Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Sep. 01, 2018 | Oct. 01, 2018 | Mar. 03, 2018 | |
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Sep. 1, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | MSC INDUSTRIAL DIRECT CO INC | ||
Entity Central Index Key | 1,003,078 | ||
Current Fiscal Year End Date | --09-01 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 3,957,389,283 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Trading Symbol | msm | ||
Class A Common Stock [Member] | |||
Entity Common Stock, Shares Outstanding | 45,406,118 | ||
Class B Common Stock [Member] | |||
Entity Common Stock, Shares Outstanding | 10,369,547 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 01, 2018 | Sep. 02, 2017 | |
Current Assets: | |||
Cash and cash equivalents | $ 46,217 | $ 16,083 | |
Accounts receivable, net of allowance for doubtful accounts of $12,992 and $13,278, respectively | 523,892 | 471,795 | |
Inventories | 518,496 | 464,959 | |
Prepaid expenses and other current assets | 58,902 | 52,742 | |
Total current assets | 1,147,507 | 1,005,579 | |
Property, plant and equipment, net | 311,685 | 316,305 | |
Goodwill | 674,998 | 633,728 | |
Identifiable intangibles, net | 122,724 | 110,429 | |
Other assets | 31,813 | 32,871 | |
Total assets | 2,288,727 | 2,098,912 | |
Current Liabilities: | |||
Short-term debt | [1] | 224,097 | 331,986 |
Accounts payable | 145,133 | 121,266 | |
Accrued liabilities | 121,293 | 104,473 | |
Total current liabilities | 490,523 | 557,725 | |
Long-term debt | 311,236 | 200,991 | |
Deferred income taxes and tax uncertainties | 99,714 | 115,056 | |
Total liabilities | 901,473 | 873,772 | |
Commitments and Contingencies | |||
Shareholders' Equity: | |||
Preferred stock; $0.001 par value; 5,000,000 shares authorized; none issued and outstanding | |||
Additional paid-in capital | 657,749 | 626,995 | |
Retained earnings | 1,325,822 | 1,168,812 | |
Accumulated other comprehensive loss | (19,634) | (17,263) | |
Class A treasury stock, at cost, 9,207,635 and 8,972,729 shares, respectively | (576,748) | (553,470) | |
Total shareholders' equity | 1,387,254 | 1,225,140 | |
Total liabilities and shareholders' equity | 2,288,727 | 2,098,912 | |
Class A Common Stock [Member] | |||
Shareholders' Equity: | |||
Common stock | 55 | 54 | |
Class B Common Stock [Member] | |||
Shareholders' Equity: | |||
Common stock | $ 10 | $ 12 | |
[1] | Net of unamortized debt issuance costs expected to be amortized in the next 12 months. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 01, 2018 | Sep. 02, 2017 | |
Accounts receivable, allowance for doubtful accounts | $ 12,992 | $ 13,278 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Class A treasury stock, at cost, shares | 9,207,635 | 8,972,729 |
Class A Common Stock [Member] | ||
Common stock, votes per share | 1 | |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 54,649,158 | 53,513,806 |
Class B Common Stock [Member] | ||
Common stock, votes per share | 10 | |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 10,454,765 | 11,850,636 |
Common stock, shares outstanding | 10,454,765 | 11,850,636 |
Consolidated Statements Of Inco
Consolidated Statements Of Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | |
Consolidated Statements Of Income [Abstract] | |||
Net sales | $ 3,203,878 | $ 2,887,744 | $ 2,863,505 |
Cost of goods sold | 1,810,917 | 1,601,497 | 1,574,647 |
Gross profit | 1,392,961 | 1,286,247 | 1,288,858 |
Operating expenses | 972,408 | 907,247 | 912,898 |
Income from operations | 420,553 | 379,000 | 375,960 |
Other income (expense): | |||
Interest expense | (14,463) | (12,370) | (5,807) |
Interest income | 647 | 658 | 654 |
Other income (expense), net | (548) | 704 | 924 |
Total other expense | (14,364) | (11,008) | (4,229) |
Income before provision for income taxes | 406,189 | 367,992 | 371,731 |
Provision for income taxes | 76,966 | 136,561 | 140,515 |
Net income | $ 329,223 | $ 231,431 | $ 231,216 |
Net income per common share: | |||
Basic | $ 5.84 | $ 4.08 | $ 3.78 |
Diluted | $ 5.80 | $ 4.05 | $ 3.77 |
Weighted average shares used in computing net income per common share: | |||
Basic | 56,355 | 56,591 | 60,908 |
Diluted | 56,707 | 56,971 | 61,076 |
Cash dividends declared per common share | $ 2.22 | $ 1.80 | $ 1.72 |
Consolidated Statements Of Comp
Consolidated Statements Of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | |||
Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | ||
Consolidated Statements Of Comprehensive Income [Abstract] | ||||
Net income, as reported | $ 329,223 | $ 231,431 | $ 231,216 | |
Other comprehensive income, net of tax: | ||||
Foreign currency translation adjustments | (2,371) | 1,835 | (1,846) | |
Comprehensive income | [1] | $ 326,852 | $ 233,266 | $ 229,370 |
[1] | There were no material taxes associated with other comprehensive income during fiscal years 2018, 2017, and 2016. |
Consolidated Statements Of Co_2
Consolidated Statements Of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | |
Consolidated Statements Of Comprehensive Income [Abstract] | |||
Other comprehensive income, taxes | $ 0 | $ 0 | $ 0 |
Consolidated Statement Of Share
Consolidated Statement Of Shareholders' Equity - USD ($) shares in Thousands, $ in Thousands | Restricted Share Awards [Member]Class A Common Stock [Member]Common Stock [Member] | Restricted Stock Units [Member]Class A Common Stock [Member]Common Stock [Member] | Restricted Stock Units [Member]Additional Paid-In Capital [Member] | Restricted Stock Units [Member] | Class A Common Stock [Member]Common Stock [Member] | Class A Common Stock [Member]Retained Earnings [Member] | Class A Common Stock [Member] | Class B Common Stock [Member]Common Stock [Member] | Class B Common Stock [Member]Retained Earnings [Member] | Class B Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Loss [Member] | Class A Treasury Stock [Member] | Total |
Balance, Value at Aug. 29, 2015 | $ 56 | $ 13 | $ 604,905 | $ 1,232,381 | $ (17,252) | $ (487,233) | $ 1,332,870 | ||||||||
Balance, Shares at Aug. 29, 2015 | 56,400 | 13,296 | 8,038 | ||||||||||||
Exchange of Class B common stock for Class A common stock, shares | 1,363 | (1,363) | |||||||||||||
Exchange of Class B common stock for Class A common stock, value | $ 1 | $ (1) | |||||||||||||
Exercise of common stock options, Shares | 144 | ||||||||||||||
Exercise of common stock options, Value | $ 1 | 8,239 | 8,240 | ||||||||||||
Common stock issued under associate stock purchase plan, Shares | (64) | ||||||||||||||
Common stock issued under associate stock purchase plan, Value | 1,649 | $ 2,435 | 4,084 | ||||||||||||
Issuance of restricted common stock, net of cancellations, Shares | (15) | ||||||||||||||
Shares issued upon vesting of restricted stock units, including dividend equivalent units, Value | $ 147 | $ 147 | |||||||||||||
Shares issued upon vesting of restricted stock units, including dividend equivalent units, Shares | 74 | ||||||||||||||
Stock-based compensation | 13,985 | 13,985 | |||||||||||||
Repurchases of common stock, Shares | 5,344 | ||||||||||||||
Repurchases of common stock, Value | $ (384,111) | (384,111) | |||||||||||||
Retirement of treasury stock, Shares | (4,973) | (4,973) | |||||||||||||
Retirement of treasury stock, Value | $ (5) | (44,908) | (317,240) | $ 362,153 | |||||||||||
Cash dividends on common stock | $ (83,000) | $ (83,000) | $ (22,778) | $ (22,778) | |||||||||||
Dividend equivalent units declared, net of cancellations | (431) | (431) | |||||||||||||
Foreign currency translation adjustment | (1,846) | (1,846) | |||||||||||||
Net income | 231,216 | 231,216 | |||||||||||||
Balance, Value at Sep. 03, 2016 | $ 53 | $ 12 | 584,017 | 1,040,148 | (19,098) | $ (506,756) | 1,098,376 | ||||||||
Balance, Shares at Sep. 03, 2016 | 52,993 | 11,933 | 8,345 | ||||||||||||
Exchange of Class B common stock for Class A common stock, shares | 82 | (82) | |||||||||||||
Exercise of common stock options, Shares | 399 | ||||||||||||||
Exercise of common stock options, Value | $ 1 | 26,887 | 26,888 | ||||||||||||
Common stock issued under associate stock purchase plan, Shares | (57) | ||||||||||||||
Common stock issued under associate stock purchase plan, Value | 2,088 | $ 2,155 | 4,243 | ||||||||||||
Issuance of restricted common stock, net of cancellations, Shares | (7) | ||||||||||||||
Shares issued upon vesting of restricted stock units, including dividend equivalent units, Value | $ 78 | $ 78 | |||||||||||||
Shares issued upon vesting of restricted stock units, including dividend equivalent units, Shares | 47 | ||||||||||||||
Stock-based compensation | 13,925 | 13,925 | |||||||||||||
Repurchases of common stock, Shares | 685 | ||||||||||||||
Repurchases of common stock, Value | $ (48,869) | (48,869) | |||||||||||||
Cash dividends on common stock | (80,848) | (80,848) | (21,368) | (21,368) | |||||||||||
Dividend equivalent units declared, net of cancellations | (551) | (551) | |||||||||||||
Foreign currency translation adjustment | 1,835 | 1,835 | |||||||||||||
Net income | 231,431 | 231,431 | |||||||||||||
Balance, Value at Sep. 02, 2017 | $ 54 | $ 12 | 626,995 | 1,168,812 | (17,263) | $ (553,470) | 1,225,140 | ||||||||
Balance, Shares at Sep. 02, 2017 | 53,514 | 11,851 | 8,973 | ||||||||||||
Exchange of Class B common stock for Class A common stock, shares | 1,396 | (1,396) | |||||||||||||
Exchange of Class B common stock for Class A common stock, value | $ 2 | $ (2) | |||||||||||||
Exercise of common stock options, Shares | 342 | ||||||||||||||
Exercise of common stock options, Value | 24,243 | 24,243 | |||||||||||||
Common stock issued under associate stock purchase plan, Shares | (57) | ||||||||||||||
Common stock issued under associate stock purchase plan, Value | 2,307 | $ 2,154 | 4,461 | ||||||||||||
Issuance of restricted common stock, net of cancellations, Shares | (6) | ||||||||||||||
Shares issued upon vesting of restricted stock units, including dividend equivalent units, Value | 222 | 222 | |||||||||||||
Shares issued upon vesting of restricted stock units, including dividend equivalent units, Shares | 83 | ||||||||||||||
Stock-based compensation | 14,934 | 14,934 | |||||||||||||
Repurchases of common stock, Shares | 292 | ||||||||||||||
Repurchases of common stock, Value | $ (25,432) | (25,432) | |||||||||||||
Repurchase and retirement of common stock, Shares | (680) | ||||||||||||||
Repurchase and retirement of common stock, Value | $ (1) | (10,952) | (45,984) | (56,937) | |||||||||||
Cash dividends on common stock | $ (101,000) | $ (101,000) | $ (24,430) | $ (24,430) | |||||||||||
Dividend equivalent units declared, net of cancellations | (799) | (799) | |||||||||||||
Foreign currency translation adjustment | (2,371) | (2,371) | |||||||||||||
Net income | 329,223 | 329,223 | |||||||||||||
Balance, Value at Sep. 01, 2018 | $ 55 | $ 10 | $ 657,749 | $ 1,325,822 | $ (19,634) | $ (576,748) | $ 1,387,254 | ||||||||
Balance, Shares at Sep. 01, 2018 | 54,649 | 10,455 | 9,208 |
Consolidated Statement Of Sha_2
Consolidated Statement Of Shareholders' Equity (Parenthetical) $ in Thousands | 12 Months Ended |
Sep. 03, 2016USD ($) | |
Consolidated Statement Of Shareholders' Equity [Abstract] | |
Exercise of common stock options, income tax benefit | $ 830 |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | |
Cash Flows from Operating Activities: | |||
Net income | $ 329,223 | $ 231,431 | $ 231,216 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 63,154 | 62,980 | 71,930 |
Stock-based compensation | 14,934 | 13,925 | 13,985 |
Loss on disposal of property, plant, and equipment | 479 | 678 | 752 |
Provision for doubtful accounts | 6,938 | 7,048 | 6,997 |
Deferred income taxes and tax uncertainties | (19,577) | 13,482 | 15,007 |
Excess tax benefits from stock-based compensation | (1,536) | ||
Write-off of deferred financing costs on previous credit facility | 94 | ||
Changes in operating assets and liabilities, net of amounts associated with business acquired: | |||
Accounts receivable | (49,827) | (72,230) | 2,595 |
Inventories | (33,235) | (15,871) | 61,047 |
Prepaid expenses and other current assets | (4,865) | (7,428) | (6,303) |
Other assets | 1,094 | 548 | 142 |
Accounts payable and accrued liabilities | 31,340 | 12,184 | 5,271 |
Total adjustments | 10,435 | 15,410 | 169,887 |
Net cash provided by operating activities | 339,658 | 246,841 | 401,103 |
Cash Flows from Investing Activities: | |||
Expenditures for property, plant and equipment | (44,919) | (46,548) | (87,930) |
Cash used in business acquisitions, net of cash acquired | (87,000) | (42,345) | |
Net cash used in investing activities | (131,919) | (88,893) | (87,930) |
Cash Flows from Financing Activities: | |||
Repurchases of common stock | (82,369) | (49,182) | (383,798) |
Payments of cash dividends | (125,430) | (102,216) | (105,778) |
Proceeds from sale of Class A common stock in connection with associate stock purchase plan | 4,461 | 4,243 | 4,084 |
Proceeds from exercise of Class A common stock options | 24,243 | 26,887 | 7,410 |
Borrowings under Credit Facility | 242,000 | 546,000 | 305,000 |
Proceeds from long-term debt | 110,000 | 175,000 | |
Payment of notes payable and revolving credit note under the Credit Facility | (350,000) | (618,500) | (301,000) |
Other, net | (491) | (1,978) | 714 |
Net cash used in financing activities | (177,586) | (194,746) | (298,368) |
Effect of foreign exchange rate changes on cash and cash equivalents | (19) | (9) | (182) |
Net increase (decrease) in cash and cash equivalents | 30,134 | (36,807) | 14,623 |
Cash and cash equivalents, beginning of the year | 16,083 | 52,890 | 38,267 |
Cash and cash equivalents, end of the year | 46,217 | 16,083 | 52,890 |
Supplemental Disclosure of Cash Flow Information: | |||
Cash paid for income taxes | 100,504 | 121,691 | 127,965 |
Cash paid for interest | $ 13,448 | $ 11,695 | $ 4,986 |
Business And Summary Of Signifi
Business And Summary Of Significant Accounting Policies | 12 Months Ended |
Sep. 01, 2018 | |
Business And Summary Of Significant Accounting Policies [Abstract] | |
