Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. |
Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification Number) |
(Address of principal executive offices) | (Zip Code) |
Registrant's telephone number, including area code: |
Title of each class | Trading symbol(s) | Name of each exchange on which registered | |||
par value $0.01 per share |
☒ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | Smaller reporting company | Emerging growth company |
Page | ||
PART I | ||
Item 1. | ||
Item 1A. | ||
Item 1B. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
PART II | ||
Item 5. | ||
Item 6. | ||
Item 7. | ||
Item 7A. | ||
Item 8. | ||
Item 9. | ||
Item 9A. | ||
Item 9B. | ||
PART III | ||
Item 10. | ||
Item 11. | ||
Item 12. | ||
Item 13. | ||
Item 14. | ||
PART IV | ||
Item 15. | ||
Item 16. |
• | March 2018: The company completed its acquisition of certain assets of JoeTap, a leading innovator of on-demand nitro and cold brew coffee dispensing equipment for the commercial foodservice industry. |
• | April 2018: The company completed its acquisition of all of the capital stock of Firex S.r.l. ("Firex"), a leading manufacturer of steam cooking equipment for the commercial foodservice industry located in Sedico, Italy. |
• | May 2018: The company completed its acquisition of all of the issued share capital of Josper S.A. ("Josper"), a leading manufacturer of charcoal grill and oven cooking equipment for commercial foodservice and residential industries located in Pineda de Mar, Spain. |
• | June 2018: The company completed its acquisition of all of the capital stock of the Taylor Company ("Taylor"), a world leader in beverage solutions, soft serve and ice cream dispensing equipment, frozen drink machines, and automated double-sided grills, for the commercial foodservice industry, located in Rockton, Illinois. |
• | December 2018: The company completed its acquisition of all of the capital stock of the Crown Food Service Equipment, Ltd. ("Crown"), a leading design and manufacturer of steam cooking equipment for the commercial foodservice industry located in Toronto, Canada. |
• | December 2018: The company completed its acquisition of all of the capital stock of EVO America, Inc. ("EVO"), a leading design and manufacturer of ventless cooking equipment for the commercial foodservice industry, located near Portland, Oregon. |
• | April 2019: The company completed its acquisition of all of the capital stock of Cooking Solutions Group, Inc. ("Cooking Solutions Group") from Standex International Corporation, which consists of the brands APW Wyott, Bakers Pride, BKI and Ultrafryer and locations in Texas, South Carolina and Mexico. |
• | April 2019: The company completed the acquisition of all of the capital stock of Powerhouse Dynamics, Inc. ("Powerhouse"), a leader in cloud-based IoT solutions for the commercial foodservice industry located near Boston. |
• | April 2019: The company completed the acquisition of all of the assets related to the Starline Product line ("Starline") non-carbonated beverage dispensers for the commercial foodservice industry. |
• | June 2019: The company completed the acquisition of substantially all of the assets of Ss Brewtech, a market leader in professional craft brewing and beverage equipment based in Santa Ana, California. |
• | November 2019: The company completed the acquisition of all of the capital stock of Synesso, Inc. ("Synesso"), a designer and manufacturer of semi-automatic espresso machines for the commercial foodservice industry, located in Seattle, Washington. |
• | February 2018: The company completed its acquisition of all of the capital stock of Hinds-Bock Corporation ("Hinds-Bock"), a leading manufacturer of solutions for filling and depositing bakery and food product located in Bothell, Washington. |
• | April 2018: The company completed its acquisition of all of the capital stock of Ve.Ma.C S.r.l. ("Ve.Ma.C"), a leading designer and manufacturer of handling, automation and robotics solutions for protein food processing lines located in Castelnuovo Rangone, Italy. |
• | October 2018: The company completed its acquisition of all of the capital stock of the M-TEK Corporation ("M-TEK"), a leading manufacturer of Modified Atmospheric Packaging (MAP) systems located in Elgin, Illinois. |
• | July 2019: The company completed the acquisition of all of the capital stock of Packaging Progressions, Inc. ("Pacproinc"), a market leader in automated packaging technologies for customers in the protein and baker segments based in Souderton, Pennsylvania. |
• | November 2019: The company completed its acquisition of Brava Home, Inc. ("Brava"), a company known for its advanced residential light cooking technology located in Redwood City, California. |
• | the company may be unable to obtain additional financing for working capital, capital expenditures, acquisitions and other general corporate purposes; |
• | a significant portion of the company’s cash flow from operations must be dedicated to debt service, which reduces the amount of cash the company has available for other purposes; |
• | the company may be more vulnerable in the event of a downturn in the company’s business or general economic and industry conditions; |
• | the company may be disadvantaged competitively by its potential inability to adjust to changing market conditions, as a result of its significant level of indebtedness; and |
• | the company may be restricted in its ability to make strategic acquisitions and to pursue new business opportunities. |
• | pay dividends; |
• | incur additional indebtedness; |
• | create liens on the company’s assets; |
• | engage in new lines of business; |
• | make investments; |
• | make capital expenditures and enter into leases; and |
• | acquire or dispose of assets. |
• | inability to operate acquired businesses or utilize acquired technologies profitably; |
• | diversion of management’s attention from other business concerns; |
• | potential assumption of unknown material liabilities; |
• | failure to achieve financial or operating objectives; |
• | unanticipated costs relating to acquisitions or to the integration of the acquired businesses; |
• | loss of customers, suppliers, or key employees; and |
• | the impact on the company's internal controls and compliance with the regulatory requirements under the Sarbanes-Oxley Act of 2002. |
• | extensive regulations and oversight, tariffs, including recently with respect to certain products imported from China or exported to China, retaliatory tariffs by China and certain other countries in response to tariffs implemented by the United States, and other trade barriers; |
• | withdrawal from or renegotiation of international trade agreements and other restrictions on trade between the United States and China, the European Union, Canada, Mexico and other countries; |
• | effects of the United Kingdom's decision to exit the European Union and related potential disruption to trade; |
• | recent outbreak of coronavirus in China and other jurisdictions and uncertain impact on operations, suppliers and customers; |
• | reduced protection for intellectual property rights; |
• | difficulties in staffing and managing foreign operations; |
• | potentially adverse tax consequences; |
• | limitations on ownership and on repatriation of earnings; |
• | transportation delays and interruptions; |
• | political, social, and economic instability and disruptions; |
• | labor unrests; |
• | potential for nationalization of enterprises; and |
• | limitations on the company’s ability to enforce legal rights and remedies. |
• | the lengthy, unpredictable sales cycle for commercial foodservice equipment, food processing equipment and residential kitchen equipment group; |
• | the level of market acceptance of new or enhanced versions of the company’s products; |
• | the company's failure to meet the performance estimates of securities analysts; |
• | changes in buy/sell recommendations by securities analysts; |
• | fluctuations in our operating results; |
• | substantial sales of the company's common stock; |
• | general stock market conditions; or |
• | other economic or external factors. |
Location | Principal Function | Square Footage | Owned/ Leased | Lease Expiration | |||||
Commercial Foodservice: | |||||||||
Fort Smith, AR | Manufacturing, Warehousing and Offices | 440,200 | Leased | Aug-31 | |||||
Brea, CA | Manufacturing, Warehousing and Offices | 80,700 | Leased | Sep-20 | |||||
Vacaville, CA | Manufacturing, Warehousing and Offices | 81,200 | Leased | May-27 | |||||
Windsor, CA | Manufacturing, Warehousing and Offices | 75,000 | Leased | Apr-22 | |||||
Elgin, IL | Manufacturing, Warehousing and Offices | 207,000 | Owned | N/A | |||||
Mundelein, IL | Manufacturing, Warehousing and Offices | 70,000 | Owned | N/A | |||||
Rockton, IL | Manufacturing, Warehousing and Offices | 339,400 | Owned | N/A | |||||
South Beloit, IL | Warehousing | 130,900 | Leased | Jun-23 | |||||
Menominee, MI | Manufacturing, Warehousing and Offices | 60,000 | Owned | N/A | |||||
Fuquay-Varina, NC | Manufacturing, Warehousing and Offices | 183,900 | Owned | N/A | |||||
Bow, NH | Manufacturing, Warehousing and Offices | 100,000 | Owned | N/A | |||||
Concord, NH | Warehousing | 39,000 | Leased | Mar-20 | |||||
Pembroke, NH | Warehousing | 136,200 | Leased | Nov-24 | |||||
Dayton, OH | Manufacturing, Warehousing and Offices | 37,700 | Owned | N/A | |||||
Tualatin, OR | Manufacturing, Warehousing and Offices | 16,500 | Leased | Dec-20 | |||||
Bethlehem, PA | Manufacturing, Warehousing and Offices | 72,900 | Leased | Dec-24 | |||||
Easton, PA | Manufacturing, Warehousing and Offices | 156,700 | Owned | N/A | |||||
Smithville, TN | Manufacturing, Warehousing and Offices | 268,000 | Owned | N/A | |||||
Allen, TX | Warehousing | 33,100 | Leased | Feb-24 | |||||
Carrollton, TX | Manufacturing, Warehousing and Offices | 132,400 | Leased | Aug-22 | |||||
Essex Junction, VT | Manufacturing, Warehousing and Offices * | 270,000 | Owned | N/A | |||||
Redmond, WA | Manufacturing, Warehousing and Offices | 42,400 | Leased | May-22 | |||||
Seattle, WA | Manufacturing, Warehousing and Offices | 12,200 | Leased | Aug-22 | |||||
New South Wales, Australia | Manufacturing, Warehousing and Offices | 204,900 | Owned | N/A | |||||
Toronto, Canada | Manufacturing, Warehousing and Offices | 101,500 | Owned | N/A | |||||
Humen, China | Manufacturing, Warehousing | 10,900 | Leased | Mar-20 | |||||
Qingdao City, China | Manufacturing, Warehousing and Offices | 113,500 | Leased | Jul-29 | |||||
Brøndby, Denmark | Manufacturing, Warehousing and Offices | 50,900 | Owned | N/A | |||||
Randers, Denmark | Manufacturing, Warehousing and Offices | 50,100 | Owned | N/A | |||||
Viljandi, Estonia | Manufacturing and Offices | 47,000 | Owned | N/A | |||||
Nusco, Italy | Manufacturing, Warehousing and Offices | 260,600 | Owned | N/A | |||||
Scandicci, Italy | Manufacturing, Warehousing and Offices | 37,600 | Leased | Apr-25 | |||||
Sedico, Italy | Manufacturing, Warehousing and Offices | 52,500 | Leased | Feb-24 | |||||
Nogales, Mexico | Manufacturing, Warehousing and Offices | 127,000 | Owned | N/A | |||||
Laguna, the Philippines | Manufacturing, Warehousing and Offices | 115,200 | Owned | N/A | |||||
Wiślina, Poland | Manufacturing, Warehousing and Offices | 77,500 | Owned | N/A | |||||
Pineda de Mar, Spain | Manufacturing, Warehousing and Offices | 50,100 | Owned | N/A | |||||
Fristad, Sweden | Manufacturing, Warehousing and Offices | 173,800 | Owned | N/A | |||||
Lincoln, the United Kingdom | Manufacturing, Warehousing and Offices | 100,000 | Owned | N/A | |||||
Wrexham, the United Kingdom | Manufacturing, Warehousing and Offices | 62,600 | Owned | N/A | |||||
Location | Principal Function | Square Footage | Owned/ Leased | Lease Expiration | |||||
Food Processing: | |||||||||
Gainesville, GA | Manufacturing, Warehousing and Offices | 107,400 | Owned | N/A | |||||
Elgin, IL | Manufacturing, Warehousing and Offices | 25,000 | Owned | N/A | |||||
Elk Grove, IL | Manufacturing, Warehousing and Offices | 101,500 | Leased | Nov-29 | |||||
Algona, IA | Manufacturing, Warehousing and Offices | 70,100 | Owned | N/A | |||||
Clayton, NC | Manufacturing, Warehousing and Offices | 65,000 | Leased | Oct-24 | |||||
Maysville, OK | Manufacturing, Warehousing and Offices | 36,700 | Owned | N/A | |||||
Souderton, PA | Manufacturing, Warehousing and Offices | 35,000 | Owned | N/A | |||||
Plano, TX | Manufacturing, Warehousing and Offices | 339,100 | Leased | Apr-22 | |||||
Waynesboro, VA | Manufacturing, Warehousing and Offices | 26,400 | Owned | N/A | |||||
Bothell, WA | Manufacturing, Warehousing and Offices | 23,600 | Leased | May-25 | |||||
Lodi, WI | Manufacturing, Warehousing and Offices | 114,600 | Owned | N/A | |||||
Aalborg, Denmark | Manufacturing, Warehousing and Offices | 68,300 | Leased | Dec-22 | |||||
Mauron, France | Manufacturing, Warehousing and Offices | 112,400 | Leased | Dec-22 | |||||
Reichenau, Germany | Manufacturing, Warehousing and Offices | 57,900 | Owned | N/A | |||||
Bangalore, India | Manufacturing, Warehousing and Offices | 75,000 | Leased | Mar-24 | |||||
Castelnuovo Rangone, Italy | Manufacturing, Warehousing and Offices | 26,900 | Leased | Dec-23 | |||||
Norwich, the United Kingdom | Manufacturing, Warehousing and Offices | 30,000 | Owned | N/A |
Residential Kitchen: | |||||||||
Chino, CA | Warehousing and Offices | 100,000 | Leased | Feb-22 | |||||
Redwood City, CA | Warehousing and Offices | 20,600 | Leased | Jan-20 | |||||
Buford, GA | Warehousing and Offices | 178,100 | Leased | Feb-23 | |||||
Greenville, MI | Manufacturing, Warehousing and Offices | 225,000 | Owned | N/A | |||||
Greenwood, MS | Manufacturing, Warehousing and Offices ** | 738,000 | Owned | N/A | |||||
Brown Deer, WI | Manufacturing, Warehousing and Offices | 165,400 | Leased | May-22 | |||||
Saint Ouen L'aumone, France | Manufacturing, Warehousing | 30,400 | Owned | N/A | |||||
Waterford, Ireland | Manufacturing, Warehousing and Offices | 73,000 | Leased | Jul-27 | |||||
Adderbury, the United Kingdom | Warehousing and Offices | 82,500 | Leased | Aug-20 | |||||
Ketley, the United Kingdom | Manufacturing and Offices | 217,300 | Owned | N/A | |||||
Leamington Spa, the United Kingdom | Manufacturing and Offices | 270,200 | Owned | N/A | |||||
Leamington Spa, the United Kingdom | Warehousing and Offices | 100,300 | Leased | Aug-29 | |||||
Nottingham, the United Kingdom | Manufacturing and Offices | 153,100 | Owned | N/A |
Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plan or Program | Maximum Number of Shares that May Yet be Purchased Under the Plan or Program (1) | |||||||||
September 29 to October 26, 2019 | — | $ | — | — | 2,373,800 | |||||||
October 27 to November 23, 2019 | — | — | — | 2,373,800 | ||||||||
November 24 to December 28, 2019 | — | — | — | 2,373,800 | ||||||||
Quarter ended December 28, 2019 | — | $ | — | — | 2,373,800 |
2019 | 2018 | 2017 | 2016 | 2015 | |||||||||||||||
Income Statement Data: | |||||||||||||||||||
Net sales | $ | 2,959,446 | $ | 2,722,931 | $ | 2,335,542 | $ | 2,267,852 | $ | 1,826,598 | |||||||||
Cost of sales | 1,855,949 | 1,718,791 | 1,422,801 | 1,366,672 | 1,120,093 | ||||||||||||||
Gross profit | 1,103,497 | 1,004,140 | 912,741 | 901,180 | 706,505 | ||||||||||||||
Selling, general, and administrative expenses | 593,813 | 538,842 | 468,219 | 471,638 | 378,366 | ||||||||||||||
Restructuring expenses | 10,480 | 19,332 | 19,951 | 10,524 | 28,754 | ||||||||||||||
Gain on litigation settlement | (14,839 | ) | — | — | — | — | |||||||||||||
Gain on sale of plant | — | — | (12,042 | ) | — | — | |||||||||||||
Impairment of intangible asset | — | — | 58,000 | — | — | ||||||||||||||
Income from operations | 514,043 | 445,966 | 378,613 | 419,018 | 299,385 | ||||||||||||||
Interest expense and deferred financing amortization, net | 82,609 | 58,742 | 25,983 | 23,880 | 16,967 | ||||||||||||||
Net periodic pension benefit (other than service costs) | (28,857 | ) | (38,114 | ) | (31,728 | ) | (27,207 | ) | (3,218 | ) | |||||||||
Other (income) expense, net | (2,328 | ) | 1,825 | 829 | 1,040 | 4,469 | |||||||||||||
Earnings before income taxes | 462,619 | 423,513 | 383,529 | 421,305 | 281,167 | ||||||||||||||
Provision for income taxes | 110,379 | 106,361 | 85,401 | 137,089 | 89,557 | ||||||||||||||
Net earnings | $ | 352,240 | $ | 317,152 | $ | 298,128 | $ | 284,216 | $ | 191,610 | |||||||||
Net earnings per share: | |||||||||||||||||||
Basic | $ | 6.33 | $ | 5.71 | $ | 5.26 | $ | 4.98 | $ | 3.36 | |||||||||
Diluted | $ | 6.33 | $ | 5.70 | $ | 5.26 | $ | 4.98 | $ | 3.36 | |||||||||
Weighted average number of shares outstanding: | |||||||||||||||||||
Basic | 55,647 | 55,576 | 56,715 | 57,030 | 56,951 | ||||||||||||||
Diluted | 55,656 | 55,604 | 56,719 | 57,085 | 56,973 | ||||||||||||||
Balance Sheet Data: | |||||||||||||||||||
Working capital | $ | 616,059 | $ | 502,642 | $ | 458,236 | $ | 323,290 | $ | 285,191 | |||||||||
Total assets | 5,002,143 | 4,549,781 | 3,339,713 | 2,917,136 | 2,761,151 | ||||||||||||||
Total debt | 1,873,140 | 1,892,105 | 1,028,881 | 732,126 | 766,061 | ||||||||||||||
Stockholders' equity | 1,946,814 | 1,665,203 | 1,361,148 | 1,265,318 | 1,166,830 |
(1) | The company's fiscal year ends on the Saturday nearest to December 31. |
(2) | The company has acquired numerous businesses in the periods presented. Please see Note 2 in the Notes to Consolidated Financial Statements for further information. |
• | changing market conditions; |
• | volatility in earnings resulting from goodwill impairment losses, which may occur irregularly and in varying amounts; |
• | variability in financing costs; |
• | quarterly variations in operating results; |
• | dependence on key customers; |
• | risks associated with the company's foreign operations, including market acceptance and demand for the company's products and the company's ability to manage the risk associated with the exposure to foreign currency exchange rate fluctuations; |
• | the company's ability to protect its trademarks, copyrights and other intellectual property; |
• | the impact of competitive products and pricing; |
• | the impact of announced management and organizational changes; |
• | the state of the residential construction, housing and home improvement markets; |
• | the state of the credit markets, including mortgages, home equity loans and consumer credit; |
• | the company's ability to maintain and grow the Viking reputation and brand image; |
• | intense competition in the company's business segments including the impact of both new and established global competitors; |
• | unfavorable tax law changes and tax authority rulings; |
• | cybersecurity attacks and other breaches in security; |
• | the continued ability to realize profitable growth through the sourcing and completion of strategic acquisitions; |
• | the timely development and market acceptance of the company's products; and |
• | the availability and cost of raw materials. |
Fiscal Year Ended(1) | ||||||||||||||||||||
2019 | 2018 | 2017 | ||||||||||||||||||
Sales | Percent | Sales | Percent | Sales | Percent | |||||||||||||||
Business Segments: | ||||||||||||||||||||
Commercial Foodservice | $ | 1,984,345 | 67.1 | % | $ | 1,729,814 | 63.5 | % | $ | 1,382,108 | 59.2 | % | ||||||||
Food Processing | 400,951 | 13.5 | 389,594 | 14.3 | 352,717 | 15.1 | ||||||||||||||
Residential Kitchen | 574,150 | 19.4 | 603,523 | 22.2 | 600,717 | 25.7 | ||||||||||||||
Total | $ | 2,959,446 | 100.0 | % | $ | 2,722,931 | 100.0 | % | $ | 2,335,542 | 100.0 | % |
(1) | The company's fiscal year ends on the Saturday nearest to December 31. |
Fiscal Year Ended(1) | ||||||||
2019 | 2018 | 2017 | ||||||
Net sales | 100.0 | % | 100.0 | % | 100.0 | % | ||
Cost of sales | 62.7 | 63.1 | 60.9 | |||||
Gross profit | 37.3 | 36.9 | 39.1 | |||||
Selling, general and administrative expenses | 20.1 | 19.8 | 20.0 | |||||
Restructuring | 0.3 | 0.7 | 0.9 | |||||
Gain on litigation settlement | (0.5 | ) | — | — | ||||
Gain on sale of plant | — | — | (0.5 | ) | ||||
Impairment of intangible assets | — | — | 2.5 | |||||
Income from operations | 17.4 | 16.4 | 16.2 | |||||
Interest expense and deferred financing amortization, net | 2.9 | 2.2 | 1.1 | |||||
Net periodic pension benefit (other than service costs) | (1.0 | ) | (1.4 | ) | (1.3 | ) | ||
Other (income) expense, net | (0.1 | ) | 0.1 | — | ||||
Earnings before income taxes | 15.6 | 15.5 | 16.4 | |||||
Provision for income taxes | 3.7 | 3.9 | 3.7 | |||||
Net earnings | 11.9 | % | 11.6 | % | 12.7 | % |
(1) | The company's fiscal year ends on the Saturday nearest to December 31. |
• | Net sales of the Commercial Foodservice Equipment Group increased by $254.5 million, or 14.7%, to $1,984.3 million in fiscal 2019 as compared to $1,729.8 million in fiscal 2018. Net sales from the acquisitions of Firex, Josper, Taylor, Crown, EVO, Cooking Solutions Group, Powerhouse, Ss Brewtech, and Synesso, which were acquired on April 27, 2018, May 10, 2018, June 22, 2018, December 3, 2018, December 31, 2018, April 1, 2019, April 1, 2019, June 15, 2019, and November 27, 2019, respectively, accounted for an increase of $247.1 million during fiscal 2019. Excluding the impact of acquisitions, net sales of the Commercial Foodservice Equipment Group increased $7.4 million, or 0.4%, as compared to the prior year. Excluding the impact of foreign exchange and acquisitions, net sales increased $27.2 million, or 1.6% at the Commercial Foodservice Equipment Group. Domestically, the company realized a sales increase of $158.8 million, or 13.5%, to $1,334.8 million, as compared to $1,176.0 million in the prior year. This includes an increase of $158.3 million from recent acquisitions. Excluding acquisitions, net sales were relatively flat. International sales increased $95.7 million, or 17.3%, to $649.5 million, as compared to $553.8 million in the prior year. This includes the increase of $88.8 million from recent acquisitions and a decrease of $19.8 million related to the unfavorable impact of exchange rates. Excluding acquisitions and foreign exchange, the net sales increase in international sales was $26.7 million, or 4.8%. The increase in international revenues reflects strengthening of sales in the Asian and Latin American markets. |
