Note 3 for additional information.

The Company's intangible assets primarily consist of capitalized customer-related intangibles, trade names, proprietary developed technology and noncompetition agreements. The Company's intangible assets subject to amortization consisted of the following at December 31, 2021 and 2020 and at March 31, 2021:

(in thousands, except useful life)				December 31, 2021
	Useful Life (years)			Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Customer relationships(1)	11	—	13	$	86,500	$	(8,030)	$	78,470
Trade names		5		11,100		(3,270)		7,830
Developed technology(1)		3		9,300		(3,286)		6,014
Noncompetition agreements(1)		5		4,000		(588)		3,412
Other		5		751		(687)		64
Total intangible assets				$	111,651	$	(15,861)	$	95,790

				December 31, 2020
	Useful Life (years)			Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Customer relationships(2)	11	—	13	$	62,500	$	(1,935)	$	60,565
Trade names(2)		5		11,100		(1,050)		10,050
Developed technology		3		4,800		(1,600)		3,200
Noncompetition agreements		5		1,000		(200)		800
Other		5		796		(701)		95
Total intangible assets				$	80,196	$	(5,486)	$	74,710

				March 31, 2021
	Useful Life (years)			Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Customer relationships	11	—	13	$	62,500	$	(3,323)	$	59,177
Trade names		5		11,100		(1,605)		9,495
Developed technology		3		4,800		(2,000)		2,800
Noncompetition agreements		5		1,000		(250)		750
Other		5		760		(678)		82
Total intangible assets				$	80,160	$	(7,856)	$	72,304

(1)On October 4, 2021, the Company acquired 100% of the capital stock of Shank's for approximately $100 million in cash and $2.4 million of additional working capital on-hand at the date of acquisition. The Shank's acquisition resulted in $31.5 million of intangible assets. See Note 3 for additional information.

(2)On October 1, 2020, the Company acquired 100% of the capital stock of Silva for approximately $164.0 million in cash and $5.9 million of working capital on-hand at the date of acquisition. The Silva acquisition resulted in $60.8 million of intangible assets. See Note 3 for additional information.

Intangible assets are amortized on a straight-line basis over the asset's estimated useful economic life as noted above.

The Company's amortization expense for intangible assets for the three and nine months ended December 31, 2021 and 2020 was:

(in thousands of dollars)	Three Months Ended December 31,				Nine Months Ended December 31,
	2021		2020		2021		2020
Amortization Expense	$	3,207	$	2,404	$	8,005	$	4,021

Amortization expense for the developed technology intangible asset is recorded in cost of goods sold in the consolidated income statements of income. The amortization expense for other intangible assets is recorded in selling, general, and administrative expenses in the consolidated statements of income.

As of December 31, 2021, the expected future amortization expense for intangible assets is as follows:

Fiscal Year (in thousands of dollars)
2022 (excluding the nine months ended December 31, 2021)	$	3,228
2023	12,495
2024	11,247
2025	11,812
2026 and thereafter	57,008
Total expected future amortization expense	$	95,790

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Leases

9 Months Ended

Dec. 31, 2021

Leases [Abstract]

Lessee, Operating Leases

LEASES

The Company, as a lessee, enters into operating leases for land, buildings, equipment, and vehicles. For all operating leases with terms greater than 12 months and with fixed payment arrangements, a lease liability and corresponding right-of-use asset are recognized in the balance sheet for the term of the lease by calculating the net present value of future lease payments. On the date of lease commencement, the present value of lease liabilities is determined by discounting the future lease payments by the Company’s collateralized incremental borrowing rate, adjusted for the lease term and currency of the lease payments. If a lease contains a renewal option that the Company is reasonably certain to exercise, the Company accounts for the original lease term and expected renewal term in the calculation of the lease liability and right-of-use asset.

The following table sets forth the right-of-use assets and lease liabilities for operating leases included in the Company’s consolidated balance sheet:

(in thousands of dollars)	December 31, 2021		December 31, 2020		March 31, 2021
Assets
Operating lease right-of-use assets	$	34,139	$	34,717	$	31,230
Liabilities
Current portion of operating lease liabilities	$	9,128	$	9,014	$	7,898
Long-term operating lease liabilities	22,612		22,709		19,725
Total operating lease liabilities	$	31,740	$	31,723	$	27,623

The following table sets forth the location and amount of operating lease costs included in the Company's consolidated statement of income:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Income Statement Location
Cost of goods sold	$	2,805	$	3,401	$	8,104	$	9,531
Selling, general, and administrative expenses	2,536		2,520		7,102		7,176
Total operating lease costs(1)	$	5,341	$	5,921	$	15,206	$	16,707

(1)Includes variable operating lease costs.

The following table reconciles the undiscounted cash flows to the operating lease liabilities in the Company’s consolidated balance sheet:

(in thousands of dollars)	December 31, 2021
Maturity of Operating Lease Liabilities
2022 (excluding the nine months ended December 31, 2021)	$	2,743
2023	9,493
2024	7,526
2025	5,393
2026	3,116
2027 and thereafter	7,676
Total undiscounted cash flows for operating leases	$	35,947
Less: Imputed interest	(4,207)
Total operating lease liabilities	$	31,740

As of December 31, 2021, the Company had no leases that have not yet commenced.

The following table sets forth supplemental information related to operating leases:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands, except lease term and incremental borrowing rate)	2021		2020		2021			2020
Supplemental Cash Flow Information
Cash paid for amounts included in the measurement of operating lease liabilities	$	3,219	$	3,171	$	8,836		$	9,358
Right-of-use assets obtained in exchange for new operating leases	3,843		1,532		12,894			3,122
Weighted Average Remaining Lease Term (years)					5.31			5.33
Weighted Average Collateralized Incremental Borrowing Rate					3.84		%	4.21		%

As part of the acquisition of Shank's, the Company recognized $8.5 million of operating lease right-of-use assets and corresponding operating lease liabilities on the opening balance sheet related to leases of Shank's facilities. The facilities were subsequently purchased in the three months ended December 31, 2021 and therefore excluded from the lease disclosures above.

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Derivatives And Hedging Activities

9 Months Ended

Dec. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives And Hedging Activities

DERIVATIVES AND HEDGING ACTIVITIESUniversal is exposed to various risks in its worldwide operations and uses derivative financial instruments to manage two specific types of risks – interest rate risk and foreign currency exchange rate risk. Interest rate risk has been managed by entering into interest rate swap agreements, and foreign currency exchange rate risk has been managed by entering into forward and option foreign currency exchange contracts. However, the Company’s policy also permits other types of derivative instruments. In addition, foreign currency exchange rate risk is also managed through strategies that do not involve derivative instruments, such as using local borrowings and other approaches to minimize net monetary positions in non-functional currencies. The disclosures below provide additional information about the Company’s hedging strategies, the derivative instruments used, and the effects of

these activities on the consolidated statements of income and comprehensive income and the consolidated balance sheets. In the consolidated statements of cash flows, the cash flows associated with all of these activities are reported in net cash provided by operating activities.

Cash Flow Hedging Strategy for Interest Rate Risk

In February 2019, the Company entered into receive-floating/pay-fixed interest rate swap agreements that were designated and qualify as hedges of the exposure to changes in interest payment cash flows created by fluctuations in variable interest rates on two outstanding non-amortizing bank term loans that were funded as part of a new bank credit facility in December 2018. Although no significant ineffectiveness is expected with this hedging strategy, the effectiveness of the interest rate swaps is evaluated on a quarterly basis. At December 31, 2021, the total notional amount of the interest rate swaps was $370 million, which corresponded with the original outstanding balance of the term loans. During the third quarter of fiscal year 2021, the Company converted $150 million from the balance in its revolving credit line into the existing term loans, splitting the balance equally between them. At December 31, 2021, the Company is not hedging the interest payments on the additional $150 million of term loans. The increase to the principal balance of the term loans does not have an impact to the effectiveness analysis of the interest rate swap agreements.

Previously, the Company had receive-floating/pay-fixed interest rate swap agreements that were designated and qualified as cash flow hedges for two outstanding non-amortizing bank loans that were repaid concurrent with closing on the new bank credit facility. Those swap agreements were subsequently terminated in February 2019 concurrent with the inception of the new swap agreements. The fair value of the previous swap agreements, approximately $5.4 million, was received from the counterparties upon termination and was amortized from accumulated other comprehensive loss into earnings as a reduction of interest expense through the original maturity dates of those agreements. As of December 31, 2021, the entire deferred gain has been amortized.

Cash Flow Hedging Strategy for Foreign Currency Exchange Rate Risk Related to Sales of Crop Inputs, Forecast Purchases of Tobacco, and Related Processing Costs

The majority of the tobacco production in most countries outside the United States where Universal operates is sold in export markets at prices denominated in U.S. dollars. However, sales of crop inputs (such as seeds and fertilizers) to farmers, purchases of tobacco from farmers, and most processing costs (such as labor and energy) in those countries are usually denominated in the local currency. Changes in exchange rates between the U.S. dollar and the local currencies where tobacco is grown and processed affect the ultimate U.S. dollar sales of crop inputs and cost of processed tobacco. From time to time, the Company enters into forward and option contracts to buy U.S. dollars and sell the local currency at future dates that coincide with the sale of crop inputs to farmers. In the case of forecast purchases of tobacco and the related processing costs, the Company enters into forward and option contracts to sell U.S. dollars and buy the local currency at future dates that coincide with the expected timing of a portion of the tobacco purchases and processing costs. These strategies offset the variability of future U.S. dollar cash flows for sales of crop inputs, tobacco purchases, and processing costs for the foreign currency notional amount hedged. These hedging strategies have been used mainly for tobacco purchases, processing costs, and sales of crop inputs in Brazil, although the Company has also entered into hedges for a portion of the tobacco purchases in Africa.

The aggregate U.S. dollar notional amount of forward and option contracts entered into for these purposes during the nine-month periods in fiscal years 2022 and 2021 was as follows:

	Nine Months Ended December 31,
(in millions of dollars)	2021		2020
Tobacco purchases	$	134.7	$	89.4
Processing costs	32.5		24.6
Crop input sales	20.8		23.5
Total	$	188.0	$	137.5

Fluctuations in exchange rates and in the amount and timing of fixed-price orders from customers for their purchases from individual crop years routinely cause variations in the U.S. dollar notional amount of forward contracts entered into from one year to the next. All contracts related to tobacco purchases and crop input sales were designated and qualified as hedges of the future cash flows associated with the forecast purchases of tobacco. As a result, changes in fair values of the forward contracts have been recognized in comprehensive income as they occurred, but only recognized in earnings as a component of cost of goods sold upon sale of the related tobacco to third-party customers. In fiscal year 2022, only non-deliverable forward contracts were utilized for the sale of 2022 crop year inputs. Premium payments for option contracts entered into for the sale of crop inputs in fiscal year 2021 were expensed into earnings as incurred.

The table below presents the expected timing of when the remaining accumulated other comprehensive gains and losses as of December 31, 2021 for cash flows hedges of tobacco purchases and crop input sales will be recognized in earnings.

Hedging Program	Crop Year	Geographic Location(s)	Fiscal Year Earnings
Tobacco purchases	2023	Brazil	2024
Tobacco purchases	2022	Brazil, Africa	2023
Tobacco purchases	2021	Brazil, Africa	2022
Tobacco purchases	2020	Brazil	2022
Crop input sales	2022	Brazil	2023
Crop input sales	2021	Brazil	2022

Forward contracts related to processing costs have not been designated as hedges, and gains and losses on those contracts have been recognized in earnings on a mark-to-market basis.

Hedging Strategy for Foreign Currency Exchange Rate Risk Related to Net Local Currency Monetary Assets and Liabilities of Foreign Subsidiaries

Most of the Company’s foreign subsidiaries transact the majority of their sales in U.S. dollars and finance the majority of their operating requirements with U.S. dollar borrowings, and therefore use the U.S. dollar as their functional currency. These subsidiaries normally have certain monetary assets and liabilities on their balance sheets that are denominated in the local currency. Those assets and liabilities can include cash and cash equivalents, accounts receivable and accounts payable, advances to farmers and suppliers, deferred income tax assets and liabilities, recoverable value-added taxes, operating lease liabilities, and other items. Net monetary assets and liabilities denominated in the local currency are remeasured into U.S. dollars each reporting period, generating gains and losses that the Company records in earnings as a component of selling, general, and administrative expenses. The level of net monetary assets or liabilities denominated in the local currency normally fluctuates throughout the year based on the operating cycle, but it is most common for monetary assets to exceed monetary liabilities, sometimes by a significant amount. When this situation exists and the local currency weakens against the U.S. dollar, remeasurement losses are generated. Conversely, remeasurement gains are generated on a net monetary asset position when the local currency strengthens against the U.S. dollar. To manage a portion of its exposure to currency remeasurement gains and losses, the Company enters into forward contracts to buy or sell the local currency at future dates coinciding with expected changes in the overall net local currency monetary asset position of the subsidiary. Gains and losses on the forward contracts are recorded in earnings as a component of selling, general, and administrative expenses for each reporting period as they occur, and thus directly offset the related remeasurement losses or gains in the consolidated statements of income for the notional amount hedged. The Company does not designate these contracts as hedges for accounting purposes. The contracts are generally arranged to hedge the subsidiary's projected exposure to currency remeasurement risk for specified periods of time, and new contracts are entered as necessary throughout the year to replace previous contracts as they mature. The Company is currently using forward currency contracts to manage its exposure to currency remeasurement risk in Brazil.  The total notional amounts of contracts outstanding at December 31, 2021 and 2020, and March 31, 2021, were approximately $59.6 million, $13.3 million, and $16.6 million, respectively. To further mitigate currency remeasurement exposure, the Company’s foreign subsidiaries may utilize short-term local currency financing during certain periods. This strategy, while not involving the use of derivative instruments, is intended to minimize the subsidiary’s net monetary position by financing a portion of the local currency monetary assets with local currency monetary liabilities, thus hedging a portion of the overall position.