Business And Summary Of Significant Accounting Policies | 1. BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business MSC Industrial Direct Co., Inc. (together with its subsidiaries, the “Company” or “MSC”) is a leading distributor of metalworking and maintenance, repair and operations (“MRO”) products and services, with co-located headquarters in Melville, New York and Davidson, North Carolina. The Company has an additional office support center in Southfield, Michigan and serves primarily domestic markets through its distribution network of 100 branch offices and 12 customer fulfillment centers. Principles of Consolidation The accompanying consolidated financial statements include the accounts of MSC and its subsidiaries, all of which are wholly owned. All intercompany balances and transactions have been eliminated in consolidation. Fiscal Year The Company’s fiscal year is on a 52- or 53-week basis, ending on the Saturday closest to August 31 st of each year. The financial statements for fiscal years 2018 and 2017 contain activity for 52 weeks while fiscal year 2016 contains activity for 53 weeks. Unless the context requires otherwise, references to years contained herein pertain to the Company’s fiscal year. Use of Estimates The preparation of financial statements, in conformity with accounting principles generally accepted in the United States, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and assumptions used in preparing the accompanying consolidated financial statements. Cash and Cash Equivalents The Company considers all short-term, highly liquid investments with maturities of three months or less at the date of purchase to be cash equivalents. Cash and cash equivalents are carried at cost, which approximates fair value. As of September 1, 2018 and September 2, 2017 , the Company did not have any cash equivalents. Concentrations of Credit Risk The Company’s mix of receivables is diverse, selling its products primarily to end-users. The Company’s customer base represents many diverse industries primarily concentrated in the United States. The Company performs periodic credit evaluations of its customers’ financial condition, and collateral is generally not required. The Company evaluates the collectability of accounts receivable based on numerous factors, including past transaction history with customers and their creditworthiness and provides a reserve for accounts that are potentially uncollectible. The Company’s cash includes deposits with commercial banks. The terms of these deposits and investments provide that all monies are available to the Company upon demand. The Company maintains the majority of its cash with high- quality financial institutions. Deposits held with banks may exceed insurance limits. While MSC monitors the creditworthiness of these commercial banks and financial institutions, a crisis in the United States financial systems could limit access to funds and/or result in a loss of principal. Allowance for Doubtful Accounts The Company establishes reserves for customer accounts that are deemed uncollectible. The method used to estimate the allowances is based on several factors, including the age of the receivables and the historical ratio of actual write-offs to the age of the receivables. These analyses also take into consideration economic conditions that may have an impact on a specific industry, group of customers or a specific customer. While the Company has a broad customer base, representing many diverse industries primarily in all regions of the United States, a general economic downturn could result in higher than expected defaults and, therefore, the need to revise estimates for bad debts. Inventory Valuation Inventories consist of merchandise held for resale and are stated at the lower of weighted average cost or market. The Company evaluates the recoverability of its slow-moving or obsolete inventories quarterly. The Company estimates the recoverable cost of such inventory by product type and considering such factors as its age, historic and current demand trends, the physical condition of the inventory, as well as assumptions regarding future demand. The Company’s ability to recover its cost for slow-moving or obsolete inventory can be affected by such factors as general market conditions, future customer demand, and relationships with suppliers. Substantially all the Company’s inventories have demonstrated long shelf lives and are not highly susceptible to obsolescence. In addition, many of the Company’s inventory items are eligible for return under various supplier agreements. Property, Plant and Equipment Property, plant and equipment and capitalized computer software are stated at cost less accumulated depreciation. Expenditures for maintenance and repairs are charged to expense as incurred; costs of major renewals and improvements are capitalized. At the time property and equipment are retired or otherwise disposed of, the cost and accumulated depreciation are eliminated from the asset and accumulated depreciation accounts and the profit or loss on such disposition is reflected in income. Depreciation and amortization of property, plant and equipment are computed for financial reporting purposes on the straight-line method based on the estimated useful lives of the assets. Leasehold improvements are amortized over either their respective lease terms or their estimated lives, whichever is shorter. Estimated useful lives range from three to 40 years for leasehold improvements and buildings, and three to 20 years for furniture, fixtures, and equipment. Capitalized computer software costs are amortized using the straight-line method over the estimated useful life. These costs include purchased software packages, payments to vendors and consultants for the development, implementation or modification of purchased software packages for Company use, and payroll and related costs for employees associated with internal-use software projects. Capitalized computer software costs are included within property, plant and equipment on the Company’s consolidated balance sheets. Goodwill and Other Indefinite-Lived Intangible Assets The Company’s business acquisitions typically result in the recording of goodwill and other intangible assets, which affect the amount of amortization expense and possibly impairment write-downs that the Company may incur in future periods. Goodwill represents the excess of the purchase price paid over the fair value of the net assets acquired in business acquisitions. The Company annually reviews goodwill and intangible assets that have indefinite lives for impairment in its fiscal fourth quarter and when events or changes in circumstances indicate the carrying values of these assets might exceed their current fair values. Goodwill and indefinite-lived intangible assets are tested for impairment by first evaluating qualitative factors to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value. If it is concluded that this is the case, it is necessary to perform the currently prescribed quantitative impairment test. Otherwise, the quantitative impairment test is not required. Based on the qualitative assessments of goodwill and intangible assets that have indefinite lives performed by the Company in its respective fiscal fourth quarters, there was no indicator of impairment for fiscal years 2018 , 2017 and 2016 . The balances and changes in the carrying amount of goodwill are as follows: Balance as of September 3, 2016 $ 624,081 Acquisition (1) 8,318 Foreign currency translation adjustments 1,329 Balance as of September 2, 2017 $ 633,728 Acquisition (2) 41,939 Post-closing working capital adjustment from acquisition of DECO Tool Supply Co. 738 Foreign currency translation adjustments (1,407) Balance as of September 1, 2018 $ 674,998 (1) Acquired DECO Tool Supply Co. (“DECO”) in July 2017. (2) Acquired All Integrated Solutions (“AIS”) in April 2018, including post-closing working capital adjustment of $1,155 . See Note 4 “Business Combinations” for further discussion on these acquisitions. The components of the Company’s intangible assets for the fiscal years ended September 1, 2018 and September 2, 2017 are as follows: For the Fiscal Years Ended September 1, 2018 September 2, 2017 Weighted Average Useful Life (in years) Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Customer Relationships 5 - 18 $ 208,260 $ (101,916) $ 187,260 $ (92,381) Contract Rights 10 23,100 (23,100) 23,100 (23,100) Trademarks 1 - 5 6,630 (4,384) 4,403 (3,058) Trademarks Indefinite 14,134 — 14,205 — Total $ 252,124 $ (129,400) $ 228,968 $ (118,539) For the fiscal year ended September 1, 2018, the Company recorded approximately $23,285 of intangible assets, primarily consisting of the acquired customer relationships and trademark from the AIS acquisition. See Note 4 “Business Combinations.” During the fiscal year ended September 1, 2018, approximately $129 in gross intangible assets, and any related accumulated amortization, were written off related to trademarks that are no longer being utilized. For the fiscal year ended September 2, 2017, the Company recorded approximately $12,980 of intangible assets consisting of acquired intangible assets from the DECO acquisition and from the registration and application of new trademarks. During the fiscal year ended September 1, 2017, approximately $17 in gross intangible assets, and any related accumulated amortization, were written off related to trademarks that are no longer being utilized. The Company’s amortizable intangible assets are amortized on a straight-line basis, including customer relationships, as it approximates customer attrition patterns and best estimates the use pattern of the asset. Amortization expense of the Company’s intangible assets was $10,513 , $8,223 , and $14,478 during fiscal years 2018 , 2017 , and 2016 , respectively. Estimated amortization expense for each of the five succeeding fiscal years is as follows: Fiscal Year 2019 $11,190 2020 10,216 2021 9,534 2022 9,520 2023 9,375 Impairment of Long-Lived Assets The Company periodically evaluates the net realizable value of long-lived assets, including definite-lived intangible assets and property and equipment, relying on a number of factors, including operating results, business plans, economic projections, and anticipated future cash flows. Impairment is assessed by evaluating the estimated undiscounted cash flows over the asset’s remaining life. If estimated cash flows are insufficient to recover the investment, an impairment loss is recognized. No impairment loss was required to be recorded by the Company during fiscal years 2018 , 2017 and 2016 . Deferred Catalog Costs The costs of producing and distributing the Company’s principal catalogs are deferred ( $3,973 and $4,778 at September 1, 2018 and September 2, 2017 , respectively) and included in other assets in the Company’s consolidated balance sheets. These costs are charged to expense over the period that the catalogs remain the most current source of sales, which is typically one year or less from the date the catalogs are mailed. The costs associated with brochures and catalog supplements are charged to expense as distributed. The total amount of advertising costs, net of co-operative advertising income from vendor-sponsored programs, included in operating expenses in the consolidated statements of income was approximately $15,530 , $16,289 and $19,242 during the fiscal years 2018 , 2017 , and 2016 , respectively. Revenue Recognition The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the sales price is fixed or determinable, and collectability is reasonably assured. In most cases, these conditions are met when the product is shipped to the customer or services have been rendered. In cases where the product is shipped directly to the customer, the Company recognizes revenue at the time of shipment primarily on a gross basis. The Company’s standard shipping terms are FOB shipping point. The Company reports its sales net of the amount of actual sales returns and the amount of reserves established for anticipated sales returns based upon historical return rates. Sales tax collected from customers is excluded from net sales in the accompanying consolidated statements of income. Gross Profit Gross profit primarily represents the difference between the sale price to our customers and the product cost from our suppliers (net of earned rebates and discounts) including the cost of inbound freight. The cost of outbound freight (including internal transfers), purchasing, receiving and warehousing are included in operating expenses. The Company’s gross profit may not be comparable to those of other companies, as other companies may include all the costs related to their distribution network in cost of sales. Vendor Consideration The Company records cash consideration received for advertising costs incurred to sell the vendor’s products as a reduction of the Company’s advertising costs and is reflected in operating expenses in the consolidated statements of income. In addition, the Company receives volume rebates from certain vendors based on contractual arrangements with such vendors. Rebates received from these vendors are recognized as a reduction to the cost of goods sold in the consolidated statements of income when the inventory is sold. Product Warranties The Company generally offers a maximum one -year warranty, including parts and labor, for certain of its products sold. The specific terms and conditions of those warranties vary depending upon the product sold. The Company may be able to recoup some of these costs through product warranties it holds with its original equipment manufacturers, which typically range from 30 to 90 days. In general, many of the Company’s general merchandise products are covered by third-party original equipment manufacturers’ warranties. The Company’s warranty expense has been minimal. Shipping and Handling Costs The Company includes shipping and handling fees billed to customers in net sales and shipping, and handling costs associated with outbound freight in operating expenses in the accompanying consolidated statements of income. The shipping and handling costs in operating expenses were approximately $130,340 , $119,979 , and $118,174 during fiscal years 2018 , 2017 , and 2016 , respectively. Stock-Based Compensation In accordance with Accounting Standards Codification (“ASC”) Topic 718, “Compensation — Stock Compensation” (“ASC 718”), the Company estimates the fair value of share-based payment awards on the date of grant. The value of awards that are ultimately expected to vest is recognized as an expense over the requisite service periods. The fair value of the Company’s restricted stock awards and units is based on the closing market price of the Company’s common stock on the date of grant. The Company estimates the fair value of stock options granted using a Black-Scholes option-pricing model. This model requires the Company to make estimates and assumptions with respect to the expected term of the option, the expected volatility of the price of the Company’s common stock and the expected forfeiture rate. The fair value is then amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. The expected term is based on the historical exercise behavior of grantees, as well as the contractual life of the option grants. The expected volatility factor is based on the volatility of the Company's common stock for a period equal to the expected term of the stock option. In addition, forfeitures of share-based awards are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company uses historical data to estimate pre-vesting option and restricted stock award and unit forfeitures and records stock-based compensation expense only for those awards that are expected to vest. In fiscal 2017, the Company adopted Accounting Standards Update (“ASU”) 2016-09, Improvements to Employee Share-Based Payment Accounting, which includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. Share Repurchases and Treasury Stock