• | Net sales of the Food Processing Equipment Group increased by $11.4 million, or 2.9%, to $401.0 million in fiscal 2019, as compared to $389.6 million in fiscal 2018. Net sales from the acquisitions of Hinds-Bock, Ve.Ma.C, M-TEK and Pacproinc, which were acquired on February 16, 2018, April 3, 2018, October 1, 2018, and July 16, 2019 respectively, accounted for an increase of $29.3 million. Excluding the impact of acquisitions, net sales of the Food Processing Equipment Group decreased $17.9 million, or 4.6%. Excluding the impact of foreign exchange and acquisitions net sales decreased $12.7 million, or 3.3% at the Food Processing Equipment Group. Domestically, the company realized a sales decrease of $17.1 million, or 6.5%, to $246.6 million, as compared to $263.7 million in the prior year. This includes an increase of $24.1 million from recent acquisitions. Excluding acquisitions, net sales decreased $41.2 million, or 15.6%. International sales increased $28.5 million, or 22.6%, to $154.4 million, as compared to $125.9 million in the prior year. This includes the increase of $5.2 million from the recent acquisitions and a decrease of $5.2 million related to the unfavorable impact of exchange rates. Excluding acquisitions and foreign exchange, the net sales decrease in international sales was $28.5 million, or 22.6%. Revenues for the Food Processing Equipment Group have been affected by the timing and deferral of certain larger projects. |
• | Net sales of the Residential Kitchen Equipment Group decreased by $29.4 million, or 4.9%, to $574.1 million in fiscal 2019, as compared to $603.5 million in fiscal 2018. Excluding the impact of foreign exchange, the acquisition of Brava, acquired November, 19, 2019, and closure of a non-core business, net sales decreased $11.7 million, or 2.0% at the Residential Kitchen Equipment Group. Domestically, the company realized a sales decrease of $4.0 million, or 1.1%, to $362.7 million, as compared to $366.7 million in the prior year. Excluding acquisitions and closure of a non-core business the net sales decrease in domestic sales was $4.7 million, or 1.3%. International sales decreased $25.4 million, or 10.7% to $211.4 million, as compared to $236.8 million in the prior year. This includes an unfavorable impact of exchange rates of $11.1 million. Excluding the impact of foreign exchange, acquisition, and closure of a non-core business the net sales decrease in international sales was $7.0 million, or 3.1%. The decrease in international revenues reflects decline of sales in the European market. |
• | Gross profit at the Commercial Foodservice Equipment Group increased by $88.1 million, or 13.4%, to $746.6 million in fiscal 2019 as compared to $658.5 million in fiscal 2018. Gross profit from the acquisitions of Firex, Josper, Taylor, Crown, EVO, Cooking Solutions Group, Powerhouse, Ss Brewtech, and Synesso, accounted for approximately $73.3 million of the increase in gross profit during fiscal 2019. Excluding acquisitions, the gross profit increased by approximately $14.8 million largely due to selling prices. The impact of foreign exchange rates decreased gross profit by approximately $6.1 million. The gross profit margin rate decreased to 37.6% as compared to 38.1% in the prior year, primarily due to lower margins at recent acquisitions. The gross margin rate in fiscal 2019 excluding acquisitions and impact of foreign exchange was 38.7%. |
• | Gross profit at the Food Processing Equipment Group increased by $8.6 million, or 6.4%, to $142.2 million in fiscal 2019 as compared to $133.6 million in fiscal 2018. Gross profit from the acquisitions of Hinds-Bock, Ve.Ma.C, M-TEK and Pacproinc, accounted for approximately $12.8 million of the increase in gross profit during fiscal 2019. Excluding acquisitions, the gross profit decreased by approximately $4.2 million based on lower sales volumes. The impact of foreign exchange rates decreased gross profit by approximately $2.1 million. The gross profit margin rate increased to 35.5% in fiscal 2019 as compared to 34.3% in the prior year, reflecting the impact of acquisitions. The gross margin rate in fiscal 2019 excluding acquisitions and impact of foreign exchange was 34.9%. |
• | Gross profit at the Residential Kitchen Equipment Group decreased by $0.3 million, or 0.1%, to $216.8 million in fiscal 2019 as compared to $217.1 million in fiscal 2018. Gross profit was offset by unfavorable foreign exchange rates of $3.9 million. The gross margin rate increased to 37.8% in fiscal 2019 as compared to 36.0% in the prior year. The gross margin rate in fiscal 2019 excluding acquisitions and impact of foreign exchange was 37.7%. |
• | Net sales of the Commercial Foodservice Equipment Group increased by $347.7 million, or 25.2%, to $1,729.8 million in fiscal 2018 as compared to $1,382.1 million in fiscal 2017. Net sales from the acquisitions of Sveba Dahlen, QualServ, L2F, Globe, Firex, Josper, Taylor, and Crown which were acquired on June 30, 2017, August 31, 2017, October 6, 2017, October 17, 2017, April 27, 2018, May 10, 2018, June 22, 2018, and December 3, 2018, respectively, accounted for an increase of $304.7 million during fiscal 2018. Excluding the impact of acquisitions, net sales of the Commercial Foodservice Equipment Group increased $43.0 million, or 3.1%, as compared to the prior year. Excluding the impact of foreign exchange and acquisitions, net sales increased $42.9 million, or 3.1% at the Commercial Foodservice Equipment Group. Domestically, the company realized a sales increase of $207.5 million, or 21.4%, to $1,176.0 million, as compared to $968.5 million in the prior year. This includes an increase of $166.6 million from recent acquisitions. Excluding acquisitions, net sales increased $40.9 million, or 4.2%, related to increased sales with major chain restaurants and retail customers. International sales increased $140.2 million, or 33.9%, to $553.8 million, as compared to $413.6 million in the prior year. This includes the increase of $138.1 million from recent acquisitions and an increase of $0.1 million related to the favorable impact of exchange rates. Excluding acquisitions and foreign exchange, the net sales increase in international sales was $2.0 million, or 0.5%. |
• | Net sales of the Food Processing Equipment Group increased by $36.9 million, or 10.5%, to $389.6 million in fiscal 2018, as compared to $352.7 million in fiscal 2017. Net sales from the acquisitions of Burford, CVP Systems, Scanico, Hinds-Bock, Ve.Ma.C, and M-TEK which were acquired on May 1, 2017, June 30, 2017, December 7, 2017, February 16, 2018, April 3, 2018, and October 1, 2018, respectively, accounted for an increase of $70.5 million. Excluding the impact of these acquisitions, net sales of the Food Processing Equipment Group decreased $33.6 million, or 9.5%. The adoption of ASC 606 increased net sales by approximately $20.6 million. Excluding the impact of foreign exchange, acquisitions, and ASC 606 net sales decreased $55.4 million, or 15.7% at the Food Processing Equipment Group. Domestically, the company realized a sales increase of $7.0 million, or 2.7%, to $263.7 million, as compared to $256.7 million in the prior year. This includes an increase of $33.2 million from recent acquisitions. Excluding acquisitions, net sales decreased $26.2 million, or 10.2%. International sales increased $29.9 million, or 31.1%, to $125.9 million, as compared to $96.0 million in the prior year. This includes the increase of $37.3 million from the recent acquisitions and an increase of $1.2 million related to the favorable impact of exchange rates. Excluding acquisitions and foreign exchange, the net sales decrease in international sales was $8.6 million, or 9.0%. Revenues for the Food Processing Equipment Group have been affected by the timing and deferral of certain larger projects. |
• | Net sales of the Residential Kitchen Equipment Group increased by $2.8 million, or 0.5%, to $603.5 million in fiscal 2018, as compared to $600.7 million in fiscal 2017. Excluding the impact of foreign exchange, net sales decreased $5.3 million, or 0.9% at the Residential Kitchen Equipment Group. Domestically, the company realized a sales increase of $22.5 million, or 6.5%, to $366.7 million, as compared to $344.2 million in the prior year. Sales at Viking increased by approximately 15% in fiscal 2018. International sales decreased $19.7 million, or 7.7% to $236.8 million, as compared to $256.5 million in the prior year. This includes a favorable impact of exchange rates of $8.1 million. Excluding foreign exchange, the net sales decrease in international sales was $27.8 million, or 10.8%, related to slower conditions in the UK market. In addition, sales decreased at non-core businesses, acquired in connection with AGA, and have been impacted by restructuring initiatives. Restructuring initiatives at Grange, one of the non-core businesses, was substantially completed at the end of fiscal 2018. |
• | Gross profit at the Commercial Foodservice Equipment Group increased by $106.6 million, or 19.3%, to $658.5 million in fiscal 2018 as compared to $551.9 million in fiscal 2017. Gross profit from the acquisitions of Sveba Dahlen, QualServ, L2F, Globe, Firex, Josper, Taylor, and Crown accounted for approximately $80.5 million of the increase in gross profit during fiscal 2018. Excluding acquisitions, the gross profit increased by approximately $26.1 million due to higher sales volume. The impact of foreign exchange rates increased gross profit by approximately $0.6 million. The gross profit margin rate decreased to 38.1% as compared to 39.9% in the prior year, primarily due to lower margins at recent acquisitions. The gross margin rate in fiscal 2018 excluding acquisitions and impact of foreign exchange was 40.5%. |
• | Gross profit at the Food Processing Equipment Group decreased by $9.5 million, or 6.6%, to $133.6 million in fiscal 2018 as compared to $143.1 million in fiscal 2017. Gross profit from the acquisitions of Burford, CVP Systems, Scanico, Hinds-Bock, Ve.Ma.C, and M-TEK accounted for approximately $25.1 million of the increase in gross profit during fiscal 2018. The adoption of ASC 606 increased gross profit by approximately $5.3 million. Excluding the recent acquisitions and adoption of ASC 606, the gross profit decreased by approximately $39.9 million based on lower sales volumes. The impact of foreign exchange rates increased gross profit by approximately $0.8 million. The gross profit margin rate decreased to 34.3% in fiscal 2018 as compared to 40.6% in the prior year, reflecting the impact of lower volumes and unfavorable product mix resulting from lesser sales of protein equipment which generally have higher margins. The gross margin rate in fiscal 2018 excluding acquisitions, adoption of ASC 606, and impact of foreign exchange was 34.4%. |
• | Gross profit at the Residential Kitchen Equipment Group decreased by $5.8 million, or 2.6%, to $217.1 million in fiscal 2018 as compared to $222.9 million in fiscal 2017. The impact of foreign exchange rates increased gross profit by approximately $2.5 million. The gross margin rate decreased to 36.0% in fiscal 2018 as compared to 37.1% in the prior year, primarily related to the impact of domestic distribution changes and sales incentives for the Viking brand. The gross margin rate in fiscal 2018 excluding the impact of foreign exchange was 36.0%. |
Amounts Due Sellers From Acquisition | Debt (1) | Estimated Interest on Debt (1) | Operating Leases | Total Contractual Cash Obligations | |||||||||||||||
Less than 1 year | $ | 2,522 | $ | 2,894 | $ | 72,831 | $ | 24,563 | $ | 102,810 | |||||||||
1-3 years | 6,720 | 680 | 143,234 | 39,299 | 189,933 | ||||||||||||||
4-5 years | — | 164 | 140,972 | 22,876 | 164,012 | ||||||||||||||
After 5 years | — | 1,869,402 | 11,550 | 25,514 | 1,906,466 | ||||||||||||||
$ | 9,242 | $ | 1,873,140 | $ | 368,587 | $ | 112,252 | $ | 2,363,221 |
• | Revenue growth rates relate to projected revenues from our long-range plans and vary from brand to brand. Adverse changes in the operating environment or our inability to grow revenues at the forecasted rates may result in a material impairment charge. |
• | In determining royalty rates for the valuation of our trademarks, we considered factors that affect the assumed royalty rates that would hypothetically be paid for the use of the trademarks. The most significant factors in determining the assumed royalty rates include the overall role and importance of the trademarks in the particular industry, the profitability of the products utilizing the trademarks, and the position of the trademarked products in the given market segment. |
• | In developing discount rates for the valuation of our trademarks, we used the market based weighted average cost of capital, adjusted for higher relative level of risks associated with doing business in other countries, as applicable, as well as the higher relative levels of risks associated with intangible assets. |
Variable Rate Debt | |||
2020 | $ | 2,894 | |
2021 | 378 | ||
2022 | 302 | ||
2023 | 82 | ||
2024 and thereafter | 1,869,484 | ||
$ | 1,873,140 |
Page | |
The following consolidated financial statement schedule is included in response to Item 15 | |
Acquisition of Taylor Company | |
Description of the Matter | As described in Note 2 of the consolidated financial statements, the Company completed its acquisition of Taylor Company for net consideration of approximately $1.0 billion on June 22, 2018. The transaction was accounted for as a business combination. Auditing the Company's accounting for its acquisition of Taylor Company was complex due to the significant estimation uncertainty in determining the fair value of identified intangible assets of approximately $604 million, which principally consisted of the Taylor trade name and customer relationships. The significant estimation uncertainty was primarily due to the sensitivity of the respective fair values to underlying assumptions about the future performance of the acquired business. The Company used a discounted cash flow model to measure the trade name and customer relationship intangible assets. The significant assumptions used to estimate the value of the intangible assets include revenue growth rates, projected profit margins, discount rates, royalty rates, and customer attrition rates. These significant assumptions are forward-looking and could be affected by future economic and market conditions. |
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company's controls over accounting for the acquisition of Taylor Company, including controls over the determination of the fair value of the acquired trade name and customer relationships intangible assets, and management's evaluation of the underlying assumptions described above. We also tested management's controls over the completeness and accuracy of the data used in the valuation models. To test the estimated fair value of the trade name and customer relationships intangible assets, we performed audit procedures that included, among others, evaluating the Company's selection of the valuation methodology, evaluating the methods and significant assumptions used by the Company's valuation specialist, and evaluating the completeness and accuracy of the underlying data supporting the significant assumptions and estimates. We compared the assumptions related to the revenue growth rate and projected profit margin, to the past performance of Taylor Company, the Company's history related to similar acquisitions, and third party industry data. We tested the assumptions related to discount rates and royalty rates to the Company’s history related to similar acquisitions and third-party industry data. We involved a valuation specialist to assist with our evaluation of the methodologies used by the Company and significant assumptions included in the fair value estimates. |
Impairment tests of indefinite-lived intangible assets | |
Description of the Matter | At December 28, 2019, the Company's indefinite-lived intangible assets consist of 69 trademarks and tradenames with an aggregate carrying value of approximately $997 million and represented 19.9% of total assets. As described in Note 3 of the consolidated financial statements, trademarks and tradenames with indefinite lives are tested by the Company’s management for impairment at least annually, in the fiscal fourth quarter, unless there are indications of impairment at other points throughout the year. If the fair value of the intangible asset is less than its carrying amount, an impairment loss is recognized in an amount equal to the difference. Auditing the impairment tests of indefinite-lived intangible assets is complex due to the significant management judgments and estimates required to determine the fair value of the trademarks and tradenames, including assumptions as to forecasted net sales, discount rates and royalty rates, all of which are sensitive to and affected by economic, industry and company-specific qualitative factors. |
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company's controls over the impairment tests of indefinite-lived intangible assets. This included evaluating controls over the Company’s process used to develop the forecasts of future net sales and the selection of royalty rates and discount rates used in estimating the fair value of the trademarks and tradenames with indefinite lives. We also tested controls over management’s review of the completeness and accuracy of data used in their valuation models. To test the estimated fair value of the Company’s trademarks and tradenames, we performed audit procedures that included, among others, assessing the methodologies, testing the significant assumptions discussed above and testing the completeness and accuracy of the underlying data. We compared the significant assumptions used by management to current industry and economic trends, the Company’s historical results and other guideline companies within the same industry and evaluated whether changes in the Company’s business would affect the significant assumptions. We assessed the historical accuracy of management’s estimates by comparing them to actual operating results and performed sensitivity analyses of significant assumptions to evaluate the change in the fair value of the trademarks and tradenames with indefinite lives resulting from changes in these assumptions. We involved our valuation specialists to assist in reviewing the valuation methodology and testing the discount rates and royalty rates. |
2019 | 2018 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | $ | |||||
Accounts receivable, net of reserve for doubtful accounts of $14,886 and $13,608 | |||||||
Inventories, net | |||||||
Prepaid expenses and other | |||||||
Prepaid taxes | |||||||
Total current assets | |||||||
Property, plant and equipment, net of accumulated depreciation of $197,629 and $167,737 | |||||||
Goodwill | |||||||
Other intangibles, net of amortization of $333,507 and $268,414 | |||||||
Long-term deferred tax assets | |||||||
Other assets | |||||||
Total assets | $ | $ | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: | |||||||
Current maturities of long-term debt | $ | $ | |||||
Accounts payable | |||||||
Accrued expenses | |||||||
Total current liabilities | |||||||
Long-term debt | |||||||
Long-term deferred tax liability | |||||||
Accrued pension benefits | |||||||
Other non-current liabilities | |||||||
Stockholders' equity: | |||||||
Preferred stock, $0.01 par value; nonvoting; 2,000,000 shares authorized; none issued | — | — | |||||
Common stock, $0.01 par value; 63,129,775 and 62,592,707 shares issued in 2019 and 2018, respectively | |||||||
Paid-in capital | |||||||
Treasury stock, at cost; 6,940,089 and 6,889,241 shares in 2019 and 2018 | ( | ) | ( | ) | |||
Retained earnings | |||||||
Accumulated other comprehensive loss | ( | ) | ( | ) | |||
Total stockholders' equity | |||||||
Total liabilities and stockholders' equity | $ | $ |
2019 | 2018 | 2017 | |||||||||
Net sales | $ | $ | $ | ||||||||
Cost of sales | |||||||||||
Gross profit | |||||||||||
Selling, general, and administrative expenses | |||||||||||
Restructuring expenses | |||||||||||
Gain on litigation settlement | ( | ) | |||||||||
Gain on sale of plant | ( | ) | |||||||||
Impairment of intangible asset | |||||||||||
Income from operations | |||||||||||
Interest expense and deferred financing amortization, net | |||||||||||
Net periodic pension benefit (other than service costs) | ( | ) | ( | ) | ( | ) | |||||
Other (income) expense, net | ( | ) | |||||||||
Earnings before income taxes | |||||||||||
Provision for income taxes | |||||||||||
Net earnings | $ | $ | $ | ||||||||
Net earnings per share: | |||||||||||
Basic | $ | $ | $ | ||||||||
Diluted | $ | $ | $ | ||||||||
Weighted average number of shares | |||||||||||
Basic | |||||||||||
Dilutive common stock equivalents | |||||||||||
Diluted |
2019 | 2018 | 2017 | |||||||||
Net earnings | $ | $ | $ | ||||||||
Other comprehensive (loss) income: | |||||||||||
Foreign currency translation adjustments | ( | ) | |||||||||
Pension liability adjustment, net of tax | ( | ) | ( | ) | |||||||
Unrealized (loss) gain on interest rate swaps, net of tax | ( | ) | |||||||||
Other comprehensive (loss) income: | $ | ( | ) | $ | ( | ) | $ | ||||
Comprehensive income | $ | $ | $ |
Common Stock | Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income/(loss) | Total Stockholders' Equity | ||||||||||||||||||