Several of the Company’s foreign subsidiaries transact the majority of their sales and finance the majority of their operating requirements in their local currency, and therefore use their respective local currencies as the functional currency for reporting purposes. From time to time, these subsidiaries sell tobacco to customers in transactions that are not denominated in the functional currency. In those situations, the subsidiaries routinely enter into forward exchange contracts to offset currency risk for the period of time that a fixed-price order and the related trade account receivable are outstanding with the customer. The contracts are not designated as hedges for accounting purposes.

Effect of Derivative Financial Instruments on the Consolidated Statements of Income

The table below outlines the effects of the Company’s use of derivative financial instruments on the consolidated statements of income:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Cash Flow Hedges - Interest Rate Swap Agreements
Derivative
Effective Portion of Hedge
Gain (loss) recorded in accumulated other comprehensive loss	$	3,967	$	953	$	2,318	$	(3,020)
Gain (loss) reclassified from accumulated other comprehensive loss into earnings	$	(2,263)	$	(2,206)	$	(6,743)	$	(6,233)
Gain on terminated interest rate swaps amortized from accumulated other comprehensive loss into earnings	$	353	$	353	$	1,061	$	1,061
Location of gain (loss) reclassified from accumulated other comprehensive loss into earnings	Interest expense
Ineffective Portion of Hedge
Gain (loss) recognized in earnings	$	—	$	—	$	—	$	—
Location of gain (loss) recognized in earnings	Selling, general and administrative expenses
Hedged Item
Description of hedged item	Floating rate interest payments on term loan
Cash Flow Hedges - Foreign Currency Exchange Contracts
Derivative
Effective Portion of Hedge
Gain (loss) recorded in accumulated other comprehensive loss	$	480	$	5,757	$	3,479	$	3,973
Gain (loss) reclassified from accumulated other comprehensive loss into earnings	$	2,274	$	(2,362)	$	3,563	$	(9,575)
Location of gain (loss) reclassified from accumulated other comprehensive loss into earnings	Cost of goods sold
Ineffective Portion and Early De-designation of Hedges
Gain (loss) recognized in earnings	$	—	$	—	$	451	$	—
Location of gain (loss) recognized in earnings	Selling, general and administrative expenses
Hedged Item
Description of hedged item	Forecast purchases of tobacco in Brazil and Africa
Derivatives Not Designated as Hedges - Foreign Currency Exchange Contracts
Gain (loss) recognized in earnings	$	174	$	922	$	3,939	$	506
Location of gain (loss) recognized in earnings	Selling, general and administrative expenses

For the interest rate swap agreements, the effective portion of the gain or loss on the derivative is recorded in accumulated other comprehensive loss and any ineffective portion is recorded in selling, general and administrative expenses.

For the forward foreign currency exchange contracts designated as cash flow hedges of tobacco purchases in Brazil and Africa and the crop input sales in Brazil, a net hedge loss of approximately $1.3 million remained in accumulated other comprehensive loss at December 31, 2021. That balance reflects gains and losses on contracts related to the 2023, 2022, 2021, and 2020 Brazil crops, the 2022 and 2021 Africa crops, and the 2022 and 2021 Brazil crop input sales, less the amounts reclassified to earnings related to tobacco sold through December 31, 2021. Based on the hedging strategy, as the gain or loss is

recognized in earnings, it is expected to be offset by a change in the direct cost for the tobacco or by a change in sales prices if the strategy has been mandated by the customer. Generally, margins on the sale of the tobacco will not be significantly affected.

Effect of Derivative Financial Instruments on the Consolidated Balance Sheets

The table below outlines the effects of the Company’s derivative financial instruments on the consolidated balance sheets at December 31, 2021 and 2020, and March 31, 2021:

	Derivatives in a Fair Value Asset Position							Derivatives in a Fair Value Liability Position
	Balance Sheet Location	Fair Value as of						Balance Sheet Location	Fair Value as of
(in thousands of dollars)		December 31, 2021		December 31, 2020		March 31, 2021			December 31, 2021		December 31, 2020		March 31, 2021
Derivatives Designated as Hedging Instruments
Interest rate swap agreements	Other non-current assets	$	—	$	—	$	—	Other long-term liabilities	$	16,658	$	33,950	$	25,719
Foreign currency exchange contracts	Other current assets	2,169		5,688		1,137		Accounts payable and accrued expenses	3,952		911		1,031
Total		$	2,169	$	5,688	$	1,137		$	20,610	$	34,861	$	26,750
Derivatives Not Designated as Hedging Instruments
Foreign currency exchange contracts	Other current assets	$	1,390	$	1,625	$	435	Accounts payable and accrued expenses	$	1,298	$	324	$	791
Total		$	1,390	$	1,625	$	435		$	1,298	$	324	$	791

Substantially all of the Company's foreign exchange derivative instruments are subject to master netting arrangements whereby the right to offset occurs in the event of default by a participating party. The Company has elected to present these contracts on a gross basis in the consolidated balance sheets.

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Fair Value Measurements

9 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Fair Value Measurements

FAIR VALUE MEASUREMENTS

Universal measures certain financial and nonfinancial assets and liabilities at fair value based on applicable accounting guidance. The financial assets and liabilities measured at fair value include money market funds, trading securities associated with deferred compensation plans, interest rate swap agreements, forward foreign currency exchange contracts and acquisition-related contingent consideration obligations. The application of the fair value guidance to nonfinancial assets and liabilities primarily includes the determination of fair values for goodwill and long-lived assets when indicators of potential impairment are present.

    Under the accounting guidance, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The framework for measuring fair value is based on a fair value hierarchy that distinguishes between observable inputs and unobservable inputs. Observable inputs are based on market data obtained from independent sources. Unobservable inputs require the Company to make its own assumptions about the value placed on an asset or liability by market participants because little or no market data exists.

There are three levels within the fair value hierarchy:

Level	Description
1	quoted prices in active markets for identical assets or liabilities that the Company has the ability to access as of the reporting date;
2	quoted prices in active markets for similar assets or liabilities, or 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; and
3	unobservable inputs for the asset or liability.

    As permitted under the accounting guidance, the Company uses net asset value per share ("NAV") as a practical expedient to measure the fair value of its money market funds. The fair values for those funds are presented under the heading "NAV" in the tables that follow in this disclosure. In measuring the fair value of liabilities, the Company considers the risk of non-performance in determining fair value. Universal has not elected to report at fair value any financial instruments or any other assets or liabilities that are not required to be reported at fair value under current accounting guidance.

Recurring Fair Value Measurements

At December 31, 2021 and 2020, and at March 31, 2021, the Company had certain financial assets and financial liabilities that were required to be measured and reported at fair value on a recurring basis. These assets and liabilities are listed in the tables below and are classified based on how their values were determined under the fair value hierarchy or the NAV practical expedient:

	December 31, 2021
			Fair Value Hierarchy
(in thousands of dollars)	NAV		Level 1		Level 2		Level 3		Total
Assets
Money market funds	$	335	$	—	$	—	$	—	$	335
Trading securities associated with deferred compensation plans	—		14,794		—		—		14,794
Interest rate swap agreements	—		—		—		—		—
Foreign currency exchange contracts	—		—		3,559		—		3,559
Total financial assets measured and reported at fair value	$	335	$	14,794	$	3,559	$	—	$	18,688
Liabilities
Interest rate swap agreements	—		—		16,658		—		16,658
Foreign currency exchange contracts	—		—		5,250		—		5,250
Total financial liabilities measured and reported at fair value	$	—	$	—	$	21,908	$	—	$	21,908

	December 31, 2020
			Fair Value Hierarchy
(in thousands of dollars)	NAV		Level 1		Level 2		Level 3		Total
Assets
Money market funds	$	380	$	—	$	—	$	—	$	380
Trading securities associated with deferred compensation plans	—		15,703		—		—		15,703
Foreign currency exchange contracts	—		—		7,313		—		7,313
Total financial assets measured and reported at fair value	$	380	$	15,703	$	7,313	$	—	$	23,396
Liabilities
Acquisition-related contingent consideration obligations - long term	$	—	$	—	$	—	$	2,532	2,532
Interest rate swap agreements	—		—		33,950		—		33,950
Foreign currency exchange contracts	—		—		1,235		—		1,235
Total financial liabilities measured and reported at fair value	$	—	$	—	$	35,185	$	2,532	$	37,717

	March 31, 2021
			Fair Value Hierarchy
(in thousands of dollars)	NAV		Level 1		Level 2		Level 3		Total
Assets
Money market funds	$	1,992	$	—	$	—	$	—	$	1,992
Trading securities associated with deferred compensation plans	—		15,735		—		—		15,735
Foreign currency exchange contracts	—		—		1,572		—		1,572
Total financial assets measured and reported at fair value	$	1,992	$	15,735	$	1,572	$	—	$	19,299
Liabilities
Acquisition-related contingent consideration obligations - long-term	$	—	$	—	$	—	$	2,532	$	2,532
Interest rate swap agreements	—		—		25,719		—		25,719
Foreign currency exchange contracts	—		—		1,822		—		1,822
Total financial liabilities measured and reported at fair value	$	—	$	—	$	27,541	$	2,532	$	30,073

Money market funds

The fair value of money market funds, which are reported in cash and cash equivalents in the consolidated balance sheets, is based on NAV, which is the amount at which the funds are redeemable and is used as a practical expedient for fair value. These funds are not classified in the fair value hierarchy, but are disclosed as part of the fair value table above.

Trading securities associated with deferred compensation plans

Trading securities represent mutual fund investments that are matched to employee deferred compensation obligations. These investments are bought and sold as employees defer compensation, receive distributions, or make changes in the funds underlying their accounts. Quoted market prices (Level 1) are used to determine the fair values of the mutual funds.

Interest rate swap agreements

The fair values of interest rate swap agreements are determined based on dealer quotes using a discounted cash flow model matched to the contractual terms of each instrument. Since inputs to the model are observable and significant judgment is not required in determining the fair values, interest rate swaps are classified within Level 2 of the fair value hierarchy.

Foreign currency exchange contracts

The fair values of forward and option foreign currency exchange contracts are also determined based on dealer quotes using a discounted cash flow model matched to the contractual terms of each instrument. Since inputs to the model are observable and significant judgment is not required in determining the fair values, forward and option foreign currency exchange contracts are classified within Level 2 of the fair value hierarchy.

Acquisition-related contingent consideration obligations

The Company estimates the fair value of acquisition-related contingent consideration obligations by applying an income approach model that utilizes probability-weighted discounted cash flows. The Company acquired FruitSmart, Inc. in fiscal year 2020 and recognized a contingent consideration liability of $6.7 million on the date of acquisition. Each period the Company evaluates the fair value of the acquisition-related contingent consideration obligations. During the year ended March 31, 2021, the evaluation resulted in a reduction of $4.2 million of contingent consideration of the original $6.7 million liability recorded. During the three months ended September 30, 2021, an evaluation of the contingent liability resulted in a reduction of the remaining $2.5 million contingent consideration recorded. Significant judgment is applied to this model and therefore the acquisition-related contingent consideration obligation was classified within Level 3 of the fair value hierarchy.

A reconciliation of the change in the balance of the acquisition-related contingent consideration obligation (Level 3) for the nine months ended December 31, 2021 and 2020 is provided below.

(in thousands of dollars)	Nine Months Ended December 31,
	2021		2020
Balance beginning of year	$	2,532	$	6,705
Change in fair value of contingent consideration liability	(2,532)		(4,173)
Balance at end of period	$	—	$	2,532

Long-term Debt

The following table summarizes the fair and carrying value of the Company’s long-term debt, including the current portion at each of the balance sheet dates December 31, 2021, and 2020 and March 31, 2021:

(in millions of dollars)	December 31, 2021		December 31, 2020		March 31, 2021
Fair market value of long term obligations	$	517	$	516	$	517
Carrying value of long term obligations	$	520	$	520	$	520

The Company estimates the fair value of its long-term debt using Level 2 inputs which are based upon quoted market prices for the same or similar obligations or on calculations that are based on the current interest rates available to the Company for debt of similar terms and maturities.

Nonrecurring Fair Value Measurements

    Assets and liabilities that are measured at fair value on a nonrecurring basis primarily relate to long-lived assets, right-of-use operating lease assets and liabilities, goodwill and intangibles, and other current and noncurrent assets. These assets and liabilities fair values are also evaluated for impairment when potential indicators of impairment exist. Accordingly, the nonrecurring measurement of the fair value of these assets and liabilities are classified within Level 3 of the fair value hierarchy.