Repurchased shares may be retired immediately and resume the status of authorized but unissued shares or may be held by the Company as treasury stock. The Company accounts for treasury stock under the cost method, using the first-in, first-out flow assumption, and is included in “Class A treasury stock, at cost” on the accompanying consolidated balance sheets. When the Company reissues treasury stock, the gains are recorded in additional paid-in capital (“APIC”), while the losses are recorded to APIC to the extent that the previous net gains on the reissuance of treasury stock are available to offset the losses. If the loss is larger than the previous gains available, then the loss is recorded to retained earnings. The Company accounts for repurchased shares retired immediately or treasury stock retired under the constructive retirement method. When shares are retired, the par value of the repurchased shares is deducted from common stock and the excess repurchase price over par is deducted by allocation to both APIC and retained earnings. The amount allocated to APIC is calculated as the original cost of APIC per share outstanding using the first-in, first-out flow assumption and is applied to the number of shares repurchased. Any remaining amount is allocated to retained earnings. Related Party Transactions Stock Purchase Agreement s In July 2018, the Company announced that in connection with its existing share repurchase authorization, the Company entered into a stock purchase agreement with the holders of the Company’s Class B common stock to purchase a pro rata number of shares, such that their aggregate percentage ownership in the Company would remain substantially the same. In August 2018, the Company purchased 45 shares of its Class A common stock from certain of its Class B shareholders at a purchase price of $82.64 per share. See Note 9 “Shareholders’ Equity” in the Notes to the Consolidated Financial Statements for more information about the stock purchase. In connection with a “modified Dutch auction” tender offer commenced on July 7, 2016, the Company purchased an aggregate of 1,152 shares of its Class A common stock pursuant to a stock purchase agreement with Mitchell Jacobson, the Company’s Chairman, his sister, Marjorie Gershwind Fiverson, Erik Gershwind, the Company’s President and Chief Executive Officer, and two other beneficial owners of the Company’s Class B common stock (collectively, the “Sellers”) at a purchase price of $72.50 per share, for an aggregate purchase price of approximately $83,524 . The purchase price per share paid to the Sellers pursuant to the Stock Purchase Agreement was equal to the purchase price per share paid to shareholders whose shares were purchased in the Company’s tender offer. Infrastructure Investments In August 2016, the Company’s subsidiary, Sid Tool Co., Inc., completed a transaction with Mitchmar Atlanta Properties, Inc. to purchase the Company’s Atlanta CFC and the real property on which the Atlanta CFC is situated for a purchase price of $33,650 . The Atlanta CFC had previously been leased since 1989. Fair Value of Financial Instruments The carrying values of the Company’s financial instruments, including cash, receivables, accounts payable and accrued liabilities, approximate fair value because of the short maturity of these instruments. In addition, based on borrowing rates currently available to the Company for borrowings with similar terms, the carrying values of the Company’s capital lease obligations also approximate fair value. The fair value of the Company’s taxable bonds is estimated based on observable inputs in non-active markets. Under this method, the Company’s fair value of the taxable bonds was not significantly different than the carrying value at September 1, 2018 and September 2, 2017 . The fair values of the Company’s long-term debt, including current maturities, are estimated based on quoted market prices for the same or similar issues or on current rates offered to the Company for debt of the same remaining maturities. Under this method, the Company’s fair value of any long-term obligations was not significantly different than the carrying values at September 1, 2018 and September 2, 2017 . Foreign Currency The local currency is the functional currency for all of MSC’s operations outside the United States. Assets and liabilities of these operations are translated to U.S. dollars at the exchange rate in effect at the end of each period. Income statement accounts are translated at the average exchange rate prevailing during the period. Translation adjustments arising from the use of differing exchange rates from period to period are included as a component of other comprehensive income within shareholders’ equity. Gains and losses from foreign currency transactions are included in net income for the period. Income Taxes The Company has established deferred income tax assets and liabilities for temporary differences between the financial reporting bases and the income tax bases of its assets and liabilities at enacted tax rates expected to be in effect when such assets or liabilities are realized or settled pursuant to the provisions of ASC Topic 740, “Income Taxes”, which prescribes a comprehensive model for the financial statement recognition, measurement, classification, and disclosure of uncertain tax positions. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. In fiscal 2017, the Company adopted ASU 2015-17, Balance Sheet Classification of Deferred Taxes, and reclassified all current deferred taxes and the related valuation allowances to noncurrent positions on the Consolidated Balance Sheets. The amounts of unrecognized tax benefits, exclusive of interest and penalties that would affect the effective tax rate, were $9,407 and $5,689 as of September 1, 2018 and September 2, 2017 , respectively. Comprehensive Income Comprehensive income consists of consolidated net income and foreign currency translation adjustments. Foreign currency translation adjustments included in comprehensive income were not tax-effected as investments in international affiliates are deemed to be permanent. Geographic Regions The Company’s sales and assets are predominantly generated from United States locations. For fiscal 2018 , U.K. and Canadian operations represented approximately 3% of the Company’s consolidated net sales. Segment Reporting The Company utilizes the management approach for segment disclosure, which designates the internal organization that is used by management for making operating decisions and assessing performance as the source of our reportable segments. The Company operates in one operating and reportable segment as a distributor of metalworking and MRO products and services. The Company’s chief operating decision maker, its Chief Executive Officer, manages the Company’s operations on a consolidated basis for purposes of allocating resources. Substantially all of the Company’s revenues and long-lived assets are in the United States. The Company does not disclose revenue information by product category as it is impracticable to do so as a result of its numerous product offerings and the manner in which its business is managed. Business Combinations The Company accounts for business combinations in accordance with ASC Topic 805, “Business Combinations ” (“ASC 805”). ASC 805 established principles and requirements for recognizing the total consideration transferred to and the assets acquired, liabilities assumed and any non-controlling interest in the acquired target in a business combination. ASC 805 also provides guidance for recognizing and measuring goodwill acquired in a business combination and requires the acquirer to disclose information that users may need to evaluate and understand the financial impact of the business combination. See Note 4 “Business Combinations” for further discussion. Recently Adopted Accounting Pronouncements Simplifying the Measurement of Inventory In July 2015, the FASB issued its final standard on simplifying the measurement of inventory. This standard, issued as ASU 2015-11, requires an entity to measure inventory at the lower of cost and net realizable value, which consists of the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The Company adopted ASU 2015-11 during the first quarter of fiscal 2018 and the adoption did not have any impact on its consolidated financial statements. Share-based Payments In March 2016, the FASB issued ASU 2016-09, which includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. The Company early adopted ASU 2016-09 in the second quarter of fiscal 2017, which required us to reflect any adjustments as of September 4, 2016, the beginning of the annual period that includes the interim period of adoption. Prior fiscal year periods were not retrospectively adjusted. Accounting Pronouncements Not Yet Adopted Revenue from Contracts with Customers In May 2014, the FASB issued its final standard on the recognition of revenue from contracts with customers. This standard, issued as ASU 2014-09, outlines a single comprehensive model for entities to use in the accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The new standard is effective for the Company for its fiscal year 2019, including interim periods. The standard permits the use of either the retrospective or cumulative effect transition method. The Company completed the process of evaluating the effect of the adoption and determined there were no changes required to its reported revenues as a result of the adoption. The majority of its revenue arrangements generally consist of a single performance obligation to transfer promised goods or services. Based on its evaluation process and review of its contracts with customers, the timing and amount of revenue recognized based on the new standard is consistent with its revenue recognition policy under previous guidance. The Company adopted the new standard effective September 2, 2018, using the modified retrospective approach, and will expand its consolidated financial statement disclosures in order to comply with this standard. The Company has determined the adoption of this new standard will not have a material impact on its consolidated financial statements. Leases In February 2016, the FASB issued its final standard on accounting for leases. This standard, issued as ASU 2016-02, requires that an entity that is a lessee recognize lease assets and lease liabilities on the balance sheet and disclose key information about leasing arrangements. This standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years , with earlier application permitted. The new standard is effective for the Company for its fiscal year 2020. The Company is currently evaluating this standard to determine the impact of adoption on its consolidated financial statements. Measurement of Credit Losses In June 2016, the FASB issued its final standard on measurement of credit losses on financial instruments. This standard, issued as ASU 2016-13, requires that an entity measure impairment of certain financial instruments, including trade receivables, based on expected losses rather than incurred losses. This update is effective for annual and interim financial statement periods beginning after December 15, 2019, with early adoption permitted for financial statement periods beginning after December 15, 2018. The new standard is effective for the Company for its fiscal year 2020. The Company is currently evaluating this standard but does not expect it to have a material impact on its consolidated financial statements. Goodwill Impairment In January 2017, the FASB issued its final standard on simplifying the test for goodwill impairment. This standard, issued as ASU 2017-04, eliminates the second step from the goodwill impairment test and instead requires an entity to perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge would be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value, not to exceed the total amount of goodwill allocated to that reporting unit. This update is effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted. The new standard is effective for the Company for its fiscal year 2020. Upon adoption, the Company will apply this guidance prospectively to its annual and interim goodwill impairment tests and disclose the change in accounting principle. Business Combinations In January 2017, the FASB issued its final standard on clarifying the definition of a business in business combinations. This standard, issued as ASU 2017-01, clarifies the definition of a business to assist entities with evaluating when a set of transferred assets and activities is considered a business. The amendment is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The new standard is effective for the Company for its fiscal year 2019. The amendments are to be applied prospectively to business combinations that occur after the effective date. Other pronouncements issued by the FASB or other authoritative accounting standards groups with future effective dates are either not applicable or are not expected to be significant to the Company’s consolidated financial statements. Reclassifications Certain of the prior years’ Cash Flows from Financing Activities line items (Borrowings under financing obligations, Payments on capital lease and financing obligations, and Credit facility financing costs) were reclassified into “Other, Net” within our consolidated statements of cash flows to conform to our current year presentation. These reclassifications did not affect the total amount of Cash Flows from Financing Activities. |
Fair Value
Fair Value | 12 Months Ended |
Sep. 01, 2018 | |
Fair Value [Abstract] | |