Balance, December 31, 2016 | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | |||||||||||||
Net earnings | |||||||||||||||||||||||
Currency translation adjustments | |||||||||||||||||||||||
Change in unrecognized pension benefit costs, net of tax of $(5,588) | ( | ) | ( | ) | |||||||||||||||||||
Unrealized gain on interest rate swap, net of tax of $588 | |||||||||||||||||||||||
Stock compensation | |||||||||||||||||||||||
Stock issuance | |||||||||||||||||||||||
Purchase of treasury stock | ( | ) | ( | ) | |||||||||||||||||||
Balance, December 30, 2017 | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | |||||||||||||
Net earnings | |||||||||||||||||||||||
Adoption of ASU 2018-02 (1) | ( | ) | |||||||||||||||||||||
Adoption of ASU 2014-09 (2) | ( | ) | ( | ) | |||||||||||||||||||
Currency translation adjustments | ( | ) | ( | ) | |||||||||||||||||||
Change in unrecognized pension benefit costs, net of tax of $6,386 | |||||||||||||||||||||||
Unrealized gain on interest rate swap, net of tax of $(81) | ( | ) | ( | ) | |||||||||||||||||||
Stock compensation | |||||||||||||||||||||||
Balance, December 29, 2018 | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | |||||||||||||
Net earnings | |||||||||||||||||||||||
Adoption of ASU 2017-12 (3) | ( | ) | |||||||||||||||||||||
Currency translation adjustments | |||||||||||||||||||||||
Change in unrecognized pension benefit costs, net of tax of $(11,914) | ( | ) | ( | ) | |||||||||||||||||||
Unrealized loss on interest rate swap, net of tax of $(8,516) | ( | ) | ( | ) | |||||||||||||||||||
Stock compensation | |||||||||||||||||||||||
Stock issuance | |||||||||||||||||||||||
Purchase of treasury stock | ( | ) | ( | ) | |||||||||||||||||||
Balance, December 28, 2019 | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ |
2019 | 2018 | 2017 | |||||||||
Cash flows from operating activities— | |||||||||||
Net earnings | $ | $ | $ | ||||||||
Adjustments to reconcile net earnings to net cash provided by operating activities | |||||||||||
Depreciation and amortization | |||||||||||
Non-cash share-based compensation | |||||||||||
Deferred income taxes | ( | ) | |||||||||
Net periodic pension benefit (other than service costs) | ( | ) | ( | ) | ( | ) | |||||
Gain on sale of plant | ( | ) | |||||||||
Impairment of equipment | |||||||||||
Impairment of intangible asset | |||||||||||
Non-cash restructuring | |||||||||||
Changes in assets and liabilities, net of acquisitions | |||||||||||
Accounts receivable, net | ( | ) | ( | ) | |||||||
Inventories, net | ( | ) | ( | ) | ( | ) | |||||
Prepaid expenses and other assets | ( | ) | |||||||||
Accounts payable | ( | ) | ( | ) | |||||||
Accrued expenses and other liabilities | ( | ) | ( | ) | |||||||
Net cash provided by operating activities | |||||||||||
Cash flows from investing activities— | |||||||||||
Additions to property and equipment | ( | ) | ( | ) | ( | ) | |||||
Proceeds on sale of plant | |||||||||||
Purchase of tradename | ( | ) | |||||||||
Acquisitions, net of cash acquired | ( | ) | ( | ) | ( | ) | |||||
Net cash used in investing activities | ( | ) | ( | ) | ( | ) | |||||
Cash flows from financing activities— | |||||||||||
Proceeds under Credit Facility | |||||||||||
Repayments under Credit Facility | ( | ) | ( | ) | ( | ) | |||||
Net repayments under foreign bank loan | ( | ) | ( | ) | ( | ) | |||||
Net repayments under other debt arrangement | ( | ) | ( | ) | ( | ) | |||||
Payments of deferred purchase price | ( | ) | ( | ) | |||||||
Repurchase of treasury stock | ( | ) | ( | ) | |||||||
Debt issuance costs | ( | ) | |||||||||
Net cash (used in) provided by financing activities | ( | ) | |||||||||
Effect of exchange rates on cash and cash equivalents | ( | ) | ( | ) | |||||||
Changes in cash and cash equivalents— | |||||||||||
Net increase (decrease) in cash and cash equivalents | ( | ) | |||||||||
Cash and cash equivalents at beginning of year | |||||||||||
Cash and cash equivalents at end of year | $ | $ | $ | ||||||||
Non-cash investing and financing activities: | |||||||||||
Stock issuance related to acquisitions | $ | $ | $ |
(1) | NATURE OF OPERATIONS |
(as initially reported) June 22, 2018 | Measurement Period Adjustments | (as adjusted) June 22, 2018 | |||||||||
Cash | $ | $ | $ | ||||||||
Current assets | ( | ) | |||||||||
Property, plant and equipment | ( | ) | |||||||||
Goodwill | ( | ) | |||||||||
Other intangibles | |||||||||||
Other assets | |||||||||||
Long-term deferred tax asset | |||||||||||
Current liabilities | ( | ) | ( | ) | ( | ) | |||||
Other non-current liabilities | ( | ) | ( | ) | ( | ) | |||||
Net assets acquired and liabilities assumed | $ | $ | ( | ) | $ |
(as initially reported) April 1, 2019 | Preliminary Measurement Period Adjustments | (as adjusted) April 1, 2019 | |||||||||
Cash | $ | $ | $ | ||||||||
Current assets | ( | ) | |||||||||
Property, plant and equipment | ( | ) | |||||||||
Goodwill | |||||||||||
Other intangibles | ( | ) | |||||||||
Other assets | |||||||||||
Current liabilities | ( | ) | ( | ) | ( | ) | |||||
Long-term deferred tax liability | ( | ) | ( | ) | |||||||
Other non-current liabilities | ( | ) | ( | ) | |||||||
Net assets acquired and liabilities assumed | $ | $ | $ |
Preliminary Opening Balance Sheet | Measurement Period Adjustments | Adjusted Opening Balance Sheet | |||||||||
Cash | $ | $ | ( | ) | $ | ||||||
Current assets | |||||||||||
Property, plant and equipment | |||||||||||
Goodwill | ( | ) | |||||||||
Other intangibles | |||||||||||
Other assets | |||||||||||
Current portion of long term debt | ( | ) | ( | ) | |||||||
Current liabilities | ( | ) | ( | ) | ( | ) | |||||
Long term debt | ( | ) | ( | ) | |||||||
Long-term deferred tax liability | ( | ) | ( | ) | ( | ) | |||||
Other non-current liabilities | ( | ) | ( | ) | |||||||
Consideration paid at closing | $ | $ | ( | ) | $ | ||||||
Contingent consideration | |||||||||||
Net assets acquired and liabilities assumed | $ | $ | ( | ) | $ |
Preliminary Opening Balance Sheet | Measurement Period Adjustments | Adjusted Opening Balance Sheet | |||||||||
Cash | $ | $ | ( | ) | $ | ||||||
Current assets | |||||||||||
Property, plant and equipment | |||||||||||
Goodwill | ( | ) | |||||||||
Other intangibles | |||||||||||
Long-term deferred tax asset | |||||||||||
Other assets | |||||||||||
Current liabilities | ( | ) | ( | ) | ( | ) | |||||
Other non-current liabilities | ( | ) | ( | ) | ( | ) | |||||
Consideration paid at closing | $ | $ | ( | ) | $ | ||||||
Deferred payments | |||||||||||
Contingent consideration | |||||||||||
Net assets acquired and liabilities assumed | $ | $ | ( | ) | $ |
Twelve Months Ended | |||||||
December 28, 2019 | December 29, 2018 | ||||||
Net sales | $ | $ | |||||
Net earnings | |||||||
Net earnings per share: | |||||||
Basic | $ | $ | |||||
Diluted | $ | $ |
(a) | Basis of Presentation |
(b) | Cash and Cash Equivalents |
(c) | Accounts Receivable |
2019 | 2018 | ||||||
Raw materials and parts | $ | $ | |||||
Work in process | |||||||
Finished goods | |||||||
$ | $ |
(e) | Property, Plant and Equipment |
2019 | 2018 | ||||||
Land | $ | $ | |||||
Building and improvements | |||||||
Furniture and fixtures | |||||||
Machinery and equipment | |||||||
Less accumulated depreciation | ( | ) | ( | ) | |||
$ | $ |
Description | Life | |
Building and improvements | 20 to 40 years | |
Furniture and fixtures | 3 to 7 years | |
Machinery and equipment | 3 to 10 years |
(f) | Goodwill and Other Intangibles |
Commercial Foodservice | Food Processing | Residential Kitchen | Total | ||||||||||||
Balance as of December 30, 2017 | $ | $ | $ | $ | |||||||||||
Goodwill acquired during the year | |||||||||||||||
Measurement period adjustments to goodwill acquired in prior year | ( | ) | ( | ) | ( | ) | |||||||||
Exchange effect | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Balance as of December 29, 2018 | $ | $ | $ | $ | |||||||||||
Goodwill acquired during the year | |||||||||||||||
Measurement period adjustments to goodwill acquired in prior year | ( | ) | ( | ) | ( | ) | |||||||||
Exchange effect | ( | ) | ( | ) | |||||||||||
Balance as of December 28, 2019 | $ | $ | $ | $ |
December 28, 2019 | December 29, 2018 | ||||||||||||||||||
Estimated Weighted Avg Remaining Life | Gross Carrying Amount | Accumulated Amortization | Estimated Weighted Avg Remaining Life | Gross Carrying Amount | Accumulated Amortization | ||||||||||||||
Amortized intangible assets: | |||||||||||||||||||
Customer relationships | $ | $ | ( | ) | $ | $ | ( | ) | |||||||||||
Backlog | ( | ) | ( | ) | |||||||||||||||
Developed technology | ( | ) | ( | ) | |||||||||||||||
$ | $ | ( | ) | $ | $ | ( | ) | ||||||||||||
Indefinite-lived assets: | |||||||||||||||||||
Trademarks and tradenames | $ | $ |
2020 | $ | ||
2021 | |||
2022 | |||
2023 | |||
2024 | |||
2025 and thereafter | |||
$ |
2019 | 2018 | ||||||
Accrued payroll and related expenses | $ | $ | |||||
Contract liabilities | |||||||
Accrued warranty | |||||||
Accrued customer rebates | |||||||
Accrued short-term leases | |||||||
Accrued sales and other tax | |||||||
Accrued product liability and workers compensation | |||||||
Accrued agent commission | |||||||
Accrued professional fees | |||||||
Other accrued expenses | |||||||
$ | $ |
(h) | Litigation Matters |
(i) | Accumulated Other Comprehensive Income (Loss) |
2019 | 2018 | ||||||
Unrecognized pension benefit costs, net of tax of ($48,633) and ($36,719) | $ | ( | ) | $ | ( | ) | |
Unrealized gain on interest rate swap, net of tax of ($5,973) and $2,543 | ( | ) | |||||
Currency translation adjustments | ( | ) | ( | ) | |||
$ | ( | ) | $ | ( | ) |
Currency Translation Adjustment | Pension Benefit Costs | Unrealized Gain/(Loss) Interest Rate Swap | Total | ||||||||||||
Balance as of December 30, 2017 | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | |||||
Adoption of ASU 2018-02 (2) | ( | ) | |||||||||||||
Other comprehensive income before reclassification | ( | ) | ( | ) | ( | ) | |||||||||
Amounts reclassified from accumulated other comprehensive income | |||||||||||||||
Net current-period other comprehensive income | $ | ( | ) | $ | $ | $ | ( | ) | |||||||
Balance as of December 29, 2018 | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | |||||
Adoption of ASU 2017-12 (3) | |||||||||||||||
Other comprehensive income before reclassification | ( | ) | ( | ) | ( | ) | |||||||||
Amounts reclassified from accumulated other comprehensive income | |||||||||||||||
Net current-period other comprehensive income | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||||
Balance as of December 28, 2019 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) |
Fair Value Level 1 | Fair Value Level 2 | Fair Value Level 3 | Total | ||||||||||||
As of December 28, 2019 | |||||||||||||||
Financial Assets: | |||||||||||||||
Interest rate swaps | $ | $ | $ | $ | |||||||||||
Financial Liabilities: | |||||||||||||||
Interest rate swaps | $ | $ | $ | $ | |||||||||||
Contingent consideration | $ | $ | $ | $ | |||||||||||
Foreign exchange derivative contracts | $ | $ | $ | $ | |||||||||||
As of December 29, 2018 | |||||||||||||||
Financial Assets: | |||||||||||||||
Interest rate swaps | $ | $ | $ | $ | |||||||||||
Financial Liabilities: | |||||||||||||||
Interest rate swaps | $ | $ | $ | $ | |||||||||||
Contingent consideration | $ | $ | $ | $ | |||||||||||
Foreign exchange derivative contracts | $ | $ | $ | $ |
(k) | Foreign Currency |
(l) | Shipping and Handling Costs |
Warranty |
2019 | 2018 | ||||||
Beginning balance | $ | $ | |||||
Warranty reserve related to acquisitions | |||||||
Warranty expense | |||||||
Warranty claims paid | ( | ) | ( | ) | |||
Ending balance | $ | $ |
(n) | Research |
(o) | Non-Cash Share-Based Compensation |
(p) | Earnings |
(q) | Consolidated Statements of Cash Flows |
(r) | New Acco |
(4) | REVENUE RECOGNITION |
• | The company does not disclose information about remaining performance obligations that have original expected durations of one year or less. |
• | The company generally expenses sales commissions when incurred because the amortization period would have been less than one year. These costs are recorded within selling, general and administrative expenses. |
• | As the company’s standard payment terms are less than one year, the company does not assess whether a contract has a significant financing component. |
• | The company treats shipping and handling activities performed after the customer obtains control of the good as a contract fulfillment activity. |
• | Sales, use and value added taxes assessed by governmental authorities are excluded from the measurement of the transaction price within the company’s contracts with its customers. |
Commercial Foodservice | Food Processing | Residential Kitchen | Total | ||||||||||||
Twelve Months Ended December 28, 2019 | |||||||||||||||
United States and Canada | $ | $ | $ | $ | |||||||||||
Asia | |||||||||||||||
Europe and Middle East | |||||||||||||||
Latin America | |||||||||||||||
Total | $ | $ | $ | $ | |||||||||||
Twelve Months Ended December 29, 2018 | |||||||||||||||
United States and Canada | $ | $ | $ | $ | |||||||||||
Asia | |||||||||||||||
Europe and Middle East | |||||||||||||||
Latin America | |||||||||||||||
Total | $ | $ | $ | $ | |||||||||||
Twelve Months Ended December 30, 2017 | |||||||||||||||
United States and Canada | $ | $ | $ | $ | |||||||||||
Asia | |||||||||||||||
Europe and Middle East | |||||||||||||||
Latin America | |||||||||||||||
Total | $ | $ | $ | $ |
December 28, 2019 | December 29, 2018 | ||||||
Contract assets | $ | $ | |||||
Contract liabilities | $ | $ | |||||
Non-current contract liabilities | $ | $ |
(5) | FINANCING ARRANGEMENTS |
2019 | 2018 | ||||||
Senior secured revolving credit line | $ | $ | |||||
Foreign loans | |||||||
Other debt arrangement | |||||||
Total debt | $ | $ | |||||
Less current maturities of long-term debt | |||||||
Long-term debt | $ | $ |
December 28, 2019 | December 29, 2018 | ||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||||
Total debt | $ | $ | $ | $ |
2020 | $ | ||
2021 | |||
2022 | |||
2023 | |||
2024 and thereafter | |||
$ |
Shares | Weighted Average Grant-Date Fair Value | |||||
Nonvested shares at December 30, 2017 | $ | |||||
Granted | ||||||
Vested | ( | ) | ||||
Forfeited | ( | ) | ||||
Nonvested shares at December 29, 2018 | $ | |||||
Granted | ||||||
Vested | ( | ) | ||||
Forfeited | ||||||
Nonvested shares at December 28, 2019 | $ |
2019 | 2018 | 2017 | |||||||||
Domestic | $ | $ | $ | ||||||||
Foreign | |||||||||||
Total | $ | $ | $ |
2019 | 2018 | 2017 | |||||||||
Federal | $ | $ | $ | ||||||||
State and local | |||||||||||
Foreign | |||||||||||
Total | $ | $ | $ | ||||||||
Current | $ | $ | $ | ||||||||
Deferred | ( | ) | |||||||||
Total | $ | $ | $ |
2019 | 2018 | 2017 | ||||||
U.S. federal statutory tax rate | % | % | % | |||||
State taxes, net of federal benefit | ||||||||
U.S. domestic manufacturers deduction | ( | ) | ||||||
Permanent differences | ( | ) | ||||||
Foreign income tax rate at rates other than U.S. statutory | ( | ) | ||||||
Tax Cuts and Jobs Act of 2017 deferred tax changes | ( | ) | ||||||
Tax Cuts and Jobs Act of 2017 transition tax | ( | ) | ||||||
Change in valuation allowances (1) | ( | ) | ( | ) | ||||
Tax on unremitted earnings | ||||||||
Other | ( | ) | ( | ) | ||||
Consolidated effective tax | % | % | % |
2019 | 2018 | ||||||
Deferred tax assets: | |||||||
Compensation related | $ | $ | |||||
Pension and post-retirement benefits | |||||||
Inventory reserves | |||||||
Accrued liabilities and reserves | |||||||
Warranty reserves | |||||||
Operating lease liability | |||||||
Net operating loss carryforwards | |||||||
Other | |||||||
Gross deferred tax assets | |||||||
Valuation allowance | ( | ) | ( | ) | |||
Deferred tax assets | $ | $ | |||||
Deferred tax liabilities: | |||||||
Intangible assets | $ | ( | ) | $ | ( | ) | |
Depreciable assets | ( | ) | ( | ) | |||
Operating lease right-of-use assets | ( | ) | |||||
Other | ( | ) | ( | ) | |||
Deferred tax liabilities | $ | ( | ) | $ | ( | ) | |
Net deferred tax assets (liabilities) | $ | ( | ) | $ | ( | ) | |
Long-term deferred asset | |||||||
Long-term deferred liability | ( | ) | ( | ) | |||
Net deferred tax assets (liabilities) | $ | ( | ) | $ | ( | ) |
Balance at December 30, 2017 | $ | ||
Increases to current year tax positions | |||
Increase to prior year tax positions | |||
Decrease to prior year tax positions | ( | ) | |
Lapse of statute of limitations | ( | ) | |
Balance at December 29, 2018 | $ | ||
Increases to current year tax positions | |||
Increase to prior year tax positions | |||
Lapse of statute of limitations | ( | ) | |
Balance at December 28, 2019 | $ |
(8) | FINANCIAL INSTRUMENTS |
(a) | Foreign Exchange |
(b) | Interest Rate |
Twelve Months Ended | |||||||||
Location | Dec 28, 2019 | Dec 29, 2018 | |||||||
Fair value | Other assets | $ | $ | ||||||
Fair value | Other non-current liabilities | $ | $ | ||||||
Amount of gain/(loss) recognized in other comprehensive income | Other comprehensive income | $ | ( | ) | $ | ( | ) | ||
Gain/(loss) reclassified from accumulated other comprehensive income (effective portion) | Interest expense | $ | $ | ||||||
Gain/(loss) recognized in income (ineffective portion) | Other expense | $ | $ |
(9) | LEASE COMMITMENTS |
Leases (in thousands) | December 28, 2019 | ||
Operating lease right-of-use assets | $ | ||
Operating Lease Liability: | |||
Current | |||
Non-current | |||
Total Liability | $ |
Total Lease Commitments (in thousands) | Operating Leases | ||
2020 | $ | ||
2021 | |||
2022 | |||
2023 | |||
2024 | |||
2025 and thereafter | |||
Total future lease commitments | |||
Less imputed interest | |||
Total | $ |
Other Lease Information (in thousands, except lease term and discount rate) | Twelve Months Ended December 28, 2019 | ||
Supplemental cash flow information | |||
Cash paid for amounts included in the measurement of lease liabilities: | |||
Operating cash flows for operating leases | $ | ||
Right-of-use assets obtained in exchange for lease obligations: | |||
Operating leases | |||
December 28, 2019 | |||
Weighted-average remaining lease terms leases - Operating | |||
Weighted-average discount rate - Operating | % |
Commercial Foodservice | Food Processing | Residential Kitchen | Corporate and Other(2) | Total | |||||||||||||||
2019 | |||||||||||||||||||
Net sales | $ | $ | $ | $ | $ | ||||||||||||||
Operating income (3,4) | ( | ) | |||||||||||||||||
Depreciation expense | |||||||||||||||||||
Amortization expense (5) | |||||||||||||||||||
Net capital expenditures | |||||||||||||||||||
Total assets | |||||||||||||||||||
Long-lived assets (6) | |||||||||||||||||||
2018 | |||||||||||||||||||
Net sales | $ | $ | $ | $ | $ | ||||||||||||||
Operating income (3) | ( | ) | |||||||||||||||||
Depreciation expense | |||||||||||||||||||
Amortization expense (5) | |||||||||||||||||||
Net capital expenditures | ( | ) | |||||||||||||||||
Total assets | |||||||||||||||||||
Long-lived assets (6) | |||||||||||||||||||
2017 | |||||||||||||||||||
Net sales | $ | $ | $ | $ | $ | ||||||||||||||
Operating income (3,7,8) | ( | ) | ( | ) | |||||||||||||||
Depreciation expense | |||||||||||||||||||
Amortization expense (5) | |||||||||||||||||||
Net capital expenditures | ( | ) | |||||||||||||||||
Total assets | |||||||||||||||||||
Long-lived assets (6) |
(1) | Non-operating expenses are not allocated to the reportable segments. Non-operating expenses consist of interest expense and deferred financing amortization, foreign exchange gains and losses and other income and expense items outside of income from operations. |
(2) | Includes corporate and other general company assets and operations. |
(3) | Restructuring expenses are included in operating income of the segment to which they pertain. See note 13 for further details. |
(4) | Gain on litigation settlement is included in Residential Kitchen. |
(5) |
(6) | Long-lived assets consist of property, plant and equipment, long-term deferred tax assets and other assets. |
(7) | Gain on sale of plant is included in Commercial Foodservice. |
(8) | Impairment of intangible assets is included in Residential Kitchen. |
2019 | 2018 | 2017 | |||||||||
United States and Canada | $ | $ | $ | ||||||||
Asia | |||||||||||
Europe and Middle East | |||||||||||
Latin America | |||||||||||
Total International | |||||||||||
$ | $ | $ |
Fiscal 2019 | Fiscal 2018 | ||||||||||||||
U.S. Plans | Non-U.S. Plans | U.S. Plans | Non-U.S. Plans | ||||||||||||
Net Periodic Pension Cost (Benefit): | |||||||||||||||
Service cost | $ | $ | $ | $ | |||||||||||
Interest cost | |||||||||||||||
Expected return on assets | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Amortization of net loss (gain) | ( | ) | |||||||||||||
Amortization of prior service cost | |||||||||||||||
Curtailment loss | |||||||||||||||
Pension settlement gain | ( | ) | |||||||||||||
$ | $ | ( | ) | $ | $ | ( | ) | ||||||||
Change in Benefit Obligation: | |||||||||||||||
Benefit obligation – beginning of year | $ | $ | $ | $ | |||||||||||
Service cost | |||||||||||||||
Prior service cost | |||||||||||||||
Interest on benefit obligations | |||||||||||||||
Member contributions | |||||||||||||||
Actuarial loss (gain) | ( | ) | ( | ) | |||||||||||
Pension settlement gain | ( | ) | |||||||||||||
Net benefit payments | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Curtailment loss | |||||||||||||||
Exchange effect | ( | ) | |||||||||||||
Benefit obligation – end of year | $ | $ | $ | $ | |||||||||||
Change in Plan Assets: | |||||||||||||||
Plan assets at fair value – beginning of year | $ | $ | $ | $ | |||||||||||
Company contributions | |||||||||||||||
Investment gain (loss) | ( | ) | ( | ) | |||||||||||
Member contributions | |||||||||||||||
Pension settlement loss | ( | ) | |||||||||||||
Benefit payments and plan expenses | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Exchange effect | ( | ) | |||||||||||||
Plan assets at fair value – end of year | $ | $ | $ | $ | |||||||||||