Acquisition Accounting for Business Combinations

The Company accounts for acquisitions qualifying under ASC 805, "Business Combinations," which requires, among other things, that the assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. The fair values of consideration transferred and net assets acquired are determined using a combination of Level 2 and Level 3 inputs as specified in the fair value hierarchy in ASC 820, “Fair Value Measurements and Disclosures.” The Company believes that the fair values assigned to the assets acquired and liabilities assumed are based on reasonable assumptions.

Long-Lived Assets

The Company reviews long-lived assets for impairment whenever events, changes in business conditions, or other circumstances provide an indication that such assets may be impaired.

Tanzania

Due to business changes that affected the leaf tobacco market in Tanzania and the Company's operations there, an impairment charge of the long-lived assets in Tanzania was recorded in fiscal year 2019 to reduce their carrying value to fair value at March 31, 2019. As a result of efforts to sell the idled Tanzania operations, in the third quarter of fiscal year 2022 an additional impairment charge of $9.4 million was recorded. The remaining long-lived assets consist principally of the Company's office building, processing facility and land. The aggregate fair value and carrying value of the long-lived assets following the impairment adjustments is approximately $3 million at December 31, 2021.

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Pension And Other Postretirement Benefit Plans

9 Months Ended

Dec. 31, 2021

Retirement Benefits [Abstract]

Pension and Other Postretirement Benefits Disclosure

PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS The Company sponsors several defined benefit pension plans covering eligible U.S. salaried employees and certain foreign and other employee groups. These plans provide retirement benefits based primarily on employee compensation and years of service. The Company also sponsors defined benefit plans that provide postretirement health and life insurance benefits

for eligible U.S. employees attaining specific age and service levels, although postretirement life insurance is no longer provided for active employees.

The components of the Company’s net periodic benefit cost were as follows:

	Pension Benefits				Other Postretirement Benefits
	Three Months Ended December 31,				Three Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Service cost	$	1,678	$	1,603	$	43	$	48
Interest cost	2,212		2,403		265		286
Expected return on plan assets	(3,373)		(3,676)		(21)		(24)
Net amortization and deferral	976		1,120		(115)		(139)
Net periodic benefit cost	$	1,493	$	1,450	$	172	$	171

	Pension Benefits				Other Postretirement Benefits
	Nine Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Service cost	$	4,981	$	4,691	$	137	$	145
Interest cost	6,725		7,316		745		859
Expected return on plan assets	(10,145)		(11,032)		(65)		(72)
Net amortization and deferral	2,928		3,361		(346)		(424)
Net periodic benefit cost	$	4,489	$	4,336	$	471	$	508

During the nine months ended December 31, 2021, the Company made contributions of approximately $4.9 million to its pension plans. Additional contributions of $1.3 million are expected during the remaining three months of fiscal year 2022.

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Stock-Based Compensation

9 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement, Noncash Expense [Abstract]

Stock-Based Compensation

STOCK-BASED COMPENSATION

Universal’s shareholders have approved the Executive Stock Plan (“Plan”) under which officers, directors, and employees of the Company may receive grants and awards of common stock, restricted stock, restricted stock units (“RSUs”), performance share units (“PSUs”), stock appreciation rights, incentive stock options, and non-qualified stock options. The Company’s practice is to award grants of stock-based compensation to officers on an annual basis at the first regularly-scheduled meeting of the Compensation Committee of the Board of Directors (the “Compensation Committee”) in the fiscal year following the public release of the Company’s financial results for the prior year. The Compensation Committee administers the Company’s Plan consistently, following previously defined guidelines. In recent years, the Compensation Committee has awarded only grants of RSUs and PSUs. Awards of restricted stock, RSUs, and PSUs are currently outstanding under the Plan.

The RSUs granted to employees vest in either three or five years from the grant date and are then paid out in shares of common stock. Under the terms of the RSU awards, grantees receive dividend equivalents in the form of additional RSUs that vest and are paid out on the same date as the original RSU grant. The PSUs vest at the end of a performance period of three years that begins with the year of the grant, are paid out in shares of common stock shortly after the vesting date, and do not carry rights to dividends or dividend equivalents prior to vesting. Shares ultimately paid out under PSU grants are dependent on the achievement of predetermined performance measures established by the Compensation Committee and can range from zero to 150% of the stated award. The Company’s outside directors receive RSUs following the annual meeting of shareholders. RSUs awarded to outside directors vest in one or three years from the grant date. Restricted shares vest upon the individual’s retirement from service as a director.

During the nine-month periods ended December 31, 2021 and 2020, Universal issued the following stock-based awards, representing the regular annual grants to officers and outside directors of the Company:

	Nine Months Ended December 31,
	2021		2020
RSUs:
Number granted	72,860		80,650
Grant date fair value	$	56.31	$	43.42
PSUs:
Number granted	48,650		63,050
Grant date fair value	$	47.95	$	34.33

Fair value expense for restricted stock units is recognized ratably over the period from grant date to the earlier of: (1) the vesting date of the award, or (2) the date the grantee is eligible to retire without forfeiting the award. For employees who are already eligible to retire at the date an award is granted, the total fair value of all non-forfeitable awards is recognized as expense at the date of grant. As a result, Universal typically incurs higher stock compensation expense in the first quarter of each fiscal year when grants are awarded to officers than in the other three quarters. For PSUs, the Company generally recognizes fair value expense ratably over the performance and vesting period based on management’s judgment of the ultimate award that is likely to be paid out based on the achievement of the predetermined performance measures. The Company accounts for forfeitures of stock-based awards as they occur. For the nine-month periods ended December 31, 2021 and 2020, the Company recorded total stock-based compensation expense of approximately $5.3 million and $5.0 million, respectively. The Company expects to recognize stock-based compensation expense of approximately $1.2 million during the remaining three months of fiscal year 2022.

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Operating Segments

9 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Operating Segments

OPERATING SEGMENTS

As a result of recent acquisitions of plant-based ingredients companies, during the three months ended December 31, 2020 management evaluated the Company’s global business activities, including product and service offerings to its customers, as well as senior management’s operational and financial responsibilities. This assessment included an analysis of how its chief operating decision maker measures business performance and allocates resources. As a result of this analysis, senior management determined the Company conducts operations across two reportable operating segments, Tobacco Operations and Ingredients Operations.

The Tobacco Operations segment activities involve selecting, procuring, processing, packing, storing, shipping, and financing leaf tobacco for sale to, or for the account of, manufacturers of consumer tobacco products throughout the world. Through various operating subsidiaries located in tobacco-growing countries around the world and significant ownership interests in unconsolidated affiliates, the Company processes and/or sells flue-cured and burley tobaccos, dark air-cured tobaccos, and oriental tobaccos. Flue-cured, burley, and oriental tobaccos are used principally in the manufacture of cigarettes, and dark air-cured tobaccos are used mainly in the manufacture of cigars, pipe tobacco, and smokeless tobacco products. Some of these tobacco types are also increasingly used in the manufacture of non-combustible tobacco products that are intended to provide consumers with an alternative to traditional combustible products. The Tobacco Operations segment also provides physical and chemical product testing and smoke testing for tobacco customers. A substantial portion of the Company’s Tobacco Operations' revenues are derived from sales to a limited number of large, multinational cigarette and cigar manufacturers.

The Ingredients Operations segment provides its customers with a broad variety of plant-based ingredients for both human and pet consumption. The Ingredients Operations segment utilizes a variety of value-added manufacturing processes converting raw materials into a wide spectrum of fruit and vegetable juices, concentrates, dehydrated products, flavors, and extracts. Customers for the Ingredients Operations segment include large multinational food and beverage companies, smaller independent manufacturers, and retail organizations. FruitSmart, Silva, and Shank's are the primary operations for the Ingredients Operations segment. FruitSmart manufactures fruit and vegetable juices, purees, concentrates, essences, fibers, seeds, seed oils, and seed powders. Silva is primarily a dehydrated product manufacturer of fruit and vegetable based flakes, dices, granules, powders, and blends. Shank's manufactures flavors and extracts and also offers bottling and custom packaging for customers. In fiscal year 2021, the Company announced the wind-down of CIFI, a greenfield operation that primarily manufactured both dehydrated and liquid sweet potato products.

The Company currently evaluates the performance of its segments based on operating income after allocated overhead expenses, plus equity in the pretax earnings of unconsolidated affiliates. Operating results for the Company’s reportable segments for each period presented in the consolidated statements of income and comprehensive income were as follows.

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
SALES AND OTHER OPERATING REVENUES
Tobacco Operations	$	578,002	$	623,852	$	1,268,610	$	1,278,844
Ingredients Operations	74,642		49,079		188,018		86,923
Consolidated sales and other operating revenues	$	652,644	$	672,931	$	1,456,628	$	1,365,767
OPERATING INCOME
Tobacco Operations	$	69,796	$	84,122	$	105,599	$	107,658
Ingredients Operations	3,494		(2,451)		10,573		(4,698)
Segment operating income	73,290		81,671		116,172		102,960
Deduct: Equity in pretax (earnings) loss of unconsolidated affiliates (1)	(2,084)		(1,506)		(5,056)		(2,089)
Restructuring and impairment costs (2)	(8,433)		(19,979)		(10,457)		(19,979)
Add: Other income (loss)(3)	—		—		2,532		4,173
Consolidated operating income	$	62,773	$	60,186	$	103,191	$	85,065

(1)Equity in pretax earnings (loss) of unconsolidated affiliates is included in segment operating income (Tobacco Operations), but is reported below consolidated operating income and excluded from that total in the consolidated statements of income and comprehensive income.

(2)Restructuring and impairment costs are excluded from segment operating income, but are included in consolidated operating income in the consolidated statements of income and comprehensive income. See Note 4 for additional information.

(3)Other income represents the reversal of a portion of the contingent consideration liability associated with the acquisition of FruitSmart. See Note 12 for additional information.

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Accumulated Other Comprehensive Income (Loss)

9 Months Ended

Dec. 31, 2021

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive Income (Loss), Net of Tax

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

    The following table summarizes the changes in the accumulated balances for each component of accumulated other comprehensive income (loss) attributable to the Company for the nine months ended December 31, 2021 and 2020:

	Nine Months Ended December 31,
(in thousands of dollars)	2021		2020
Foreign currency translation:
Balance at beginning of year	$	(35,135)	$	(42,923)
Other comprehensive income (loss) attributable to Universal Corporation:
Net gain (loss) on foreign currency translation	(4,685)		13,232
Less: Net (gain) loss on foreign currency translation attributable to noncontrolling interests	170		25
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes	(4,515)		13,257
Balance at end of period	$	(39,650)	$	(29,666)
Foreign currency hedge:
Balance at beginning of year	$	(414)	$	(12,226)
Other comprehensive income (loss) attributable to Universal Corporation:
Net gain (loss) on derivative instruments (net of tax (expense) benefit of $(301) and $(1,092))	730		6,423
Reclassification of (gain) loss to earnings (net of tax expense (benefit) of $748 and $(1,914)) (1)	(2,265)		6,682
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes	(1,535)		13,105
Balance at end of period	$	(1,949)	$	879
Interest rate hedge:
Balance at beginning of year	$	(19,480)	$	(27,402)
Other comprehensive income (loss) attributable to Universal Corporation:
Net gain (loss) on derivative instruments (net of tax (expense) benefit of $(487) and $634)	1,832		(2,386)
Reclassification of (gain) loss to earnings (net of tax expense (benefit) of $(1,193) and $(1,086)) (2)	4,488		4,086
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes	6,320		1,700
Balance at end of period	$	(13,160)	$	(25,702)
Pension and other postretirement benefit plans:
Balance at beginning of year	$	(52,008)	$	(69,046)
Other comprehensive income (loss) attributable to Universal Corporation:
Amortization included in earnings (net of tax expense (benefit) of $(524) and $(561))(3)	2,355		1,273
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes	2,355		1,273
Balance at end of period	$	(49,653)	$	(67,773)
Total accumulated other comprehensive loss at end of period	$	(104,412)	$	(122,262)

(1)    Gain (loss) on foreign currency cash flow hedges related to forecast purchases of tobacco and crop input sales is reclassified from accumulated other comprehensive income (loss) to cost of goods sold when the tobacco is sold to customers. See Note 11 for additional information.

(2)    Gain (loss) on interest rate cash flow hedges is reclassified from accumulated other comprehensive income (loss) to interest expense when the related interest payments are made on the underlying debt, or as amortized to interest expense over the period to original maturity for terminated swap agreements. See Note 11 for additional information.

(3)    This accumulated other comprehensive income (loss) component is included in the computation of net periodic benefit cost. See Note 13 for additional information.