Fair Value | 2. FAIR VALUE Fair value accounting standards define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following fair value hierarchy prioritizes the inputs used to measure fair value into three levels, with Level 1 being of the highest priority. The three levels of inputs used to measure fair value are as follows: Level 1 —Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 —Include other inputs that are directly or indirectly observable in the marketplace. Level 3 —Unobservable inputs which are supported by little or no market activity. As of September 1, 2018 and September 2, 2017 , the Company did no t have any cash equivalents. In connection with the construction of the Company’s customer fulfillment center in Columbus, Ohio, the Company entered into an arrangement during fiscal 2013 with the Columbus-Franklin County Finance Authority (“Finance Authority”) which provides savings on state and local sales taxes imposed on construction materials to entities that finance the transactions through them. Under this arrangement, the Finance Authority issued taxable bonds to finance the structure and site improvements of the Company’s customer fulfillment center. The bonds ( $27,025 at both September 1, 2018 and September 2, 2017 ) are classified as available for sale securities in accordance with ASC Topic 320. The securities are recorded at fair value in Other assets in the Consolidated Balance Sheet. The fair values of these securities are based on observable inputs in non-active markets, which are therefore classified as Level 2 in the hierarchy. The Company did no t record any gains or losses on these securities during fiscal year 2018. The outstanding principal amount of each bond bears interest at the rate of 2.4% per year. Interest is payable on a semiannual basis in arrears on each interest payment date. In addition, based on borrowing rates currently available to the Company for borrowings with similar terms, the carrying values of the Company’s capital lease obligations also approximate fair value. The fair value of the Company’s short-term and long-term debt is estimated based on quoted market prices for the same or similar issues or on current rates offered to the Company for debt of the same remaining maturities. The carrying amount of the Company’s debt at September 1, 2018 approximates its fair value. The Company’s financial instruments, other than those presented in the disclosure above, include cash, receivables, accounts payable, and accrued liabilities. Management believes the carrying amounts of the aforementioned financial instruments are reasonable estimates of fair value as of September 1, 2018 and September 2, 2017 due to the short-term maturity of these items. During the fiscal years ended September 1, 2018 and September 2, 2017 , the Company had no measurements of no n-financial assets or liabilities at fair value on a non-recurring basis subsequent to their initial recognition. |
Net Income Per Share
Net Income Per Share | 12 Months Ended |
Sep. 01, 2018 | |
Net Income Per Share [Abstract] | |
Net Income Per Share | 3. NET INCOME PER SHARE The Company’s non-vested restricted stock awards contain non-forfeitable rights to dividends and meet the criteria of a participating security as defined by ASC Topic 260, “ Earnings Per Share” . Under the two-class method, net income per share is computed by dividing net income allocated to common shareholders by the weighted average number of common shares outstanding for the period. In applying the two-class method, net income is allocated to both common shares and participating securities based on their respective weighted average shares outstanding for the period. The following table sets forth the computation of basic and diluted net income per common share under the two-class method for the fiscal years ended September 1, 2018 , September 2, 2017 and September 3, 2016 , respectively : For the Fiscal Years Ended September 1, September 2, September 3, 2018 2017 2016 (52 weeks) (52 weeks) (53 weeks) Net income as reported $ 329,223 $ 231,431 $ 231,216 Less: Distributed net income available to participating securities (89) (206) (308) Less: Undistributed net income available to participating securities (291) (410) (601) Numerator for basic net income per share: Undistributed and distributed net income available to common shareholders $ 328,843 $ 230,815 $ 230,307 Add: Undistributed net income allocated to participating securities 291 410 601 Less: Undistributed net income reallocated to participating securities (290) (408) (600) Numerator for diluted net income per share: Undistributed and distributed net income available to common shareholders $ 328,844 $ 230,817 $ 230,308 Denominator: Weighted average shares outstanding for basic net income per share 56,355 56,591 60,908 Effect of dilutive securities 352 380 168 Weighted average shares outstanding for diluted net income per share 56,707 56,971 61,076 Net income per share two-class method: Basic $ 5.84 $ 4.08 $ 3.78 Diluted $ 5.80 $ 4.05 $ 3.77 Potentially dilutive securities 207 — 843 Potentially dilutive securities attributable to outstanding stock options and restricted stock units are excluded from the calculation of diluted earnings per share where the combined exercise price and average unamortized fair value are greater than the average market price of MSC common stock, and therefore their inclusion would be anti-dilutive. Prior to the adoption of ASU 2016-09 Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting in the second quarter of fiscal 2017, the assumed tax benefits upon the exercise of options and vesting of restricted stock units were also included in this calculation. |
Business Combination
Business Combination | 12 Months Ended |
Sep. 01, 2018 | |
Business Combination [Abstract] | |
Business Combination | 4. BUSINESS COMBINATIONS Acquisition of AIS On April 30, 2018 , the Company acquired 100% of the outstanding shares of privately held Accurate Holding, Inc., a holding company whose subsidiaries do business under the name AIS. AIS is a leading value-added distributor of industrial fasteners and components, MRO supplies and assembly tools, headquartered in Franksville, Wisconsin. Total cash consideration paid was $87,848 , which included a post-closing working capital adjustment in the amount of $1,155 , which was paid out in August 2018. The acquisition was funded from available cash resources and borrowings under the Credit Facility. AIS delivers production fasteners and custom tool and fastener solutions for use in the assembly of manufactured commercial and consumer products, serving customers primarily in the Midwest region. The Company plans to provide AIS’s customer base access to its product portfolio to support their full metalworking and MRO needs. Similarly, the Company will extend AIS's production fastener and VMI solutions to its manufacturing customers. Non-recurring transaction and integration costs totaling $866 are included in the Company’s condensed consolidated statement of income as operating expenses for fiscal 2018. As required by ASC Topic 805-20, the Company allocated the purchase price to assets and liabilities based on their estimated fair value at the acquisition date. During the fourth quarter of fiscal 2018, the Company identified a measurement period adjustment that impacted the estimated fair value of the AIS assets and liabilities assumed on April 30, 2018 as a result of new information obtained about the facts and circumstances that existed as of the closing date. The table below, which summarizes the allocation of the purchase price for the acquisition of AIS on April 30, 2018, has been updated to reflect this measurement period adjustment. The total measurement period adjustments resulted in an increase to the deferred tax liability of $1,210 and a corresponding increase in goodwill of $1,210 . This change to the provisional amounts of fair value of the assets and liabilities assumed had no impact on the Consolidated Statement of Income for the year ended September 1, 2018. The Company’s purchase accounting as of September 1, 2018 is preliminary pending final valuation to the purchase price. The purchase price allocation is summarized in the following table: Cash $ 1,586 Inventories 20,629 Accounts receivable 9,834 Prepaid expenses and other current assets 1,303 Identifiable intangibles 23,200 Goodwill 41,939 Property, plant and equipment 1,561 Other assets 121 Total assets acquired $ 100,173 Accounts payable 3,119 Accrued liabilities 4,971 Deferred income taxes and tax uncertainties 4,235 Total liabilities assumed $ 12,325 Net assets acquired $ 87,848 Acquired intangible assets with a fair value of $23,200 consisted of customer relationships of $21,000 with a useful life of 10 years and a trademark of $2,200 with a useful life of five years. The goodwill amount of $41,939 represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired. The primary items that generated the goodwill were the premiums paid by the Company for the right to control the business acquired and benefit from adding a highly complementary provider of production fasteners and custom tool and fastener solutions and services with an experienced field sales force and VMI solution. This goodwill will not be amortized and will be included in the Company’s periodic test for impairment at least annually. The amount of goodwill deductible for tax purposes is $4,900 . The amount of revenue and loss before provision for income taxes from AIS included in the condensed consolidated statements of income for fiscal 2018 was $24,659 and ( $4,443 ), respectively. Acquisition of DECO On July 31, 2017 , the Company acquired certain assets and assumed certain liabilities of DECO, an industrial supply distributor based in Davenport, Iowa . The cash purchase price for the combined acquisition of the DECO business and real property was $43,083 , which included a post-closing working capital adjustment in the amount of $738 , which was paid out in October 2017 . The acquisitions of AIS and DECO were accounted for as business purchases pursuant to ASC 805. The results of operations for AIS and DECO have been included in our consolidated financial statements from the respective dates of acquisition. |
Property, Plant And Equipment
Property, Plant And Equipment | 12 Months Ended |
Sep. 01, 2018 | |
Property, Plant And Equipment [Abstract] | |
Property, Plant And Equipment | 5. PROPERTY, PLANT AND EQUIPMENT The following is a summary of property, plant and equipment and the estimated useful lives used in the computation of depreciation and amortization: September 1, September 2, Number of Years 2018 2017 Land — $ 28,154 $ 28,169 Building and improvements 3 - 40 186,208 182,032 Leasehold improvements The lesser of lease term or 7 3,114 2,595 Furniture, fixtures and equipment 3 - 20 185,556 178,251 Computer systems, equipment and software 3 - 5 364,050 336,685 767,082 727,732 Less: accumulated depreciation and amortization 455,397 411,427 Total $ 311,685 $ 316,305 The amount of capitalized interest, net of accumulated amortization, included in property, plant and equipment was $716 and $754 at September 1, 2018 and September 2, 2017 , respectively. Depreciation expense was $52,113 , $54,356 and $57,052 for the fiscal years ended September 1, 2018 , September 2, 2017 , and September 3, 2016, respectively . |
Income Taxes
Income Taxes | 12 Months Ended |
Sep. 01, 2018 | |
Income Taxes [Abstract] | |
Income Taxes | 6. INCOME TAXES The provision for income taxes is comprised of the following: For the Fiscal Years Ended September 1, September 2, September 3, 2018 2017 2016 Current: Federal $ 85,205 $ 108,347 $ 109,699 State and local 16,108 16,059 15,621 101,313 124,406 125,320 Deferred: Federal (27,372) 10,938 13,993 State and local 3,025 1,217 1,202 (24,347) 12,155 15,195 Total $ 76,966 $ 136,561 $ 140,515 Significant components of deferred tax assets and liabilities are as follows: September 1, September 2, 2018 2017 Deferred tax liabilities: Depreciation $ (36,361) $ (56,382) Deferred catalog costs (561) (1,079) Goodwill (77,023) (103,218) (113,945) (160,679) Deferred tax assets: Accounts receivable 2,812 4,441 Inventory 6,163 9,794 Deferred compensation 650 1,280 Stock-based compensation 5,329 9,140 Intangible amortization 988 9,517 Foreign Tax Credit 2,712 2,712 Less: Valuation Allowance (1,762) — Other accrued expenses/reserves 7,192 14,733 24,084 51,617 Net Deferred Tax Liabilities $ (89,861) $ (109,062) Reconciliation of the statutory federal income tax rate to the Company’s effective tax rate is as follows: For the Fiscal Years Ended September 1, September 2, September 3, 2018 2017 2016 U.S. federal statutory rate 25.6 % 35.0 % 35.0 % State income taxes, net of federal benefit 3.4 3.0 3.0 Revaluation of net deferred tax liabilities (10.0) — — Other, net (0.1) (0.9) (0.2) Effective income tax rate 18.9 % 37.1 % 37.8 % The aggregate changes in the balance of gross unrecognized tax benefits during fiscal 2018 and 2017 were as follows: September 1, September 2, 2018 2017 Beginning balance $ 12,641 $ 10,610 Additions for tax positions relating to current year 2,811 3,261 Additions for tax positions relating to prior years 1,940 1,015 Reductions for tax positions relating to prior years (2,821) — Lapse of statute of limitations (2,628) (2,245) Ending balance $ 11,943 $ 12,641 Included in the balance of unrecognized tax benefits at September 1, 2018 is $1,217 related to tax positions for which it is reasonably possible that the total amounts could significantly change during the next 12 months. This amount represents a decrease in unrecognized tax benefits comprised primarily of items related to expiring statutes of limitations in state jurisdictions. The Company recognizes interest expense and penalties in the provision for income taxes. The fiscal years 2018 , 2017 and 2016 provisions include interest and penalties of $44 , $245 and $6 , respectively. The Company has accrued $447 and $305 for interest and penalties as of September 1, 2018 and September 2, 2017 , respectively. The Company has a foreign tax credit carryover of $2,712 in fiscal year 2018 of which a valuation allowance of $1,762 has been provided. This foreign tax credit carryover expires beginning fiscal year 2 024. On December 22, 2017, the TCJA was enacted. The TCJA made significant changes to U.S. federal income tax laws including permanently lowering the U.S. corporate income tax rate from 35% to 21% effective January 1, 2018. As the Company has a fiscal August year-end, the lower corporate income tax rate will be phased in, resulting in a U.S. statutory rate of 25.6% for the fiscal year ending September 1, 2018. The Company’s statutory federal tax rate will be 21.0% for fiscal years 2019 and beyond. U.S. GAAP requires that the impact of tax legislation be recognized in the period in which the law was enacted. In December 2017, the SEC issued Staff Accounting Bulletin No. 118, which allows a company to report provisional numbers related to the TCJA and adjust those amounts during a measurement period not to extend beyond o ne year. The Company recorded a net tax benefit of $40,464 due to the revaluation of its net deferred tax liabilities primarily related to the lower federal corporate tax rate, partially offset by the lower federal benefit for state taxes and the change from a worldwide tax system to a territorial tax system in fiscal 2018. The amounts recorded are provisional and are subject to change due to further interpretations of the T CJA , legislative action to address questions that arise because of the T CJA , and/or any updates or changes to estimates the Company has utilized to calculate the impacts, such as return to accrual adjustments and/or changes to current year earnings estimates and the Company’s ongoing analysis of the TCJA. With limited exceptions, the Company is no longer subject to federal income tax examinations through fiscal 2014 and state income tax examinations through fiscal 2013 . |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Sep. 01, 2018 | |
Accrued Liabilities [Abstract] | |
Accrued Liabilities | 7. ACCRUED LIABILITIES Accrued liabilities consist of the following: September 1, September 2, 2018 2017 Accrued payroll and fringe $ 33,012 $ 32,151 Accrued bonus 25,620 19,657 Accrued sales, property and income taxes 13,380 12,622 Accrued sales rebates and returns 18,832 14,458 Accrued other 30,449 25,585 Total accrued liabilities $ 121,293 $ 104,473 |