Funded Status: | |||||||||||||||
Unfunded benefit obligation | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
Amounts recognized in balance sheet at year end: | |||||||||||||||
Accrued pension benefits | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) |
Fiscal 2019 | Fiscal 2018 | ||||||||||||||
U.S. Plans | Non-U.S. Plans | U.S. Plans | Non-U.S. Plans | ||||||||||||
Pre-tax components in accumulated other comprehensive income at period end: | |||||||||||||||
Net actuarial loss | $ | $ | $ | $ | |||||||||||
Pre-tax components recognized in other comprehensive income for the period: | |||||||||||||||
Current year actuarial (gain) loss | $ | $ | $ | $ | ( | ) | |||||||||
Actuarial gain (loss) recognized | ( | ) | ( | ) | ( | ) | |||||||||
Prior service cost | |||||||||||||||
Prior service cost recognized | ( | ) | ( | ) | |||||||||||
Pension settlement gain | ( | ) | |||||||||||||
Pension settlement gain recognized | |||||||||||||||
Total amount recognized | $ | $ | $ | $ | ( | ) | |||||||||
Accumulated Benefit Obligation | $ | $ | $ | $ | |||||||||||
Salary growth rate | n/a | % | n/a | % | |||||||||||
Assumed discount rate | % | % | % | % | |||||||||||
Expected return on assets | % | % | % | % |
Target Allocation | Percentage of Plan Assets | |||||||
2019 | 2018 | |||||||
Equity | % | % | % | |||||
Fixed income | ||||||||
Money market | ||||||||
Other (real estate investment trusts & commodities contracts) | ||||||||
% | % | % |
Target Allocation | Percentage of Plan Assets | |||||||
2019 | 2018 | |||||||
Equity | % | % | % | |||||
Fixed income | ||||||||
Alternatives/Other | ||||||||
Real Estate | ||||||||
Cash and cash equivalents | ||||||||
% | % | % |
Fiscal 2019 | Fiscal 2018 | |||||||||||||||||||||||
Asset Category | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Net Asset Value | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Net Asset Value | ||||||||||||||||||
Short Term Investment Fund (a) | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
Equity Securities: | ||||||||||||||||||||||||
Large Cap | ||||||||||||||||||||||||
Mid Cap | ||||||||||||||||||||||||
Small Cap | ||||||||||||||||||||||||
International | ||||||||||||||||||||||||
Fixed Income: | ||||||||||||||||||||||||
Government/Corporate | ||||||||||||||||||||||||
High Yield | ||||||||||||||||||||||||
Alternative: | ||||||||||||||||||||||||
Global Real Estate Investment Trust | ||||||||||||||||||||||||
Commodities Contracts | ||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ |
(a) | Represents collective short term investment fund, composed of high-grade money market instruments with short maturities. |
Fiscal 2019 | ||||||||||||||||||||
Asset Category | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Net Asset Value | |||||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | $ | |||||||||||||||
Equity Securities: | ||||||||||||||||||||
UK | ||||||||||||||||||||
International: | ||||||||||||||||||||
Developed | ||||||||||||||||||||
Emerging | ||||||||||||||||||||
Unquoted/Private Equity | ||||||||||||||||||||
Fixed Income: | ||||||||||||||||||||
Government/Corporate: | ||||||||||||||||||||
UK | ||||||||||||||||||||
International | ||||||||||||||||||||
Index Linked | ||||||||||||||||||||
Other | ||||||||||||||||||||
Convertible Bonds | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Direct | ||||||||||||||||||||
Indirect | ||||||||||||||||||||
Hedge Fund Strategy: | ||||||||||||||||||||
Equity Long/Short | ||||||||||||||||||||
Arbitrage & Event | ||||||||||||||||||||
Directional Trading & Fixed Income | ||||||||||||||||||||
Cash & Other | ||||||||||||||||||||
Direct Sourcing | ||||||||||||||||||||
Leveraged Loans | ||||||||||||||||||||
Alternative/Other | ||||||||||||||||||||
Total | $ | $ | $ | $ | $ |
Fiscal 2018 | ||||||||||||||||||||
Asset Category | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Net Asset Value | |||||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | $ | |||||||||||||||
Equity Securities: | ||||||||||||||||||||
UK | ||||||||||||||||||||
International: | ||||||||||||||||||||
Developed | ||||||||||||||||||||
Emerging | ||||||||||||||||||||
Unquoted/Private Equity | ||||||||||||||||||||
Fixed Income: | ||||||||||||||||||||
Government/Corporate: | ||||||||||||||||||||
UK | ||||||||||||||||||||
International | ||||||||||||||||||||
Index Linked | ||||||||||||||||||||
Other | ||||||||||||||||||||
Convertible Bonds | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Direct | ||||||||||||||||||||
Indirect | ||||||||||||||||||||
Hedge Fund Strategy: | ||||||||||||||||||||
Equity Long/Short | ||||||||||||||||||||
Arbitrage & Event | ||||||||||||||||||||
Directional Trading & Fixed Income | ||||||||||||||||||||
Cash & Other | ||||||||||||||||||||
Direct Sourcing | ||||||||||||||||||||
Leveraged Loans | ||||||||||||||||||||
Alternative/Other | ( | ) | ( | ) | ||||||||||||||||
Total | $ | $ | $ | $ | $ |
U.S. Plans | Non-U.S. Plans | ||||||
2020 | $ | $ | |||||
2021 | |||||||
2022 | |||||||
2023 | |||||||
2024 through 2029 |
(b) | Defined Contribution Plans |
1st | 2nd | 3rd | 4th | Total Year | ||||||||||||||||
(dollars in thousands, except per share data) | ||||||||||||||||||||
2019 | ||||||||||||||||||||
Net sales | $ | $ | $ | $ | $ | |||||||||||||||
Gross profit | ||||||||||||||||||||
Income from operations | ||||||||||||||||||||
Net earnings | $ | $ | $ | $ | $ | |||||||||||||||
Basic earnings per share (1) | $ | $ | $ | $ | $ | |||||||||||||||
Diluted earnings per share (1) | $ | $ | $ | $ | $ | |||||||||||||||
2018 | ||||||||||||||||||||
Net sales | $ | $ | $ | $ | $ | |||||||||||||||
Gross profit | ||||||||||||||||||||
Income from operations | ||||||||||||||||||||
Net earnings | $ | $ | $ | $ | $ | |||||||||||||||
Basic earnings per share (1) | $ | $ | $ | $ | $ | |||||||||||||||
Diluted earnings per share (1) | $ | $ | $ | $ | $ |
(1) | Sum of quarters may not equal the total for the year due to changes in the number of shares outstanding during the year. |
Severance/Benefits | Facilities/Operations | Other | Total | |||||||||||||
Balance as of December 31, 2016 | $ | $ | $ | $ | ||||||||||||
Expenses | ||||||||||||||||
Exchange Effect | ||||||||||||||||
Payments | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Balance as of December 30, 2017 | $ | $ | $ | $ | ||||||||||||
Expenses | ||||||||||||||||
Exchange Effect | ( | ) | ( | ) | ( | ) | ||||||||||
Payments/Utilization | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Balance as of December 29, 2018 | $ | $ | $ | $ | ||||||||||||
Expenses | ( | ) | ||||||||||||||
Exchange Effect | ( | ) | ( | ) | ( | ) | ||||||||||
Payments/Utilization | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Balance as of December 28, 2019 | $ | $ | $ | $ |
Balance Beginning Of Period | Additions/ (Recoveries) Charged to Expense | Other Adjustments (1) | Write-Offs During the Period | Balance At End Of Period | |||||||||||||||
Allowance for doubtful accounts; deducted from accounts receivable on the balance sheets- | |||||||||||||||||||
2019 | $ | $ | $ | $ | ( | ) | $ | ||||||||||||
2018 | $ | $ | $ | $ | ( | ) | $ | ||||||||||||
2017 | $ | $ | $ | $ | ( | ) | $ |
Balance Beginning Of Period | Additions/ (Recoveries) Charged to Expense | Write-Offs During the Period | Balance At End Of Period | ||||||||||||
Valuation allowance - Deferred tax assets | |||||||||||||||
2019 | $ | $ | $ | ( | ) | $ | |||||||||
2018 | $ | $ | $ | $ | |||||||||||
2017 | $ | $ | ( | ) | $ | $ |
(i) | pertain to the maintenance of records that in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; |
(ii) | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of our management and directors; and |
(iii) | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements. |
(a) | 1. Financial Statements |
3. | Exhibits |
2.1 |
3.1 |
3.2 |
3.3 |
3.4 |
4.1 | Certificate of Designations dated October 30, 1987, and specimen stock certificate relating to the company Preferred Stock, incorporated by reference from the company’s Form 10-K, Exhibit (4), for the fiscal year ended December 31, 1988, filed on March 15, 1989. |
10.1 |
10.2 |
10.3* |
10.4* |
10.5* |
10.6* |
10.7* |
10.8* |
10.9* |
10.10* |
10.11* |
10.12* |
10.13* |
10.14* |
10.15* |
10.16* |
10.17* |
10.18* |
21 |
23.1 |
31.1 |
31.2 |
32.1 |
32.2 |
101 | Financial statements on Form 10-K for the year ended December 28, 2019, filed on February 26, 2020, formatted in Extensive Business Reporting Language (XBRL); (i) consolidated balance sheets, (ii) consolidated statements of earnings, (iii) consolidated statements of cash flows, (iv) notes to the consolidated financial statements. |
104 | Cover Page Interactive Data File (formatted as Inline Extensive Business Reporting Language (iXBRL) and contained in Exhibit 101). |
* | Designates management contract or compensation plan. |
(c) | See the financial statement schedule included under Item 8. |
BY: | /s/ Bryan E. Mittelman | |
Bryan E. Mittelman | ||
Chief Financial Officer |
Signatures | Title | |
PRINCIPAL EXECUTIVE OFFICER | ||
/s/ Timothy J. FitzGerald | Chief Executive Officer and Director | |
Timothy J. FitzGerald | ||
PRINCIPAL FINANCIAL AND | ||
ACCOUNTING OFFICER | ||
/s/ Bryan E. Mittelman | Chief Financial Officer, | |
Bryan E. Mittelman | Principal Financial Officer and | |
Principal Accounting Officer | ||
DIRECTORS | ||
/s/ Gordon O'Brien | Chairman of the Board, Director | |
Gordon O'Brien | ||
/s/ Sarah Palisi Chapin | Director | |
Sarah Palisi Chapin | ||
/s/ Cathy L. McCarthy | Director | |
Cathy L. McCarthy | ||
/s/ John R. Miller, III | Director | |
John R. Miller, III | ||
/s/ Robert Nerbonne | Director | |
Robert Nerbonne | ||
/s/ Nassem Ziyad | Director | |
Nassem Ziyad |
Subsidiaries of The Middleby Corporation(1) | |
State/Country of | |
Name of Subsidiary | Incorporation/Organization |
1184111 Ontario Limited | Canada |
AGA Rangemaster Group Ltd | United Kingdom |
AGA Rangemaster Ltd | United Kingdom |
AGA Rangemaster Properties Ltd | United Kingdom |
AGA Rayburn Ltd | United Kingdom |
Alkar Holdings, Inc. | Wisconsin |
Alkar-RapidPak, Inc. | Wisconsin |
American Permanent Ware Company, LLC | Delaware |
Anetsberger, LLC | Delaware |
ARG Corporate Services Ltd | United Kingdom |
Armor Inox Holding France S.A.S. | France |
Armor Inox Production S.a.r.l. | France |
Armor Inox S.A. | France |
Armor Inox Services S.A.S. | France |
Armor Inox UK Ltd | United Kingdom |
Armor Inox USA LLC | Delaware |
Associated American Industries, LLC | Texas |
A/S Wodschow & Co. | Denmark |
Auto-Bake Acquisition Pty. Ltd | Australia |
Auto-Bake Pty Ltd | Australia |
Automatic Bar Controls, Inc. | Delaware |
Bakers Pride Oven Company, LLC | Delaware |
Baker Thermal Solutions LLC | Delaware |
Beech Ovens LLC | Delaware |
Beech Ovens Pty Ltd | Australia |
BKI Worldwide, Inc. | Delaware |
Blodgett Holdings, Inc. | Delaware |
Brava Home, Inc. | Delaware |
Britannia Kitchen Ventilation | United Kingdom |
Burford Bakery Solutions Limited | United Kingdom |
Burford Corp | Oklahoma |
Carrier Commercial Refrigeration Inc. | Delaware |
Carter-Hoffmann LLC | Delaware |
Catering Equipment Industry srl | Italy |
Cinoxplan, S.L. | Spain |
Cloverleaf Properties, Inc. | Vermont |
CM Brewing Technologies, LLC | California |
Concordia Coffee Company, Inc. | Washington |
Cooking Solutions Group, Inc. | Delaware |
CookTek Induction Systems, LLC | Delaware |
Cozzini do Brasil Ltda | Brazil |
Cozzini Middleby de Mexico, S. de R.L.de C.V. | Mexico |
Cozzini Middleby Europe, S.r.l. | Italy |
Cozzini, LLC | Delaware |
Cranmore Property Ltd | United Kingdom |
Crown Food Service Equipment Ltd. | Canada |
CVP Systems LLC | Illinois |
Danfotech Holdings, LLC | Delaware |
Danfotech Inc. | Missouri |
Desmon S.p.A. | Italy |
DMKS Holdings Inc. | Canada |
Doyon Acquisition Company, LLC | Delaware |
Doyon Equipment Inc. | Canada |
Eswood Australia Pty Ltd | Australia |
Evo, Inc. | Oregon |
F.R. Drake Company | Delaware |
Fab-Asia Inc. | Philippines |
Field Service Solutions | Arkansas |
Fired Earth Ltd | United Kingdom |
Firex S.r.l. | Italy |
Follett Europe Polska sp. z.o.o. | Poland |
Follett International sp. z.o.o. | Poland |
Follett LLC | Pennsylvania |
G.S. Blodgett Corporation | Vermont |
Giga Grandi Cucine S.r.l. | Italy |
Globe Food Equipment Company | Ohio |
Globe Food Equipment Holding Company | Delaware |
Goldstein Eswood Commercial Cooking Pty Ltd | Australia |
Goldstein Properties Pty Ltd | Australia |
Grand Rise International Limited | Hong Kong |
Grange Furniture Canada (1989) Ltd | Canada |
Grange Furniture Inc. | Delaware |
Heartland Appliances Inc. | Canada |
Hinds-Bock Corporation | Washington |
Holman Cooking Equipment Inc. | Delaware |
Houno A/S | Denmark |
Houno Holdings LLC | Delaware |
Imperial Machine Company Ltd | United Kingdom |
J. Goldstein & Co. Pty Ltd | Australia |
Jade Range LLC | Delaware |
J.M. Stritzl Holdings Inc. | Canada |
Johs. Lassen Fjellebroen A/S | Denmark |
Josper, S.A. | Spain |
Keylog S.r.l. | Italy |
L2F Inc. | Delaware |
LA Cornue SAS | France |
Levens Middleby Worldwide B.V. | Netherlands |
Lincat Group PLC | United Kingdom |
Lincat Limited. | United Kingdom |
Lynx Grills Inc. | Delaware |
Lynx Holdco Inc. | Delaware |
MagiKitch'n Inc. | Pennsylvania |
Maurer-Atmos Middleby GmbH | Germany |
Middleby Advantage, LLC | Delaware |
Middleby Asia Ltd | Hong Kong |
Middleby Australia Pty Ltd | Australia |
Middleby Canada Company | Canada |
Middleby Celfrost Innovations Pvt Ltd | India |
Middleby China Corporation | Peoples Republic of China |
Middleby Cooking System Manufacturing (Shanghai) Corporation | Peoples Republic of China |
Middleby Cozzini Brasil Equipamentos, Ltda | Brazil |
Middleby Denmark Holdings ApS | Denmark |
Middleby Espana SLU | Spain |
Middleby Europe SL | Spain |
Middleby Holding UK Ltd | United Kingdom |
Middleby India Engineering Pvt Ltd | India |
Middleby Induction China Corporation | Peoples Republic of China |
Middleby Lux Holdings SCS | Luxembourg |
Middleby Luxembourg S.a.r.l. | Luxembourg |
Middleby Marshall Holding, LLC | Delaware |
Middleby Marshall, Inc. | Delaware |
Middleby Nationals Sales LLC | Delaware |
Middleby Packaging Solutions, LLC | Delaware |
Middleby Philippines Corporation | Philippines |
Middleby Sweden Holdings SB | Sweden |
Middleby UK Ltd | United Kingdom |
Middleby UK Residential Holdings | United Kingdom |
Middleby Worldwide Mexico SA de CV | Mexico |
Middleby Worldwide Philippines | Philippines |
Middleby Worldwide Services SA de CV | Mexico |
Middleby Worldwide, Inc. | Florida |
Middleby XME S.L.U. | Spain |
M.K.D. Corporation Ltd. | Canada |
MP Equipment LLC | Delaware |
M-TEK Inc. | Illinois |
New Star International Holdings, Inc. | Delaware |
Nieco Corporation | California |
Northland Corporation | Michigan |
Packaging Progressions, Inc. | Pennsylvania |
Pengyuan Technology (Shenzhen) Co, LTD. | Peoples Republic of China |
Perfect Fry LLC | Delaware |
Pitco Frialator, Inc. | New Hampshire |
Powerhouse Dynamics, Inc. | Delaware |
QualServ Solutions LLC | Delaware |
Scanico A/S | Denmark |
SD Asia Pacific Ltd | Hong Kong |
SD Group Intressenter (SDGI) | Sweden |
Standex de Mexico S.A. de C.V. | Mexico |
Star International Holdings, Inc. | Delaware |
Star Manufacturing International Inc. | Delaware |
Stewart Systems Baking, LLC | Delaware |
Sveba Dahlen Rus. Ltd. | Russia |
Sveba-Dahlen Aktiebolag | Sweden |
Sveba Dahlen Baltic OÜ | Estonia |
Sveba-Dahlen España | Spain |
Sveba-Dahlen Group AB | Sweden |
Synesso, Inc. | Washington |
Taylor Company S.r.l. | Italy |
Taylor Food Service Equipment Trading (Shanghai) Co. Ltd | China |
The Alluvian Spa, LLC | Mississippi |
The Alluvian, LLC | Mississippi |
The Piper Doyon Group, Inc. | Wisconsin |
Thurne-Middleby Ltd | United Kingdom |
TMC Lux Holdings Sarl | Luxembourg |
TMC Lux Sarl | Luxembourg |
TMC Scots Holdings LP | United Kingdom |
TMC Scottish Private Ltd | United Kingdom |
TurboChef Technologies Europe, Ltd | United Kingdom |
TurboChef Technologies Inc. | Delaware |
ULC Holding Company | Delaware |
U-Line Corporation | Wisconsin |
Ultrafryer Systems, LLC | Delaware |
Ve.Ma.C. S.r.l. | Italy |
Viking Cooking Schools, LLC | Mississippi |
Viking Culinary Group, LLC | Mississippi |
Viking Range Brasil Participacoes Ltda | Brazil |
Viking Range Corporation do Brasil Importacao e Comercio Ltda | Brazil |
Viking Range, LLC | Delaware |
Waterford Stanley Ltd | Ireland |
Wells Bloomfield LLC | Delaware |
Wunder-Bar Europe S.r.o. | Czech Republic |
Wunder-Bar Dispensing UK Ltd | United Kingdom |
Wunder-Bar Holdings, Inc. | Delaware |
Wunder-Bar International, Inc. | California |
(1) Certain subsidiaries have been omitted as allowed. | |
1. | I have reviewed this Annual Report on Form 10-K of The Middleby Corporation; |
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 an 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 registrant’s board of directors (or persons performing the equivalent function): |
(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 controls over financial reporting. |
/s/ Timothy J. FitzGerald |
Timothy J. FitzGerald |
Chief Executive Officer of The Middleby Corporation |
1. | I have reviewed this Annual Report on Form 10-K of The Middleby Corporation; |
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 an 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 registrant’s board of directors (or persons performing the equivalent function): |
(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 controls over financial reporting. |
/s/ Bryan E. Mittelman |
Bryan E. Mittelman |
Chief Financial Officer of The Middleby Corporation |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act; and |
(2) | The information contained in the Report fairly presents, in all material aspects, the financial condition and results of operations of the Registrant. |
/s/ Timothy J. FitzGerald |
Timothy J. FitzGerald |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act; and |
(2) | The information contained in the Report fairly presents, in all material aspects, the financial condition and results of operations of the Registrant. |
/s/ Bryan E. Mittelman |
Bryan E. Mittelman |
Income Taxes - Summary of Earnings Before Taxes (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
Dec. 30, 2017 |
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Income Tax Disclosure [Abstract] | |||
Domestic | $ 336,688 | $ 328,870 | $ 290,866 |
Foreign | 125,931 | 94,643 | 92,663 |
Total | $ 462,619 | $ 423,513 | $ 383,529 |
Financing Arrangements - Level 2 Measurements (Details) - USD ($) $ in Thousands |
Dec. 28, 2019 |
Dec. 29, 2018 |
---|---|---|
Debt Disclosure [Abstract] | ||
Total debt | $ 1,873,140 | $ 1,892,105 |
Total debt, fair value | $ 1,873,140 | $ 1,892,105 |
Income Taxes - Summary of Activity Related to Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
|
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Balance, Beginning Period | $ 31,912 | $ 29,930 |
Increases to current year tax positions | 4,216 | 3,912 |
Unrecognized Tax Benefits, Increase Resulting from Prior Period Tax Positions | 254 | 2,860 |
Unrecognized Tax Benefits, Decrease Resulting from Prior Period Tax Positions | 569 | |
Lapse of statute of limitations | 4,823 | 4,221 |
Balance, Ending Period | $ 31,559 | $ 31,912 |
Summary of Significant Accounting Policies (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 28, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Inventory, Current | Inventories at December 28, 2019 and December 29, 2018 are as follows (in thousands):
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Property, Plant and Equipment | Property, plant and equipment are carried at cost as follows (in thousands):
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Schedule Of Useful Lives For Property Plant Equipment | Following is a summary of the estimated useful lives:
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Schedule of Goodwill | Goodwill is allocated to the business segments as follows (in thousands):
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Schedule Of Intangible Assets By Major Class | Intangible assets consist of the following (in thousands):
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Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | The estimated future amortization expense of intangible assets is as follows (in thousands):
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Schedule of Accrued Liabilities | Accrued expenses consist of the following at December 28, 2019 and December 29, 2018, respectively (in thousands):
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Schedule of Accumulated Other Comprehensive Income (Loss) | The following table summarizes the components of accumulated other comprehensive income (loss) as reported in the consolidated balance sheets (in thousands):
Changes in accumulated other comprehensive income (loss) (1) were as follows (in thousands):
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Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The company’s financial assets and liabilities that are measured at fair value are categorized using the fair value hierarchy at December 28, 2019 and December 29, 2018 are as follows (in thousands):
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Schedule of Product Warranty Liability | A rollforward of the warranty reserve for the fiscal years 2019 and 2018 are as follows (in thousands):
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Schedule II - Valuation and Qualifying Accounts and Reserves |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 28, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule II - Valuation and Qualifying Accounts and Reserves | SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES FOR THE FISCAL YEARS ENDED DECEMBER 28, 2019, DECEMBER 29, 2018 AND DECEMBER 30, 2017 (amounts in thousands)
(1) Amounts consist primarily of valuation allowances assumed from acquired companies.