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Changes In Shareholders' Equity And Noncontrolling Interests In Subsidiaries

9 Months Ended

Dec. 31, 2021

Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest [Abstract]

Changes In Shareholders' Equity And Noncontrolling Interests In Subsidiaries

CHANGES IN SHAREHOLDERS' EQUITY AND NONCONTROLLING INTERESTS IN SUBSIDIARIES

A reconciliation of the changes in Universal Corporation shareholders’ equity and noncontrolling interests in subsidiaries for the three and nine months ended December 31, 2021 and 2020 is as follows:

	Three Months Ended December 31, 2021						Three Months Ended December 31, 2020
(in thousands of dollars)	Universal Corporation		Non-controlling Interests		Total		Universal Corporation		Non-controlling Interests		Total
Balance at beginning of three-month period	$	1,297,332	$	36,094	$	1,333,426	$	1,239,500	$	39,376	$	1,278,876
Changes in common stock
Accrual of stock-based compensation	1,204		—		1,204		1,334		—		1,334
Dividend equivalents on RSUs	266		—		266		255		—		255
Changes in retained earnings
Net income	34,940		9,215		44,155		33,273		7,168		40,441
Cash dividends declared
Common stock	(19,193)		—		(19,193)		(18,877)		—		(18,877)
Dividend equivalents on RSUs	(266)		—		(266)		(254)		—		(254)
Other comprehensive income (loss)	1,721		(14)		1,707		15,294		(54)		15,240
Other changes in noncontrolling interests
Dividends paid to noncontrolling shareholders	—		(2,057)		(2,057)		—		—		—
Balance at end of period	$	1,316,004	$	43,238	$	1,359,242	$	1,270,525	$	46,490	$	1,317,015

	Nine Months Ended December 31, 2021						Nine Months Ended December 31, 2020
(in thousands of dollars)	Universal Corporation		Non-controlling Interests		Total		Universal Corporation		Non-controlling Interests		Total
Balance at beginning of year	$	1,307,299	$	41,126	$	1,348,425	$	1,246,665	$	42,619	$	1,289,284
Changes in common stock
Accrual of stock-based compensation	5,289		—		5,289		5,042		—		5,042
Withholding of shares from stock-based compensation for grantee income taxes	(2,458)		—		(2,458)		(1,949)		—		(1,949)
Dividend equivalents on RSUs	802		—		802		755		—		755
Changes in retained earnings
Net income	60,807		9,015		69,822		48,049		7,541		55,590
Cash dividends declared
Common stock	(57,558)		—		(57,558)		(56,617)		—		(56,617)
Dividend equivalents on RSUs	(802)		—		(802)		(755)		—		(755)
Other comprehensive income (loss)	2,625		(170)		2,455		29,335		25		29,360
Other changes in noncontrolling interests
Dividends paid to noncontrolling shareholders	—		(6,733)		(6,733)		—		(3,695)		(3,695)
Balance at end of period	$	1,316,004	$	43,238	$	1,359,242	$	1,270,525	$	46,490	$	1,317,015

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Business Combinations Business Combinations (Tables)

9 Months Ended

Dec. 31, 2021

Business Combinations [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed - Silva Acquisition [Table Text Block]

The following table summarizes the preliminary purchase price allocation of the assets acquired and liabilities assumed for the Shank's acquisition and final purchase price allocation for the Silva acquisition.

(in thousands of dollars)
	Shank's		Silva
	October 4, 2021		October 1, 2020
Assets
Cash and cash equivalents	$	754	$	8,126
Accounts receivable, net	6,643		17,885
Advances to suppliers, net	—		3,011
Inventory	15,792		33,162
Other current assets	415		833
Property, plant and equipment (net)	11,000		24,437
Operating lease right-of-use assets	8,531		—
Intangibles
Customer relationships	24,000		53,000
Developed technology	4,500		—
Trade names	—		7,800
Non-compete agreements	3,000		—
Goodwill	41,061		46,144
Total assets acquired	115,696		194,398
Liabilities
Accounts payable and accrued expenses	6,159		11,683
Customer advances and deposits	351		—
Accrued compensation	655		3,350
Income taxes payable	—		946
Current portion of operating lease liabilities	8,531		—
Deferred income taxes	—		14,419
Total liabilities assumed	15,696		30,398
Total assets acquired and liabilities assumed	$	100,000	$	164,000

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Restructuring and Related Activities (Tables)

9 Months Ended

Dec. 31, 2021

Restructuring and Related Activities [Abstract]

Cumulative restructuring Costs

A summary of the restructuring and impairment costs recorded for the three and nine months ended December 31, 2021 and December 31, 2020 were as follows:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands)	2021		2020		2021		2020
Restructuring costs:
Employee termination benefits	$	627	$	2,625	$	2,174	$	2,625
Other	—		1,766		(24)		1,766
Total restructuring costs	627		4,391		2,150		4,391
Impairment costs:
Property, plant and equipment	7,806		13,886		8,307		13,886
Inventory	—		1,702		—		1,702
Total impairment costs	7,806		15,588		8,307		15,588
Total restructuring and impairment costs	$	8,433	$	19,979	$	10,457	$	19,979

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Revenue from Contract with Customer (Tables)

9 Months Ended

Dec. 31, 2021

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The following table disaggregates the Company’s revenue by significant revenue-generating category:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Tobacco sales	$	540,363	$	583,543	$	1,181,329	$	1,193,230
Ingredient sales	70,682		47,337		175,087		82,820
Processing revenue	19,647		18,831		52,391		47,605
Other sales and revenue from contracts with customers	16,988		14,867		41,733		32,671
Total revenue from contracts with customers	647,680		664,578		1,450,540		1,356,326
Other operating sales and revenues	4,964		8,353		6,088		9,441
Consolidated sales and other operating revenues	$	652,644	$	672,931	$	1,456,628	$	1,365,767

    Other operating sales and revenues consists principally of interest on advances to suppliers.

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Earnings Per Share (Tables)

9 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The following table sets forth the computation of basic and diluted earnings per share:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands, except share and per share data)	2021		2020		2021		2020
Basic Earnings Per Share
Numerator for basic earnings per share
Net income attributable to Universal Corporation	$	34,940	$	33,273	$	60,807	$	48,049
Denominator for basic earnings per share
Weighted average shares outstanding	24,792,108		24,677,122		24,761,290		24,646,342
Basic earnings per share	$	1.41	$	1.35	$	2.46	$	1.95
Diluted Earnings Per Share
Numerator for diluted earnings per share
Net income attributable to Universal Corporation	$	34,940	$	33,273	$	60,807	$	48,049
Denominator for diluted earnings per share:
Weighted average shares outstanding	24,792,108		24,677,122		24,761,290		24,646,342
Effect of dilutive securities
Employee and outside director share-based awards	156,983		141,796		151,354		118,097
Denominator for diluted earnings per share	24,949,091		24,818,918		24,912,644		24,764,439
Diluted earnings per share	$	1.40	$	1.34	$	2.44	$	1.94

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Goodwill and Other Intangibles Goodwill and Other Intangibles (Tables)

9 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill [Table Text Block]

The Company's changes in goodwill at December 31, 2021 and 2020 consisted of the following:

(in thousands of dollars)	Nine Months Ended December 31,
	2021		2020
Balance at beginning of fiscal year	$	173,051	$	126,826
Acquisition of business(1)(2)	41,061		53,728
Foreign currency translation adjustment	(89)		101
Balance at end of period	$	214,023	$	180,655

Schedule of Finite-Lived Intangible Assets [Table Text Block]

The Company's intangible assets subject to amortization consisted of the following at December 31, 2021 and 2020 and at March 31, 2021:

(in thousands, except useful life)				December 31, 2021
	Useful Life (years)			Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Customer relationships(1)	11	—	13	$	86,500	$	(8,030)	$	78,470
Trade names		5		11,100		(3,270)		7,830
Developed technology(1)		3		9,300		(3,286)		6,014
Noncompetition agreements(1)		5		4,000		(588)		3,412
Other		5		751		(687)		64
Total intangible assets				$	111,651	$	(15,861)	$	95,790

				December 31, 2020
	Useful Life (years)			Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Customer relationships(2)	11	—	13	$	62,500	$	(1,935)	$	60,565
Trade names(2)		5		11,100		(1,050)		10,050
Developed technology		3		4,800		(1,600)		3,200
Noncompetition agreements		5		1,000		(200)		800
Other		5		796		(701)		95
Total intangible assets				$	80,196	$	(5,486)	$	74,710

				March 31, 2021
	Useful Life (years)			Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Customer relationships	11	—	13	$	62,500	$	(3,323)	$	59,177
Trade names		5		11,100		(1,605)		9,495
Developed technology		3		4,800		(2,000)		2,800
Noncompetition agreements		5		1,000		(250)		750
Other		5		760		(678)		82
Total intangible assets				$	80,160	$	(7,856)	$	72,304

(1)On October 4, 2021, the Company acquired 100% of the capital stock of Shank's for approximately $100 million in cash and $2.4 million of additional working capital on-hand at the date of acquisition. The Shank's acquisition resulted in $31.5 million of intangible assets. See Note 3 for additional information.

(2)On October 1, 2020, the Company acquired 100% of the capital stock of Silva for approximately $164.0 million in cash and $5.9 million of working capital on-hand at the date of acquisition. The Silva acquisition resulted in $60.8 million of intangible assets. See Note 3 for additional information.

Intangible assets are amortized on a straight-line basis over the asset's estimated useful economic life as noted above.

Finite-lived Intangible Assets Amortization Expense [Table Text Block]

The Company's amortization expense for intangible assets for the three and nine months ended December 31, 2021 and 2020 was:

(in thousands of dollars)	Three Months Ended December 31,				Nine Months Ended December 31,
	2021		2020		2021		2020
Amortization Expense	$	3,207	$	2,404	$	8,005	$	4,021

Amortization expense for the developed technology intangible asset is recorded in cost of goods sold in the consolidated income statements of income. The amortization expense for other intangible assets is recorded in selling, general, and administrative expenses in the consolidated statements of income.

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]

As of December 31, 2021, the expected future amortization expense for intangible assets is as follows:

Fiscal Year (in thousands of dollars)
2022 (excluding the nine months ended December 31, 2021)	$	3,228
2023	12,495
2024	11,247
2025	11,812
2026 and thereafter	57,008
Total expected future amortization expense	$	95,790

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Leases of Lessess (Tables)

9 Months Ended

Dec. 31, 2021

Leases of Lessees [Abstract]

Schedule of supplemental balance sheet information related to leases [Table Text Block]

The following table sets forth the right-of-use assets and lease liabilities for operating leases included in the Company’s consolidated balance sheet:

(in thousands of dollars)	December 31, 2021		December 31, 2020		March 31, 2021
Assets
Operating lease right-of-use assets	$	34,139	$	34,717	$	31,230
Liabilities
Current portion of operating lease liabilities	$	9,128	$	9,014	$	7,898
Long-term operating lease liabilities	22,612		22,709		19,725
Total operating lease liabilities	$	31,740	$	31,723	$	27,623

Schedule of supplemental income statement information related to leases [Table Text Block]

The following table sets forth the location and amount of operating lease costs included in the Company's consolidated statement of income:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Income Statement Location
Cost of goods sold	$	2,805	$	3,401	$	8,104	$	9,531
Selling, general, and administrative expenses	2,536		2,520		7,102		7,176
Total operating lease costs(1)	$	5,341	$	5,921	$	15,206	$	16,707

(1)Includes variable operating lease costs.

Lessee, Operating Lease, Liability, Maturity [Table Text Block]

The following table reconciles the undiscounted cash flows to the operating lease liabilities in the Company’s consolidated balance sheet:

(in thousands of dollars)	December 31, 2021
Maturity of Operating Lease Liabilities
2022 (excluding the nine months ended December 31, 2021)	$	2,743
2023	9,493
2024	7,526
2025	5,393
2026	3,116
2027 and thereafter	7,676
Total undiscounted cash flows for operating leases	$	35,947
Less: Imputed interest	(4,207)
Total operating lease liabilities	$	31,740

Supplemental information related to operating leases [Table Text Block]

The following table sets forth supplemental information related to operating leases:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands, except lease term and incremental borrowing rate)	2021		2020		2021			2020
Supplemental Cash Flow Information
Cash paid for amounts included in the measurement of operating lease liabilities	$	3,219	$	3,171	$	8,836		$	9,358
Right-of-use assets obtained in exchange for new operating leases	3,843		1,532		12,894			3,122
Weighted Average Remaining Lease Term (years)					5.31			5.33
Weighted Average Collateralized Incremental Borrowing Rate					3.84		%	4.21		%

As part of the acquisition of Shank's, the Company recognized $8.5 million of operating lease right-of-use assets and corresponding operating lease liabilities on the opening balance sheet related to leases of Shank's facilities. The facilities were subsequently purchased in the three months ended December 31, 2021 and therefore excluded from the lease disclosures above.