Debt And Capital Lease Obligati
Debt And Capital Lease Obligations | 12 Months Ended |
Sep. 01, 2018 | |
Debt And Capital Lease Obligations [Abstract] | |
Debt And Capital Lease Obligations | 8. DEBT AND CAPITAL LEASE OBLIGATIONS Debt at September 1, 2018 and September 2, 2017 consisted of the following: September 1, September 2, 2018 2017 Revolving Credit Facility $ 224,000 $ 332,000 Private Placement Debt: Senior notes, series A 75,000 75,000 Senior notes, series B 100,000 100,000 Senior notes 20,000 — Shelf Facility Agreements 90,000 — Capital lease and financing obligations 27,926 27,829 Less: unamortized debt issuance costs (1,593) (1,852) Total debt $ 535,333 $ 532,977 Less: short-term debt (1) (224,097) (331,986) Long-term debt $ 311,236 $ 200,991 __________________________ (1) Net of unamortized debt issuance costs expected to be amortized in the next 12 months. Credit Facility In April 2017, the Company entered into a $600,000 credit facility (the “Credit Facility”). The Credit Facility, which matures on April 14, 2022 , provides for a five -year unsecured revolving loan facility. The Credit Facility permits up to $50,000 to be used to fund letters of credit. The Credit Facility also permits the Company to request one or more incremental term loan facilities and/or increase the revolving loan commitments in an aggregate amount not to exceed $300,000 . Subject to certain limitations, each such incremental term loan facility or revolving commitment increase will be on terms as agreed to by the Company, the Administrative Agent and the lenders providing such financing. The interest rate is based on either LIBOR or a base rate, plus in either case a spread based on our leverage ratio at the end of each fiscal reporting quarter. The weighted average applicable borrowing rate for any borrowings outstanding under the Credit Facility at September 1, 2018 was 3.20% which represents LIBOR plus 1.125% . Based on the interest period the Company selects, interest may be payable every one, two, or three months. Interest is reset at the end of each interest period. The Company currently elects to have loans under the Credit Facility bear interest based on LIBOR with one-month interest periods. During fiscal 2018, the Company borrowed $242,000 and repaid $350,000 under the Credit Facility. Private Placement Debt In July 2016 , the Company completed the issuance and sale of $75,000 aggregate principal amount of 2.65% Senior Notes, Series A, due July 28, 2023 and $100,000 aggregate principal amount of 2.90% Senior Notes, Series B, due July 28, 2026 ; and in June 2018, the Company completed the issuance and sale of $20,000 aggregate principal amount of 3.79% Senior Notes, due June 11, 2025 (collectively “Private Placement Debt”). Interest is payable semiannually at the fixed stated interest rates. Shelf Facility Agreements In January 2018, the Company entered into Note Purchase and Private Shelf Agreements with Metropolitan Life Insurance Company (“Met Life Note Purchase Agreement”) and PGIM, Inc. (“Prudential Note Purchase Agreement” and together with the Met Life Note Purchase Agreement, the “Shelf Facility Agreements”). The Met Life Note Purchase Agreement provides for an uncommitted facility for the issuance and sale of up to an aggregate total of $250,000 of senior notes, at either fixed or floating rates. In June 2018, the Company completed the issuance and sale of $20,000 aggregate principal amount of 3.22% Series 2018A Notes, due June 11, 2020 and $20,000 aggregate principal amount of 3.42% Series 2018B Notes, due June 11, 2021 under the Met Life Note Purchase Agreement in a private placement exempt from the registration requirements of the Securities Act of 1933, as amended. Interest is payable semiannually at the fixed stated interest rates. As of September 1, 2018, the aggregate availability under the Met Life Note Purchase Agreement is $210,000 . The Prudential Note Purchase Agreement provides for an uncommitted facility for the issuance and sale of up to an aggregate total of $250,000 of senior notes, at a fixed rate. In January 2018, the Company completed the issuance and sale of $50,000 aggregate principal amount of 3.04% Senior Notes due January 12, 2023 under the Prudential Note Purchase Agreement in a private placement exempt from the registration requirements of the Securities Act of 1933, as amended. Interest is payable semiannually at the fixed stated interest rate. As of September 1, 2018, the aggregate availability under the Prudential Note Purchase Agreement is $200,000 . Each of the Credit Facility, Private Placement Debt, and Shelf Facility Agreements contains several restrictive covenants including the requirement that the Company maintain a maximum consolidated leverage ratio of total indebtedness to EBITDA (earnings before interest expense, taxes, depreciation, amortization and stock-based compensation) of no more than 3.00 to 1.00 (or, at the election of the Company after it consummates a material acquisition, a four-quarter temporary increase to 3.50 to 1.00), and a minimum consolidated interest coverage ratio of EBITDA to total interest expense of at least 3.00 to 1.00, during the terms of the Credit Facility, Private Placement Debt and Shelf Facility Agreements. At September 1, 2018 and September 2, 2017, the Company was in compliance with the operating and financial covenants of the Credit Facility, Private Placement Debt, and Shelf Facility Agreements, respectively. Maturities of debt, excluding capital lease and financing obligations, as of September 1, 2018 are as follows: Maturities of Fiscal Year Debt 2019 $ 224,000 2020 20,000 2021 20,000 2022 — 2023 125,000 Thereafter 120,000 Total $ 509,000 Capital Lease Obligations In connection with the construction of the Company’s customer fulfillment center in Columbus, Ohio, the Finance Authority holds the title to the building and entered into a long-term lease with the Company. The lease has a 20 -year term with a prepayment option without penalty between 7 and 20 years. At the end of the lease term, the building’s title is transferred to the Company for a nominal amount when the principal of and interest on the bonds have been fully paid. The lease has been classified as a capital lease in accordance with ASC Topic 840. At September 1, 2018 and September 2, 2017 , the capital lease obligation was approximately $27,025 . Under this arrangement, the Finance Authority has issued taxable bonds to finance the structure and site improvements of the Company’s customer fulfillment center in the amount of $27,025 outstanding at both September 1, 2018 and September 2, 2017 . From time to time, the Company enters into capital leases and financing arrangements with vendors to purchase certain IT equipment or software. The equipment or software acquired from these vendors is paid for over a specified period of time based on the terms agreed upon. During the fiscal year ended September 1, 2018, the Company entered into capital lease and financing obligations related to certain IT equipment and software totaling $1,163 . The gross amount of property and equipment acquired under the capital lease obligation at September 1, 2018 was approximately $442 . There is no related accumulated amortization for this capital lease as of September 1, 2018. At September 1, 2018 , approximate future minimum payments under capital leases and financing arrangements are as follows: Fiscal Year Payments under capital leases and financing arrangements 2019 $ 1,133 2020 27,448 2021 120 2022 90 Total minimum lease payments $ 28,791 Less: amount representing interest 865 Present value of minimum lease payments $ 27,926 Less: current portion 484 Long-term capital leases and financing arrangements $ 27,442 |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Sep. 01, 2018 | |
Shareholders' Equity [Abstract] | |
Shareholders' Equity | 9. SHAREHOLDERS’ EQUITY Share Repurchases During fiscal 1999, the Board of Directors established the MSC Stock Repurchase Plan (the “Repurchase Plan”). In 2011, the Board of Directors reaffirmed and replenished the Repurchase Plan so that the total number of shares of Class A common stock authorized for future repurchase was 5,000 shares. As of September 1, 2018 , the maximum number of shares that may yet be repurchased under the Repurchase Plan was 1,930 shares. The Repurchase Plan allows the Company to repurchase shares at any time and in any increments it deems appropriate in accordance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended. During fiscal years 2018 and 2017, the Company repurchased 972 shares and 685 shares, respectively, of its Class A common stock for $82,369 and $48,869 , respectively. 54 and 43 of these shares were repurchased by the Company to satisfy the Company’s associates’ tax withholding liability associated with its share-based compensation program in fiscal years 2018 and 2017, respectively. In July 2018, the Company announced that in connection with its existing share repurchase authorization, the Company had entered into a stock purchase agreement with the holders of the Company’s Class B common stock to purchase a pro rata number of shares, such that their aggregate percentage ownership in the Company would remain substantially the same. In August 2018, the Company purchased 45 shares of its Class A common stock from certain of its Class B shareholders at a purchase price of $82.64 per share. This figure is included in the totals provided in the previous paragraph. All of these shares were immediately retired. Shares of the Company’s common stock purchased pursuant to the stock purchase agreement, as well as shares purchased to satisfy the Company’s associates’ tax withholding liability associated with its share-based compensation program, did not reduce the number of shares that may be repurchased under the Repurchase Plan. The Company reissued 57 shares of treasury stock during both fiscal years 2018 and 2017 to fund the Associate Stock Purchase Plan (see Note 10). Common Stock Each holder of the Company’s Class A common stock is entitled to one vote for each share held of record on the applicable record date on all matters presented to a vote of shareholders, including the election of directors. The holders of Class B common stock are entitled to 10 votes per share for each share held of record on the applicable record date and are entitled to vote, together with the holders of the Class A common stock, on all matters which are subject to shareholder approval. Holders of Class A common stock and Class B common stock have no cumulative voting rights or preemptive rights to purchase or subscribe for any stock or other securities and there are no redemption or sinking fund provisions with respect to such stock. The holders of the Company’s Class B common stock have the right to convert their shares of Class B common stock into shares of Class A common stock at their election and on a one-to-one basis, and all shares of Class B common stock convert into shares of Class A common stock on a one to-one basis upon the sale or transfer of such shares of Class B common stock to any person who is not a member of the Jacobson or Gershwind families or any trust not established principally for members of the Jacobson or Gershwind families or to any person who is not an executor, administrator or personal representative of an estate of a member of the Jacobson or Gershwind families. Preferred Stock The Company has authorized 5,000 shares of preferred stock. The Company’s Board of Directors has the authority to issue the shares of preferred stock. Shares of preferred stock may have priority over the Company’s Class A common stock and Class B common stock with respect to dividend or liquidation rights, or both. As of September 1, 2018 , there were no shares of preferred stock issued or outstanding . Cash Dividend In 2003, the Board of Directors instituted a policy of regular quarterly cash dividends to shareholders. This policy is reviewed regularly by the Board of Directors. On October 18, 2018 , the Board of Directors declared a quarterly cash dividend of $0.63 per share, payable on November 27, 2018 to shareholders of record at the close of business on November 13, 2018 . The dividend will result in a payout of approximately $35,400 , based on the number of shares outstanding at October 1, 2018. |
Associate Benefit Plans
Associate Benefit Plans | 12 Months Ended |
Sep. 01, 2018 | |
Associate Benefit Plans [Abstract] | |
Associate Benefit Plans | 10. ASSOCIATE BENEFIT PLANS The Company accounts for all share-based payments in accordance with ASC 718. Stock ‑based compensation expense included in operating expenses for the fiscal years ended September 1, 2018 , September 2, 2017 and September 3, 2016 was as follows: For the Fiscal Years Ended September 1, September 2, September 3, 2018 2017 2016 Stock options $ 4,534 $ 4,369 $ 4,382 Restricted share awards 2,856 4,399 6,112 Restricted stock units 7,281 4,872 3,205 Associate Stock Purchase Plan 263 285 286 Total 14,934 13,925 13,985 Deferred income tax benefit (4,376) (5,292) (5,206) Stock-based compensation expense, net $ 10,558 $ 8,633 $ 8,779 Stock Compensation Plans 2015 Omnibus Incentive Plan At the Company’s annual meeting of shareholders held on January 15, 2015, the shareholders approved the MSC Industrial Direct Co., Inc. 2015 Omnibus Incentive Plan (“2015 Omnibus Plan”). The 2015 Omnibus Plan replaced the Company’s 2005 Omnibus Incentive Plan (the “Prior Plan”) and, beginning January 15, 2015, all awards are granted under the 2015 Omnibus Plan. Awards under the 2015 Omnibus Plan may be made in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, other share-based awards, and performance cash, performance shares or performance units. All outstanding awards under the Prior Plan will continue to be governed by the terms of the Prior Plan. Upon approval of the 2015 Omnibus Plan, the maximum aggregate number of shares of common stock authorized to be issued under the 2015 Omnibus Plan was 5,217 shares, of which 3,404 authorized shares of common stock were remaining as of September 1, 2018. Stock Options A summary of the status of the Company’s stock options at September 1, 2018 and changes during the fiscal year then ended is presented in the table and narrative below: 2018 Shares Weighted-Average Exercise Price Outstanding - beginning of year 1,743 $ 70.88 Granted 436 79.60 Exercised (342) 70.96 Canceled/Forfeited (77) 72.45 Outstanding - end of year 1,760 $ 72.96 Exercisable - end of year 666 $ 73.96 The total intrinsic value of options exercised during the fiscal years ended September 1, 2018 , September 2, 2017 and September 3, 2016 was $7,516 , $9,474 , and $3,129 , respectively. The unrecognized share-based compensation cost related to stock option expense at September 1, 2018 was $7,529 and will be recognized over a weighted average of 2.1 years. Stock option awards outstanding under the Company’s incentive plans have