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Common and Preferred Stock (Notes) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 28, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common and Preferred Stock | COMMON AND PREFERRED STOCK (a) Shares Authorized At December 28, 2019 and December 29, 2018, the company had 95,000,000 authorized shares of common stock and 2,000,000 authorized shares of non-voting preferred stock. (b) Treasury Stock In November 2017, the company's Board of Directors approved a stock repurchase program authorizing the company to repurchase in the aggregate up to 2,500,000 shares of its outstanding common stock. As of December 28, 2019, 126,200 shares had been purchased under the 2017 stock repurchase program and 2,373,800 remain authorized for repurchase. (c) Share-Based Awards The company maintains several stock incentive plans under which the company's Board of Directors issues restricted share grants to key employees. Restricted share grants issued to employees are transferable upon certain vesting requirements being met. The 2011 Stock Incentive Plan (the "2011 Plan") was adopted on April 1, 2011, under which the company's Board of Directors issues stock grants to key employees. On July 11, 2017 the company increased the maximum amount of shares reserved for issuance under the 2011 Plan by 1,000,000. A maximum amount of 2,650,000 shares can be issued under the 2011 Plan. Stock grants issued to employees are transferable upon certain vesting requirements. As of December 28, 2019, a total of 1,652,175 share-based awards have been issued under the 2011 Plan. This includes 1,652,175 restricted share grants, of which 527,085 remain outstanding and unvested. For fiscal year ended December 28, 2019, the approximate fair value of shares vested were $16.5 million. A summary of the company’s nonvested restricted share grant activity for fiscal years ended December 28, 2019 and December 29, 2018 is as follows:
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Acquisitions and Purchase Accounting Acquisition and Purchase Accounting (Notes) |
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Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combination Disclosure [Text Block] | ACQUISITIONS AND PURCHASE ACCOUNTING The company operates in a highly fragmented industry and has completed numerous acquisitions over the past several years as a component of its growth strategy. The company has acquired industry leading brands and technologies to position itself as a leader in the commercial foodservice equipment, food processing equipment and residential kitchen equipment industries. The company has accounted for all business combinations using the acquisition method to record a new cost basis for the assets acquired and liabilities assumed. The difference between the purchase price and the fair value of the assets acquired and liabilities assumed has been recorded as goodwill in the financial statements. The company also recognizes identifiable intangible assets, primarily trade names and customer relationships, using a discounted cash flow model. The significant assumptions used to estimate the value of the intangible assets include revenue growth rates, projected profit margins, discount rates, royalty rates, and customer attrition rates. These significant assumptions are forward-looking and could be affected by future economic and market conditions. The results of operations are reflected in the consolidated financial statements of the company from the dates of acquisition. The following represents the company's significant acquisitions in 2019 and 2018 as well as summarized information on various acquisitions that were not individually material. The company also made smaller acquisitions not presented below which are individually and collectively immaterial. Taylor On June 22, 2018, the company completed its acquisition of all of the capital stock of the Taylor Company ("Taylor"), a world leader in beverage solutions, soft serve and ice cream dispensing equipment, frozen drink machines, and automated double-sided grills, located in Rockton, Illinois, for a purchase price of approximately $1.0 billion, net of cash acquired. During the fourth quarter of 2018, the company finalized the working capital provision provided for by the purchase agreement resulting in a refund from the seller of $11.5 million. The final allocation of consideration paid for the Taylor acquisition is summarized as follows (in thousands):
The goodwill and $304.7 million of other intangibles associated with the trade name are subject to the non-amortization provisions of ASC 350. Other intangibles also include $290.9 million allocated to customer relationships, $1.7 million of existing developed oven technology, $4.4 million of equipment backlog, and $2.1 million of deferred service backlog, which are being amortized over periods up to 15 years, 5 years, 3 months, and 3 years, respectively. Goodwill and other intangibles of Taylor are allocated to the Commercial Foodservice Equipment Group for segment reporting purposes. A significant portion of the assets are expected to be deductible for tax purposes. Cooking Solutions Group On April 1, 2019, the company completed its acquisition of all of the capital stock of Cooking Solutions Group, Inc. ("Cooking Solutions Group") from Standex International Corporation, which consists of the brands APW Wyott, Bakers Pride, BKI and Ultrafryer with locations in Texas, South Carolina and Mexico for a purchase price of approximately $106.1 million, net of cash acquired. During the third quarter of 2019, the company finalized the working capital provision provided for by the purchase agreement resulting in a payment due to the sellers of $0.1 million. The following estimated fair values of assets acquired and liabilities assumed are provisional and are based on the information that was available as of the acquisition date to estimate the fair value of assets acquired and liabilities assumed (in thousands):
The long term deferred tax liability amounted to $10.9 million. The net deferred tax liability is comprised of $11.6 million of deferred tax liability related to the difference between the book and tax basis on identifiable intangible asset and liability accounts and $0.7 million of deferred tax asset related to the difference between the book and tax basis on identifiable tangible assets and liability accounts. The goodwill and $24.7 million of other intangibles associated with the trade name is subject to the non-amortization provisions of ASC 350. Other intangibles also include $22.5 million allocated to customer relationships and $0.4 million allocated to backlog, which are being amortized over periods of 9 years and 3 months, respectively. Goodwill and other intangibles of Cooking Solutions Group are allocated to the Commercial Foodservice Equipment Group for segment reporting purposes. These assets are not expected to be deductible for tax purposes. The company believes that information gathered to date provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed, but the company is waiting for additional information necessary to finalize those fair values. Thus, the provisional measurements of fair value set forth above are subject to change. The company will complete the purchase price allocation in the first quarter of fiscal 2020. Other 2018 Acquisitions During 2018 the company completed various other acquisitions that were not individually material. The final allocation of consideration paid for the other 2018 acquisitions is summarized as follows (in thousands):
The long term deferred tax liability amounted to $13.9 million. The net deferred tax liability is comprised of $13.1 million of deferred tax liability related to the difference between the book and tax basis of identifiable intangible assets and $0.8 million of deferred tax liability related to the difference between the book and tax basis on identifiable tangible asset and liability accounts. The goodwill and $30.7 million of other intangibles associated with the trade names are subject to the non-amortization provisions of ASC 350. Other intangibles also include $28.6 million allocated to customer relationships, $0.3 million allocated to developed technology and $3.3 million allocated to backlog, which are being amortized over periods of 5 to 7 years, 5 years, and 3 months to 1 year, respectively. Goodwill of $85.4 million and other intangibles of $42.9 million of the companies are allocated to the Commercial Foodservice Equipment Group. Goodwill of $26.9 million and other intangibles of $19.9 million are allocated to the Food Processing Equipment Group for segment reporting purposes. Of these assets, goodwill of $22.1 million is expected to be deductible for tax purposes. One purchase agreement includes an earnout provision providing for contingent payments due to the sellers to the extent certain financial targets are exceeded. The earnout is payable between 2020 and 2021, if the company exceeds certain sales and earnings targets. The contractual obligation associated with the contingent earnout provision recognized on the acquisition date is $3.5 million. Other 2019 Acquisitions During 2019 the company completed various other acquisitions that were not individually material. The following estimated fair values of assets acquired and liabilities assumed are based on the information that was available as of the acquisition date to estimate the fair value of assets acquired and liabilities assumed (in thousands):
The long term deferred tax asset amounted to $2.8 million. The net deferred tax asset is comprised of $3.0 million of deferred tax asset related to tax loss carryforwards, $0.9 million of deferred tax liability related to the difference between the book and tax basis of identifiable intangible assets, and $0.7 million of deferred tax asset related to the difference between the book and tax basis on other book to tax differences and liability accounts. The goodwill and $29.6 million of other intangibles associated with the trade names are subject to the non-amortization provisions of ASC 350. Other intangibles also include $23.9 million allocated to customer relationships, $9.2 million allocated to developed technology and $1.5 million allocated to backlog, which are being amortized over periods of 2 to 10 years, 5 to 7 years, and 3 months, respectively. Goodwill of $43.6 million and other intangibles of $35.2 million of the companies are allocated to the Commercial Foodservice Equipment Group. Goodwill of $43.6 million and other intangibles of $21.3 million are allocated to the Food Processing Equipment Group. Goodwill of $9.5 million and other intangibles of $7.7 million are allocated to the Residential Kitchen Equipment Group for segment reporting purposes. Of these assets, goodwill of $85.5 million and intangibles of $54.1 million are expected to be deductible for tax purposes. One purchase agreement includes deferred payments and earnout provisions providing for contingent payments due to the sellers to the extent certain financial targets are exceeded. The deferred payments are payable between 2020 and 2022. The contractual obligation associated with the deferred payments on the acquisition date is $2.4 million. The earnout is payable in 2022, if the company exceeds certain sales and earnings targets. The contractual obligation associated with the contingent earnout provision recognized on the acquisition date is $4.3 million. The company believes that information gathered to date provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed, but the company is waiting for additional information necessary to finalize those fair values for substantially all 2019 acquisitions. Thus, the provisional measurements of fair value set forth above are subject to change. The company will complete the purchase price allocations during 2020. Pro Forma Financial Information In accordance with ASC 805 Business Combinations, the following unaudited pro forma results of operations for the twelve months ended December 28, 2019 and December 29, 2018, assumes the 2018 and 2019 acquisitions were completed on December 31, 2017 (first day of fiscal year 2018). The following pro forma results include adjustments to reflect additional interest expense to fund the acquisitions, amortization of intangibles associated with the acquisitions, and the effects of adjustments made to the carrying value of certain assets (in thousands, except per share data):
The historical consolidated financial information of the Company and the acquisitions have been adjusted in the pro forma information to give effect to pro forma events that are (1) directly attributable to the transactions, (2) factually supportable and (3) expected to have a continuing impact on the combined results. Pro forma data may not be indicative of the results that would have been obtained had these acquisitions occurred at the beginning of the periods presented, nor is it intended to be a projection of future results. Additionally, the pro forma financial information does not reflect the costs which the company has incurred or may incur to integrate the acquired businesses.
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Employee Retirement Plans |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Retirement Plans | EMPLOYEE RETIREMENT PLANS (a)Pension Plans U.S. Plans: The company maintains a non-contributory defined benefit plan for its union employees at the Elgin, Illinois facility. Benefits are determined based upon retirement age and years of service with the company. This defined benefit plan was frozen on April 30, 2002, and no further benefits accrue to the participants beyond this date. Plan participants will receive or continue to receive payments for benefits earned on or prior to April 30, 2002 upon reaching retirement age. The company maintains a non-contributory defined benefit plan for its employees at the Smithville, Tennessee facility, which was acquired as part of the Star acquisition. Benefits are determined based upon retirement age and years of service with the company. This defined benefit plan was frozen on April 1, 2008, and no further benefits accrue to the participants beyond this date. Plan participants will receive or continue to receive payments for benefits earned on or prior to April 1, 2008 upon reaching retirement age. The company also maintains a retirement benefit agreement with its former Chairman ("Chairman Plan"). The retirement benefits are based upon a percentage of the Chairman’s final base salary with no increase in compensation. Non-U.S. Plans: The company maintains a defined benefit plan for its employees at the Wrexham, the United Kingdom facility. Benefits are determined based upon retirement age and years of service with the company. This defined benefit plan was frozen on April 30, 2010 and no further benefits accrue to the participants beyond this date. Plan participants will receive or continue to receive payments for benefits earned on or prior to April 30, 2010 upon reaching retirement age. The company maintains several pension plans related to AGA and its subsidiaries (collectively, the "AGA Group"), the most significant being the Aga Rangemaster Group Pension Scheme, which covers the majority of employees in the United Kingdom. Membership in the plan on a defined benefit basis of pension provision was closed to new entrants in 2001. The plan became open to new entrants on a defined contribution basis of pension provision in 2002, but was generally closed to new entrants on this basis during 2014. The other, much smaller, defined benefit pension plans operating within the AGA Group cover employees in France and the United Kingdom. All pension plan assets are held in separate trust funds although the net defined benefit pension obligations are included in the company's consolidated balance sheet. A summary of the plans’ net periodic pension cost, benefit obligations, funded status, and net balance sheet position is as follows (dollars in thousands)
On October 26, 2018, in Lloyds Banking Group Pensions Trustees Limited vs. Lloyds Bank plc and Others, the High Court of Justice in the United Kingdom issued a ruling ("Court Ruling") requiring Lloyds Bank plc to equalize benefits payable to men and women under its U.K. defined benefit pension plan. The Court Ruling noted that the formulas used to determine guaranteed minimum pension (GMP) benefits violated gender-pay equality laws due to differences in the way benefits were calculated for men and women. As a result of this ruling, the U.K. pension plan was required to amend its benefit formulas and account for the higher pension payments resulting from GMP equalization. In accordance with ASC 715, this Court Ruling represents a change to the company's U.K. pension plans resulting in a retroactive increase in benefit levels for plan participants and has been accounted for as a prior service cost deferred in other comprehensive income, to be amortized as a component of net periodic pension benefit in future periods. The U.K. pension plans projected benefit obligation increased $53.6 million as a result of the Court Ruling, subject to potential future adjustments as the calculations by participants are finalized. The company has engaged non-affiliated third party professional investment advisors to assist the company to develop its investment policy and establish asset allocations. The company's overall investment objective is to provide a return, that along with company contributions, is expected to meet future benefit payments. Investment policy is established in consideration of anticipated future timing of benefit payments under the plans. The anticipated duration of the investment and the potential for investment losses during that period are carefully weighed against the potential for appreciation when making investment decisions. The company routinely monitors the performance of investments made under the plans and reviews investment policy in consideration of changes made to the plans or expected changes in the timing of future benefit payments. The assets of the plans were invested in the following classes of securities (none of which were securities of the company): U.S. Plans:
Non-U.S. Plans:
In accordance with ASC 820 Fair Value Measurements and Disclosures, the company has measured its defined benefit pension plans at fair value. In accordance with ASU 2015-04, "Practical Expedient for the Measurement Date of an Employer's Defined Benefit Obligation and Plan Assets", the company has elected to measure the pension plan assets and obligations as of the calendar month-end closest to the fiscal year end. The following tables summarize the basis used to measure the pension plans’ assets at fair value as of December 28, 2019and December 29, 2018 (in thousands): U.S. Plans:
Non-U.S. Plans:
The fair value of the Level 1 assets is based on observable, quoted market prices of the identical underlying security in an active market. The fair value of the Level 2 assets is primarily based on market observable inputs to quoted market prices, benchmark yields and broker/dealer quotes. Level 3 inputs, as applicable, represent unobservable inputs that reflect assumptions developed by management to measure assets at fair value. The expected return on assets is developed in consideration of the anticipated duration of investment period for assets held by the plan, the allocation of assets in the plan, and the historical returns for plan assets. Estimated future benefit payments under the plans are as follows (dollars in thousands):
Expected contributions to the U.S. Plans and Non-U.S. Plans to be made in 2020 are $1.3 million and $5.8 million, respectively.
As of December 28, 2019, the company maintained two separate defined contribution 401(k) savings plans covering all employees in the United States. These two plans separately cover the union employees at the Elgin, Illinois facility and all other remaining union and non-union employees in the United States. The company also maintained defined contribution plans for its UK based employees.
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Segment Information (Tables) |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment | The following table summarizes the results of operations for the company’s business segments(1) (dollars in thousands):
(8) Impairment of intangible assets is included in Residential Kitchen.
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Schedule of Entity-Wide Disclosure on Geographic Areas, Long-Lived Assets in Individual Foreign Countries by Country | Long-lived assets, not including goodwill and other intangibles (in thousands):
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Nature of Operations (Details) |
12 Months Ended |
---|---|
Dec. 28, 2019
segment
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Regulatory Assets [Line Items] | |
Number of operating segments | 3 |
United States | |
Regulatory Assets [Line Items] | |
Number of manufacturing plants | 37 |
International | |
Regulatory Assets [Line Items] | |
Number of manufacturing plants | 28 |
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
Dec. 30, 2017 |
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Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | $ (11,914) | $ 6,386 | $ (5,588) |
Unrealized (loss) gain on interest rate swap, tax | $ (8,516) | $ (81) | $ 588 |
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands |
Dec. 28, 2019 |
Dec. 29, 2018 |
---|---|---|
Allowance for Doubtful Accounts Receivable, Current | $ 14,886 | $ 13,608 |
Less accumulated depreciation | (197,629) | (167,737) |
Finite-Lived Intangible Assets, Accumulated Amortization | $ (333,507) | $ (268,414) |
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Preferred Stock, Shares Authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common Stock, Shares Authorized | 95,000,000 | 95,000,000 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares issued | 63,129,775 | 62,592,707 |
Treasury Stock, Shares | 6,940,089 | 6,889,241 |
Employee Retirement Plans - Additional Information (Details) |
12 Months Ended |
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Dec. 28, 2019
plan
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Retirement Benefits [Abstract] | |
Number of defined contribution 401K savings plans | 2 |
Lease Commitments Operating Lease (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
Dec. 30, 2017 |
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Leases [Abstract] | |||
Operating Lease, Cost | $ 31,000 | $ 30,200 | $ 27,100 |
Operating Lease, Right-of-Use Asset | 96,655 | ||
Operating Lease, Liability, Current | 21,827 | $ 0 | |
Operating Lease, Liability, Noncurrent | 75,018 | ||
Operating Lease, Liability | $ 96,845 |
Segment Information - Results of Business Segments (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 28, 2019 |
Sep. 28, 2019 |
Jun. 29, 2019 |
Mar. 30, 2019 |
Dec. 29, 2018 |
Sep. 29, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 28, 2019 |
Dec. 29, 2018 |
Dec. 30, 2017 |
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Segment Reporting Information [Line Items] | ||||||||||||||||||||||||||||||
Net sales | $ 787,626 | $ 724,014 | $ 761,004 | $ 686,802 | $ 756,672 | $ 713,331 | $ 668,128 | $ 584,800 | $ 2,959,446 | $ 2,722,931 | $ 2,335,542 | |||||||||||||||||||
Operating Income (Loss) | 152,030 | $ 121,345 | $ 139,607 | $ 101,061 | 139,987 | $ 107,677 | $ 111,310 | $ 86,992 | 514,043 | [1],[2] | 445,966 | [2] | 378,613 | [2],[3],[4] | ||||||||||||||||
Depreciation | 37,852 | 35,782 | 29,710 | |||||||||||||||||||||||||||
Amortization expense (5) | [5] | 65,576 | 61,456 | 40,064 | ||||||||||||||||||||||||||
Net capital expenditures | 46,609 | 36,040 | 54,493 | |||||||||||||||||||||||||||
Total assets | 5,002,143 | 4,549,781 | 5,002,143 | 4,549,781 | 3,339,713 | |||||||||||||||||||||||||
Long-lived assets | [6] | 499,819 | 383,988 | 499,819 | 383,988 | 362,588 | ||||||||||||||||||||||||
Commercial Foodservice Equipment Group | ||||||||||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||||||||||
Net sales | 1,984,345 | 1,729,814 | 1,382,108 | |||||||||||||||||||||||||||
Operating Income (Loss) | [2] | 429,946 | [1] | 393,380 | 357,085 | [3],[4] | ||||||||||||||||||||||||
Depreciation | 21,054 | 17,374 | 12,643 | |||||||||||||||||||||||||||
Amortization expense (5) | [5] | 45,906 | 35,224 | 17,338 | ||||||||||||||||||||||||||
Net capital expenditures | 29,353 | 17,444 | 41,457 | |||||||||||||||||||||||||||
Total assets | 3,188,304 | 2,906,373 | 3,188,304 | 2,906,373 | 1,693,820 | |||||||||||||||||||||||||
Long-lived assets | 261,466 | [6] | 181,636 | [7] | 261,466 | [6] | 181,636 | [7] | 148,565 | [6] | ||||||||||||||||||||
Food Processing Group | ||||||||||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||||||||||
Net sales | 400,951 | 389,594 | 352,717 | |||||||||||||||||||||||||||
Operating Income (Loss) | [2] | 68,935 | [1] | 62,435 | 88,121 | [3],[4] | ||||||||||||||||||||||||
Depreciation | 4,944 | 5,207 | 3,677 | |||||||||||||||||||||||||||
Amortization expense (5) | [5] | 8,162 | 7,527 | 3,680 | ||||||||||||||||||||||||||
Net capital expenditures | 6,683 | 7,373 | 5,519 | |||||||||||||||||||||||||||
Total assets | 621,619 | 513,189 | 621,619 | 513,189 | 450,932 | |||||||||||||||||||||||||
Long-lived assets | 57,403 | [6] | 33,127 | [7] | 57,403 | [6] | 33,127 | [7] | 25,346 | [6] | ||||||||||||||||||||
Residential Kitchen | ||||||||||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||||||||||
Net sales | 574,150 | 603,523 | 600,717 | |||||||||||||||||||||||||||
Operating Income (Loss) | [2] | 89,312 | [1] | 53,959 | (377) | [3],[4] | ||||||||||||||||||||||||
Depreciation | 11,742 | 12,838 | 12,984 | |||||||||||||||||||||||||||
Amortization expense (5) | [5] | 9,896 | 17,226 | 17,567 | ||||||||||||||||||||||||||
Net capital expenditures | 9,168 | 11,721 | 7,637 | |||||||||||||||||||||||||||
Total assets | 1,157,211 | 1,089,103 | 1,157,211 | 1,089,103 | 1,140,668 | |||||||||||||||||||||||||
Long-lived assets | 176,834 | [6] | 146,897 | [7] | 176,834 | [6] | 146,897 | [7] | 167,486 | [6] | ||||||||||||||||||||
Corporate and Other | ||||||||||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||||||||||
Net sales | 0 | 0 | 0 | |||||||||||||||||||||||||||
Operating Income (Loss) | [2] | (74,150) | [1] | (63,808) | (66,216) | [3],[4] | ||||||||||||||||||||||||
Depreciation | 112 | 363 | 406 | |||||||||||||||||||||||||||
Amortization expense (5) | [5] | 1,612 | 1,479 | 1,479 | ||||||||||||||||||||||||||
Net capital expenditures | 1,405 | (498) | (120) | |||||||||||||||||||||||||||
Total assets | 35,009 | 41,116 | 35,009 | 41,116 | 54,293 | |||||||||||||||||||||||||
Long-lived assets | $ 4,116 | [6] | $ 22,328 | [7] | $ 4,116 | [6] | $ 22,328 | [7] | $ 21,191 | [6] | ||||||||||||||||||||
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Schedule II - Valuation and Qualifying Accounts and Reserves (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
Dec. 30, 2017 |
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SEC Schedule, 12-09, Allowance, Credit Loss [Member] | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance Beginning Of Period | $ 13,608 | $ 13,182 | $ 12,600 |
Additions/ (Recoveries) Charged to Expense | 1,941 | 3,160 | 2,084 |
Other Adjustments (1) | 2,009 | 1,121 | 478 |
Write-Offs During the Period | (2,672) | (3,855) | (1,979) |
Balance At End Of Period | 14,886 | 13,608 | 13,182 |
SEC Schedule, 12-09, Valuation Allowance, Deferred Tax Asset [Member] | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance Beginning Of Period | 26,023 | 23,190 | 29,893 |
Additions/ (Recoveries) Charged to Expense | 129 | 2,833 | (6,703) |
Write-Offs During the Period | (18,398) | 0 | 0 |
Balance At End Of Period | $ 7,754 | $ 26,023 | $ 23,190 |
Quarterly Data (Unaudited) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarterly Data (Unaudited) | QUARTERLY DATA (UNAUDITED)
(1) Sum of quarters may not equal the total for the year due to changes in the number of shares outstanding during the year.
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Income Taxes |
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | INCOME TAXES Earnings before taxes is summarized as follows (in thousands):
The provision for income taxes is summarized as follows (in thousands):
Reconciliation of the differences between income taxes computed at the federal statutory rate to the effective rate are as follows:
(1) Net of changes in related tax attributes. The company’s effective tax rate for 2019 was 23.9% as compared to 25.1% in 2018. The effective tax rate for 2019 reflects favorable tax adjustments for a refund of foreign taxes, enacted tax rate changes in several foreign jurisdictions and adjustments for the finalization of 2018 tax returns. The effective tax rate is higher than the federal tax rate of 21.0% primarily due to state taxes, non-deductible expenses and foreign tax rate differentials. At December 28, 2019 and December 29, 2018, the company had recorded the following deferred tax assets and liabilities (in thousands):
The company has recorded tax reserves on undistributed foreign earnings not permanently reinvested of $5.6 million and $4.1 million at December 28, 2019 and December 29, 2018, respectively. No further provisions were made for income taxes that may result from future remittances of undistributed earnings of foreign subsidiaries that are determined to be permanently reinvested, which were $369.0 million on December 28, 2019. Determination of the total amount of unrecognized deferred income taxes on undistributed earnings net of foreign subsidiaries is not practicable. The company has a deferred tax asset on net operating loss carryforwards totaling $17.9 million as of December 28, 2019. These net operating losses are available to reduce future taxable earnings of certain domestic and foreign subsidiaries. United States federal loss carryforwards total $19.5 million of which $13.4 million will expire through 2037 and $6.1 million have no expiration date. State loss carryforwards total $104.4 million and expire through 2039 and international loss carryforwards total $38.2 million and expire through 2038; however, some have no expiration date. Of these carryforwards, $5.2 million are subject to full valuation allowance. During 2019, the company wrote off $18.4 million of deferred tax assets on foreign loss carryforwards that had full valuation allowances. The deferred tax assets were written off as the entities were dissolved or otherwise disposed of during 2019. As of December 28, 2019, the total amount of liability for unrecognized tax benefits related to federal, state and foreign taxes was approximately $31.6 million (of which $31.2 million would impact the effective tax rate if recognized) plus approximately $5.5 million of accrued interest and $7.2 million of penalties. The company recognizes interest and penalties accrued related to unrecognized tax benefits in income tax expense. Interest recognized in fiscal years 2019, 2018 and 2017 was $0.4 million, $0.6 million and $0.7 million, respectively. Penalties recognized in fiscal years 2019, 2018 and 2017 was $(0.9) million, $0.6 million and $1.3 million, respectively. Although the company believes its tax returns are correct, the final determination of tax examinations may be different than what was reported on the tax returns. In the opinion of management, adequate tax provisions have been made for the years subject to examination. The following table summarizes the activity related to the unrecognized tax benefits for the fiscal years ended December 30, 2017, December 29, 2018 and December 28, 2019 (in thousands):
It is reasonably possible that the amounts of unrecognized tax benefits associated with state, federal and foreign tax positions may decrease over the next twelve months due to expiration of a statute or completion of an audit. The company believes that it is reasonably possible that $5.3 million of its remaining unrecognized tax benefits may be recognized by the end of 2020 as a result of settlements with taxing authorities or lapses of statutes of limitations. In the normal course of business, income tax authorities in various income tax jurisdictions both in the United States and internationally conduct routine audits of our income tax returns filed in prior years. These audits are generally designed to determine if individual income tax authorities are in agreement with our interpretations of complex tax regulations regarding the allocation of income to the various income tax jurisdictions. Income tax years are open from 2016 through the current year for the United States federal jurisdiction. Income tax years open for our other major jurisdictions range from 2014 through the current year.
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Summary of Significant Accounting Policies |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The consolidated financial statements include the accounts of the company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The company's consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires the company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses as well as related disclosures. Significant items that are subject to such estimates and judgments include allowances for doubtful accounts, reserves for excess and obsolete inventories, long-lived and intangible assets, warranty reserves, insurance reserves, income tax reserves and post-retirement obligations. On an ongoing basis, the company evaluates its estimates and assumptions based on historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. The company's fiscal year ends on the Saturday nearest December 31. Fiscal years 2019, 2018, and 2017 ended on December 28, 2019, December 29, 2018 and December 30, 2017, respectively, with each year including 52 weeks. Certain prior year amounts have been reclassified to be consistent with current year presentation, including the non-operating components of pension benefit previously reported in accrued expenses and other liabilities within the changes in assets and liabilities, net of acquisitions to an individual adjustment to reconcile net earnings to cash provided by operating activities on the Consolidated Statements of Cash Flows.
The company considers all short-term investments with original maturities of three months or less when acquired to be cash equivalents. The company’s policy is to invest its excess cash in interest-bearing deposits with major banks that are subject to minimal credit and market risk.