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Derivatives And Hedging Activities (Tables)

9 Months Ended

Dec. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Notional Amount of Forward Contracts

The aggregate U.S. dollar notional amount of forward and option contracts entered into for these purposes during the nine-month periods in fiscal years 2022 and 2021 was as follows:

	Nine Months Ended December 31,
(in millions of dollars)	2021		2020
Tobacco purchases	$	134.7	$	89.4
Processing costs	32.5		24.6
Crop input sales	20.8		23.5
Total	$	188.0	$	137.5

Effect Of Derivative Financial Instruments On The Consolidated Statements Of Income

The table below outlines the effects of the Company’s use of derivative financial instruments on the consolidated statements of income:

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Cash Flow Hedges - Interest Rate Swap Agreements
Derivative
Effective Portion of Hedge
Gain (loss) recorded in accumulated other comprehensive loss	$	3,967	$	953	$	2,318	$	(3,020)
Gain (loss) reclassified from accumulated other comprehensive loss into earnings	$	(2,263)	$	(2,206)	$	(6,743)	$	(6,233)
Gain on terminated interest rate swaps amortized from accumulated other comprehensive loss into earnings	$	353	$	353	$	1,061	$	1,061
Location of gain (loss) reclassified from accumulated other comprehensive loss into earnings	Interest expense
Ineffective Portion of Hedge
Gain (loss) recognized in earnings	$	—	$	—	$	—	$	—
Location of gain (loss) recognized in earnings	Selling, general and administrative expenses
Hedged Item
Description of hedged item	Floating rate interest payments on term loan
Cash Flow Hedges - Foreign Currency Exchange Contracts
Derivative
Effective Portion of Hedge
Gain (loss) recorded in accumulated other comprehensive loss	$	480	$	5,757	$	3,479	$	3,973
Gain (loss) reclassified from accumulated other comprehensive loss into earnings	$	2,274	$	(2,362)	$	3,563	$	(9,575)
Location of gain (loss) reclassified from accumulated other comprehensive loss into earnings	Cost of goods sold
Ineffective Portion and Early De-designation of Hedges
Gain (loss) recognized in earnings	$	—	$	—	$	451	$	—
Location of gain (loss) recognized in earnings	Selling, general and administrative expenses
Hedged Item
Description of hedged item	Forecast purchases of tobacco in Brazil and Africa
Derivatives Not Designated as Hedges - Foreign Currency Exchange Contracts
Gain (loss) recognized in earnings	$	174	$	922	$	3,939	$	506
Location of gain (loss) recognized in earnings	Selling, general and administrative expenses

Effect Of Derivative Financial Instruments On The Consolidated Balance Sheets

The table below outlines the effects of the Company’s derivative financial instruments on the consolidated balance sheets at December 31, 2021 and 2020, and March 31, 2021:

	Derivatives in a Fair Value Asset Position							Derivatives in a Fair Value Liability Position
	Balance Sheet Location	Fair Value as of						Balance Sheet Location	Fair Value as of
(in thousands of dollars)		December 31, 2021		December 31, 2020		March 31, 2021			December 31, 2021		December 31, 2020		March 31, 2021
Derivatives Designated as Hedging Instruments
Interest rate swap agreements	Other non-current assets	$	—	$	—	$	—	Other long-term liabilities	$	16,658	$	33,950	$	25,719
Foreign currency exchange contracts	Other current assets	2,169		5,688		1,137		Accounts payable and accrued expenses	3,952		911		1,031
Total		$	2,169	$	5,688	$	1,137		$	20,610	$	34,861	$	26,750
Derivatives Not Designated as Hedging Instruments
Foreign currency exchange contracts	Other current assets	$	1,390	$	1,625	$	435	Accounts payable and accrued expenses	$	1,298	$	324	$	791
Total		$	1,390	$	1,625	$	435		$	1,298	$	324	$	791

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Fair Value Measurements (Tables)

9 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Financial Assets And Liabilities Measured At Fair Value On Recurring Basis [Table Text Block]

At December 31, 2021 and 2020, and at March 31, 2021, the Company had certain financial assets and financial liabilities that were required to be measured and reported at fair value on a recurring basis. These assets and liabilities are listed in the tables below and are classified based on how their values were determined under the fair value hierarchy or the NAV practical expedient:

	December 31, 2021
			Fair Value Hierarchy
(in thousands of dollars)	NAV		Level 1		Level 2		Level 3		Total
Assets
Money market funds	$	335	$	—	$	—	$	—	$	335
Trading securities associated with deferred compensation plans	—		14,794		—		—		14,794
Interest rate swap agreements	—		—		—		—		—
Foreign currency exchange contracts	—		—		3,559		—		3,559
Total financial assets measured and reported at fair value	$	335	$	14,794	$	3,559	$	—	$	18,688
Liabilities
Interest rate swap agreements	—		—		16,658		—		16,658
Foreign currency exchange contracts	—		—		5,250		—		5,250
Total financial liabilities measured and reported at fair value	$	—	$	—	$	21,908	$	—	$	21,908

	December 31, 2020
			Fair Value Hierarchy
(in thousands of dollars)	NAV		Level 1		Level 2		Level 3		Total
Assets
Money market funds	$	380	$	—	$	—	$	—	$	380
Trading securities associated with deferred compensation plans	—		15,703		—		—		15,703
Foreign currency exchange contracts	—		—		7,313		—		7,313
Total financial assets measured and reported at fair value	$	380	$	15,703	$	7,313	$	—	$	23,396
Liabilities
Acquisition-related contingent consideration obligations - long term	$	—	$	—	$	—	$	2,532	2,532
Interest rate swap agreements	—		—		33,950		—		33,950
Foreign currency exchange contracts	—		—		1,235		—		1,235
Total financial liabilities measured and reported at fair value	$	—	$	—	$	35,185	$	2,532	$	37,717

	March 31, 2021
			Fair Value Hierarchy
(in thousands of dollars)	NAV		Level 1		Level 2		Level 3		Total
Assets
Money market funds	$	1,992	$	—	$	—	$	—	$	1,992
Trading securities associated with deferred compensation plans	—		15,735		—		—		15,735
Foreign currency exchange contracts	—		—		1,572		—		1,572
Total financial assets measured and reported at fair value	$	1,992	$	15,735	$	1,572	$	—	$	19,299
Liabilities
Acquisition-related contingent consideration obligations - long-term	$	—	$	—	$	—	$	2,532	$	2,532
Interest rate swap agreements	—		—		25,719		—		25,719
Foreign currency exchange contracts	—		—		1,822		—		1,822
Total financial liabilities measured and reported at fair value	$	—	$	—	$	27,541	$	2,532	$	30,073

Schedule of Business Acquisitions by Acquisition, Contingent Consideration [Table Text Block]

A reconciliation of the change in the balance of the acquisition-related contingent consideration obligation (Level 3) for the nine months ended December 31, 2021 and 2020 is provided below.

(in thousands of dollars)	Nine Months Ended December 31,
	2021		2020
Balance beginning of year	$	2,532	$	6,705
Change in fair value of contingent consideration liability	(2,532)		(4,173)
Balance at end of period	$	—	$	2,532

Schedule of Carrying Values and Estimated Fair Values of Debt Instruments [Table Text Block]

The following table summarizes the fair and carrying value of the Company’s long-term debt, including the current portion at each of the balance sheet dates December 31, 2021, and 2020 and March 31, 2021:

(in millions of dollars)	December 31, 2021		December 31, 2020		March 31, 2021
Fair market value of long term obligations	$	517	$	516	$	517
Carrying value of long term obligations	$	520	$	520	$	520

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Pension And Other Postretirement Benefit Plans (Tables)

9 Months Ended

Dec. 31, 2021

Retirement Benefits [Abstract]

Components of Company's Net Periodic Benefit Cost

The components of the Company’s net periodic benefit cost were as follows:

	Pension Benefits				Other Postretirement Benefits
	Three Months Ended December 31,				Three Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Service cost	$	1,678	$	1,603	$	43	$	48
Interest cost	2,212		2,403		265		286
Expected return on plan assets	(3,373)		(3,676)		(21)		(24)
Net amortization and deferral	976		1,120		(115)		(139)
Net periodic benefit cost	$	1,493	$	1,450	$	172	$	171

	Pension Benefits				Other Postretirement Benefits
	Nine Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
Service cost	$	4,981	$	4,691	$	137	$	145
Interest cost	6,725		7,316		745		859
Expected return on plan assets	(10,145)		(11,032)		(65)		(72)
Net amortization and deferral	2,928		3,361		(346)		(424)
Net periodic benefit cost	$	4,489	$	4,336	$	471	$	508

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Stock-Based Compensation (Tables)

9 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement, Noncash Expense [Abstract]

Stock-Based Awards Issued During The Period

During the nine-month periods ended December 31, 2021 and 2020, Universal issued the following stock-based awards, representing the regular annual grants to officers and outside directors of the Company:

	Nine Months Ended December 31,
	2021		2020
RSUs:
Number granted	72,860		80,650
Grant date fair value	$	56.31	$	43.42
PSUs:
Number granted	48,650		63,050
Grant date fair value	$	47.95	$	34.33

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Operating Segments (Tables)

9 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Operating Results For The Company's Reportable Segments

Operating results for the Company’s reportable segments for each period presented in the consolidated statements of income and comprehensive income were as follows.

	Three Months Ended December 31,				Nine Months Ended December 31,
(in thousands of dollars)	2021		2020		2021		2020
SALES AND OTHER OPERATING REVENUES
Tobacco Operations	$	578,002	$	623,852	$	1,268,610	$	1,278,844
Ingredients Operations	74,642		49,079		188,018		86,923
Consolidated sales and other operating revenues	$	652,644	$	672,931	$	1,456,628	$	1,365,767
OPERATING INCOME
Tobacco Operations	$	69,796	$	84,122	$	105,599	$	107,658
Ingredients Operations	3,494		(2,451)		10,573		(4,698)
Segment operating income	73,290		81,671		116,172		102,960
Deduct: Equity in pretax (earnings) loss of unconsolidated affiliates (1)	(2,084)		(1,506)		(5,056)		(2,089)
Restructuring and impairment costs (2)	(8,433)		(19,979)		(10,457)		(19,979)
Add: Other income (loss)(3)	—		—		2,532		4,173
Consolidated operating income	$	62,773	$	60,186	$	103,191	$	85,065

(1)Equity in pretax earnings (loss) of unconsolidated affiliates is included in segment operating income (Tobacco Operations), but is reported below consolidated operating income and excluded from that total in the consolidated statements of income and comprehensive income.

(2)Restructuring and impairment costs are excluded from segment operating income, but are included in consolidated operating income in the consolidated statements of income and comprehensive income. See Note 4 for additional information.

(3)Other income represents the reversal of a portion of the contingent consideration liability associated with the acquisition of FruitSmart. See Note 12 for additional information.

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Accumulated Other Comprehensive Income (Loss) (Tables)

9 Months Ended

Dec. 31, 2021

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss)

The following table summarizes the changes in the accumulated balances for each component of accumulated other comprehensive income (loss) attributable to the Company for the nine months ended December 31, 2021 and 2020:

	Nine Months Ended December 31,
(in thousands of dollars)	2021		2020
Foreign currency translation:
Balance at beginning of year	$	(35,135)	$	(42,923)
Other comprehensive income (loss) attributable to Universal Corporation:
Net gain (loss) on foreign currency translation	(4,685)		13,232
Less: Net (gain) loss on foreign currency translation attributable to noncontrolling interests	170		25
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes	(4,515)		13,257
Balance at end of period	$	(39,650)	$	(29,666)
Foreign currency hedge:
Balance at beginning of year	$	(414)	$	(12,226)
Other comprehensive income (loss) attributable to Universal Corporation:
Net gain (loss) on derivative instruments (net of tax (expense) benefit of $(301) and $(1,092))	730		6,423
Reclassification of (gain) loss to earnings (net of tax expense (benefit) of $748 and $(1,914)) (1)	(2,265)		6,682
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes	(1,535)		13,105
Balance at end of period	$	(1,949)	$	879
Interest rate hedge:
Balance at beginning of year	$	(19,480)	$	(27,402)
Other comprehensive income (loss) attributable to Universal Corporation:
Net gain (loss) on derivative instruments (net of tax (expense) benefit of $(487) and $634)	1,832		(2,386)
Reclassification of (gain) loss to earnings (net of tax expense (benefit) of $(1,193) and $(1,086)) (2)	4,488		4,086
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes	6,320		1,700
Balance at end of period	$	(13,160)	$	(25,702)
Pension and other postretirement benefit plans:
Balance at beginning of year	$	(52,008)	$	(69,046)
Other comprehensive income (loss) attributable to Universal Corporation:
Amortization included in earnings (net of tax expense (benefit) of $(524) and $(561))(3)	2,355		1,273
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes	2,355		1,273
Balance at end of period	$	(49,653)	$	(67,773)
Total accumulated other comprehensive loss at end of period	$	(104,412)	$	(122,262)

(1)    Gain (loss) on foreign currency cash flow hedges related to forecast purchases of tobacco and crop input sales is reclassified from accumulated other comprehensive income (loss) to cost of goods sold when the tobacco is sold to customers. See Note 11 for additional information.

(2)    Gain (loss) on interest rate cash flow hedges is reclassified from accumulated other comprehensive income (loss) to interest expense when the related interest payments are made on the underlying debt, or as amortized to interest expense over the period to original maturity for terminated swap agreements. See Note 11 for additional information.

(3)    This accumulated other comprehensive income (loss) component is included in the computation of net periodic benefit cost. See Note 13 for additional information.

