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Guarantor and Non-Guarantor Financial Information
9 Months Ended
Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Guarantor and Non-Guarantor Financial Information
20. GUARANTOR AND NON-GUARANTOR FINANCIAL INFORMATION
 
The 2022 Notes and 2024 Notes are fully and unconditionally, as well as jointly and severally, guaranteed by our directly and indirectly owned domestic subsidiaries, which are collectively known as the “Guarantor Subsidiaries”. Bay Valley Foods, LLC, which is a 100% owned direct subsidiary, maintains 100% direct and indirect ownership of the following Guarantor Subsidiaries: Sturm Foods, Inc.; S.T. Specialty Foods, Inc.; Associated Brands, Inc.; Cains Foods, Inc.; Cains Foods L.P.; Cains GP, LLC; Flagstone Foods, Inc., Protenergy Holdings, Inc.; Protenergy Natural Foods, Inc.; TreeHouse Private Brands, Inc. (formerly Ralcorp Holdings, Inc.); American Italian Pasta Company.; Nutcracker Brands, Inc.; Linette Quality Chocolates, Inc.; Ralcorp Frozen Bakery Products, Inc.; Cottage Bakery, Inc.; The Carriage House Companies, Inc. and certain other domestic subsidiaries that may become guarantors in the future. 

The guarantees of the Guarantor Subsidiaries are subject to release in limited circumstances, only upon the occurrence of certain customary conditions. There are no significant restrictions on the ability of the parent company or any guarantor to obtain funds from its subsidiaries by dividend or loan. The following condensed supplemental consolidating financial information presents the results of operations, financial position, and cash flows of the parent company, its Guarantor Subsidiaries, its non-guarantor subsidiaries, and the eliminations necessary to arrive at the information for the Company on a consolidated basis as of September 30, 2018 and December 31, 2017, and for the three and nine months ended September 30, 2018 and 2017. The equity method has been used with respect to investments in subsidiaries. The principal elimination entries eliminate investments in subsidiaries and intercompany balances and transactions.
Condensed Supplemental Consolidating Balance Sheet
September 30, 2018
(In millions)
 
 
 
Parent
Company
 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Assets
 
 
 
 

 
 

 
 

 
 

Current assets:
 
 

 
 

 
 

 
 

 
 

Cash and cash equivalents
 
$
0.2

 
$

 
$
52.6

 
$

 
$
52.8

Investments
 

 

 
15.4

 

 
15.4

Accounts receivable, net
 
3.4

 
221.6

 
60.6

 

 
285.6

Inventories
 

 
890.7

 
108.6

 

 
999.3

Prepaid expenses and other current assets
 
25.7

 
53.0

 
13.8

 

 
92.5

Total current assets
 
29.3

 
1,165.3

 
251.0

 

 
1,445.6

Property, plant, and equipment, net
 
34.0

 
1,084.9

 
153.2

 

 
1,272.1

Goodwill
 

 
2,046.7

 
121.3

 

 
2,168.0

Investment in subsidiaries
 
5,112.2

 
584.7

 

 
(5,696.9
)
 

Deferred income taxes
 
12.4

 

 

 
(12.4
)
 

Intangible and other assets, net
 
68.5

 
600.4

 
89.6

 

 
758.5

Total assets
 
$
5,256.4

 
$
5,482.0

 
$
615.1

 
$
(5,709.3
)
 
$
5,644.2

Liabilities and Stockholders’ Equity
 
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
 
 
 
Accounts payable and accrued expenses
 
$
61.8

 
$
624.6

 
$
64.5

 
$

 
$
750.9

Current portion of long-term debt
 
9.8

 
0.5

 
0.1

 

 
10.4

Total current liabilities
 
71.6

 
625.1

 
64.6

 

 
761.3

Long-term debt
 
2,332.1

 
0.5

 
0.5

 

 
2,333.1

Deferred income taxes
 

 
163.4

 
22.3

 
(12.4
)
 
173.3

Other long-term liabilities
 
10.8

 
162.4

 
13.6

 

 
186.8

Intercompany accounts receivable (payable), net
 
652.2

 
(581.6
)
 
(70.6
)
 

 

Stockholders’ equity
 
2,189.7

 
5,112.2

 
584.7

 
(5,696.9
)
 