Accounts receivable, as shown in the consolidated balance sheets, are net of allowances for doubtful accounts of $14.9 million and $13.6 million at December 28, 2019 and December 29, 2018, respectively. At December 28, 2019, all accounts receivable are expected to be collected within one year. (d) Inventories Inventories are composed of material, labor and overhead and are stated at the lower of cost or net realizable value. Costs for inventory have been determined using the first-in, first-out ("FIFO") method. The company estimates reserves for inventory obsolescence and shrinkage based on its judgment of future realization. Inventories at December 28, 2019 and December 29, 2018 are as follows (in thousands):
Property, plant and equipment are carried at cost as follows (in thousands):
Property, plant and equipment are depreciated or amortized on a straight-line basis over their useful lives based on management's estimates of the period over which the assets will be utilized to benefit the operations of the company. The useful lives are estimated based on historical experience with similar assets, taking into account anticipated technological or other changes. The company periodically reviews these lives relative to physical factors, economic factors and industry trends. If there are changes in the planned use of property and equipment or if technological changes were to occur more rapidly than anticipated, the useful lives assigned to these assets may need to be shortened, resulting in the recognition of increased depreciation and amortization expense in future periods. Following is a summary of the estimated useful lives:
Depreciation expense amounted to $37.9 million, $35.8 million and $29.7 million in fiscal 2019, 2018 and 2017, respectively. Expenditures which significantly extend useful lives are capitalized. Maintenance and repairs are charged to expense as incurred. Asset impairments are recorded whenever events or changes in circumstances indicate that the recorded value of an asset is greater than the sum of its expected future undiscounted cash flows.
The company’s business acquisitions result in the recognition of goodwill and other intangible assets, which are a significant portion of the company’s total assets. The company recognizes goodwill and other intangible assets under the guidance of ASC Topic 350-10, Intangibles - Goodwill and Other. Goodwill represents the excess of acquisition costs over the fair value of the net tangible assets and identifiable intangible assets acquired in a business combination. Identifiable intangible assets are recognized separately from goodwill and include trademarks and trade names, technology, customer relationships and other specifically identifiable assets. Trademarks and trade names are deemed to be indefinite-lived. Goodwill and indefinite-lived intangible assets are not amortized, but are subject to impairment testing. The company performs the annual impairment assessment for goodwill and indefinite-lived intangible assets as of first day of the fourth quarter and more frequently if indicators of impairment exist. The goodwill impairment test is performed at the reporting unit level. The company initially performs a qualitative analysis to determine if it is more likely than not that the goodwill balance or indefinite-life intangible asset is impaired. In conducting a qualitative assessment, the Company analyzes a variety of events or factors that may influence the fair value of the reporting unit or indefinite-life intangible, including, but not limited to: macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, share price and other relevant factors. If an indicator of impairment is determined from the qualitative analysis, then the company will perform a two-step quantitative analysis. First, the fair value of each reporting unit is compared to its carrying value. If the fair value of the reporting unit is less than its carrying value, the company performs a hypothetical purchase price allocation based on the reporting unit’s fair value to determine the fair value of the reporting unit’s goodwill. Any resulting difference will be a charge to impairment of intangible assets in the Consolidated Statements of Earnings in the period in which the determination is made. Fair value is determined using a combination of present value techniques and market prices of comparable businesses. The company completed its annual impairment test for goodwill as of September 29, 2019. The company performed a qualitative assessment to evaluate goodwill for all reporting units. Based on the qualitative assessment it was determined there was no impairment of goodwill. The company has not recognized any goodwill impairments and therefore no accumulated impairment loss. Goodwill is allocated to the business segments as follows (in thousands):
Intangible assets consist of the following (in thousands):
The company completed its annual impairment for other intangibles as of September 29, 2019. We identified indicators of impairment associated with certain tradenames within the Food Processing and Residential Kitchen reporting units based on the qualitative assessment, which required the completion of a quantitative impairment assessment. The primary indicator of impairment was lower than expected revenue performance in the current year. Based on the results of the quantitative assessment, the company determined there was no impairment of any of the indefinite-lived intangible assets. In performing the quantitative assessment of indefinite-life intangible assets, primarily tradenames, the company estimated the fair value using the relief-from-royalty method which requires assumptions related to projected revenues; assumed royalty rates that could be payable if we did not own the brand; and a market participant discount rate based on a weighted-average cost of capital. The company elected to perform a qualitative assessment on the other indefinite-life intangible assets noting no events that indicated that the fair value was less than carrying value that would require a quantitative impairment assessment. The estimates of future cash flows used in determining the fair value of goodwill and intangible assets involve significant management judgment and are based upon assumptions about expected future operating performance, economic conditions, market conditions and cost of capital. Inherent in estimating the future cash flows are uncertainties beyond our control, such as changes in capital markets. The actual cash flows could differ materially from management's estimates due to changes in business conditions, operating performance and economic conditions. During 2017 testing, the company determined that the Viking tradename, within the Residential Kitchen Equipment Group, was impaired. The company estimated the fair value of the tradename using a relief from royalty method under the income approach. The decline in fair value of the Viking tradename was primarily the result of weaker than expected revenue performance in 2017 and a corresponding reduction of future revenue expectations. The impairment resulted from the decline in revenues attributable, in part, to the product recall announced in 2015 related to products manufactured prior to the acquisition of Viking. The fair value of the Viking tradename was estimated to be $93.0 million as compared to the carrying value of $151.0 million and resulted in a $58.0 million indefinite-lived intangible asset impairment charge. The aggregate intangible amortization expense was $64.0 million, $60.0 million and $38.6 million in 2019, 2018 and 2017, respectively. The estimated future amortization expense of intangible assets is as follows (in thousands):
(g) Accrued Expenses Accrued expenses consist of the following at December 28, 2019 and December 29, 2018, respectively (in thousands):
From time to time, the company is subject to proceedings, lawsuits and other claims related to products, suppliers, employees, customers and competitors. The company maintains insurance to partially cover product liability, workers compensation, property and casualty, and general liability matters. The company is required to assess the likelihood of any adverse judgments or outcomes to these matters as well as potential ranges of probable losses. A determination of the amount of accrual required, if any, for these contingencies is made after assessment of each matter and the related insurance coverage. The required accrual may change in the future due to new developments or changes in approach such as a change in settlement strategy in dealing with these matters. The company does not believe that any such matter will have a material adverse effect on its financial condition, results of operations or cash flows of the company. During the fourth quarter, we reached a settlement with respect to a lawsuit filed by the company arising from a prior acquisition included our Residential Kitchen Equipment Segment. The gain associated with this settlement, which is net of the release of funds in escrow, is reflected in the consolidated statement of earnings.
The following table summarizes the components of accumulated other comprehensive income (loss) as reported in the consolidated balance sheets (in thousands):
Changes in accumulated other comprehensive income (loss) (1) were as follows (in thousands):
(1) As of December 28, 2019 pension and interest rate swap amounts are net of tax of $(48.6) million and $(6.0) million, respectively. During the twelve months ended December 28, 2019, the adjustments to pension benefit costs and unrealized gain/(loss) interest rate swap were net of tax of $(11.9) million and $(8.5) million, respectively. (2) As of December 31, 2017, the company adopted ASU No. 2018-02, Income Statement-Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. The adoption of this guidance resulted in the reclassification of $1.1 million of stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 from accumulated other comprehensive income to retained earnings. (3) As of December 30, 2018, the company adopted ASU No. 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities" using the modified retrospective method. The adoption of this guidance resulted in the recognition of less than $(0.1) million as an adjustment to the opening balance of retained earnings. (j) Fair Value Measures ASC 820 Fair Value Measurements and Disclosures defines fair value as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value into the following levels: Level 1 – Quoted prices in active markets for identical assets or liabilities Level 2 – Inputs, other than quoted prices in active markets, that are observable either directly or indirectly Level 3 – Unobservable inputs based on our own assumptions The company’s financial assets and liabilities that are measured at fair value are categorized using the fair value hierarchy at December 28, 2019 and December 29, 2018 are as follows (in thousands):
The contingent consideration, as of December 28, 2019 and December 29, 2018, relates to the earnout provisions recorded in conjunction with various purchase agreements. The earnout provisions associated with these acquisitions are based upon performance measurements related to sales and earnings, as defined in the respective purchase agreements. On a quarterly basis, the company assesses the projected results for each of the acquisitions in comparison to the earnout targets and adjusts the liability accordingly.
Foreign currency transactions are accounted for in accordance with ASC 830 Foreign Currency Translation. The income statements of the company’s foreign operations are translated at the monthly average rates. Assets and liabilities of the company’s foreign operations are translated at exchange rates at the balance sheet date. These translation adjustments are not included in determining net income for the period but are disclosed and accumulated in a separate component of stockholders’ equity. Exchange gains and losses on foreign currency transactions are included in determining net income for the period in which they occur. These transactions amounted to a gain of $0.9 million, and loss of $2.6 million and $2.4 million in 2019, 2018 and 2017, respectively, and are included in other expense on the statements of earnings.
Fees billed to the customer for shipping and handling are classified as a component of net revenues. Shipping and handling costs are included in cost of products sold.
In the normal course of business, the company issues product warranties for specific product lines and provides for the estimated future warranty cost in the period in which the sale is recorded. The estimate of warranty cost is based on contract terms and historical warranty loss experience that is periodically adjusted for recent actual experience. Because warranty estimates are forecasts that are based on the best available information, claims costs may differ from amounts provided. Adjustments to initial obligations for warranties are made as changes in the obligations become reasonably estimable. A rollforward of the warranty reserve for the fiscal years 2019 and 2018 are as follows (in thousands):
Research and development costs, included in cost of sales in the consolidated statements of earnings, are charged to expense when incurred. These costs were $41.2 million, $35.3 million and $29.1 million in fiscal 2019, 2018 and 2017, respectively.
The company estimates the fair value of restricted share grants and stock options at the time of grant and recognizes compensation costs over the vesting period of the awards and options. Non-cash share-based compensation expense of $8.1 million, $2.5 million and $6.2 million was recognized for fiscal 2019, 2018 and 2017, respectively, associated with restricted share grants. The company recorded a related tax benefit of $0.5 million, less than $0.1 million and $2.4 million in fiscal 2019, 2018 and 2017, respectively. As of December 28, 2019, there was $52.3 million of total unrecognized compensation cost related to nonvested restricted share grant compensation arrangements, if all performance conditions are fully achieved. The remaining weighted average life is 1.65 years. Share grant awards not subject to market conditions for vesting are valued at the closing share price of the company’s stock as of the date of the grant. The company issued 537,059 and 132,038 restricted share grant awards in 2019 and 2018, respectively, with a fair value of $60.8 million and $13.3 million, respectively. Share grant awards issued in 2019 and 2018 are generally performance based and were not subject to market conditions. The fair value of $113.26 and $100.50 per share for the awards for 2019 and 2018, respectively, represent the closing share price of the company’s stock as of the date of grant.
“Basic earnings per share” is calculated based upon the weighted average number of common shares actually outstanding, and “diluted earnings per share” is calculated based upon the weighted average number of common shares outstanding and other dilutive securities. The company’s potentially dilutive securities consist of shares issuable on exercise of outstanding options and vesting of restricted stock grants computed using the treasury method and amounted to 9,000, 28,000, and 4,000 for fiscal 2019, 2018 and 2017, respectively. There were no anti-dilutive equity awards excluded from common stock equivalents for 2019, 2018 or 2017.
Cash paid for interest was $80.9 million, $55.3 million and $25.9 million in fiscal 2019, 2018 and 2017, respectively. Cash payments totaling $91.5 million, $79.0 million, and $123.3 million were made for income taxes during fiscal 2019, 2018 and 2017, respectively.
Accounting Pronouncements - Recently Adopted In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The amendments under this pronouncement change the way all leases with a duration of one year or more are treated. Under this guidance, lessees are required to capitalize virtually all leases on the balance sheet as a right-of-use asset and an associated financing lease liability or operating lease liability. The company adopted this guidance on December 30, 2018 using the modified retrospective method. The company has elected the package of practical expedients to not reassess prior conclusions related to contracts containing leases, lease classification and initial direct costs. The adoption of this guidance increased total assets and liabilities due to the recognition of right-of-use assets and lease liabilities amounting to approximately $96.8 million. For additional information related to the impact of adopting this guidance, see Note 9 of the Consolidated Financial Statements. In August 2017, the FASB issued ASU 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities". The amendments in ASU-12 provide new guidance about income statement classification and eliminates the requirement to separately measure and report hedge ineffectiveness. The entire change in fair value for qualifying hedge instruments included in the effectiveness is recorded in other comprehensive income (OCI) and amounts deferred in OCI are reclassified to earnings in the same income statement line item in which the earnings effect of the hedged item is reported. The adoption of this guidance on December 30, 2018 did not have a material impact on the company's Consolidated Financial Statements. For additional information related to the impact of adopting this guidance, see Note of the Consolidated Financial Statements. In June 2018, the FASB issued ASU 2018-07, "Improvements to Nonemployee Share-Based Payment Accounting". The amendments in ASU-08 simplify several aspects of the accounting for nonemployee share-based payment transactions resulting from expanding the scope of Topic 718, Compensation—Stock Compensation, to include share-based payment transactions for acquiring goods and services from nonemployees. The adoption of this guidance on December 30, 2018 did not have an impact on the company's Consolidated Financial Statements. In August of 2018, the SEC published Final Rule Release No. 33-10532, "Disclosure Update and Simplification". This guidance streamlines disclosure requirements by removing certain redundant topics and is effective for quarterly and annual reports submitted after November 5, 2018. The adoption of this guidance on December 30, 2018 resulted in the presentation and expansion of the company's Consolidated Statements of Changes in Stockholders' Equity to display quarter-to-quarter details. Accounting Pronouncements - To be adopted In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”, and has since modified the standard with several ASUs (collectively, the “new credit loss standard”). The new credit loss standard requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions and reasonable and supportable forecasts that affect the collectability of the reported amount. The ASU is effective for annual reporting periods, and interim reporting periods, beginning after December 15, 2019. As a result of the company's assessment process on its receivables and contract assets portfolio, which is the only financial instrument in scope of this standard, the company does not expect this ASU to have a material impact on its Consolidated Financial Statements. In January 2017, the FASB issued ASU 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment". The amendments in ASU-04 simplify the subsequent measurement of goodwill, by removing the second step of the goodwill impairment test. An entity will apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit's carrying amount over its fair value. The new guidance does not amend the optional qualitative assessment of goodwill impairment. This ASU is effective for annual reporting periods, and interim reporting periods, beginning after December 15, 2019. Early adoption is permitted for testing dates after January 1, 2017. The company is evaluating the application of this ASU on the company's annual impairment test. The company does not expect the adoption of this ASU to have a material impact on its Consolidated Financial Statements. In August 2018, the FASB issued ASU 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement". The amendments in ASU-13 remove, modify and add various disclosure requirements around the topic in order to clarify and improve the cost-benefit nature of disclosures. This ASU is effective for annual reporting periods, and interim periods with those reporting periods, beginning after December 15, 2019 with early adoption permitted. The company does not expect the adoption of this ASU to have a material impact on its Consolidated Financial Statements. In August 2018, the FASB issued ASU 2018-14, "Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20)". The amendments in ASU-14 remove, modify and add various disclosure requirements around the topic in order to clarify and improve the cost-benefit nature of disclosures. This ASU is effective for annual reporting periods, and interim periods with those reporting periods, beginning after December 15, 2020 with early adoption permitted. The amendments must be applied on a retrospective basis for all periods presented. The company is currently evaluating the impacts the adoption of this ASU will have on its Consolidated Financial Statements. In August 2018, the FASB issued ASU 2018-15, "Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40)". The amendments in ASU-15 align the requirements for capitalizing implementation costs in a service contract hosting arrangement with those of developing or obtaining internal-use software. This ASU is effective for annual reporting periods, and interim periods with those reporting periods, beginning after December 15, 2019 with early adoption permitted. The company does not expect the adoption of this ASU to have a material impact on its Consolidated Financial Statements. In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes (Topic 740) which removes certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. This guidance also clarifies and simplifies other areas of ASC 740. This ASU is effective for annual reporting periods, and interim periods with those reporting periods, beginning after December 15, 2020 with early adoption permitted. Certain amendments in this update must be applied on a prospective basis, certain amendments must be applied on a retrospective basis, and certain amendments must be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings in the period of adoption. The company is currently evaluating the impacts the adoption of this ASU will have on its Consolidated Financial Statements.
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Lease Commitments (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating Leases |
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Other Lease Information |
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Restructuring (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restructuring and Related Costs [Table Text Block] | The costs and corresponding reserve balances for the Residential Kitchen Equipment Group are summarized as follows (in thousands):
|
Revenue Recognition Contract with Customer, Asset and Liability (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
|
Revenue Recognition [Abstract] | ||
Contract assets | $ 22,675 | $ 14,048 |
Contract liabilities | 74,511 | 57,913 |
Non-current contract liabilities | 12,870 | $ 12,170 |
Contract with Customer, Asset, Reclassified to Receivable | 9,100 | |
Contract with Customer, Liability, Revenue Recognized | 51,800 | |
Increase (Decrease) in Deferred Revenue and Customer Advances and Deposits | 71,400 | |
Contract asset impairment | $ 0 |
Summary of Significant Accounting Policies - Rollforward of the Warranty Reserve (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
|
Movement in Standard Product Warranty Accrual [Roll Forward] | ||
Beginning balance | $ 59,451 | $ 52,834 |
Warranty reserve related to acquisitions | 7,353 | 5,884 |
Warranty expense | 68,842 | 62,314 |
Warranty claims paid | (69,272) | (61,581) |
Ending balance | $ 66,374 | $ 59,451 |
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands |
Total |
Common Stock |
Paid-in Capital |
Treasury Stock |
Retained Earnings |
Accumulated Other Comprehensive Income (loss) |
Accumulated Defined Benefit Plans Adjustment Attributable to Parent |
Interest Rate Swap
Retained Earnings
|
Interest Rate Swap
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member]
|
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Balance, Beginning at Dec. 31, 2016 | $ 1,265,318 | $ 144 | $ 355,287 | $ (205,280) | $ 1,399,490 | $ (284,323) | ||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||
Net earnings | 298,128 | 0 | 0 | 0 | 298,128 | 0 | ||||||||||||||
Currency translation adjustments | 46,690 | 0 | 0 | 0 | 0 | 46,690 | ||||||||||||||
Change in unrecognized pension benefit costs, net of tax | (29,669) | 0 | 0 | 0 | 0 | (29,669) | ||||||||||||||
Unrealized gain on interest rate swap, net of tax | 883 | 0 | 0 | 0 | 0 | 883 | ||||||||||||||
Stock compensation | 6,237 | 0 | 6,237 | 0 | 0 | 0 | ||||||||||||||
Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs | 13,399 | 1 | 13,398 | 0 | 0 | 0 | ||||||||||||||
Purchase of treasury stock | (239,838) | 0 | 0 | (239,838) | 0 | 0 | ||||||||||||||
Balance, Ending at Dec. 30, 2017 | 1,361,148 | 145 | 374,922 | (445,118) | 1,697,618 | (266,419) | ||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||
Net earnings | 317,152 | 0 | 0 | 0 | 317,152 | 0 | ||||||||||||||
Cumulative Effect on Retained Earnings, Net of Tax | Accounting Standards Update 2018-02 | [1] | 0 | 0 | 0 | 0 | (1,132) | 1,132 | |||||||||||||
Cumulative Effect on Retained Earnings, Net of Tax | Accounting Standards Update 2014-09 | [2] | (4,405) | 0 | 0 | 0 | (4,405) | 0 | |||||||||||||
Currency translation adjustments | (43,050) | 0 | 0 | 0 | 0 | (43,050) | ||||||||||||||
Change in unrecognized pension benefit costs, net of tax | 32,125 | |||||||||||||||||||
Change in unrecognized pension benefit costs, net of tax | Accounting Standards Update 2018-02 | 32,612 | 0 | 0 | 0 | 0 | 32,612 | ||||||||||||||
Unrealized gain on interest rate swap, net of tax | 868 | |||||||||||||||||||
Unrealized gain on interest rate swap, net of tax | Accounting Standards Update 2018-02 | (751) | 0 | 0 | 0 | 0 | (751) | ||||||||||||||
Stock compensation | 2,497 | 0 | 2,497 | 0 | 0 | 0 | ||||||||||||||
Balance, Ending at Dec. 29, 2018 | 1,665,203 | 145 | 377,419 | (445,118) | 2,009,233 | (276,476) | ||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||
Adoption of ASU 2018-02 | $ 500 | |||||||||||||||||||
Adoption of ASU 2018-02 | Accounting Standards Update 2018-02 | 1,132 | [3] | (487) | [3] | $ (1,600) | $ 1,619 | [3] | |||||||||||||
Stranded Tax Effects Reclassified from OCI to Retained Earnings | Accounting Standards Update 2018-02 | 1,100 | |||||||||||||||||||