been granted at exercise prices that are equal to the market value of its common stock on the date of grant. Such options generally vest over a period of four years and expire at seven years after the grant date. The Company recognizes compensation expense ratably over the vesting period, net of estimated forfeitures. The Company uses the Black-Scholes option-pricing model to estimate the fair value of stock options granted, which requires the input of both subjective and objective assumptions as follows: Expected Term — The estimate of expected term is based on the historical exercise behavior of grantees, as well as the contractual life of the option grants. Expected Volatility — The expected volatility factor is based on the volatility of the Company's common stock for a period equal to the expected term of the stock option. Risk-free Interest Rate — The risk-free interest rate is determined using the implied yield for a traded zero-coupon U.S. Treasury bond with a term equal to the expected term of the stock option. Expected Dividend Yield — The expected dividend yield is based on the Company's historical practice of paying quarterly dividends on its common stock. The Company’s weighted-average assumptions used to estimate the fair value of stock options granted during the fiscal years ended September 1, 2018, September 2, 2017, and September 3, 2016 were as follows: 2018 2017 2016 Expected life (in years) 4.0 4.1 3.9 Risk-free interest rate 1.87 % 1.16 % 1.09 % Expected volatility 22.1 % 20.5 % 21.8 % Expected dividend yield 2.30 % 2.40 % 2.40 % Weighted-Average Grant-Date Fair Value $ 12.25 $ 9.29 $ 8.03 The following table summarizes information about stock options outstanding and exercisable at September 1, 2018 : Range of Exercise Prices Number of Options Outstanding at September 1, 2018 Weighted-Average Remaining Contractual Life Weighted-Average Exercise Price Intrinsic Value Number of Options Exercisable at September 1, 2018 Weighted-Average Remaining Contractual Life Weighted-Average Exercise Price Intrinsic Value $ 58.90 – $ 69.46 464 3.9 $ 59.90 $ 11,869 213 3.5 $ 61.08 $ 5,188 69.47 – 72.23 460 5.2 71.33 6,501 99 5.2 71.33 1,398 72.24 – 81.76 578 5.0 80.25 3,032 171 2.2 81.75 637 81.77 – 83.03 258 3.1 83.02 635 183 3.1 83.03 450 1,760 4.5 $ 72.96 $ 22,037 666 3.3 $ 73.96 $ 7,673 Restricted Stock Awards A summary of the non-vested restricted share awards (“RSA”) granted under the Company’s incentive plans for the fiscal year ended September 1, 2018 is as follows: 2018 Shares Weighted-Average Grant-Date Fair Value Non-vested restricted share awards at the beginning of the year 160 $ 80.49 Granted — — Vested (91) 79.23 Canceled/Forfeited (6) 82.43 Non-vested restricted share awards at the end of the year 63 $ 81.98 The fair value of each RSA is the closing stock price on the NYSE of the Company’s Class A common stock on the date of grant. Upon vesting, a portion of the RSA may be withheld to satisfy the minimum statutory withholding taxes. The remaining RSAs will be settled in shares of the Company’s Class A common stock after the vesting period. The fair value of shares vested during the fiscal years ended September 1, 2018 , September 2, 2017 and September 3, 2016 was $7,222 , $7,357 and $7,518 , respectively. The unrecognized compensation cost related to the non-vested RSAs at September 1, 2018 is $1,920 and will be recognized over a weighted-average period of 0.9 years. Restricted Stock Units A summary of the Company’s non-vested restricted stock unit (“RSU”) award activity for the fiscal year ended September 1, 2018 is as follows: 2018 Shares Weighted-Average Grant-Date Fair Value Non-vested restricted stock unit awards at the beginning of the year 313 $ 66.66 Granted 175 81.57 Vested (81) 66.75 Canceled/Forfeited (30) 71.60 Non-vested restricted stock unit awards at the end of the year 377 $ 73.18 The fair value of each RSU is the closing stock price on the NYSE of the Company’s Class A common stock on the date of grant. Upon vesting, a portion of the RSU award may be withheld to satisfy the minimum statutory withholding taxes. The remaining RSUs will be settled in shares of the Company’s Class A common stock after the vesting period. These awards accrue dividend equivalents on outstanding units (in the form of additional stock units) based on dividends declared on the Company’s Class A common stock and these additional RSUs are subject to the same vesting periods as the RSUs in the underlying award. The dividend equivalents are not included in the RSU table above. The unrecognized compensation cost related to the RSUs at September 1, 2018 was $21,158 and is expected to be recognized over a period of 3.2 years. Associate Stock Purchase Plan The Company has established a qualified Associate Stock Purchase Plan, the terms of which allow for eligible associates (as defined in the Associate Stock Purchase Plan) to participate in the purchase of up to a maximum of five shares of the Company’s Class A common stock at a price equal to 90% of the closing price at the end of each stock purchase period. On January 7, 2009, the shareholders of the Company approved an increase to the authorized but unissued shares of the Class A common stock of the Company reserved for sale under the Associate Stock Purchase Plan from 800 to 1,150 shares. On January 15, 2015, the shareholders of the Company approved an increase to the authorized but unissued shares of the Class A common stock of the Company reserved for sale under the Associate Stock Purchase Plan from 1,150 to 1,500 shares. As of September 1, 2018 , approximately 126 shares remain reserved for issuance under this plan. Associates purchased approximately 57 shares of common stock during both fiscal years 2018 and 2017 at an average per share price of $78.65 and $74.81 , respectively. Savings Plan The Company maintains a defined contribution plan with both a profit sharing feature and a 401(k) feature which covers all associates who have completed at least one month of service with the Company. For fiscal years 2018 , 2017 , and 2016 , the Company contributed $7,730 , $7,048 and $6,594 , respectively, to the plan. The Company contributions are discretionary. |
Commitments And Contingencies
Commitments And Contingencies | 12 Months Ended |
Sep. 01, 2018 | |
Commitments And Contingencies [Abstract] | |
Commitments And Contingencies | 11. COMMITMENTS AND CONTINGENCIES Leases Certain of the operations of the Company are conducted on leased premises. The leases (most of which require the Company to provide for the payment of real estate taxes, insurance and other operating costs) are for varying periods, the longest extending to the fiscal year 20 28 . Some of the leased premises contain multiple renewal provisions, exercisable at the Company’s option, as well as escalation clauses. In addition, the Company is obligated under certain equipment and automobile operating leases, which expire on varying dates through fiscal 20 22 . At September 1, 2018 , approximate minimum annual rentals on all such leases are as follows: Fiscal Year Total Rental Payments 2019 $ 14,687 2020 9,337 2021 6,815 2022 4,256 2023 2,824 Thereafter 5,602 Total $ 43,521 Total rental expense (exclusive of real estate taxes, insurance and other operating costs) for all operating leases for fiscal years 2018 , 2017 and 2016 was approximately $12,477 , $12,541 and $13,428 , respectively. This included rent expense of approximately $1,044 for fiscal year 2016 for a related party lease. As a result of the purchase of our Atlanta CFC, which was previously leased with a related party, rental expense was partially offset by the release of a deferred rent liability during fiscal 2016. See Note 1 “Business and Summary of Significant Accounting Policies” for more information about this transaction. |
Legal Proceedings
Legal Proceedings | 12 Months Ended |
Sep. 01, 2018 | |
Legal Proceedings [Abstract] | |
Legal Proceedings | 12. LEGAL PROCEEDINGS There are various claims, lawsuits, and pending actions against the Company incidental to the operation of its business. Although the outcome of these matters is currently not determinable, management does not expect that the ultimate costs to resolve these matters will have a material adverse effect on the Company’s consolidated financial position, results of operations, or liquidity. |
Summary Of Quarterly Results
Summary Of Quarterly Results | 12 Months Ended |
Sep. 01, 2018 | |
Summary Of Quarterly Results [Abstract] | |
Summary Of Quarterly Results | 13. SUMMARY OF QUARTERLY RESULTS (UNAUDITED) The following table sets forth unaudited financial data for each of the Company’s last eight fiscal quarters. Fiscal Year Ended September 1, 2018 Fiscal Year Ended September 2, 2017 First Quarter Second Quarter (1) Third Quarter Fourth Quarter First Quarter Second Quarter Third Quarter Fourth Quarter (Unaudited) Consolidated Income Statement Data: Net sales $ 768,561 $ 768,987 $ 828,345 $ 837,985 $ 686,271 $ 703,780 $ 743,923 $ 753,770 Gross profit 335,069 337,223 361,001 359,668 308,735 314,562 329,500 333,450 Income from operations 99,278 98,103 115,382 107,790 90,600 86,645 101,776 99,979 Net income 59,585 117,552 79,069 73,017 54,288 53,559 62,836 60,748 Net income per share: Basic 1.06 2.08 1.40 1.30 0.96 0.94 1.10 1.07 Diluted 1.05 2.06 1.39 1.29 0.96 0.93 1.09 1.07 (1) In the second quarter of fiscal 2018, the Company recorded a net tax benefit of $41,199 due to the revaluation of its net deferred tax liabilities primarily related to the lower federal corporate tax rate, partially offset by the lower federal benefit for state taxes and the change from a worldwide tax system to a territorial tax system, and a net tax benefit of $16,929 attributable to the lower effective tax rate required to bring our first half into alignment with the expected full year rate. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Sep. 01, 2018 | |
Subsequent Event [Abstract] | |
Subsequent Events | 14. SUBSEQUENT EVENT In September 2018 and October 2018, pursuant to the Company’s share repurchase authorization, the Company purchased 7 shares of its Class A common stock at a volume weighted average purchase price of $85.00 per share and 493 shares if its Class A common stock at a volume weighted average purchase price of $81.22 per share, respectively. In connection with the stock purchase agreement noted in Note 9, the Company purchased from certain of its Class B shareholders 113 shares of its Class A common stock at a purchase price of $84.29 per share in September 2018 and 2 shares of its Class A common stock at a purchase price of $85.00 per share in October 2018. |
Schedule II - Valuation And Qua
Schedule II - Valuation And Qualifying Accounts | 12 Months Ended |
Sep. 01, 2018 | |
Schedule II - Valuation And Qualifying Accounts [Abstract] | |
Schedule II - Valuation And Qualifying Accounts | MSC INDUSTRIAL DIRECT CO., INC. AND SUBSIDIARIES SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS (In thousands) Description Balance at Beginning of Year Charged to Costs and Expenses Charged to Other Accounts Deductions (2) Balance at End of Year Deducted from asset accounts: For the fiscal year ended September 3, 2016 Allowance for doubtful accounts (1) $ 11,312 $ 6,997 $ — $ 5,956 $ 12,353 Deducted from asset accounts: For the fiscal year ended September 2, 2017 Allowance for doubtful accounts (1) $ 12,353 $ 7,048 $ — $ 6,123 $ 13,278 Deducted from asset accounts: For the fiscal year ended September 1, 2018 Allowance for doubtful accounts (1) $ 13,278 $ 6,938 $ — $ 7,224 $ 12,992 __________________________ (1) Included in accounts receivable. (2) Comprised of uncollected accounts charged against the allowance. |
Business And Summary Of Signi_2
Business And Summary Of Significant Accounting Policies (Policy) | 12 Months Ended |
Sep. 01, 2018 | |
Business And Summary Of Significant Accounting Policies [Abstract] | |
Principles Of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of MSC and its subsidiaries, all of which are wholly owned. All intercompany balances and transactions have been eliminated in consolidation. |
Fiscal Year | Fiscal Year The Company’s fiscal year is on a 52- or 53-week basis, ending on the Saturday closest to August 31 st of each year. The financial statements for fiscal years 2018 and 2017 contain activity for 52 weeks while fiscal year 2016 contains activity for 53 weeks. Unless the context requires otherwise, references to years contained herein pertain to the Company’s fiscal year. |
Use Of Estimates | Use of Estimates The preparation of financial statements, in conformity with accounting principles generally accepted in the United States, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and assumptions used in preparing the accompanying consolidated financial statements. |
Cash And Cash Equivalents | Cash and Cash Equivalents The Company considers all short-term, highly liquid investments with maturities of three months or less at the date of purchase to be cash equivalents. Cash and cash equivalents are carried at cost, which approximates fair value. As of September 1, 2018 and September 2, 2017 , the Company did not have any cash equivalents. |
Concentrations Of Credit Risk | Concentrations of Credit Risk The Company’s mix of receivables is diverse, selling its products primarily to end-users. The Company’s customer base represents many diverse industries primarily concentrated in the United States. The Company performs periodic credit evaluations of its customers’ financial condition, and collateral is generally not required. The Company evaluates the collectability of accounts receivable based on numerous factors, including past transaction history with customers and their creditworthiness and provides a reserve for accounts that are potentially uncollectible. The Company’s cash includes deposits with commercial banks. The terms of these deposits and investments provide that all monies are available to the Company upon demand. The Company maintains the majority of its cash with high- quality financial institutions. Deposits held with banks may exceed insurance limits. While MSC monitors the creditworthiness of these commercial banks and financial institutions, a crisis in the United States financial systems could limit access to funds and/or result in a loss of principal. |
Allowance For Doubtful Accounts | Allowance for Doubtful Accounts The Company establishes reserves for customer accounts that are deemed uncollectible. The method used to estimate the allowances is based on several factors, including the age of the receivables and the historical ratio of actual write-offs to the age of the receivables. These analyses also take into consideration economic conditions that may have an impact on a specific industry, group of customers or a specific customer. While the Company has a broad customer base, representing many diverse industries primarily in all regions of the United States, a general economic downturn could result in higher than expected defaults and, therefore, the need to revise estimates for bad debts. |