2,189.7

Total liabilities and stockholders’ equity
 
$
5,256.4

 
$
5,482.0

 
$
615.1

 
$
(5,709.3
)
 
$
5,644.2

 
Condensed Supplemental Consolidating Balance Sheet
December 31, 2017
(In millions)
 
 
 
Parent
Company
 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Assets
 
 

 
 

 
 

 
 

 
 

Current assets:
 
 

 
 

 
 

 
 

 
 

Cash and cash equivalents
 
$
83.2

 
$
0.2

 
$
49.4

 
$

 
$
132.8

Investments
 

 

 
14.1

 

 
14.1

Accounts receivable, net
 
0.2

 
297.1

 
32.5

 

 
329.8

Inventories
 

 
803.1

 
115.2

 

 
918.3

Prepaid expenses and other current assets
 
69.8

 
32.0

 
20.0

 
(32.1
)
 
89.7

Total current assets
 
153.2

 
1,132.4

 
231.2

 
(32.1
)
 
1,484.7

Property, plant, and equipment, net
 
29.3

 
1,108.7

 
156.4

 

 
1,294.4

Goodwill
 

 
2,057.3

 
124.7

 

 
2,182.0

Investment in subsidiaries
 
4,945.5

 
582.6

 

 
(5,528.1
)
 

Intercompany accounts (payable) receivable, net
 
(328.6
)
 
274.5

 
54.1

 

 

Deferred income taxes
 
15.1

 

 

 
(15.1
)
 

Intangible and other assets, net
 
62.5

 
652.1

 
103.6

 

 
818.2

Total assets
 
$
4,877.0

 
$
5,807.6

 
$
670.0

 
$
(5,575.3
)
 
$
5,779.3

Liabilities and Stockholders’ Equity
 
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
 
 
 
Accounts payable and accrued expenses
 
$
53.3

 
$
513.8

 
$
54.7

 
$
(32.1
)
 
$
589.7

Current portion of long-term debt
 
9.0

 
1.1

 

 

 
10.1

Total current liabilities
 
62.3

 
514.9

 
54.7

 
(32.1
)
 
599.8

Long-term debt
 
2,533.8

 
1.4

 
0.5

 

 
2,535.7

Deferred income taxes
 

 
167.3

 
26.2

 
(15.1
)
 
178.4

Other long-term liabilities
 
17.6

 
178.5

 
6.0

 

 
202.1

Stockholders’ equity
 
2,263.3

 
4,945.5

 
582.6

 
(5,528.1
)
 
2,263.3

Total liabilities and stockholders’ equity
 
$
4,877.0

 
$
5,807.6

 
$
670.0

 
$
(5,575.3
)
 
$
5,779.3


 
Condensed Supplemental Consolidating Statement of Operations
Three Months Ended September 30, 2018
(In millions)
 
 
 
Parent
Company
 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Net sales
 
$

 
$
1,400.2

 
$
170.9

 
$
(177.1
)
 
$
1,394.0

Cost of sales
 

 
1,193.9

 
149.7

 
(177.1
)
 
1,166.5

Gross profit
 

 
206.3

 
21.2

 

 
227.5

Selling, general, and administrative expense
 
35.3

 
107.7

 
8.9

 

 
151.9

Amortization expense
 
3.0

 
16.1

 
2.3

 

 
21.4

Other operating expense, net
 
26.2

 
(3.4
)
 
0.5

 

 
23.3

Operating income (loss)
 
(64.5
)
 
85.9

 
9.5

 

 
30.9

Interest expense
 
28.3

 

 
1.3

 
(1.8
)
 
27.8

Interest income
 
(0.3
)
 
(1.5
)
 
(1.3
)
 
1.8

 
(1.3
)
Other expense (income), net
 
(4.2
)
 
5.7

 
2.7

 

 
4.2

Income (loss) before income taxes
 
(88.3
)
 
81.7

 
6.8

 

 
0.2

Income tax (benefit) expense
 
(18.0
)
 
12.3

 
0.5

 

 
(5.2
)
Equity in net income (loss) of subsidiaries
 
75.7

 
6.3

 

 
(82.0
)
 

Net income (loss)
 
$
5.4

 
$
75.7

 
$
6.3

 
$
(82.0
)
 
$
5.4

 
 