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Changes In Shareholders' Equity And Noncontrolling Interests In Subsidiaries (Tables)

9 Months Ended

Dec. 31, 2021

Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest [Abstract]

Reconciliation Of Changes In Shareholders' Equity And Noncontrolling Interests In Subsidiaries

A reconciliation of the changes in Universal Corporation shareholders’ equity and noncontrolling interests in subsidiaries for the three and nine months ended December 31, 2021 and 2020 is as follows:

	Three Months Ended December 31, 2021						Three Months Ended December 31, 2020
(in thousands of dollars)	Universal Corporation		Non-controlling Interests		Total		Universal Corporation		Non-controlling Interests		Total
Balance at beginning of three-month period	$	1,297,332	$	36,094	$	1,333,426	$	1,239,500	$	39,376	$	1,278,876
Changes in common stock
Accrual of stock-based compensation	1,204		—		1,204		1,334		—		1,334
Dividend equivalents on RSUs	266		—		266		255		—		255
Changes in retained earnings
Net income	34,940		9,215		44,155		33,273		7,168		40,441
Cash dividends declared
Common stock	(19,193)		—		(19,193)		(18,877)		—		(18,877)
Dividend equivalents on RSUs	(266)		—		(266)		(254)		—		(254)
Other comprehensive income (loss)	1,721		(14)		1,707		15,294		(54)		15,240
Other changes in noncontrolling interests
Dividends paid to noncontrolling shareholders	—		(2,057)		(2,057)		—		—		—
Balance at end of period	$	1,316,004	$	43,238	$	1,359,242	$	1,270,525	$	46,490	$	1,317,015

	Nine Months Ended December 31, 2021						Nine Months Ended December 31, 2020
(in thousands of dollars)	Universal Corporation		Non-controlling Interests		Total		Universal Corporation		Non-controlling Interests		Total
Balance at beginning of year	$	1,307,299	$	41,126	$	1,348,425	$	1,246,665	$	42,619	$	1,289,284
Changes in common stock
Accrual of stock-based compensation	5,289		—		5,289		5,042		—		5,042
Withholding of shares from stock-based compensation for grantee income taxes	(2,458)		—		(2,458)		(1,949)		—		(1,949)
Dividend equivalents on RSUs	802		—		802		755		—		755
Changes in retained earnings
Net income	60,807		9,015		69,822		48,049		7,541		55,590
Cash dividends declared
Common stock	(57,558)		—		(57,558)		(56,617)		—		(56,617)
Dividend equivalents on RSUs	(802)		—		(802)		(755)		—		(755)
Other comprehensive income (loss)	2,625		(170)		2,455		29,335		25		29,360
Other changes in noncontrolling interests
Dividends paid to noncontrolling shareholders	—		(6,733)		(6,733)		—		(3,695)		(3,695)
Balance at end of period	$	1,316,004	$	43,238	$	1,359,242	$	1,270,525	$	46,490	$	1,317,015

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Business Combinations Business Combinations (Narrative) (Details) - USD ($) $ in Thousands			3 Months Ended		9 Months Ended
	Oct. 04, 2021	Oct. 01, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Mar. 31, 2021
Business Acquisition [Line Items]
Purchase of business, net of cash held by the business					$ 102,462	$ 161,095
Restricted cash (Other noncurrent assets)			$ 6,000	$ 6,000	6,000	6,000
Payments to Acquire Property, Plant, and Equipment					39,831	33,794
Operating Lease, Liability			31,740	31,723	31,740	31,723	$ 27,623
Silva, International [Member]
Business Acquisition [Line Items]
Working capital adjustments		$ 5,900
Purchase of business, net of cash held by the business		$ 164,000
Business acquisition percentage of capital stock Acquired		100.00%
Restricted cash (Other noncurrent assets)			6,000		6,000
Business Combination, Acquisition Related Costs				$ 2,300		3,900
Shank's Extracts [Member]
Business Acquisition [Line Items]
Working capital adjustments	$ 2,400
Purchase of business, net of cash held by the business	$ 100,000
Business acquisition percentage of capital stock Acquired	100.00%
Business Combination, Acquisition Related Costs			600			$ 2,300
Payments to Acquire Property, Plant, and Equipment			13,300
Operating Lease, Liability			$ 8,500		$ 8,500

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Business Combinations Business Combinations Assets Acquired and Liabilities Assumed (Silva) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Oct. 04, 2021	Mar. 31, 2021	Dec. 31, 2020	Oct. 01, 2020	Mar. 31, 2020
Business Acquisition [Line Items]
Goodwill, net	$ 214,023		$ 173,051	$ 180,655		$ 126,826
Silva, International [Member]
Business Acquisition [Line Items]
Cash and cash equivalents					$ 8,126
Accounts receivable, net					17,885
Advances to suppliers, net					3,011
Inventory					33,162
Other current assets					833
Property, plant and equipment (net)					24,437
Operating lease right-of-use assets					0
Customer relationships					53,000
Developed technology					0
Trade names					7,800
Non-compete agreements					0
Goodwill, net					46,144
Total assets acquired					194,398
Accounts payable and accrued expenses					11,683
Customer advances and deposits					0
Accrued compensation					3,350
Income taxes payable					946
Current portion of operating lease liabilities					0
Deferred income taxes					14,419
Total liabilities assumed					30,398
Total assets acquired and liabilities assumed					$ 164,000
Shank's Extracts [Member]
Business Acquisition [Line Items]
Cash and cash equivalents		$ 754
Accounts receivable, net		6,643
Advances to suppliers, net		0
Inventory		15,792
Other current assets		415
Property, plant and equipment (net)		11,000
Operating lease right-of-use assets		8,531
Customer relationships		24,000
Developed technology		4,500
Trade names		0
Non-compete agreements		3,000
Goodwill, net		41,061
Total assets acquired		115,696
Accounts payable and accrued expenses		6,159
Customer advances and deposits		351
Accrued compensation		655
Income taxes payable		0
Current portion of operating lease liabilities		8,531
Deferred income taxes		0
Total liabilities assumed		15,696
Total assets acquired and liabilities assumed		$ 100,000

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Restructuring and Related Activities (Narrative) (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Restructuring Cost and Reserve [Line Items]
Restructuring and impairment costs	[1]	$ 8,433	$ 19,979	$ 10,457	$ 19,979
Property, plant and equipment		7,806	13,886	8,307	13,886
Tobacco Operations | Africa [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and impairment costs			2,600		2,600
Employee termination benefits		600		2,200
Tobacco Operations | Tanzania
Restructuring Cost and Reserve [Line Items]
Property, plant and equipment		$ 9,400	900		900
Tobacco Operations | North America [Member]
Restructuring Cost and Reserve [Line Items]
Employee termination benefits			$ 400		400
Ingredients
Restructuring Cost and Reserve [Line Items]
Property, plant and equipment					16,100
Employee termination benefits					$ 600
Gain on sale of impaired equipment				$ (1,200)

[1] Restructuring and impairment costs are excluded from segment operating income, but are included in consolidated operating income in the consolidated statements of income and comprehensive income. See Note 4 for additional information.

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Restructuring Costs (Cumulative Restructuring Costs) (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Restructuring Cost and Reserve [Line Items]
Restructuring Costs, Total		$ 627	$ 4,391	$ 2,150	$ 4,391
Property, plant and equipment		7,806	13,886	8,307	13,886
Inventory		0	1,702	0	1,702
Asset Impairment Charges, Total		7,806	15,588	8,307	15,588
Restructuring and impairment costs	[1]	8,433	19,979	10,457	19,979
Employee Termination Benefits [Member]
Restructuring Cost and Reserve [Line Items]
Employee termination benefits		627	2,625	2,174	2,625
Other Restructuring [Member]
Restructuring Cost and Reserve [Line Items]
Other restructuring costs		$ 0	$ 1,766	$ (24)	$ 1,766

[1] Restructuring and impairment costs are excluded from segment operating income, but are included in consolidated operating income in the consolidated statements of income and comprehensive income. See Note 4 for additional information.

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Revenue from Contract with Customer (Disaggregation of Revenue) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers	$ 647,680	$ 664,578	$ 1,450,540	$ 1,356,326
Other operating sales and revenues	4,964	8,353	6,088	9,441
Sales and other operating revenues	652,644	672,931	1,456,628	1,365,767
Manufactured Product [Member] | Tobacco Sales [Member]
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers	540,363	583,543	1,181,329	1,193,230
Manufactured Product [Member] | Food Ingredient Sales [Member]
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers	70,682	47,337	175,087	82,820
Processing revenue [Member]
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers	19,647	18,831	52,391	47,605
Other sales and revenue from contracts with customers [Member]
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers	$ 16,988	$ 14,867	$ 41,733	$ 32,671

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Other Contingent Liabilities And Other Matters (Narrative) (Details) - USD ($) $ in Thousands	9 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Mar. 31, 2021
Other Contingent Liabilities and Other Matters [Line Items]
Other contingent liabilities	$ 1,000
Net provision for losses (recoveries) on advances to suppliers	2,864	$ 2,753
Long-term Line of Credit	150,000
Issuance of long-term debt	0	150,000
Loans Payable	150,000
Stock repurchase program authorized amount	100,000
Stock repurchase program remaining authorized repurchase amount	100,000
Five-year term loan [Member]
Other Contingent Liabilities and Other Matters [Line Items]
Issuance of long-term debt	75,000
Loans Payable	225,000
Seven-year term loan [Member]
Other Contingent Liabilities and Other Matters [Line Items]
Issuance of long-term debt	75,000
Loans Payable	295,000
Advances to suppliers [Member]
Other Contingent Liabilities and Other Matters [Line Items]
Advances to suppliers current and non-current	147,000	122,000	$ 144,000
Valuation allowances	17,000	16,000	18,000
Net provision for losses (recoveries) on advances to suppliers	2,900	2,800
Recoverable value added tax credits [Member]
Other Contingent Liabilities and Other Matters [Line Items]
Aggregate balance of recoverable value added tax credits	65,000	53,000	49,000
Valuation allowances	20,000	$ 18,000	$ 19,000
Santa Catarina [Member]
Other Contingent Liabilities and Other Matters [Line Items]
Brazil audit assessment for tax, penalties, and interest on recoverable value added tax credits	9,000
Reduced Brazil audit assessment for tax, penalties, and interest on recoverable value added tax credits	9,000
Loss contingency amount accrued	0
Santa Catarina [Member] | Minimum [Member]
Other Contingent Liabilities and Other Matters [Line Items]
Estimate of possible loss on remaining VAT audit assessment	0
Santa Catarina [Member] | Maximum [Member]
Other Contingent Liabilities and Other Matters [Line Items]
Estimate of possible loss on remaining VAT audit assessment	9,000
Parana [Member]
Other Contingent Liabilities and Other Matters [Line Items]
Brazil audit assessment for tax, penalties, and interest on recoverable value added tax credits	10,000
Reduced Brazil audit assessment for tax, penalties, and interest on recoverable value added tax credits	3,000
Loss contingency amount accrued	0
Parana [Member] | Minimum [Member]
Other Contingent Liabilities and Other Matters [Line Items]
Estimate of possible loss on remaining VAT audit assessment	0
Parana [Member] | Maximum [Member]
Other Contingent Liabilities and Other Matters [Line Items]
Estimate of possible loss on remaining VAT audit assessment	$ 3,000

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Earnings Per Share (Computation Of Basic And Diluted Earnings (Loss) Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Numerator for basic earnings per share
Net income attributable to Universal Corporation	$ 34,940	$ 33,273	$ 60,807	$ 48,049
Denominator for basic earnings per share
Weighted average shares outstanding	24,792,108	24,677,122	24,761,290	24,646,342
Basic earnings per share	$ 1.41	$ 1.35	$ 2.46	$ 1.95
Numerator for diluted earnings per share
Net income attributable to Universal Corporation	$ 34,940	$ 33,273	$ 60,807	$ 48,049
Denominator for diluted earnings per share:
Weighted average shares outstanding	24,792,108	24,677,122	24,761,290	24,646,342
Employee and outside director share-based awards	156,983	141,796	151,354	118,097
Denominator for diluted earnings per share	24,949,091	24,818,918	24,912,644	24,764,439
Diluted earnings per share	$ 1.40	$ 1.34	$ 2.44	$ 1.94

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Income Taxes (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Income Tax Disclosure [Line Items]
Effective income tax rate	23.40%	26.50%	21.00%	18.60%
Income Tax Expense (Benefit)	$ (1,200)		$ (1,200)
Interest expense	$ 7,462	$ 6,735	20,800	$ 19,140
Unresolved tax matter foreign jurisdiction [Member]
Income Tax Disclosure [Line Items]
Interest expense				$ 1,800
Tax benefit - Hybrid Dividend [Member]
Income Tax Disclosure [Line Items]
Effective income tax rate		31.70%		29.30%
Income Tax Expense (Benefit)				$ (4,400)
Tax Law Ruling [Member]
Income Tax Disclosure [Line Items]
Income Tax Expense (Benefit)			$ (1,700)
Effective income tax rate reconciliation after other adjustments, percent	25.50%		24.30%
Amended Tax Return [Member]
Income Tax Disclosure [Line Items]
Income Tax Expense (Benefit)		$ (2,900)		$ (2,900)

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Goodwill and Other Intangibles Goodwill and Other Intangibles (Narrative) (Details) - USD ($) $ in Thousands				9 Months Ended
		Oct. 04, 2021	Oct. 01, 2020	Dec. 31, 2021	Dec. 31, 2020
Goodwill [Line Items]
Purchase of business, net of cash held by the business				$ 102,462	$ 161,095
Goodwill, Acquired During Period	[1],[2]			$ 41,061	$ 53,728
Shank's Extracts, Inc. [Member]
Goodwill [Line Items]
Business acquisition percentage of capital stock Acquired		100.00%
Purchase of business, net of cash held by the business		$ 100,000
Business combination finite-lived intangibles		31,500
Working capital adjustments		2,400
Goodwill, Acquired During Period		$ 41,100
Silva, International [Member]
Goodwill [Line Items]
Business acquisition percentage of capital stock Acquired			100.00%
Purchase of business, net of cash held by the business			$ 164,000
Business combination finite-lived intangibles			60,800
Working capital adjustments			5,900
Goodwill, Acquired During Period			$ 46,100

[1] On October 1, 2020, the Company acquired 100% of the capital stock of Silva for approximately $164.0 million in cash and $5.9 million of working capital on-hand at the date of acquisition. The Silva acquisition resulted in $46.1 million of goodwill after the final purchase accounting was completed in the three months ended September 30, 2021. See Note 3 for additional information.