Net earnings | 352,240 | 0 | 0 | 0 | 352,240 | 0 | ||||||||||||||
Cumulative Effect on Retained Earnings, Net of Tax | (100) | |||||||||||||||||||
Cumulative Effect on Retained Earnings, Net of Tax | Accounting Standards Update 2017-12 | 0 | 0 | 0 | 0 | (11) | 11 | ||||||||||||||
Currency translation adjustments | 7,066 | 0 | 0 | 0 | 0 | 7,066 | ||||||||||||||
Change in unrecognized pension benefit costs, net of tax | (57,398) | 0 | 0 | 0 | 0 | (57,398) | ||||||||||||||
Unrealized gain on interest rate swap, net of tax | (24,125) | |||||||||||||||||||
Unrealized gain on interest rate swap, net of tax | Accounting Standards Update 2017-12 | (24,136) | 0 | 0 | 0 | 0 | (24,136) | ||||||||||||||
Stock compensation | 8,133 | 0 | 8,133 | 0 | 0 | 0 | ||||||||||||||
Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs | 1,850 | 0 | 1,850 | 0 | 0 | 0 | ||||||||||||||
Purchase of treasury stock | (6,144) | 0 | 0 | (6,144) | 0 | 0 | ||||||||||||||
Balance, Ending at Dec. 28, 2019 | 1,946,814 | $ 145 | $ 387,402 | $ (451,262) | $ 2,361,462 | $ (350,933) | ||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||
Adoption of ASU 2018-02 | Accounting Standards Update 2017-12 | [4] | $ 11 | $ 0 | $ 11 | ||||||||||||||||
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CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands |
Dec. 28, 2019 |
Dec. 29, 2018 |
---|---|---|
Common Stock, Value, Issued | $ 145 | $ 145 |
Current assets: | ||
Cash and cash equivalents | 94,500 | 71,701 |
Accounts Receivable, Net, Current | 447,612 | 398,660 |
Inventory, Net | 585,699 | 521,810 |
Prepaid expenses and other | 61,224 | 50,940 |
Prepaid Taxes | 20,161 | 18,483 |
Total current assets | 1,209,196 | 1,061,594 |
Property, Plant and Equipment, Net | 352,145 | 314,569 |
Goodwill | 1,849,747 | 1,743,175 |
Other intangibles | 1,443,381 | 1,361,024 |
Deferred Income Tax Assets, Net | 36,932 | 32,188 |
Other assets | 110,742 | 37,231 |
Total Assets | 5,002,143 | 4,549,781 |
Current liabilities: | ||
Current maturities of long-term debt | 2,894 | 3,207 |
Accounts payable | 173,693 | 188,299 |
Accrued expenses | 416,550 | 367,446 |
Total current liabilities | 593,137 | 558,952 |
Long-term debt | 1,870,246 | 1,888,898 |
Long-term deferred tax liability | 133,500 | 113,896 |
Liability, Defined Benefit Pension Plan, Noncurrent | 289,086 | 253,119 |
Other non-current liabilities | 169,360 | 69,713 |
Stockholders' equity: | ||
Common Stock, Value, Issued | 145 | 145 |
Paid-in capital | 387,402 | 377,419 |
Treasury Stock, Value | 451,262 | 445,118 |
Retained earnings | 2,361,462 | 2,009,233 |
Accumulated other comprehensive loss | (350,933) | (276,476) |
Total stockholders' equity | 1,946,814 | 1,665,203 |
Total liabilities and stockholders' equity | $ 5,002,143 | $ 4,549,781 |
Employee Retirement Plans Estimated Future Benefit Payments under the Plans (Details) $ in Thousands |
Dec. 28, 2019
USD ($)
|
---|---|
USPlans | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
2020 | $ 1,738 |
2021 | 1,763 |
2022 | 1,776 |
2023 | 1,784 |
2024 through 2029 | 11,267 |
Defined Benefit Plan, Expected Future Employer Contributions, Next Fiscal Year | 1,300 |
Non US Plans | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
2020 | 63,856 |
2021 | 65,110 |
2022 | 66,177 |
2023 | 66,332 |
2024 through 2029 | 405,088 |
Defined Benefit Plan, Expected Future Employer Contributions, Next Fiscal Year | $ 5,800 |
Financial Instruments - Additional Information (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
|
Derivatives, Fair Value [Line Items] | ||
Interest rate derivative liabilities, at fair value | $ 23,300 | |
Interest Rate Derivative Assets, at Fair Value | $ 9,400 | |
Increase (decrease) in fair value of interest rate fair value hedging instruments | (24,100) | |
Interest Rate Swap | Other Noncurrent Assets | ||
Derivatives, Fair Value [Line Items] | ||
Interest Rate Fair Value Hedge Asset at Fair Value | 1,830 | 13,487 |
Interest Rate Swap | Other Noncurrent Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Interest Rate Cash Flow Hedge Liability at Fair Value | 25,120 | 4,125 |
Foreign Exchange Forward | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of forward contracts | (900) | |
Other Comprehensive Income (Loss) | Interest Rate Swap | ||
Derivatives, Fair Value [Line Items] | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax | (31,396) | (561) |
Interest Expense | Interest Rate Swap | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | 1,256 | 415 |
Other Expense | Interest Rate Swap | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net | $ 0 | $ 72 |
Segment Information Segment Information - Narrative (Details) |
12 Months Ended |
---|---|
Dec. 28, 2019
segment
| |
Segment Reporting [Abstract] | |
Number of operating segments | 3 |
Subsequent Event (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Jan. 31, 2020 |
Dec. 28, 2019 |
Dec. 29, 2018 |
|
Subsequent Event [Line Items] | |||
Maximum borrowing capacity | $ 2,500,000 | ||
Line of Credit Facility, Potential Additional Borrowing Capacity | 3,000,000 | ||
Long-term line of credit | $ 1,869,402 | $ 1,887,764 | |
Credit facility, additional interest rate above LIBOR | 1.625% | ||
Line of Credit | |||
Subsequent Event [Line Items] | |||
Maximum borrowing capacity | $ 3,500,000 | ||
Line of Credit Facility, Potential Additional Borrowing Capacity | 4,000,000 | ||
Long-term line of credit | 750,000 | ||
Long-term Line of Credit, Revolving Credit Facility | $ 2,750,000 | ||
Credit facility, additional interest rate above LIBOR | 1.625% | ||
Term loan facility amortization rate | 2.50% |
Employee Retirement Plans Summary classes of security by percentage (Details) |
Dec. 28, 2019 |
Dec. 29, 2018 |
---|---|---|
Non US Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 100.00% | |
Defined Benefit Plan, Plan Assets, Actual Allocation, Percentage | 100.00% | 100.00% |
Non US Plans | Equity Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 17.00% | |
Defined Benefit Plan, Plan Assets, Actual Allocation, Percentage | 22.00% | 23.00% |
Non US Plans | Fixed Income Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 38.00% | |
Defined Benefit Plan, Plan Assets, Actual Allocation, Percentage | 39.00% | 52.00% |
Non US Plans | Money Market Instruments [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 32.00% | |
Defined Benefit Plan, Plan Assets, Actual Allocation, Percentage | 22.00% | 9.00% |
Non US Plans | Other (real estate & commodities) [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 13.00% | |
Defined Benefit Plan, Plan Assets, Actual Allocation, Percentage | 13.00% | 14.00% |
Non US Plans | Cash and Cash Equivalents | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 0.00% | |
Defined Benefit Plan, Plan Assets, Actual Allocation, Percentage | 4.00% | 2.00% |
USPlans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 100.00% | |
Defined Benefit Plan, Plan Assets, Actual Allocation, Percentage | 100.00% | 100.00% |
USPlans | Equity Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 48.00% | |
Defined Benefit Plan, Plan Assets, Actual Allocation, Percentage | 51.00% | 42.00% |
USPlans | Fixed Income Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 40.00% | |
Defined Benefit Plan, Plan Assets, Actual Allocation, Percentage | 37.00% | 49.00% |
USPlans | Money Market Instruments [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 4.00% | |
Defined Benefit Plan, Plan Assets, Actual Allocation, Percentage | 2.00% | 1.00% |
USPlans | Other (real estate & commodities) [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 8.00% | |
Defined Benefit Plan, Plan Assets, Actual Allocation, Percentage | 10.00% | 8.00% |
Acquisitions and Purchase Accounting - Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
|
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||
Net sales | $ 3,022,279 | $ 3,078,487 |
Net earnings | $ 344,823 | $ 285,642 |
Basic | $ 6.20 | $ 5.14 |
Diluted | $ 6.20 | $ 5.14 |
Summary of Significant Accounting Policies - Summary of Estimated Useful Lives (Details) |
12 Months Ended |
---|---|
Dec. 28, 2019 | |
Minimum | Building and Building Improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 20 years |
Minimum | Furniture and Fixtures | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 3 years |
Minimum | Machinery and Equipment | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 3 years |
Maximum | Building and Building Improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 40 years |
Maximum | Furniture and Fixtures | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 7 years |
Maximum | Machinery and Equipment | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 10 years |
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
Dec. 30, 2017 |
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Income Tax Disclosure [Abstract] | |||
Permanently Reinvested Foreign Earnings | $ 5,600 | $ 4,100 | |
Deferred Tax Liabilities, Undistributed Foreign Earnings | 369,000 | ||
Operating Loss Carryforwards | 17,873 | 36,629 | |
Deferred Tax Assets, Operating Loss Carryforwards | 19,500 | ||
Deferred Tax Assets, Operating Loss Carryforwards, Subject to Expiration | 13,400 | ||
Deferred Tax Assets, Operating Loss Carryforwards, Not Subject to Expiration | 6,100 | ||
Deferred Tax Assets, Operating Loss Carryforwards, State and Local | 104,400 | ||
Deferred Tax Assets, Operating Loss Carryforwards, Foreign | 38,200 | ||
Deferred Tax Assets, Valuation Allowance | 5,200 | ||
Deferred Tax Assets, Operating Loss Carryforwards, Foreign Write Off | 18,400 | ||
Unrecognized tax benefits rleated to federal, state and foreign taxes | 31,559 | 31,912 | $ 29,930 |
Unrecognized tax benefits related to federal, state and foreign taxes that would impact the effective tax rate if recognized | 31,200 | ||
Unrecognized tax benefits, accured interest | 5,500 | ||
Unrecognized tax benefits, penalties | 7,200 | ||
Unrecognized tax benefits, interest recognized | 400 | 600 | 700 |
Unrecognized tax benefits, penalties recognized | (900) | $ 600 | $ 1,300 |
Significant Change in Unrecognized Tax Benefits is Reasonably Possible, Amount of Unrecorded Benefit | $ 5,300 |
Income Taxes - Summary of Provision for Income Taxes (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
Dec. 30, 2017 |
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Income Tax Disclosure [Abstract] | |||
Federal | $ 69,074 | $ 66,359 | $ 48,688 |
State and local | 16,203 | 16,035 | 9,076 |
Foreign | 25,102 | 23,967 | 27,637 |
Total | 110,379 | 106,361 | 85,401 |
Current | 88,167 | 85,872 | 99,893 |
Deferred | $ 22,212 | $ 20,489 | $ (14,492) |
Financing Arrangements - Schedule of Future Aggregate Debt Payable (Details) $ in Thousands |
Dec. 28, 2019
USD ($)
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Debt Disclosure [Abstract] | |
2020 | $ 2,894 |
2021 | 378 |
2022 | 302 |
2023 | 82 |
2024 and thereafter | 1,869,484 |
Total Debt Payable | $ 1,873,140 |
Revenue Recognition (Tables) |
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Dec. 28, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of Revenue | The following table summarizes our net sales by reportable operating segment and geographical location (in thousands):
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Contract with Customer, Asset and Liability | The following table provides information about contract assets and contract liabilities from contracts with customers (in thousands):
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Summary of Significant Accounting Policies (Policies) |
12 Months Ended | ||||||||||||||||||
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Dec. 28, 2019 | |||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||
Basis of Presentation | Basis of Presentation The consolidated financial statements include the accounts of the company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The company's consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires the company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses as well as related disclosures. Significant items that are subject to such estimates and judgments include allowances for doubtful accounts, reserves for excess and obsolete inventories, long-lived and intangible assets, warranty reserves, insurance reserves, income tax reserves and post-retirement obligations. On an ongoing basis, the company evaluates its estimates and assumptions based on historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.
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Fiscal Period | The company's fiscal year ends on the Saturday nearest December 31. Fiscal years 2019, 2018, and 2017 ended on December 28, 2019, December 29, 2018 and December 30, 2017, respectively, with each year including 52 weeks. Certain prior year amounts have been reclassified to be consistent with current year presentation, including the non-operating components of pension benefit previously reported in accrued expenses and other liabilities within the changes in assets and liabilities, net of acquisitions to an individual adjustment to reconcile net earnings to cash provided by operating activities on the Consolidated Statements of Cash Flows. |
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Cash and Cash Equivalents | Cash and Cash Equivalents The company considers all short-term investments with original maturities of three months or less when acquired to be cash equivalents. The company’s policy is to invest its excess cash in interest-bearing deposits with major banks that are subject to minimal credit and market risk.
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Accounts Receivable | Accounts Receivable Accounts receivable, as shown in the consolidated balance sheets, are net of allowances for doubtful accounts of $14.9 million and $13.6 million at December 28, 2019 and December 29, 2018, respectively. At December 28, 2019, all accounts receivable are expected to be collected within one year.
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Inventories | Inventories |
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Property, Plant and Equipment | Property, plant and equipment are depreciated or amortized on a straight-line basis over their useful lives based on management's estimates of the period over which the assets will be utilized to benefit the operations of the company. The useful lives are estimated based on historical experience with similar assets, taking into account anticipated technological or other changes. The company periodically reviews these lives relative to physical factors, economic factors and industry trends. If there are changes in the planned use of property and equipment or if technological changes were to occur more rapidly than anticipated, the useful lives assigned to these assets may need to be shortened, resulting in the recognition of increased depreciation and amortization expense in future periods. Following is a summary of the estimated useful lives:
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Goodwill and Other Intangibles | Goodwill and Other Intangibles The company’s business acquisitions result in the recognition of goodwill and other intangible assets, which are a significant portion of the company’s total assets. The company recognizes goodwill and other intangible assets under the guidance of ASC Topic 350-10, Intangibles - Goodwill and Other. Goodwill represents the excess of acquisition costs over the fair value of the net tangible assets and identifiable intangible assets acquired in a business combination. Identifiable intangible assets are recognized separately from goodwill and include trademarks and trade names, technology, customer relationships and other specifically identifiable assets. Trademarks and trade names are deemed to be indefinite-lived. Goodwill and indefinite-lived intangible assets are not amortized, but are subject to impairment testing. The company performs the annual impairment assessment for goodwill and indefinite-lived intangible assets as of first day of the fourth quarter and more frequently if indicators of impairment exist. The goodwill impairment test is performed at the reporting unit level. The company initially performs a qualitative analysis to determine if it is more likely than not that the goodwill balance or indefinite-life intangible asset is impaired. In conducting a qualitative assessment, the Company analyzes a variety of events or factors that may influence the fair value of the reporting unit or indefinite-life intangible, including, but not limited to: macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, share price and other relevant factors. |
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Litigation Matters | Litigation Matters From time to time, the company is subject to proceedings, lawsuits and other claims related to products, suppliers, employees, customers and competitors. The company maintains insurance to partially cover product liability, workers compensation, property and casualty, and general liability matters. The company is required to assess the likelihood of any adverse judgments or outcomes to these matters as well as potential ranges of probable losses. A determination of the amount of accrual required, if any, for these contingencies is made after assessment of each matter and the related insurance coverage. The required accrual may change in the future due to new developments or changes in approach such as a change in settlement strategy in dealing with these matters. The company does not believe that any such matter will have a material adverse effect on its financial condition, results of operations or cash flows of the company.
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Fair Value Measures | Fair Value Measures ASC 820 Fair Value Measurements and Disclosures defines fair value as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value into the following levels: Level 1 – Quoted prices in active markets for identical assets or liabilities Level 2 – Inputs, other than quoted prices in active markets, that are observable either directly or indirectly Level 3 – Unobservable inputs based on our own assumptions
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Foreign Currency | Foreign Currency |
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Shipping and Handling Costs | Fees billed to the customer for shipping and handling are classified as a component of net revenues. Shipping and handling costs are included in cost of products sold. |
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Warranty Costs | Costs In the normal course of business, the company issues product warranties for specific product lines and provides for the estimated future warranty cost in the period in which the sale is recorded. The estimate of warranty cost is based on contract terms and historical warranty loss experience that is periodically adjusted for recent actual experience. Because warranty estimates are forecasts that are based on the best available information, claims costs may differ from amounts provided. Adjustments to initial obligations for warranties are made as changes in the obligations become reasonably estimable. |
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Research and Development Costs | and Development Costs |
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Non-Cash Share-Based Compensation | The company estimates the fair value of restricted share grants and stock options at the time of grant and recognizes compensation costs over the vesting period of the awards and options. | ||||||||||||||||||
Earnings Per Share | Per Share “Basic earnings per share” is calculated based upon the weighted average number of common shares actually outstanding, and “diluted earnings per share” is calculated based upon the weighted average number of common shares outstanding and other dilutive securities. |
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New Accounting Pronouncements | unting Pronouncements Accounting Pronouncements - Recently Adopted In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The amendments under this pronouncement change the way all leases with a duration of one year or more are treated. Under this guidance, lessees are required to capitalize virtually all leases on the balance sheet as a right-of-use asset and an associated financing lease liability or operating lease liability. The company adopted this guidance on December 30, 2018 using the modified retrospective method. The company has elected the package of practical expedients to not reassess prior conclusions related to contracts containing leases, lease classification and initial direct costs. The adoption of this guidance increased total assets and liabilities due to the recognition of right-of-use assets and lease liabilities amounting to approximately $96.8 million. For additional information related to the impact of adopting this guidance, see Note 9 of the Consolidated Financial Statements. In August 2017, the FASB issued ASU 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities". The amendments in ASU-12 provide new guidance about income statement classification and eliminates the requirement to separately measure and report hedge ineffectiveness. The entire change in fair value for qualifying hedge instruments included in the effectiveness is recorded in other comprehensive income (OCI) and amounts deferred in OCI are reclassified to earnings in the same income statement line item in which the earnings effect of the hedged item is reported. The adoption of this guidance on December 30, 2018 did not have a material impact on the company's Consolidated Financial Statements. For additional information related to the impact of adopting this guidance, see Note of the Consolidated Financial Statements. In June 2018, the FASB issued ASU 2018-07, "Improvements to Nonemployee Share-Based Payment Accounting". The amendments in ASU-08 simplify several aspects of the accounting for nonemployee share-based payment transactions resulting from expanding the scope of Topic 718, Compensation—Stock Compensation, to include share-based payment transactions for acquiring goods and services from nonemployees. The adoption of this guidance on December 30, 2018 did not have an impact on the company's Consolidated Financial Statements. In August of 2018, the SEC published Final Rule Release No. 33-10532, "Disclosure Update and Simplification". This guidance streamlines disclosure requirements by removing certain redundant topics and is effective for quarterly and annual reports submitted after November 5, 2018. The adoption of this guidance on December 30, 2018 resulted in the presentation and expansion of the company's Consolidated Statements of Changes in Stockholders' Equity to display quarter-to-quarter details. Accounting Pronouncements - To be adopted In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”, and has since modified the standard with several ASUs (collectively, the “new credit loss standard”). The new credit loss standard requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions and reasonable and supportable forecasts that affect the collectability of the reported amount. The ASU is effective for annual reporting periods, and interim reporting periods, beginning after December 15, 2019. As a result of the company's assessment process on its receivables and contract assets portfolio, which is the only financial instrument in scope of this standard, the company does not expect this ASU to have a material impact on its Consolidated Financial Statements. In January 2017, the FASB issued ASU 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment". The amendments in ASU-04 simplify the subsequent measurement of goodwill, by removing the second step of the goodwill impairment test. An entity will apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit's carrying amount over its fair value. The new guidance does not amend the optional qualitative assessment of goodwill impairment. This ASU is effective for annual reporting periods, and interim reporting periods, beginning after December 15, 2019. Early adoption is permitted for testing dates after January 1, 2017. The company is evaluating the application of this ASU on the company's annual impairment test. The company does not expect the adoption of this ASU to have a material impact on its Consolidated Financial Statements. In August 2018, the FASB issued ASU 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement". The amendments in ASU-13 remove, modify and add various disclosure requirements around the topic in order to clarify and improve the cost-benefit nature of disclosures. This ASU is effective for annual reporting periods, and interim periods with those reporting periods, beginning after December 15, 2019 with early adoption permitted. The company does not expect the adoption of this ASU to have a material impact on its Consolidated Financial Statements. In August 2018, the FASB issued ASU 2018-14, "Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20)". The amendments in ASU-14 remove, modify and add various disclosure requirements around the topic in order to clarify and improve the cost-benefit nature of disclosures. This ASU is effective for annual reporting periods, and interim periods with those reporting periods, beginning after December 15, 2020 with early adoption permitted. The amendments must be applied on a retrospective basis for all periods presented. The company is currently evaluating the impacts the adoption of this ASU will have on its Consolidated Financial Statements. In August 2018, the FASB issued ASU 2018-15, "Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40)". The amendments in ASU-15 align the requirements for capitalizing implementation costs in a service contract hosting arrangement with those of developing or obtaining internal-use software. This ASU is effective for annual reporting periods, and interim periods with those reporting periods, beginning after December 15, 2019 with early adoption permitted. The company does not expect the adoption of this ASU to have a material impact on its Consolidated Financial Statements. In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes (Topic 740) which removes certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. This guidance also clarifies and simplifies other areas of ASC 740. This ASU is effective for annual reporting periods, and interim periods with those reporting periods, beginning after December 15, 2020 with early adoption permitted. Certain amendments in this update must be applied on a prospective basis, certain amendments must be applied on a retrospective basis, and certain amendments must be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings in the period of adoption. The company is currently evaluating the impacts the adoption of this ASU will have on its Consolidated Financial Statements.