Condensed Supplemental Consolidating Statement of Operations
Three Months Ended September 30, 2017
(In millions)
 
 
 
Parent
Company
 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Net sales
 
$

 
$
1,458.0

 
$
175.9

 
$
(85.1
)
 
$
1,548.8

Cost of sales
 

 
1,221.9

 
152.3

 
(85.1
)
 
1,289.1

Gross profit
 

 
236.1

 
23.6

 

 
259.7

Selling, general, and administrative expense
 
23.9

 
128.3

 
10.3

 

 
162.5

Amortization expense
 
3.3

 
22.7

 
2.5

 

 
28.5

Other operating expense, net
 
2.4

 
8.0

 
0.7

 

 
11.1

Operating income (loss)
 
(29.6
)
 
77.1

 
10.1

 

 
57.6

Interest expense
 
31.3

 
0.1

 
3.8

 
(3.8
)
 
31.4

Interest income
 

 
(3.8
)
 
(0.4
)
 
3.8

 
(0.4
)
Other expense (income), net
 
(2.4
)
 
(1.9
)
 
0.8

 

 
(3.5
)
Income (loss) before income taxes
 
(58.5
)
 
82.7

 
5.9

 

 
30.1

Income tax (benefit) expense
 
(22.4
)
 
22.7

 
1.0

 

 
1.3

Equity in net income (loss) of subsidiaries
 
64.9

 
4.9

 

 
(69.8
)
 

Net income (loss)
 
$
28.8

 
$
64.9

 
$
4.9

 
$
(69.8
)
 
$
28.8


Condensed Supplemental Consolidating Statement of Operations
Nine Months Ended September 30, 2018
(In millions)
 
 
 
Parent
Company
 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Net sales
 
$

 
$
4,336.9

 
$
518.3

 
$
(524.2
)
 
$
4,331.0

Cost of sales
 

 
3,699.5

 
460.5

 
(524.2
)
 
3,635.8

Gross profit
 

 
637.4

 
57.8

 

 
695.2

Selling, general, and administrative expense
 
114.9

 
361.7

 
29.4

 

 
506.0

Amortization expense
 
8.7

 
49.3

 
6.9

 

 
64.9

Other operating expense, net
 
81.6

 
14.0

 
3.3

 

 
98.9

Operating income (loss)
 
(205.2
)
 
212.4

 
18.2

 

 
25.4

Interest expense
 
88.9

 

 
2.7

 
(4.0
)
 
87.6

Interest income
 
(2.6
)
 
(3.6
)
 
(1.6
)
 
4.0

 
(3.8
)
Other expense (income), net
 
(1.4
)
 
12.2

 
0.7

 

 
11.5

Income (loss) before income taxes
 
(290.1
)
 
203.8

 
16.4

 

 
(69.9
)
Income tax (benefit) expense
 
(61.4
)
 
39.0

 
1.3

 

 
(21.1
)
Equity in net income (loss) of subsidiaries
 
179.9

 
15.1

 

 
(195.0
)
 

Net income (loss)
 
$
(48.8
)
 
$
179.9

 
$
15.1

 
$
(195.0
)
 
$
(48.8
)
 
Condensed Supplemental Consolidating Statement of Operations
Nine Months Ended September 30, 2017
(In millions)
 
 
 
Parent
Company
 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Net sales
 
$

 
$
4,353.3

 
$
498.8

 
$
(244.9
)
 
$
4,607.2

Cost of sales
 

 
3,597.6

 
431.8

 
(244.9
)
 
3,784.5

Gross profit
 

 
755.7

 
67.0

 

 
822.7

Selling, general, and administrative expense
 
86.0

 
407.6

 
30.3

 

 
523.9

Amortization expense
 
9.4

 
69.2

 
7.2

 

 
85.8

Other operating expense, net
 
2.4

 
107.4

 
2.1

 

 
111.9

Operating income (loss)
 
(97.8
)
 
171.5

 
27.4

 

 
101.1

Interest expense
 
94.2

 
0.3

 
4.8

 
(6.4
)
 
92.9

Interest income
 
(2.2
)
 
(6.4
)
 
(1.3
)
 
6.4

 
(3.5
)
Other expense (income), net
 
(0.8
)
 
(2.1
)
 
0.8

 

 
(2.1
)
Income (loss) before income taxes
 
(189.0
)
 