[2] On October 4, 2021, the Company acquired 100% of the capital stock of Shank's for approximately $100 million in cash and $2.4 million of additional working capital on-hand at the date of acquisition. The Shank's acquisition resulted in $41.1 million of goodwill. See Note 3 for additional information.

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Goodwill and Other Intangibles Change in Goodwill Balance (Details) - USD ($) $ in Thousands		9 Months Ended
		Dec. 31, 2021	Dec. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
Balance at beginning of year		$ 173,051	$ 126,826
Acquisition of business(1)(2)	[1],[2]	41,061	53,728
Foreign currency translation adjustment		(89)	101
Balance at end of period		$ 214,023	$ 180,655

[1] On October 1, 2020, the Company acquired 100% of the capital stock of Silva for approximately $164.0 million in cash and $5.9 million of working capital on-hand at the date of acquisition. The Silva acquisition resulted in $46.1 million of goodwill after the final purchase accounting was completed in the three months ended September 30, 2021. See Note 3 for additional information.

[2] On October 4, 2021, the Company acquired 100% of the capital stock of Shank's for approximately $100 million in cash and $2.4 million of additional working capital on-hand at the date of acquisition. The Shank's acquisition resulted in $41.1 million of goodwill. See Note 3 for additional information.

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Goodwill and Other Intangibles Intangible Assets (Details) - USD ($) $ in Thousands	9 Months Ended				12 Months Ended
	Dec. 31, 2021		Dec. 31, 2020		Mar. 31, 2021
Finite-Lived Intangible Assets [Line Items]
Gross carrying value	$ 111,651		$ 80,196		$ 80,160
Accumulated amortization	(15,861)		(5,486)		(7,856)
Net carrying value	95,790		74,710		72,304
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying value	86,500	[1]	62,500	[2]	62,500
Accumulated amortization	(8,030)	[1]	(1,935)	[2]	(3,323)
Net carrying value	$ 78,470	[1]	$ 60,565	[2]	$ 59,177
Customer Relationships [Member] | Minimum [Member]
Finite-Lived Intangible Assets [Line Items]
Useful life	11 years		11 years		11 years
Customer Relationships [Member] | Maximum [Member]
Finite-Lived Intangible Assets [Line Items]
Useful life	13 years		13 years		13 years
Trade Names [Member]
Finite-Lived Intangible Assets [Line Items]
Useful life	5 years		5 years		5 years
Gross carrying value	$ 11,100		$ 11,100	[2]	$ 11,100
Accumulated amortization	(3,270)		(1,050)	[2]	(1,605)
Net carrying value	$ 7,830		$ 10,050	[2]	$ 9,495
Developed Technology Rights [Member]
Finite-Lived Intangible Assets [Line Items]
Useful life	3 years		3 years		3 years
Gross carrying value	$ 9,300	[1]	$ 4,800		$ 4,800
Accumulated amortization	(3,286)	[1]	(1,600)		(2,000)
Net carrying value	$ 6,014	[1]	$ 3,200		$ 2,800
Noncompete Agreements [Member]
Finite-Lived Intangible Assets [Line Items]
Useful life	5 years		5 years		5 years
Gross carrying value	$ 4,000	[1]	$ 1,000		$ 1,000
Accumulated amortization	(588)	[1]	(200)		(250)
Net carrying value	$ 3,412	[1]	$ 800		$ 750
Other Intangible Assets [Member]
Finite-Lived Intangible Assets [Line Items]
Useful life	5 years		5 years		5 years
Gross carrying value	$ 751		$ 796		$ 760
Accumulated amortization	(687)		(701)		(678)
Net carrying value	$ 64		$ 95		$ 82

[1] On October 4, 2021, the Company acquired 100% of the capital stock of Shank's for approximately $100 million in cash and $2.4 million of additional working capital on-hand at the date of acquisition. The Shank's acquisition resulted in $31.5 million of intangible assets. See Note 3 for additional information.

[2] On October 1, 2020, the Company acquired 100% of the capital stock of Silva for approximately $164.0 million in cash and $5.9 million of working capital on-hand at the date of acquisition. The Silva acquisition resulted in $60.8 million of intangible assets. See Note 3 for additional information.

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Amortization Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization of Intangible Assets	$ 3,207	$ 2,404	$ 8,005	$ 4,021

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Goodwill and Other Intangibles Future Amortization Expense (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
2022	$ 3,228
2023	12,495
2024	11,247
2025	11,812
2026 and thereafter	57,008
Total expected future amortization expense	$ 95,790	$ 72,304	$ 74,710

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Leases of Lessees (Narrative) (Details) $ in Millions	Dec. 31, 2021 USD ($)
Additional operating leases that have not yet commenced	$ 0.0

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Supplemental balance sheet information related to leases (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
Operating lease right-of-use assets	$ 34,139	$ 31,230	$ 34,717
Current portion of operating lease liabilities	9,128	7,898	9,014
Long-term operating lease liabilities	22,612	19,725	22,709
Total operating lease liabilities	$ 31,740	$ 27,623	$ 31,723

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Supplemental income statement information related to leases (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Supplemental income statement information related to leases [Line Items]
Operating Lease, Cost	[1]	$ 5,341	$ 5,921	$ 15,206	$ 16,707
Cost of goods sold [Member]
Supplemental income statement information related to leases [Line Items]
Operating Lease, Cost		2,805	3,401	8,104	9,531
Selling, General and Administrative Expenses [Member]
Supplemental income statement information related to leases [Line Items]
Operating Lease, Cost		$ 2,536	$ 2,520	$ 7,102	$ 7,176

[1] Includes variable operating lease costs.

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Maturities of operating lease liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
2022 (excluding the nine months ended December 31, 2021)	$ 2,743
2023	9,493
2024	7,526
2025	5,393
2026	3,116
2027 and thereafter	7,676
Total undiscounted cash flows for operating leases	35,947
Less: Imputed interest	(4,207)
Total operating lease liabilities	$ (31,740)	$ (27,623)	$ (31,723)

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Supplemental information related to leases (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Cash paid for amounts included in the measurement of operating lease liabilities	$ 3,219	$ 3,171	$ 8,836	$ 9,358
Right-of-use assets obtained in exchange for new operating leases	$ 3,843	$ 1,532	$ 12,894	$ 3,122
Weighted Average Remaining Lease Term (years)	5 years 3 months 21 days	5 years 3 months 29 days	5 years 3 months 21 days	5 years 3 months 29 days
Weighted Average Collateralized Incremental Borrowing Rate	3.84%	4.21%	3.84%	4.21%

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Derivatives And Hedging Activities (Narrative) (Details) - USD ($) $ in Thousands	9 Months Ended
	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020	Feb. 26, 2019
Derivative [Line Items]
Repayments of Lines of Credit	$ 150,000
Loans Payable	150,000
Foreign Exchange Forward [Member]
Derivative [Line Items]
Notional amount of derivative contracts	59,600	$ 16,600	$ 13,300
Cash Flow Hedging [Member] | Interest Rate Swap [Member]
Derivative [Line Items]
Notional amount of derivative contracts	370,000
Derivative, Fair Value, Net				$ 5,400
Cash Flow Hedging [Member] | Foreign Exchange Forward [Member]
Derivative [Line Items]
Net unrealized gain (loss) on foreign currency derivatives designated as cash flow hedges	$ (1,300)

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Notional Amount of Forward Contracts (Details) - Forward Foreign Currency Exchange Contract [Member] - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020
Derivative [Line Items]
Notional amount of derivative contracts	$ 188.0	$ 137.5
Derivatives related to tobacco purchases [Member] | Tobacco purchases [Member]
Derivative [Line Items]
Notional amount of derivative contracts	134.7	89.4
Derivatives related to processing costs [Member] | Processing costs [Member]
Derivative [Line Items]
Notional amount of derivative contracts	32.5	24.6
Derivatives related to processing costs [Member] | Crop input sales [Member]
Derivative [Line Items]
Notional amount of derivative contracts	$ 20.8	$ 23.5

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Derivatives And Hedging Activities (Effect Of Derivative Financial Instruments On The Consolidated Statements Of Income) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Derivatives Designated As Hedges [Member] | Interest Rate Swap Agreements [Member] | Interest Expense [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification and Tax	$ 3,967	$ 953	$ 2,318	$ (3,020)
Gain (loss) reclassified from accumulated other comprehensive loss into earnings	(2,263)	(2,206)	(6,743)	(6,233)
Gain on terminated interest rate swaps amortized from accumulated other comprehensive loss into earnings	353	353	1,061	1,061
Derivatives Designated As Hedges [Member] | Interest Rate Swap Agreements [Member] | Selling, General And Administrative Expenses [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) recognized in earnings from ineffective portion and early de-designation of cash flow hedges	0	0	0	0
Derivatives Designated As Hedges [Member] | Forward Foreign Currency Exchange Contracts [Member] | Cost of goods sold [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification and Tax	480	5,757	3,479	3,973
Gain (loss) reclassified from accumulated other comprehensive loss into earnings	2,274	(2,362)	3,563	(9,575)
Derivatives Designated As Hedges [Member] | Forward Foreign Currency Exchange Contracts [Member] | Selling, General And Administrative Expenses [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) recognized in earnings from ineffective portion and early de-designation of cash flow hedges	0	0	451	0
Derivatives Not Designated As Hedges [Member] | Forward Foreign Currency Exchange Contracts [Member] | Selling, General And Administrative Expenses [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) recognized in earnings	$ 174	$ 922	$ 3,939	$ 506

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Derivatives And Hedging Activities (Effect Of Derivative Financial Instruments On The Consolidated Balance Sheets) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
Derivative [Line Items]
Derivatives in a Fair Value Asset Position Designated as Hedging Instruments	$ 2,169	$ 1,137	$ 5,688
Derivatives in a Fair Value Liability Position Designated as Hedging Instruments	20,610	26,750	34,861
Derivatives in a Fair Value Asset Position Not Designated as Hedging Instruments	1,390	435	1,625
Derivatives in a Fair Value Liability Position Not Designated as Hedging Instruments	1,298	791	324
Interest Rate Swap Agreements [Member] | Other Non-Current Assets [Member]
Derivative [Line Items]
Derivatives in a Fair Value Asset Position Designated as Hedging Instruments	0	0	0
Interest Rate Swap Agreements [Member] | Other Long-Term Liabilities [Member]
Derivative [Line Items]
Derivatives in a Fair Value Liability Position Designated as Hedging Instruments	16,658	25,719	33,950
Forward Foreign Currency Exchange Contract [Member] | Other Current Assets [Member]
Derivative [Line Items]
Derivatives in a Fair Value Asset Position Designated as Hedging Instruments	2,169	1,137	5,688
Derivatives in a Fair Value Asset Position Not Designated as Hedging Instruments	1,390	435	1,625
Forward Foreign Currency Exchange Contract [Member] | Accounts Payable and Accrued Expenses [Member]
Derivative [Line Items]
Derivatives in a Fair Value Liability Position Designated as Hedging Instruments	3,952	1,031	911
Derivatives in a Fair Value Liability Position Not Designated as Hedging Instruments	$ 1,298	$ 791	$ 324

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Fair Value Measurements (Narrative) (Details) - USD ($)	3 Months Ended	6 Months Ended	9 Months Ended
	Jun. 30, 2021	Sep. 30, 2021	Dec. 31, 2021	Mar. 31, 2020	Jan. 01, 2020
FruitSmart, Inc. [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value contingent consideration liability				$ 6,700,000
Change in contingent consideration liability	$ 4,200,000		$ 2,500,000
Nonrecurring fair value measurements [Member] | Tanzania
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired fixed assets			9,400,000
Fair Value of impaired assets for sale or disposal			$ 3,000,000

