SEGMENT INFORMATION |
NOTE 18 SEGMENT INFORMATION We are organized into three reporting segments. Operations that sell dispensing systems and sealing solutions primarily to the beauty, personal care and home care markets form the Beauty + Home segment. Operations that sell dispensing systems and sealing solutions to the prescription drug, consumer health care, injectables and active packaging markets form the Pharma segment. Operations that sell dispensing systems and sealing solutions to the food and beverage markets form the Food + Beverage segment. The accounting policies of the segments are the same as those described in Note 1 – Summary of Significant Accounting Policies. In order to more closely align with how the markets analyze our segment results, we have changed our non-U.S. GAAP segment measure of profitability from Segment Income to Adjusted EBITDA beginning in 2018. All internal segment reporting and discussions of results with our Chief Operating Decision Maker (CODM) are now based on segment Adjusted EBITDA. All references to segment profitability have been updated for this change. Financial information regarding our reporting segments is shown below: | | | | | | | | | | | Year Ended December 31, | | 2019 | | 2018 | | 2017 | | Total Sales: | | | | | | | | | | | Beauty + Home | | $ | 1,376,027 | | $ | 1,446,231 | | $ | 1,333,048 | | Pharma | | | 1,100,463 | | | 955,069 | | | 805,913 | | Food + Beverage | | | 418,017 | | | 386,689 | | | 352,483 | | Total Sales | | $ | 2,894,507 | | $ | 2,787,989 | | $ | 2,491,444 | | Less: Intersegment Sales: | | | | | | | | | | | Beauty + Home | | $ | 23,313 | | $ | 19,849 | | $ | 19,262 | | Pharma | | | 9,412 | | | 417 | | | 33 | | Food + Beverage | | | 2,050 | | | 2,962 | | | 2,866 | | Total Intersegment Sales | | $ | 34,775 | | $ | 23,228 | | $ | 22,161 | | Net Sales: | | | | | | | | | | | Beauty + Home | | $ | 1,352,714 | | $ | 1,426,382 | | $ | 1,313,786 | | Pharma | | | 1,091,051 | | | 954,652 | | | 805,880 | | Food + Beverage | | | 415,967 | | | 383,727 | | | 349,617 | | Net Sales | | $ | 2,859,732 | | $ | 2,764,761 | | $ | 2,469,283 | | Adjusted EBITDA (1): | | | | | | | | | | | Beauty + Home | | $ | 181,150 | | $ | 185,926 | | $ | 173,227 | | Pharma | | | 387,483 | | | 343,706 | | | 275,933 | | Food + Beverage | | | 68,108 | | | 57,589 | | | 62,903 | | Corporate & Other, unallocated | | | (44,406) | | | (36,285) | | | (37,457) | | Acquisition-related costs (2) | | | (3,927) | | | (23,770) | | | — | | Restructuring Initiatives (3) | | | (20,472) | | | (63,829) | | | (2,208) | | Gain on insurance recovery (4) | | | — | | | — | | | 10,648 | | Depreciation and amortization (5) | | | (194,552) | | | (171,747) | | | (153,094) | | Interest Expense | | | (35,489) | | | (32,626) | | | (40,597) | | Interest Income | | | 4,174 | | | 7,056 | | | 5,470 | | Income before Income Taxes | | $ | 342,069 | | $ | 266,020 | | $ | 294,825 | | Depreciation and Amortization: | | | | | | | | | | | Beauty + Home | | $ | 82,778 | | $ | 83,546 | | $ | 79,422 | | Pharma | | | 65,590 | | | 51,495 | | | 41,143 | | Food + Beverage | | | 35,728 | | | 27,467 | | | 24,720 | | Corporate & Other | | | 10,456 | | | 9,239 | | | 7,809 | | Depreciation and Amortization | | $ | 194,552 | | $ | 171,747 | | $ | 153,094 | | Capital Expenditures: | | | | | | | | | | | Beauty + Home | | $ | 96,040 | | $ | 101,371 | | $ | 76,425 | | Pharma | | | 89,702 | | | 54,433 | | | 33,005 | | Food + Beverage | | | 45,130 | | | 41,236 | | | 38,730 | | Corporate & Other | | | 13,933 | | | 25,739 | | | 18,924 | | Transfer of Corporate Technology Expenditures (6) | | | (2,529) | | | (11,527) | | | (10,460) | | Capital Expenditures | | $ | 242,276 | | $ | 211,252 | | $ | 156,624 | | Total Assets: | | | | | | | | | | | Beauty + Home | | $ | 1,378,292 | | $ | 1,373,816 | | $ | 1,358,283 | | Pharma | | | 1,422,815 | | | 1,324,696 | | | 881,443 | | Food + Beverage | | | 534,527 | | | 501,700 | | | 296,271 | | Corporate & Other | | | 226,485 | | | 177,523 | | | 601,826 | | Total Assets | | $ | 3,562,119 | | $ | 3,377,735 | | $ | 3,137,823 | |