179.7

 
23.1

 

 
13.8

Income tax (benefit) expense
 
(72.6
)
 
59.2

 
4.4

 

 
(9.0
)
Equity in net income (loss) of subsidiaries
 
139.2

 
18.7

 

 
(157.9
)
 

Net income (loss)
 
$
22.8

 
$
139.2

 
$
18.7

 
$
(157.9
)
 
$
22.8


 
Condensed Supplemental Consolidating Statement of Comprehensive Income (Loss)
Three Months Ended September 30, 2018
(In millions)
 
 
 
Parent
Company
 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Net income (loss)
 
$
5.4

 
$
75.7

 
$
6.3

 
$
(82.0
)
 
$
5.4

Other comprehensive income (loss):
 
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments
 

 

 
6.5

 

 
6.5

Pension and postretirement reclassification
   adjustment, net of tax
 

 
0.1

 

 

 
0.1

Other comprehensive income (loss)
 

 
0.1

 
6.5

 

 
6.6

Equity in other comprehensive (loss) income of
   subsidiaries
 
6.6

 
6.5

 

 
(13.1
)
 

Comprehensive income (loss)
 
$
12.0

 
$
82.3

 
$
12.8

 
$
(95.1
)
 
$
12.0


Condensed Supplemental Consolidating Statement of Comprehensive Income (Loss)
Three Months Ended September 30, 2017
(In millions)
 
 
 
Parent
Company
 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Net income (loss)
 
$
28.8

 
$
64.9

 
$
4.9

 
$
(69.8
)
 
$
28.8

Other comprehensive income (loss):
 
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments
 

 

 
18.0

 

 
18.0

Pension and postretirement reclassification
   adjustment, net of tax
 

 
0.1

 

 

 
0.1

Other comprehensive income (loss)
 

 
0.1

 
18.0

 

 
18.1

Equity in other comprehensive income (loss) of
   subsidiaries
 
18.1

 
18.0

 

 
(36.1
)
 

Comprehensive income (loss)
 
$
46.9

 
$
83.0

 
$
22.9

 
$
(105.9
)
 
$
46.9


 

Condensed Supplemental Consolidating Statement of Comprehensive Income (Loss)
Nine Months Ended September 30, 2018
(In millions)
 
 
 
Parent
Company
 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Net income (loss)
 
$
(48.8
)
 
$
179.9

 
$
15.1

 
$
(195.0
)
 
$
(48.8
)
Other comprehensive income (loss):
 
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments
 

 

 
(13.0
)
 

 
(13.0
)
Pension and postretirement reclassification
   adjustment, net of tax
 

 
0.4

 

 

 
0.4

Adoption of ASU 2018-02 reclassification to retained earnings
 

 
(1.1
)
 

 

 
(1.1
)
Other comprehensive income (loss)
 

 
(0.7
)
 
(13.0
)
 

 
(13.7
)
Equity in other comprehensive (loss) income of
   subsidiaries
 
(13.7
)
 
(13.0
)
 

 
26.7

 

Comprehensive income (loss)
 
$
(62.5
)
 
$
166.2

 
$
2.1

 
$
(168.3
)
 
$
(62.5
)
 
 
Condensed Supplemental Consolidating Statement of Comprehensive Income (Loss)
Nine Months Ended September 30, 2017
(In millions)
 
 
 
Parent
Company
 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Net income (loss)
 
$
22.8

 
$
139.2

 
$
18.7

 
$
(157.9
)
 
$
22.8

Other comprehensive income (loss):
 
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments
 

 

 
34.5

 

 
34.5

Pension and postretirement reclassification
   adjustment, net of tax
 

 
7.2

 

 

 
7.2

Other comprehensive income (loss)
 

 
7.2

 
34.5

 

 
41.7

Equity in other comprehensive income (loss) of
   subsidiaries
 
41.7

 
34.5

 

 
(76.2
)
 

Comprehensive income (loss)
 
$
64.5

 
$
180.9

 
$
53.2

 
$
(234.1
)
 
$
64.5




Condensed Supplemental Consolidating Statement of Cash Flows
Nine Months Ended September 30, 2018
(In millions)
 
 
 
Parent
Company
 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Cash flows from operating activities:
 
 

 
 

 
 