Inventory Valuation | Inventory Valuation Inventories consist of merchandise held for resale and are stated at the lower of weighted average cost or market. The Company evaluates the recoverability of its slow-moving or obsolete inventories quarterly. The Company estimates the recoverable cost of such inventory by product type and considering such factors as its age, historic and current demand trends, the physical condition of the inventory, as well as assumptions regarding future demand. The Company’s ability to recover its cost for slow-moving or obsolete inventory can be affected by such factors as general market conditions, future customer demand, and relationships with suppliers. Substantially all the Company’s inventories have demonstrated long shelf lives and are not highly susceptible to obsolescence. In addition, many of the Company’s inventory items are eligible for return under various supplier agreements. |
Property, Plant And Equipment | Property, Plant and Equipment Property, plant and equipment and capitalized computer software are stated at cost less accumulated depreciation. Expenditures for maintenance and repairs are charged to expense as incurred; costs of major renewals and improvements are capitalized. At the time property and equipment are retired or otherwise disposed of, the cost and accumulated depreciation are eliminated from the asset and accumulated depreciation accounts and the profit or loss on such disposition is reflected in income. Depreciation and amortization of property, plant and equipment are computed for financial reporting purposes on the straight-line method based on the estimated useful lives of the assets. Leasehold improvements are amortized over either their respective lease terms or their estimated lives, whichever is shorter. Estimated useful lives range from three to 40 years for leasehold improvements and buildings, and three to 20 years for furniture, fixtures, and equipment. Capitalized computer software costs are amortized using the straight-line method over the estimated useful life. These costs include purchased software packages, payments to vendors and consultants for the development, implementation or modification of purchased software packages for Company use, and payroll and related costs for employees associated with internal-use software projects. Capitalized computer software costs are included within property, plant and equipment on the Company’s consolidated balance sheets. |
Goodwill And Other Indefinite-Lived Intangible Assets | Goodwill and Other Indefinite-Lived Intangible Assets The Company’s business acquisitions typically result in the recording of goodwill and other intangible assets, which affect the amount of amortization expense and possibly impairment write-downs that the Company may incur in future periods. Goodwill represents the excess of the purchase price paid over the fair value of the net assets acquired in business acquisitions. The Company annually reviews goodwill and intangible assets that have indefinite lives for impairment in its fiscal fourth quarter and when events or changes in circumstances indicate the carrying values of these assets might exceed their current fair values. Goodwill and indefinite-lived intangible assets are tested for impairment by first evaluating qualitative factors to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value. If it is concluded that this is the case, it is necessary to perform the currently prescribed quantitative impairment test. Otherwise, the quantitative impairment test is not required. Based on the qualitative assessments of goodwill and intangible assets that have indefinite lives performed by the Company in its respective fiscal fourth quarters, there was no indicator of impairment for fiscal years 2018 , 2017 and 2016 . The balances and changes in the carrying amount of goodwill are as follows: Balance as of September 3, 2016 $ 624,081 Acquisition (1) 8,318 Foreign currency translation adjustments 1,329 Balance as of September 2, 2017 $ 633,728 Acquisition (2) 41,939 Post-closing working capital adjustment from acquisition of DECO Tool Supply Co. 738 Foreign currency translation adjustments (1,407) Balance as of September 1, 2018 $ 674,998 (1) Acquired DECO Tool Supply Co. (“DECO”) in July 2017. (2) Acquired All Integrated Solutions (“AIS”) in April 2018, including post-closing working capital adjustment of $1,155 . See Note 4 “Business Combinations” for further discussion on these acquisitions. The components of the Company’s intangible assets for the fiscal years ended September 1, 2018 and September 2, 2017 are as follows: For the Fiscal Years Ended September 1, 2018 September 2, 2017 Weighted Average Useful Life (in years) Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Customer Relationships 5 - 18 $ 208,260 $ (101,916) $ 187,260 $ (92,381) Contract Rights 10 23,100 (23,100) 23,100 (23,100) Trademarks 1 - 5 6,630 (4,384) 4,403 (3,058) Trademarks Indefinite 14,134 — 14,205 — Total $ 252,124 $ (129,400) $ 228,968 $ (118,539) For the fiscal year ended September 1, 2018, the Company recorded approximately $23,285 of intangible assets, primarily consisting of the acquired customer relationships and trademark from the AIS acquisition. See Note 4 “Business Combinations.” During the fiscal year ended September 1, 2018, approximately $129 in gross intangible assets, and any related accumulated amortization, were written off related to trademarks that are no longer being utilized. For the fiscal year ended September 2, 2017, the Company recorded approximately $12,980 of intangible assets consisting of acquired intangible assets from the DECO acquisition and from the registration and application of new trademarks. During the fiscal year ended September 1, 2017, approximately $17 in gross intangible assets, and any related accumulated amortization, were written off related to trademarks that are no longer being utilized. The Company’s amortizable intangible assets are amortized on a straight-line basis, including customer relationships, as it approximates customer attrition patterns and best estimates the use pattern of the asset. Amortization expense of the Company’s intangible assets was $10,513 , $8,223 , and $14,478 during fiscal years 2018 , 2017 , and 2016 , respectively. Estimated amortization expense for each of the five succeeding fiscal years is as follows: Fiscal Year 2019 $11,190 2020 10,216 2021 9,534 2022 9,520 2023 9,375 |
Impairment Of Long-Lived Assets | Impairment of Long-Lived Assets The Company periodically evaluates the net realizable value of long-lived assets, including definite-lived intangible assets and property and equipment, relying on a number of factors, including operating results, business plans, economic projections, and anticipated future cash flows. Impairment is assessed by evaluating the estimated undiscounted cash flows over the asset’s remaining life. If estimated cash flows are insufficient to recover the investment, an impairment loss is recognized. No impairment loss was required to be recorded by the Company during fiscal years 2018 , 2017 and 2016 . |
Deferred Catalog Costs | Deferred Catalog Costs The costs of producing and distributing the Company’s principal catalogs are deferred ( $3,973 and $4,778 at September 1, 2018 and September 2, 2017 , respectively) and included in other assets in the Company’s consolidated balance sheets. These costs are charged to expense over the period that the catalogs remain the most current source of sales, which is typically one year or less from the date the catalogs are mailed. The costs associated with brochures and catalog supplements are charged to expense as distributed. The total amount of advertising costs, net of co-operative advertising income from vendor-sponsored programs, included in operating expenses in the consolidated statements of income was approximately $15,530 , $16,289 and $19,242 during the fiscal years 2018 , 2017 , and 2016 , respectively. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the sales price is fixed or determinable, and collectability is reasonably assured. In most cases, these conditions are met when the product is shipped to the customer or services have been rendered. In cases where the product is shipped directly to the customer, the Company recognizes revenue at the time of shipment primarily on a gross basis. The Company’s standard shipping terms are FOB shipping point. The Company reports its sales net of the amount of actual sales returns and the amount of reserves established for anticipated sales returns based upon historical return rates. Sales tax collected from customers is excluded from net sales in the accompanying consolidated statements of income. |
Gross Profit | Gross Profit Gross profit primarily represents the difference between the sale price to our customers and the product cost from our suppliers (net of earned rebates and discounts) including the cost of inbound freight. The cost of outbound freight (including internal transfers), purchasing, receiving and warehousing are included in operating expenses. The Company’s gross profit may not be comparable to those of other companies, as other companies may include all the costs related to their distribution network in cost of sales. |
Vendor Consideration | Vendor Consideration The Company records cash consideration received for advertising costs incurred to sell the vendor’s products as a reduction of the Company’s advertising costs and is reflected in operating expenses in the consolidated statements of income. In addition, the Company receives volume rebates from certain vendors based on contractual arrangements with such vendors. Rebates received from these vendors are recognized as a reduction to the cost of goods sold in the consolidated statements of income when the inventory is sold. |
Product Warranties | Product Warranties The Company generally offers a maximum one -year warranty, including parts and labor, for certain of its products sold. The specific terms and conditions of those warranties vary depending upon the product sold. The Company may be able to recoup some of these costs through product warranties it holds with its original equipment manufacturers, which typically range from 30 to 90 days. In general, many of the Company’s general merchandise products are covered by third-party original equipment manufacturers’ warranties. The Company’s warranty expense has been minimal. |
Shipping And Handling Costs | Shipping and Handling Costs The Company includes shipping and handling fees billed to customers in net sales and shipping, and handling costs associated with outbound freight in operating expenses in the accompanying consolidated statements of income. The shipping and handling costs in operating expenses were approximately $130,340 , $119,979 , and $118,174 during fiscal years 2018 , 2017 , and 2016 , respectively. |
Stock-Based Compensation | Stock-Based Compensation In accordance with Accounting Standards Codification (“ASC”) Topic 718, “Compensation — Stock Compensation” (“ASC 718”), the Company estimates the fair value of share-based payment awards on the date of grant. The value of awards that are ultimately expected to vest is recognized as an expense over the requisite service periods. The fair value of the Company’s restricted stock awards and units is based on the closing market price of the Company’s common stock on the date of grant. The Company estimates the fair value of stock options granted using a Black-Scholes option-pricing model. This model requires the Company to make estimates and assumptions with respect to the expected term of the option, the expected volatility of the price of the Company’s common stock and the expected forfeiture rate. The fair value is then amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. The expected term is based on the historical exercise behavior of grantees, as well as the contractual life of the option grants. The expected volatility factor is based on the volatility of the Company's common stock for a period equal to the expected term of the stock option. In addition, forfeitures of share-based awards are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company uses historical data to estimate pre-vesting option and restricted stock award and unit forfeitures and records stock-based compensation expense only for those awards that are expected to vest. In fiscal 2017, the Company adopted Accounting Standards Update (“ASU”) 2016-09, Improvements to Employee Share-Based Payment Accounting, which includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. |
Share Repurchases And Treasury Stock | Share Repurchases and Treasury Stock Repurchased shares may be retired immediately and resume the status of authorized but unissued shares or may be held by the Company as treasury stock. The Company accounts for treasury stock under the cost method, using the first-in, first-out flow assumption, and is included in “Class A treasury stock, at cost” on the accompanying consolidated balance sheets. When the Company reissues treasury stock, the gains are recorded in additional paid-in capital (“APIC”), while the losses are recorded to APIC to the extent that the previous net gains on the reissuance of treasury stock are available to offset the losses. If the loss is larger than the previous gains available, then the loss is recorded to retained earnings. The Company accounts for repurchased shares retired immediately or treasury stock retired under the constructive retirement method. When shares are retired, the par value of the repurchased shares is deducted from common stock and the excess repurchase price over par is deducted by allocation to both APIC and retained earnings. The amount allocated to APIC is calculated as the original cost of APIC per share outstanding using the first-in, first-out flow assumption and is applied to the number of shares repurchased. Any remaining amount is allocated to retained earnings. |
Related Party Transactions | Related Party Transactions Stock Purchase Agreement s In July 2018, the Company announced that in connection with its existing share repurchase authorization, the Company entered into a stock purchase agreement with the holders of the Company’s Class B common stock to purchase a pro rata number of shares, such that their aggregate percentage ownership in the Company would remain substantially the same. In August 2018, the Company purchased 45 shares of its Class A common stock from certain of its Class B shareholders at a purchase price of $82.64 per share. See Note 9 “Shareholders’ Equity” in the Notes to the Consolidated Financial Statements for more information about the stock purchase. In connection with a “modified Dutch auction” tender offer commenced on July 7, 2016, the Company purchased an aggregate of 1,152 shares of its Class A common stock pursuant to a stock purchase agreement with Mitchell Jacobson, the Company’s Chairman, his sister, Marjorie Gershwind Fiverson, Erik Gershwind, the Company’s President and Chief Executive Officer, and two other beneficial owners of the Company’s Class B common stock (collectively, the “Sellers”) at a purchase price of $72.50 per share, for an aggregate purchase price of approximately $83,524 . The purchase price per share paid to the Sellers pursuant to the Stock Purchase Agreement was equal to the purchase price per share paid to shareholders whose shares were purchased in the Company’s tender offer. Infrastructure Investments In August 2016, the Company’s subsidiary, Sid Tool Co., Inc., completed a transaction with Mitchmar Atlanta Properties, Inc. to purchase the Company’s Atlanta CFC and the real property on which the Atlanta CFC is situated for a purchase price of $33,650 . The Atlanta CFC had previously been leased since 1989. |