(1) | We evaluate performance of our reporting segments and allocate resources based upon Adjusted EBITDA. Adjusted EBITDA is defined as earnings before net interest, taxes, depreciation, amortization, unallocated corporate expenses, restructuring, acquisition-related costs and insurance recoveries. |
(2) | Acquisition-related costs include transaction costs and purchase accounting adjustments related to inventory for acquisitions (see Note 20 – Acquisitions for further details). |
(3) | Restructuring Initiatives includes expense items for the years ended December 31, 2019 and 2018 as follows (see Note 21 – Restructuring Initiatives for further details): |
| | | | | | | | | | | Year Ended December 31, | | 2019 | | 2018 | | 2017 | | Restructuring Initiatives by Segment | | | | | | | | | | | Beauty + Home | | $ | 17,682 | | $ | 52,244 | | $ | 529 | | Pharma | | | 632 | | | 3,589 | | | — | | Food + Beverage | | | 391 | | | 4,185 | | | 1,679 | | Corporate & Other | | | 1,767 | | | 3,811 | | | — | | Total Restructuring Initiatives | | $ | 20,472 | | $ | 63,829 | | $ | 2,208 | |
(4) | The gain on insurance recovery relates to the Annecy fire (see Note 19 – Insurance Settlement Receivable for further details). |
(5) | Depreciation and amortization includes amortization related to acquisition purchase accounting adjustments for backlog. See the reconciliation of Non-U.S. GAAP measures starting on page 22. |
(6) | The transfer of corporate technology expenditures represents amounts of projects managed by corporate for the benefit of specific entities within each segment. Once the projects are complete, all related costs are allocated from corporate to and paid by the appropriate entity and the associated assets are then depreciated at the entity level. |
Geographic Information The following are net sales and long-lived asset information by geographic area and product information for the years ended December 31, 2019, 2018 and 2017: | | | | | | | | | | | | | 2019 | | 2018 | | 2017 | | Net Sales to Unaffiliated Customers (1): | | | | | | | | | | | United States | | $ | 836,768 | | $ | 726,336 | | $ | 642,164 | | Europe: | | | | | | | | | | | France | | | 895,110 | | | 862,364 | | | 744,856 | | Germany | | | 452,409 | | | 474,369 | | | 416,802 | | Italy | | | 141,867 | | | 144,044 | | | 131,523 | | Other Europe | | | 149,083 | | | 146,701 | | | 132,992 | | Total Europe | | | 1,638,469 | | | 1,627,478 | | | 1,426,173 | | Other Foreign Countries | | | 384,495 | | | 410,947 | | | 400,946 | | Total | | $ | 2,859,732 | | $ | 2,764,761 | | $ | 2,469,283 | | Property, Plant and Equipment | | | | | | | | | | | United States | | $ | 300,820 | | $ | 265,004 | | $ | 182,434 | | Europe: | | | | | | | | | | | France | | | 338,288 | | | 308,250 | | | 266,804 | | Germany | | | 163,782 | | | 154,505 | | | 163,948 | | Italy | | | 53,562 | | | 54,978 | | | 57,080 | | Other Europe | | | 63,636 | | | 59,411 | | | 59,963 | | Total Europe | | | 619,268 | | | 577,144 | | | 547,795 | | Other Foreign Countries | | | 167,590 | | | 149,465 | | | 137,677 | | Total | | $ | 1,087,678 | | $ | 991,613 | | $ | 867,906 | |
(1) | Sales are attributed to countries based upon where the sales invoice to unaffiliated customers is generated. |
No single customer represents 6% or more of our net sales in 2019, 2018 or 2017.
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