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Fair Value Measurements (Financial Assets And Liabilities Measured At Fair Value On Recurring Basis) (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
Assets:
Money market funds	$ 335	$ 1,992	$ 380
Trading securities associated with deferred compensation plans	14,794	15,735	15,703
Forward foreign currency exchange contracts	3,559	1,572	7,313
Total financial assets measured and reported at fair value	18,688	19,299	23,396
Liabilities:
Business Combination, Contingent Consideration, Liability, Noncurrent		2,532	2,532
Interest Rate Derivative Liabilities, at Fair Value	16,658	25,719	33,950
Forward foreign currency exchange contracts	5,250	1,822	1,235
Total financial liabilities measured and reported at fair value	21,908	30,073	37,717
Net Asset Value [Member]
Assets:
Money market funds	335	1,992	380
Trading securities associated with deferred compensation plans	0	0	0
Forward foreign currency exchange contracts	0	0	0
Total financial assets measured and reported at fair value	335	1,992	380
Liabilities:
Business Combination, Contingent Consideration, Liability, Noncurrent		0	0
Interest Rate Derivative Liabilities, at Fair Value	0	0	0
Forward foreign currency exchange contracts	0	0	0
Total financial liabilities measured and reported at fair value	0	0	0
Level 1 [Member]
Assets:
Money market funds	0	0	0
Trading securities associated with deferred compensation plans	14,794	15,735	15,703
Forward foreign currency exchange contracts	0	0	0
Total financial assets measured and reported at fair value	14,794	15,735	15,703
Liabilities:
Business Combination, Contingent Consideration, Liability, Noncurrent		0	0
Interest Rate Derivative Liabilities, at Fair Value	0	0	0
Forward foreign currency exchange contracts	0	0	0
Total financial liabilities measured and reported at fair value	0	0	0
Level 2 [Member]
Assets:
Money market funds	0	0	0
Trading securities associated with deferred compensation plans	0	0	0
Forward foreign currency exchange contracts	3,559	1,572	7,313
Total financial assets measured and reported at fair value	3,559	1,572	7,313
Liabilities:
Business Combination, Contingent Consideration, Liability, Noncurrent		0	0
Interest Rate Derivative Liabilities, at Fair Value	16,658	25,719	33,950
Forward foreign currency exchange contracts	5,250	1,822	1,235
Total financial liabilities measured and reported at fair value	21,908	27,541	35,185
Level 3 [Member]
Assets:
Money market funds	0	0	0
Trading securities associated with deferred compensation plans	0	0	0
Forward foreign currency exchange contracts	0	0	0
Total financial assets measured and reported at fair value	0	0	0
Liabilities:
Business Combination, Contingent Consideration, Liability, Noncurrent		2,532	2,532
Interest Rate Derivative Liabilities, at Fair Value	0	0	0
Forward foreign currency exchange contracts	0	0	0
Total financial liabilities measured and reported at fair value	$ 0	$ 2,532	$ 2,532

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Fair Value Measurements (Reconciliation of Contingent Consideration Liabilities Related to Acquisitions) (Details) - Contingent consideration [Member] - USD ($) $ in Thousands	9 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance beginning of year	$ 2,532	$ 6,705
Change in contingent consideration liability	(2,532)	(4,173)
Balance at end of period	$ 0	$ 2,532

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Fair Value Measurements - Long Term Obligations (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
Fair Value [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term debt	$ 517,000	$ 517,000	$ 516,000
Carrying Value [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term debt	520,000	520,000	520,000
Long-term debt	$ 518,547	$ 518,172	$ 518,047

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Pension And Other Postretirement Benefit Plans (Narrative) (Details) $ in Millions	9 Months Ended
	Dec. 31, 2021 USD ($)
Pension and Other Postretirement Benefits [Line Items]
Contributions to qualified and non-qualified pension plans	$ 4.9
Expected additional contributions in the current fiscal year	$ 1.3

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Pension And Other Postretirement Benefit Plans (Components Of Company's Net Periodic Benefit Cost) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Pension Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 1,678	$ 1,603	$ 4,981	$ 4,691
Interest cost	2,212	2,403	6,725	7,316
Expected return on plan assets	(3,373)	(3,676)	(10,145)	(11,032)
Net amortization and deferral	976	1,120	2,928	3,361
Net periodic benefit cost	1,493	1,450	4,489	4,336
Other Postretirement Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	43	48	137	145
Interest cost	265	286	745	859
Expected return on plan assets	(21)	(24)	(65)	(72)
Net amortization and deferral	(115)	(139)	(346)	(424)
Net periodic benefit cost	$ 172	$ 171	$ 471	$ 508

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Stock-Based Compensation (Narrative) (Details) - USD ($) $ in Thousands	9 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 5,300	$ 5,000
Expected stock based compensation for remaining fiscal year	$ 1,200
Restricted Stock Units (RSUs) [Member] | Pre FY2022 Grants [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	5 years
Restricted Stock Units (RSUs) [Member] | FY2022 Grants [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years
Performance Share Awards (PSAs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years
Minimum [Member] | Performance Share Awards (PSAs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of award grant paid	0.00%
Maximum [Member] | Performance Share Awards (PSAs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of award grant paid	150.00%
Outside Directors [Member] | Restricted Stock Units (RSUs) [Member] | Pre FY2020 Grants [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years
Outside Directors [Member] | Restricted Stock Units (RSUs) [Member] | FY2020 Grants [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	1 year

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Stock-Based Compensation (Stock-Based Awards Issued During The Period) (Details) - $ / shares	9 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number granted	72,860	80,650
Grant date fair value	$ 56.31	$ 43.42
Performance Share Awards (PSAs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number granted	48,650	63,050
Grant date fair value	$ 47.95	$ 34.33

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Operating Segments (Operating Results For The Company's Reportable Segments) (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Segment Reporting Information [Line Items]
Sales and other operating revenues		$ 652,644	$ 672,931	$ 1,456,628	$ 1,365,767
Deduct: Equity in pretax (earnings) loss of unconsolidated affiliates (1)	[1]	(2,084)	(1,506)	(5,056)	(2,089)
Restructuring Costs and Asset Impairment Charges	[2]	(8,433)	(19,979)	(10,457)	(19,979)
Other income	[3]	0	0	2,532	4,173
Consolidated operating income		62,773	60,186	103,191	85,065
Tobacco Operations
Segment Reporting Information [Line Items]
Sales and other operating revenues		578,002	623,852	1,268,610	1,278,844
Consolidated operating income		69,796	84,122	105,599	107,658
Ingredients
Segment Reporting Information [Line Items]
Sales and other operating revenues		74,642	49,079	188,018	86,923
Consolidated operating income		3,494	(2,451)	10,573	(4,698)
Operating Segments [Member]
Segment Reporting Information [Line Items]
Consolidated operating income		$ 73,290	$ 81,671	$ 116,172	$ 102,960

[1] Equity in pretax earnings (loss) of unconsolidated affiliates is included in segment operating income (Tobacco Operations), but is reported below consolidated operating income and excluded from that total in the consolidated statements of income and comprehensive income.

[2] Restructuring and impairment costs are excluded from segment operating income, but are included in consolidated operating income in the consolidated statements of income and comprehensive income. See Note 4 for additional information.

[3] Other income represents the reversal of a portion of the contingent consideration liability associated with the acquisition of FruitSmart. See Note 12 for additional information.

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Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands		9 Months Ended
		Dec. 31, 2021	Dec. 31, 2020	Mar. 31, 2021
Other Comprehensive Income (Loss), Tax [Abstract]
Accumulated other comprehensive loss		$ (104,412)	$ (122,262)	$ (107,037)
Accumulated Translation Adjustment [Member]
Foreign currency translation:
Balance at beginning of year		(35,135)	(42,923)
Net gain (loss) on foreign currency translation		(4,685)	13,232
Less: Net (gain) loss on foreign currency translation attributable to noncontrolling interests		170	25
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes		(4,515)	13,257
Balance at end of period		(39,650)	(29,666)
Accumulated Gain (Loss), Net, Cash Flow Hedge, Parent [Member] | Forward Foreign Currency Exchange Contract [Member]
Cash flow hedges: [Abstract]
Balance at beginning of year		(414)	(12,226)
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification, after Tax		730	6,423
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), Reclassification, after Tax	[1]	(2,265)	6,682
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), after Reclassification and Tax		(1,535)	13,105
Balance at the end of period		(1,949)	879
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification, Tax		(301)	(1,092)
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), Reclassification, Tax		(748)	1,914
Accumulated Gain (Loss), Net, Cash Flow Hedge, Parent [Member] | Interest Rate Swap [Member]
Cash flow hedges: [Abstract]
Balance at beginning of year		(19,480)	(27,402)
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification, after Tax		1,832	(2,386)
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), Reclassification, after Tax	[2]	4,488	4,086
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), after Reclassification and Tax		6,320	1,700
Balance at the end of period		(13,160)	(25,702)
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification, Tax		(487)	634
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), Reclassification, Tax		1,193	1,086
Accumulated Defined Benefit Plans Adjustment [Member]
Pension and other postretirement benefit plans:
Balance at beginning of year		(52,008)	(69,046)
Amortization included in earnings (net of tax expense (benefit) of $(524) and $(561))(3)	[3]	2,355	1,273
Other comprehensive income (loss) attributable to Universal Corporation, net of income taxes		2,355	1,273
Balance at end of period		(49,653)	(67,773)
Taxes on amortization included in net income		$ (524)	$ (561)

[1] Gain (loss) on foreign currency cash flow hedges related to forecast purchases of tobacco and crop input sales is reclassified from accumulated other comprehensive income (loss) to cost of goods sold when the tobacco is sold to customers. See Note 11 for additional information.

[2] Gain (loss) on interest rate cash flow hedges is reclassified from accumulated other comprehensive income (loss) to interest expense when the related interest payments are made on the underlying debt, or as amortized to interest expense over the period to original maturity for terminated swap agreements. See Note 11 for additional information.

[3] This accumulated other comprehensive income (loss) component is included in the computation of net periodic benefit cost. See Note 13 for additional information.

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Changes In Shareholders' Equity And Noncontrolling Interests In Subsidiaries (Reconciliation Of Changes In Shareholders' Equity And Noncontrolling Interests In Subsidiaries) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Schedule of Capitalization, Equity [Line Items]
Total stockholders' equity attributable to parent, beginning balance			$ 1,307,299
Noncontrolling interests in subsidiaries, beginning balance			41,126
Total shareholders' equity, beginning balance	$ 1,333,426	$ 1,278,876	1,348,425	$ 1,289,284
Accrual of stock-based compensation	1,204	1,334	5,289	5,042
Share-based Payment Arrangement, Decrease for Tax Withholding Obligation			2,458	1,949
Dividend equivalents on RSUs	266	255	802	755
Net income (loss) attributable to parent	34,940	33,273	60,807	48,049
Net income attributable to noncontrolling interest	9,215	7,168	9,015	7,541
Net (income) loss	44,155	40,441	69,822	55,590
Common stock dividends declared	(19,193)	(18,877)	(57,558)	(56,617)
Dividend equivalents on RSUs	(266)	(254)	(802)	(755)
Other comprehensive income (loss)	1,707	15,240	2,455	29,360
Dividends paid to noncontrolling interests	(2,057)	0	(6,733)	(3,695)
Total stockholders' equity attributable to parent, ending balance	1,316,004	1,270,525	1,316,004	1,270,525
Noncontrolling interest in subsidiaries, ending balance	43,238	46,490	43,238	46,490
Total shareholders' equity, ending balance	1,359,242	1,317,015	1,359,242	1,317,015
Universal Corporation [Member]
Schedule of Capitalization, Equity [Line Items]
Total stockholders' equity attributable to parent, beginning balance	1,297,332	1,239,500	1,307,299	1,246,665
Accrual of stock-based compensation	1,204	1,334	5,289	5,042
Share-based Payment Arrangement, Decrease for Tax Withholding Obligation			2,458	1,949
Dividend equivalents on RSUs	266	255	802	755
Net income (loss) attributable to parent	34,940	33,273	60,807	48,049
Common stock dividends declared	(19,193)	(18,877)	(57,558)	(56,617)
Dividend equivalents on RSUs	(266)	(254)	(802)	(755)
Other comprehensive income (loss) attributable to parent	1,721	15,294	2,625	29,335
Dividends paid to noncontrolling interests	0	0	0	0
Total stockholders' equity attributable to parent, ending balance	1,316,004	1,270,525	1,316,004	1,270,525
Noncontrolling Interests [Member]
Schedule of Capitalization, Equity [Line Items]
Noncontrolling interests in subsidiaries, beginning balance	36,094	39,376	41,126	42,619
Accrual of stock-based compensation	0	0	0	0
Share-based Payment Arrangement, Decrease for Tax Withholding Obligation			0	0
Dividend equivalents on RSUs	0	0	0	0
Net income attributable to noncontrolling interest	9,215	7,168	9,015	7,541
Common stock dividends declared	0	0	0	0
Dividend equivalents on RSUs	0	0	0	0
Other comprehensive income (loss) attributable to noncontrolling interest	(14)	(54)	(170)	25
Dividends paid to noncontrolling interests	(2,057)	0	(6,733)	(3,695)
Noncontrolling interest in subsidiaries, ending balance	$ 43,238	$ 46,490	$ 43,238	$ 46,490