 
 

 
 

Net cash provided by (used in) operating
   activities
 
$
89.3

 
$
323.9

 
$
51.5

 
$
(194.2
)
 
$
270.5

Cash flows from investing activities:
 
 
 
 
 
 
 
 
 
 
Additions to property, plant, and equipment
 
(2.2
)
 
(99.2
)
 
(15.3
)
 

 
(116.7
)
Additions to intangible assets
 
(15.8
)
 
(0.6
)
 

 

 
(16.4
)
Intercompany transfer
 
(25.8
)
 
(162.2
)
 
(16.2
)
 
204.2

 

Other
 

 
35.5

 
(1.1
)
 

 
34.4

Net cash (used in) provided by investing
   activities
 
(43.8
)
 
(226.5
)
 
(32.6
)
 
204.2

 
(98.7
)
Cash flows from financing activities:
 
 
 
 
 
 
 
 
 
 
Net (repayment) borrowing of debt
 
(208.5
)
 
(1.5
)
 

 

 
(210.0
)
Intercompany transfer
 
120.8

 
(95.1
)
 
(15.7
)
 
(10.0
)
 

Repurchases of common stock
 
(42.2
)
 

 

 

 
(42.2
)
Receipts related to stock-based award activities
 
4.7

 

 

 

 
4.7

Payments related to stock-based award activities
 
(3.3
)
 

 

 

 
(3.3
)
Net cash (used in) provided by financing
   activities
 
(128.5
)
 
(96.6
)
 
(15.7
)
 
(10.0
)
 
(250.8
)
Effect of exchange rate changes on cash and
cash equivalents
 

 
(1.0
)
 

 

 
(1.0
)
Decrease (increase) in cash and cash equivalents
 
(83.0
)
 
(0.2
)
 
3.2

 

 
(80.0
)
Cash and cash equivalents, beginning of period
 
83.2

 
0.2

 
49.4

 

 
132.8

Cash and cash equivalents, end of period
 
$
0.2

 
$

 
$
52.6

 
$

 
$
52.8

 
Condensed Supplemental Consolidating Statement of Cash Flows
Nine Months Ended September 30, 2017
(In millions)
 
 
 
Parent
Company
 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Cash flows from operating activities:
 
 

 
 

 
 

 
 

 
 

Net cash provided by (used in) operating
   activities
 
$
13.4

 
$
406.0

 
$
1.4

 
$
(157.4
)
 
$
263.4

Cash flows from investing activities:
 
 
 
 
 
 
 
 
 
 
Additions to property, plant, and equipment
 
(1.6
)
 
(87.4
)
 
(13.5
)
 

 
(102.5
)
Additions to intangible assets
 
(17.7
)
 
(0.8
)
 
(0.1
)
 

 
(18.6
)
Intercompany transfer
 
69.8

 
(128.2
)
 

 
58.4

 

Proceeds from sale of fixed assets
 

 
7.2

 

 

 
7.2

Proceeds from divestiture
 

 
19.0

 
0.3

 

 
19.3

Other
 

 

 
(1.0
)
 

 
(1.0
)
Net cash (used in) provided by investing
   activities
 
50.5

 
(190.2
)
 
(14.3
)
 
58.4

 
(95.6
)
Cash flows from financing activities:
 
 
 
 
 
 
 
 
 
 
Net borrowing (repayment) of debt
 
(100.8
)
 
(2.2
)
 
(0.1
)
 

 
(103.1
)
Intercompany transfer
 
109.2

 
(213.6
)
 
5.4

 
99.0

 

Receipts related to stock-based award activities
 
11.1

 

 

 

 
11.1

Payments related to stock-based award activities
 
(6.7
)
 

 

 

 
(6.7
)
Net cash (used in) provided by financing
   activities
 
12.8

 
(215.8
)
 
5.3

 
99.0

 
(98.7
)
Effect of exchange rate changes on cash and
cash equivalents
 

 

 
0.7

 

 
0.7

Increase (decrease) in cash and cash equivalents
 
76.7

 

 
(6.9
)
 

 
69.8

Cash and cash equivalents, beginning of period
 

 
0.2

 
61.9

 

 
62.1

Cash and cash equivalents, end of period
 
$
76.7

 
$
0.2

 
$
55.0

 
$

 
$
131.9