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Acquisitions and Purchase Accounting Acquisition and Purchase Accounting - Taylor (Details) - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Jun. 22, 2018 |
Dec. 28, 2019 |
Dec. 29, 2018 |
Dec. 30, 2017 |
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Business Acquisition [Line Items] | ||||
Payments to Acquire Businesses, Net of Cash Acquired | $ 281,058 | $ 1,197,984 | $ 305,251 | |
Goodwill | 1,849,747 | 1,743,175 | 1,264,810 | |
Taylor | ||||
Business Acquisition [Line Items] | ||||
Payments to Acquire Businesses, Net of Cash Acquired | $ 1,000,000 | |||
Business Combination, Provisional Information Adjustment, Working Capital | 11,500 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents | 2,615 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets | 69,151 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 20,631 | |||
Goodwill | 370,842 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill | 603,760 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets | 361 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Assets Noncurrent | 227 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities | 52,516 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Other | 8,809 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | 1,006,262 | |||
Scenario, Previously Reported | Taylor | ||||
Business Acquisition [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents | 2,551 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets | 71,162 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 21,187 | |||
Goodwill | 491,339 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill | 484,210 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets | 0 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Assets Noncurrent | 0 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities | 48,417 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Other | 8,161 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | (1,013,871) | |||
Scenario, Adjustment | Taylor | ||||
Business Acquisition [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents | 64 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets | (2,011) | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | (556) | |||
Goodwill | (120,497) | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill | 119,550 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets | 361 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Assets Noncurrent | 227 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities | 4,099 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Other | 648 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | 7,609 | |||
Commercial Foodservice Equipment Group | ||||
Business Acquisition [Line Items] | ||||
Goodwill | $ 1,153,552 | $ 1,102,067 | $ 631,451 | |
Customer Relationships | Commercial Foodservice Equipment Group | Taylor | ||||
Business Acquisition [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill | $ 290,900 | |||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 15 years | |||
Oven developed technology | Commercial Foodservice Equipment Group | Taylor | ||||
Business Acquisition [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill | $ 1,700 | |||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 5 years | |||
Backlog | Commercial Foodservice Equipment Group | Taylor | ||||
Business Acquisition [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill | $ 4,400 | |||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 3 months | |||
Service Backlog | Commercial Foodservice Equipment Group | Taylor | ||||
Business Acquisition [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill | $ 2,100 | |||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 3 years | |||
Trade Names | Commercial Foodservice Equipment Group | Taylor | ||||
Business Acquisition [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill | $ 304,700 |
Income Taxes (Tables) |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Before Taxes | Earnings before taxes is summarized as follows (in thousands):
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Schedule of Provision of Taxes | The provision for income taxes is summarized as follows (in thousands):
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Schedule of Effective Income Tax Reconciliation | Reconciliation of the differences between income taxes computed at the federal statutory rate to the effective rate are as follows:
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Schedule of Deferred Assets and Liabilities | At December 28, 2019 and December 29, 2018, the company had recorded the following deferred tax assets and liabilities (in thousands):
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Schedule of Unrecognized Tax Benefits | The following table summarizes the activity related to the unrecognized tax benefits for the fiscal years ended December 30, 2017, December 29, 2018 and December 28, 2019 (in thousands):
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Employee Retirement Plans (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 28, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Defined Benefit Plans Disclosures | A summary of the plans’ net periodic pension cost, benefit obligations, funded status, and net balance sheet position is as follows (dollars in thousands)
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Schedule of Allocation of Plan Assets | The assets of the plans were invested in the following classes of securities (none of which were securities of the company): U.S. Plans:
Non-U.S. Plans:
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Pension Plans Fair Value Of Investments | The following tables summarize the basis used to measure the pension plans’ assets at fair value as of December 28, 2019and December 29, 2018 (in thousands): U.S. Plans:
Non-U.S. Plans:
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Schedule of Expected Benefit Payments | Estimated future benefit payments under the plans are as follows (dollars in thousands):
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Segment Information |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 28, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | SEGMENT INFORMATION The company operates in three reportable operating segments defined by management reporting structure and operating activities. The Commercial Foodservice Equipment Group manufactures, sells, and distributes foodservice equipment for the restaurant and institutional kitchen industry. This business segment has manufacturing facilities in Arkansas, California, Illinois, Michigan, New Hampshire, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Vermont, Washington, Australia, China, Denmark, Estonia, Italy, the Philippines, Spain, Poland, Sweden and the United Kingdom. Principal product lines of this group include conveyor ovens, combi-ovens, convection ovens, baking ovens, proofing ovens, deck ovens, speed cooking ovens, hydrovection ovens, ranges, fryers, rethermalizers, steam cooking equipment, food warming equipment, catering equipment, heated cabinets, charbroilers, ventless cooking systems, kitchen ventilation, induction cooking equipment, countertop cooking equipment, toasters, griddles, charcoal grills, professional mixers, stainless steel fabrication, custom millwork, professional refrigerators, blast chillers, coldrooms, ice machines, freezers, soft serve ice cream equipment, coffee and beverage dispensing equipment, home and professional craft brewing equipment and IoT solutions. These products are sold and marketed under the brand names: Anets, APW Wyott, Bakers Pride, Beech, BKI, Blodgett, Blodgett Combi, Blodgett Range, Bloomfield, Britannia, Carter-Hoffmann, Celfrost, Concordia, CookTek, Crown, CTX, Desmon, Doyon, Eswood, EVO, Firex, Follett, Frifri, Giga, Globe, Goldstein, Holman, Houno, IMC, Induc, Jade, JoeTap, Josper, L2F, Lang, Lincat, MagiKitch’n, Market Forge, Marsal, Middleby Marshall, MPC, Nieco, Nu-Vu, PerfectFry, Pitco, Powerhouse Dynamics, QualServ, Southbend, Ss Brewtech, Star, Starline, Sveba Dahlen, Synesso, Taylor, Toastmaster, TurboChef, Ultrafryer, Varimixer, Wells and Wunder-Bar. The Food Processing Equipment Group manufactures preparation, cooking, packaging food handling and food safety equipment for the food processing industry. This business segment has manufacturing operations in Georgia, Illinois, Iowa, North Carolina, Oklahoma, Texas, Virginia, Washington, Wisconsin, Denmark, France, Germany, India, Italy, and the United Kingdom. Principal product lines of this group include batch ovens, baking ovens, proofing ovens, conveyor belt ovens, continuous processing ovens, frying systems and automated thermal processing systems, grinders, slicers, reduction and emulsion systems, mixers, blenders, battering equipment, breading equipment, seeding equipment, water cutting systems, food presses, food suspension equipment, filling and depositing solutions, forming equipment, automated loading and unloading systems, food safety, food handling, freezing, defrosting and packaging equipment. These products are sold and marketed under the brand names: Alkar, Armor Inox, Auto-Bake, Baker Thermal Solutions, Burford, Cozzini, CVP Systems, Danfotech, Drake, Emico, Glimek, Hinds-Bock, Maurer-Atmos, MP Equipment, M-TEK, Pacproinc, RapidPak, Scanico, Spooner Vicars, Stewart Systems, Thurne and Ve.Ma.C. The Residential Kitchen Equipment Group manufactures, sells and distributes kitchen equipment for the residential market. This business segment has manufacturing facilities in California, Michigan, Mississippi, Wisconsin, France, Ireland and the United Kingdom. Principal product lines of this group are ranges, cookers, stoves, ovens, refrigerators, dishwashers, microwaves, cooktops, wine coolers, ice machines, ventilation equipment and outdoor equipment. These products are sold and marketed under the brand names: AGA, AGA Cookshop, Brava, EVO, Fired Earth, Heartland, La Cornue, Leisure Sinks, Lynx, Marvel, Mercury, Rangemaster, Rayburn, Redfyre, Sedona, Stanley, TurboChef, U-Line and Viking. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. The chief operating decision maker evaluates individual segment performance based on operating income. Management believes that intersegment sales are made at established arm's length transfer prices. The following table summarizes the results of operations for the company’s business segments(1) (dollars in thousands):
Geographic Information Long-lived assets, not including goodwill and other intangibles (in thousands):
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Financing Arrangements |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financing Arrangements | FINANCING ARRANGEMENTS The following is a summary of long-term debt at December 28, 2019 and December 29, 2018 (in thousands):
On July 28, 2016, the company entered into an amended and restated five year $2.5 billion multi-currency senior secured revolving credit agreement (the "Credit Facility"). On December 18, 2018, the company entered into an amendment to the Credit Facility, increasing the revolving commitments under the Credit Facility by $500.0 million to a total of $3.0 billion. Subsequent to the end of fiscal year December 28, 2019, the company entered into an amended and restated facility ("Amended Facility"). See Note 14 to the consolidated financial statements for further information. As of December 28, 2019, the company had $1.9 billion of borrowings outstanding under the Credit Facility, including $1.8 billion of borrowings in U.S. Dollars and $47.9 million of borrowings denominated in Euro. The company also has $13.3 million in outstanding letters of credit as of December 28, 2019, which reduces the borrowing availability under the Credit Facility. Remaining borrowing availability under this facility was $1.1 billion at December 28, 2019. At December 28, 2019, borrowings under the Credit Facility accrued interest at a rate of 1.625% above LIBOR per annum or 0.625% above the highest of the prime rate, the federal funds rate plus 0.50% and one month LIBOR plus 1.00%. The average interest rate per annum on the debt under the Credit Facility was equal to 3.37% at the end of the period. The interest rates on borrowings under the Credit Facility may be adjusted quarterly based on the company’s Funded Debt Less Unrestricted Cash to Pro Forma EBITDA (the "Leverage Ratio") on a rolling four-quarter basis. Additionally, a commitment fee based upon the Leverage Ratio is charged on the unused portion of the commitments under the Credit Facility. This variable commitment fee was equal to 0.25% per annum as of December 28, 2019. In addition, the company has other international credit facilities to fund working capital needs outside the United States and the United Kingdom. At December 28, 2019, these foreign credit facilities amounted to $3.6 million in U.S. Dollars with a weighted average per annum interest rate of approximately 5.18%. The company’s debt is reflected on the balance sheet at cost. The company believes its interest rate margins on its existing debt are consistent with current market conditions and, therefore, the carrying value of debt reflects the fair value. The interest rate margin is based on the company's Leverage Ratio. The company estimated the fair value of its loans by calculating the upfront cash payment a market participant would require to assume the company’s obligations. The upfront cash payment is the amount that a market participant would be able to lend to achieve sufficient cash inflows to cover the cash outflows under the company’s senior secured revolving credit facility assuming the facility was outstanding in its entirety until maturity. Since the company maintains its borrowings under a revolving credit facility and there is no predetermined borrowing or repayment schedule, for purposes of this calculation the company calculated the fair value of its obligations assuming the current amount of debt at the end of the period was outstanding until the maturity of the company’s Credit Facility in January 2025. Although borrowings could be materially greater or less than the current amount of borrowings outstanding at the end of the period, it is not practical to estimate the amounts that may be outstanding during future periods. The carrying value and estimated aggregate fair value, a level 2 measurement, based primarily on market prices, of debt is as follows (in thousands):
The company uses floating-to-fixed interest rate swap agreements to hedge variable interest rate risk associated with the Credit Facility. At December 28, 2019, the company had outstanding floating-to-fixed interest rate swaps totaling $51.0 million notional amount carrying an average interest rate of 1.27% maturing in less than 12 months and $897.0 million of notional amount carrying an average interest rate of 2.27% that mature in more than 12 months but less than 72 months. The terms of the Amended Facility limit the ability of the company and its subsidiaries to, with certain exceptions: incur indebtedness; grant liens; engage in certain mergers, consolidations, acquisitions and dispositions; make restricted payments; enter into certain transactions with affiliates; and requires, among other things, the company to satisfy certain financial covenants: (i) a minimum Interest Coverage Ratio (as defined in the Amended Facility) of 3.00 to 1.00 and (ii) a maximum Leverage Ratio of Funded Debt less Unrestricted Cash to Pro Forma EBITDA (each as defined in the Amended Facility) of 4.00 to 1.00, which may be adjusted to 4.50 to 1.00 for a four consecutive fiscal quarter period in connection with certain qualified acquisitions, subject to the terms and conditions contained in the Amended Facility. The Amended Facility is secured by substantially all of the assets of Middleby Marshall, the company and the company's domestic subsidiaries and is unconditionally guaranteed by, subject to certain exceptions, the company and certain of the company's direct and indirect material foreign and domestic subsidiaries. The Amended Facility contains certain customary events of default, including, but not limited to, the failure to make required payments; bankruptcy and other insolvency events; the failure to perform certain covenants; the material breach of a representation or warranty; non-payment of certain other indebtedness; the entry of undischarged judgments against the company or any subsidiary for the payment of material uninsured amounts; the invalidity of the company guarantee or any subsidiary guaranty; and a change of control of the company. At December 28, 2019, the company was in compliance with all covenants pursuant to its borrowing agreements. The aggregate amount of debt payable during each of the next five years, which includes the amendment and restatement to our multi-currency senior secured credit agreement disclosed in Note 14 to the consolidated financial statements, is as follows (in thousands):
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Quarterly Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 12 Months Ended | ||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 28, 2019 |
Sep. 28, 2019 |
Jun. 29, 2019 |
Mar. 30, 2019 |
Dec. 29, 2018 |
Sep. 29, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 28, 2019 |
Dec. 29, 2018 |
Dec. 30, 2017 |
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Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||||||||||||||||||
Net sales | $ 787,626 | $ 724,014 | $ 761,004 | $ 686,802 | $ 756,672 | $ 713,331 | $ 668,128 | $ 584,800 | $ 2,959,446 | $ 2,722,931 | $ 2,335,542 | |||||||||||||||||||||
Gross Profit | 289,678 | 270,028 | 286,479 | 257,312 | 280,588 | 261,160 | 250,759 | 211,633 | 1,103,497 | 1,004,140 | 912,741 | |||||||||||||||||||||
Income from operations | 152,030 | 121,345 | 139,607 | 101,061 | 139,987 | 107,677 | 111,310 | 86,992 | 514,043 | [1],[2] | 445,966 | [2] | 378,613 | [2],[3],[4] | ||||||||||||||||||
Net earnings | $ 108,997 | $ 82,020 | $ 92,210 | $ 69,013 | $ 94,839 | $ 72,905 | $ 83,988 | $ 65,420 | $ 352,240 | $ 317,152 | $ 298,128 | |||||||||||||||||||||
Basic earnings per share (usd per share) | $ 1.96 | [5] | $ 1.47 | [5] | $ 1.66 | [5] | $ 1.24 | [5] | $ 1.71 | [5] | $ 1.31 | [5] | $ 1.51 | [5] | $ 1.18 | [5] | $ 6.33 | $ 5.71 | [5] | $ 5.26 | ||||||||||||
Diluted earnings per share (usd per share) | $ 1.96 | [5] | $ 1.47 | [5] | $ 1.66 | [5] | $ 1.24 | [5] | $ 1.70 | [5] | $ 1.31 | [5] | $ 1.51 | [5] | $ 1.18 | [5] | $ 6.33 | $ 5.70 | [5] | $ 5.26 | ||||||||||||
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Lease Commitments Lease Commitments (Details) $ in Thousands |
Dec. 28, 2019
USD ($)
|
---|---|
Leases [Abstract] | |
2020 | $ 24,563 |
2021 | 21,424 |
2022 | 17,875 |
2023 | 12,742 |
2024 | 10,134 |
2025 and thereafter | 25,514 |
Total future lease commitments | 112,252 |
Less imputed interest | 15,407 |
Operating Lease, Liability | $ 96,845 |
Segment Information - Long-lived assets (Details) - USD ($) $ in Thousands |
Dec. 28, 2019 |
Dec. 29, 2018 |
Dec. 30, 2017 |
---|---|---|---|
Segment Reporting Information [Line Items] | |||
Long-lived assets | $ 499,819 | $ 383,988 | $ 362,588 |
United States And Canada | |||
Segment Reporting Information [Line Items] | |||
Long-lived assets | 221,479 | ||
Asia | |||
Segment Reporting Information [Line Items] | |||
Long-lived assets | 14,033 | ||
Europe And Middle East | |||
Segment Reporting Information [Line Items] | |||
Long-lived assets | 126,264 | ||
Latin America | |||
Segment Reporting Information [Line Items] | |||
Long-lived assets | 812 | ||
Total International | |||
Segment Reporting Information [Line Items] | |||
Long-lived assets | 194,612 | 121,506 | $ 141,109 |
United States And Canada | |||
Segment Reporting Information [Line Items] | |||
Long-lived assets | 305,207 | 262,482 | |
Asia | |||
Segment Reporting Information [Line Items] | |||
Long-lived assets | 22,312 | 12,136 | |
Europe And Middle East | |||
Segment Reporting Information [Line Items] | |||
Long-lived assets | 165,781 | 108,001 | |
Latin America | |||
Segment Reporting Information [Line Items] | |||
Long-lived assets | $ 6,519 | $ 1,369 |
Revenue Recognition Effect of Adopting ASC 606 (Details) - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
|||
Effect of Adopting ASC 606 [Line Items] | ||||
Cumulative Effect on Retained Earnings, Net of Tax | $ 100 | |||
Accounting Standards Update 2014-09 | ||||
Effect of Adopting ASC 606 [Line Items] | ||||
Cumulative Effect on Retained Earnings, Net of Tax | [1] | $ 4,405 | ||
|
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
Dec. 30, 2017 |
|
Statement of Cash Flows [Abstract] | |||
Stock Issued During Period, Value, Acquisitions | $ 0 | $ 0 | $ 13,399 |
Cash flows from operating activities-- | |||
Net earnings | 352,240 | 317,152 | 298,128 |
Adjustments to reconcile net earnings to net cash provided by operating activities | |||
Depreciation and amortization | 103,428 | 97,238 | 69,774 |
Non-cash share-based compensation | 8,133 | 2,497 | 6,237 |
Deferred income taxes | 22,212 | 20,489 | (14,492) |
Net Periodic Benefit Cost, Other Components | (28,857) | (38,114) | (31,728) |
Gain (Loss) on Disposition of Assets | 0 | 0 | (12,042) |
Gain (Loss) on Sale of Assets and Asset Impairment Charges | 0 | 783 | 3,114 |
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill) | 0 | 0 | 58,000 |
Non Cash Restructuring | 0 | 5,637 | 0 |
Changes in assets and liabilities, net of acquisitions | |||
Accounts receivable, net | (27,748) | (25,347) | 26,180 |
Inventories, net | (28,288) | (28,378) | (9,744) |
Prepaid expenses and other assets | 5,067 | 18,145 | (34,122) |
Accounts payable | (29,396) | 13,611 | (21,631) |
Accrued expenses and other liabilities | 634 | (14,799) | (33,219) |
Net cash provided by operating activities | 377,425 | 368,914 | 304,455 |
Cash flows from investing activities-- | |||
Additions to property and equipment | (46,609) | (36,040) | (54,493) |
Proceeds from Sale of Property Held-for-sale | 0 | 0 | 14,278 |
Payments to Acquire Intangible Assets | 0 | 5,399 | 0 |
Payments to Acquire Businesses, Net of Cash Acquired | (281,058) | (1,197,984) | (305,251) |
Net cash (used in) investing activities | (327,667) | (1,239,423) | (345,466) |
Cash flows from financing activities-- | |||
Proceeds from (Repayments of) Lines of Credit | 543,294 | 1,611,110 | 758,883 |
Repayments of Lines of Credit | (560,363) | (746,281) | (462,112) |
Net (repayments) proceeds under foreign bank loan | (405) | (7,088) | (1,062) |
Repayments of Notes Payable | (179) | (3) | (35) |
Proceeds from (Payments for) Other Financing Activities | (1,648) | (1,234) | 0 |
Repurchase of treasury stock | (6,144) | 0 | (239,838) |
Payments of Debt Issuance Costs | 0 | (375) | 0 |
Net cash (used in) provided by financing activities | (25,445) | 856,129 | 55,836 |
Effect of exchange rates on cash and cash equivalents | (1,514) | (3,573) | 6,344 |
Changes in cash and cash equivalents-- | |||
Net (decrease) increase in cash and cash equivalents | 22,799 | (17,953) | 21,169 |
Cash and cash equivalents at beginning of year | 71,701 | 89,654 | 68,485 |
Cash and cash equivalents at end of quarter | $ 94,500 | $ 71,701 | $ 89,654 |
Summary of Significant Accounting Policies - Summary of Components of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
Dec. 30, 2017 |
|||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Accumulated Other Comprehensive (Income) Loss, Defined Benefit Plan, after Tax | $ 228,336 | $ 170,938 | |||||||
Accumulated Other Comprehensive Income (Loss), Cumulative Changes in Net Gain (Loss) from Cash Flow Hedges, Effect Net of Tax | (16,892) | 7,233 | |||||||
Accumulated Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Net of Tax | (105,705) | (112,771) | |||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | (350,933) | (276,476) | $ (266,419) | ||||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, before Reclassification Adjustment, Tax | (48,600) | 36,719 | |||||||
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Tax | (5,973) | 2,543 | |||||||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (77,564) | (14,689) | |||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 3,096 | 3,500 | |||||||
Other Comprehensive Income (Loss), before Reclassifications, before Tax | (74,457) | (10,057) | |||||||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Tax | (8,500) | ||||||||
Cumulative Effect on Retained Earnings, Net of Tax | (100) | ||||||||
Accumulated Foreign Currency Adjustment Attributable to Parent [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | (105,705) | (112,771) | (69,721) | ||||||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | 7,066 | (43,050) | |||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | 0 | |||||||
Other Comprehensive Income (Loss), before Reclassifications, before Tax | 7,066 | (43,050) | |||||||
Accumulated Defined Benefit Plans Adjustment Attributable to Parent | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | (228,336) | (170,938) | (203,063) | ||||||
Adoption of ASU 2018-02 | 500 | ||||||||
Pension liability adjustment, net of tax | (59,238) | 29,527 | |||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 1,840 | 3,085 | |||||||
Other Comprehensive Income (Loss), before Reclassifications, before Tax | (57,398) | 32,125 | |||||||
Interest Rate Swap | Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | (16,892) | 7,233 | $ 6,365 | ||||||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (25,392) | (1,166) | |||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 1,256 | 415 | |||||||
Other Comprehensive Income (Loss), before Reclassifications, before Tax | (24,125) | 868 | |||||||
Accounting Standards Update 2018-02 | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Adoption of ASU 2018-02 | [1] | 1,132 | |||||||
Stranded Tax Effects Reclassified from OCI to Retained Earnings | 1,100 | ||||||||
Cumulative Effect on Retained Earnings, Net of Tax | [2] | 0 | |||||||
Accounting Standards Update 2018-02 | Retained Earnings | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Cumulative Effect on Retained Earnings, Net of Tax | [2] | (1,132) | |||||||
Accounting Standards Update 2018-02 | Accumulated Foreign Currency Adjustment Attributable to Parent [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Adoption of ASU 2018-02 | [1] | 0 | |||||||
Accounting Standards Update 2018-02 | Accumulated Defined Benefit Plans Adjustment Attributable to Parent | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Adoption of ASU 2018-02 | [1] | (487) | |||||||
Accounting Standards Update 2018-02 | Interest Rate Swap | Retained Earnings | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Adoption of ASU 2018-02 | (1,600) | ||||||||
Accounting Standards Update 2018-02 | Interest Rate Swap | Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Adoption of ASU 2018-02 | [1] | $ 1,619 | |||||||
Accounting Standards Update 2017-12 | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Adoption of ASU 2018-02 | [3] | 11 | |||||||
Cumulative Effect on Retained Earnings, Net of Tax | 0 | ||||||||
Accounting Standards Update 2017-12 | Retained Earnings | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Cumulative Effect on Retained Earnings, Net of Tax | (11) | ||||||||
Accounting Standards Update 2017-12 | Accumulated Foreign Currency Adjustment Attributable to Parent [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Adoption of ASU 2018-02 | [3] | 0 | |||||||
Accounting Standards Update 2017-12 | Accumulated Defined Benefit Plans Adjustment Attributable to Parent | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Adoption of ASU 2018-02 | [3] | 0 | |||||||
Accounting Standards Update 2017-12 | Interest Rate Swap | Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Adoption of ASU 2018-02 | [3] | $ 11 | |||||||
|
CONSOLIDATED STATEMENTS OF EARNINGS - USD ($) $ in Thousands |
12 Months Ended | |||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
Dec. 30, 2017 |
||||||||||||||
Net sales | $ 2,959,446 | $ 2,722,931 | $ 2,335,542 | |||||||||||||
Cost of Sales | 1,855,949 | 1,718,791 | 1,422,801 | |||||||||||||
Gross profit | 1,103,497 | 1,004,140 | 912,741 | |||||||||||||
Selling, General and Administrative Expense | 593,813 | 538,842 | 468,219 | |||||||||||||
Restructuring Charges | 10,480 | 19,332 | 19,951 | |||||||||||||
Gain (Loss) Related to Litigation Settlement | (14,839) | 0 | 0 | |||||||||||||
Gain (Loss) on Disposition of Assets | 0 | 0 | (12,042) | |||||||||||||
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill) | 0 | 0 | 58,000 | |||||||||||||
Income from operations | [2] | 514,043 | [1] | 445,966 | 378,613 | [3],[4] | ||||||||||
Net interest expense and deferred financing amortization, net | 82,609 | 58,742 | 25,983 | |||||||||||||
Net Periodic Benefit Cost, Other Components | (28,857) | (38,114) | (31,728) | |||||||||||||
Other (income) expense, net | (2,328) | 1,825 | 829 | |||||||||||||
Earnings before income taxes | 462,619 | 423,513 | 383,529 | |||||||||||||
Provision for income taxes | 110,379 | 106,361 | 85,401 | |||||||||||||
Net earnings | $ 352,240 | $ 317,152 | $ 298,128 | |||||||||||||
Net earnings per share: | ||||||||||||||||
Basic (in usd per share) | $ 6.33 | $ 5.71 | [5] | $ 5.26 | ||||||||||||
Diluted (in usd per share) | $ 6.33 | $ 5.70 | [5] | $ 5.26 | ||||||||||||
Weighted average number of shares | ||||||||||||||||
Basic (in shares) | 55,647,000 | 55,576,000 | 56,715,000 | |||||||||||||
Dilutive common stock equivalents (in shares) | 9,000 | 28,000 | 4,000 | |||||||||||||
Diluted (in shares) | 55,656,000 | 55,604,000 | 56,719,000 | |||||||||||||
|
Financing Arrangements - Additional Information (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 28, 2019 |
Dec. 29, 2018 |
|
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | $ 2,500,000 | |
Line of Credit Facility, Increase (Decrease), Net | $ 500,000 | |
Line of Credit Facility, Potential Additional Borrowing Capacity | 3,000,000 | |
Long-term line of credit | 1,869,402 | 1,887,764 |
Senior secured revolving credit line | 1,869,402 | $ 1,887,764 |
Line of Credit Facility, Outstanding Amount, USD Borrowings | 1,800,000 | |
Line of Credit Facility, Amount Outstanding, EUR Borrowings | 47,900 | |
Letters of credit outstanding | 13,300 | |
Remaining borrowing capacity | $ 1,100,000 | |
Credit facility, additional interest rate above LIBOR | 1.625% | |
Debt Instrument Interest Additional Interest Above LIBOR Rate Alternative | 0.625% | |
Debt Instrument Interest Additional Interest Above Fed Funds Rate | 0.50% | |
Debt Instrument, Interest Rate, Increase (Decrease) | 1.00% | |
Credit facility, average interest rate | 3.37% | |
Variable commitment fee | 0.25% | |
Line of credit, Current and Noncurrent, Foreign | $ 3,600 | |
Interest rate at period end | 5.18% | |
Derivative Notional Amount, NonCurrent | $ 897,000 | |
Derivative Fixed Interest Rate, NonCurrent | 2.27% | |
Debt Instrument, Interest Coverage Ratio Range, Low | 300.00% | |
Debt Instrument, Interest Coverage Ratio Range, High | 100.00% | |
Debt Instrument, Leverage Ratio Range, Low | 400.00% | |
Debt Instrument, Leverage Ratio Range, High | 100.00% | |
Debt Instrument, Qualified Leverage Ratio Range, Low | 450.00% | |
Debt Instrument, Qualified Leverage Ratio Range, High | 100.00% | |
maturity less than 12 months [Member] | ||
Debt Instrument [Line Items] | ||
Derivative Notional Amount, NonCurrent | $ 51,000 | |
Derivative Fixed Interest Rate, NonCurrent | 1.27% |
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