Fair Value Of Financial Instruments | Fair Value of Financial Instruments The carrying values of the Company’s financial instruments, including cash, receivables, accounts payable and accrued liabilities, approximate fair value because of the short maturity of these instruments. In addition, based on borrowing rates currently available to the Company for borrowings with similar terms, the carrying values of the Company’s capital lease obligations also approximate fair value. The fair value of the Company’s taxable bonds is estimated based on observable inputs in non-active markets. Under this method, the Company’s fair value of the taxable bonds was not significantly different than the carrying value at September 1, 2018 and September 2, 2017 . The fair values of the Company’s long-term debt, including current maturities, are estimated based on quoted market prices for the same or similar issues or on current rates offered to the Company for debt of the same remaining maturities. Under this method, the Company’s fair value of any long-term obligations was not significantly different than the carrying values at September 1, 2018 and September 2, 2017 . |
Foreign Currency | Foreign Currency The local currency is the functional currency for all of MSC’s operations outside the United States. Assets and liabilities of these operations are translated to U.S. dollars at the exchange rate in effect at the end of each period. Income statement accounts are translated at the average exchange rate prevailing during the period. Translation adjustments arising from the use of differing exchange rates from period to period are included as a component of other comprehensive income within shareholders’ equity. Gains and losses from foreign currency transactions are included in net income for the period. |
Income Taxes | Income Taxes The Company has established deferred income tax assets and liabilities for temporary differences between the financial reporting bases and the income tax bases of its assets and liabilities at enacted tax rates expected to be in effect when such assets or liabilities are realized or settled pursuant to the provisions of ASC Topic 740, “Income Taxes”, which prescribes a comprehensive model for the financial statement recognition, measurement, classification, and disclosure of uncertain tax positions. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. In fiscal 2017, the Company adopted ASU 2015-17, Balance Sheet Classification of Deferred Taxes, and reclassified all current deferred taxes and the related valuation allowances to noncurrent positions on the Consolidated Balance Sheets. The amounts of unrecognized tax benefits, exclusive of interest and penalties that would affect the effective tax rate, were $9,407 and $5,689 as of September 1, 2018 and September 2, 2017 , respectively. |
Comprehensive Income | Comprehensive Income Comprehensive income consists of consolidated net income and foreign currency translation adjustments. Foreign currency translation adjustments included in comprehensive income were not tax-effected as investments in international affiliates are deemed to be permanent. |
Geographic Regions | Geographic Regions The Company’s sales and assets are predominantly generated from United States locations. For fiscal 2018 , U.K. and Canadian operations represented approximately 3% of the Company’s consolidated net sales. |
Segment Reporting | Segment Reporting The Company utilizes the management approach for segment disclosure, which designates the internal organization that is used by management for making operating decisions and assessing performance as the source of our reportable segments. The Company operates in one operating and reportable segment as a distributor of metalworking and MRO products and services. The Company’s chief operating decision maker, its Chief Executive Officer, manages the Company’s operations on a consolidated basis for purposes of allocating resources. Substantially all of the Company’s revenues and long-lived assets are in the United States. The Company does not disclose revenue information by product category as it is impracticable to do so as a result of its numerous product offerings and the manner in which its business is managed. |
Business Combinations | Business Combinations The Company accounts for business combinations in accordance with ASC Topic 805, “Business Combinations ” (“ASC 805”). ASC 805 established principles and requirements for recognizing the total consideration transferred to and the assets acquired, liabilities assumed and any non-controlling interest in the acquired target in a business combination. ASC 805 also provides guidance for recognizing and measuring goodwill acquired in a business combination and requires the acquirer to disclose information that users may need to evaluate and understand the financial impact of the business combination. See Note 4 “Business Combinations” for further discussion. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements Simplifying the Measurement of Inventory In July 2015, the FASB issued its final standard on simplifying the measurement of inventory. This standard, issued as ASU 2015-11, requires an entity to measure inventory at the lower of cost and net realizable value, which consists of the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The Company adopted ASU 2015-11 during the first quarter of fiscal 2018 and the adoption did not have any impact on its consolidated financial statements. Share-based Payments In March 2016, the FASB issued ASU 2016-09, which includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. The Company early adopted ASU 2016-09 in the second quarter of fiscal 2017, which required us to reflect any adjustments as of September 4, 2016, the beginning of the annual period that includes the interim period of adoption. Prior fiscal year periods were not retrospectively adjusted. |
Accounting Pronouncements Not Yet Adopted | Accounting Pronouncements Not Yet Adopted Revenue from Contracts with Customers In May 2014, the FASB issued its final standard on the recognition of revenue from contracts with customers. This standard, issued as ASU 2014-09, outlines a single comprehensive model for entities to use in the accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The new standard is effective for the Company for its fiscal year 2019, including interim periods. The standard permits the use of either the retrospective or cumulative effect transition method. The Company completed the process of evaluating the effect of the adoption and determined there were no changes required to its reported revenues as a result of the adoption. The majority of its revenue arrangements generally consist of a single performance obligation to transfer promised goods or services. Based on its evaluation process and review of its contracts with customers, the timing and amount of revenue recognized based on the new standard is consistent with its revenue recognition policy under previous guidance. The Company adopted the new standard effective September 2, 2018, using the modified retrospective approach, and will expand its consolidated financial statement disclosures in order to comply with this standard. The Company has determined the adoption of this new standard will not have a material impact on its consolidated financial statements. Leases In February 2016, the FASB issued its final standard on accounting for leases. This standard, issued as ASU 2016-02, requires that an entity that is a lessee recognize lease assets and lease liabilities on the balance sheet and disclose key information about leasing arrangements. This standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years , with earlier application permitted. The new standard is effective for the Company for its fiscal year 2020. The Company is currently evaluating this standard to determine the impact of adoption on its consolidated financial statements. Measurement of Credit Losses In June 2016, the FASB issued its final standard on measurement of credit losses on financial instruments. This standard, issued as ASU 2016-13, requires that an entity measure impairment of certain financial instruments, including trade receivables, based on expected losses rather than incurred losses. This update is effective for annual and interim financial statement periods beginning after December 15, 2019, with early adoption permitted for financial statement periods beginning after December 15, 2018. The new standard is effective for the Company for its fiscal year 2020. The Company is currently evaluating this standard but does not expect it to have a material impact on its consolidated financial statements. Goodwill Impairment In January 2017, the FASB issued its final standard on simplifying the test for goodwill impairment. This standard, issued as ASU 2017-04, eliminates the second step from the goodwill impairment test and instead requires an entity to perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge would be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value, not to exceed the total amount of goodwill allocated to that reporting unit. This update is effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted. The new standard is effective for the Company for its fiscal year 2020. Upon adoption, the Company will apply this guidance prospectively to its annual and interim goodwill impairment tests and disclose the change in accounting principle. Business Combinations In January 2017, the FASB issued its final standard on clarifying the definition of a business in business combinations. This standard, issued as ASU 2017-01, clarifies the definition of a business to assist entities with evaluating when a set of transferred assets and activities is considered a business. The amendment is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The new standard is effective for the Company for its fiscal year 2019. The amendments are to be applied prospectively to business combinations that occur after the effective date. Other pronouncements issued by the FASB or other authoritative accounting standards groups with future effective dates are either not applicable or are not expected to be significant to the Company’s consolidated financial statements. |
Reclassifications | Reclassifications Certain of the prior years’ Cash Flows from Financing Activities line items (Borrowings under financing obligations, Payments on capital lease and financing obligations, and Credit facility financing costs) were reclassified into “Other, Net” within our consolidated statements of cash flows to conform to our current year presentation. These reclassifications did not affect the total amount of Cash Flows from Financing Activities. |
Business And Summary Of Signi_3
Business And Summary Of Significant Accounting Policies (Tables) | 12 Months Ended |
Sep. 01, 2018 | |
Business And Summary Of Significant Accounting Policies [Abstract] | |
Change In The Carrying Amount Of Goodwill | Balance as of September 3, 2016 $ 624,081 Acquisition (1) 8,318 Foreign currency translation adjustments 1,329 Balance as of September 2, 2017 $ 633,728 Acquisition (2) 41,939 Post-closing working capital adjustment from acquisition of DECO Tool Supply Co. 738 Foreign currency translation adjustments (1,407) Balance as of September 1, 2018 $ 674,998 (1) Acquired DECO Tool Supply Co. (“DECO”) in July 2017. (2) Acquired All Integrated Solutions (“AIS”) in April 2018, including post-closing working capital adjustment of $1,155 . See Note 4 “Business Combinations” for further discussion on these acquisitions. |
Components Of Other Intangible Assets | For the Fiscal Years Ended September 1, 2018 September 2, 2017 Weighted Average Useful Life (in years) Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Customer Relationships 5 - 18 $ 208,260 $ (101,916) $ 187,260 $ (92,381) Contract Rights 10 23,100 (23,100) 23,100 (23,100) Trademarks 1 - 5 6,630 (4,384) 4,403 (3,058) Trademarks Indefinite 14,134 — 14,205 — Total $ 252,124 $ (129,400) $ 228,968 $ (118,539) |
Schedule Of Estimated Amortization Expense | Fiscal Year 2019 $11,190 2020 10,216 2021 9,534 2022 9,520 2023 9,375 |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 12 Months Ended |
Sep. 01, 2018 | |
Net Income Per Share [Abstract] | |
Basic And Diluted Net Income Per Common Share Under The Two-Class Method | For the Fiscal Years Ended September 1, September 2, September 3, 2018 2017 2016 (52 weeks) (52 weeks) (53 weeks) Net income as reported $ 329,223 $ 231,431 $ 231,216 Less: Distributed net income available to participating securities (89) (206) (308) Less: Undistributed net income available to participating securities (291) (410) (601) Numerator for basic net income per share: Undistributed and distributed net income available to common shareholders $ 328,843 $ 230,815 $ 230,307 Add: Undistributed net income allocated to participating securities 291 410 601 Less: Undistributed net income reallocated to participating securities (290) (408) (600) Numerator for diluted net income per share: Undistributed and distributed net income available to common shareholders $ 328,844 $ 230,817 $ 230,308 Denominator: Weighted average shares outstanding for basic net income per share 56,355 56,591 60,908 Effect of dilutive securities 352 380 168 Weighted average shares outstanding for diluted net income per share 56,707 56,971 61,076 Net income per share two-class method: Basic $ 5.84 $ 4.08 $ 3.78 Diluted $ 5.80 $ 4.05 $ 3.77 Potentially dilutive securities 207 — 843 |
Business Combination (Tables)
Business Combination (Tables) | 12 Months Ended |
Sep. 01, 2018 | |
Business Combination [Abstract] | |
Summary Of Purchase Price Allocation | Cash $ 1,586 Inventories 20,629 Accounts receivable 9,834 Prepaid expenses and other current assets 1,303 Identifiable intangibles 23,200 Goodwill 41,939 Property, plant and equipment 1,561 Other assets 121 Total assets acquired $ 100,173 Accounts payable 3,119 Accrued liabilities 4,971 Deferred income taxes and tax uncertainties 4,235 Total liabilities assumed $ 12,325 Net assets acquired $ 87,848 |
Property, Plant And Equipment (
Property, Plant And Equipment (Tables) | 12 Months Ended |
Sep. 01, 2018 | |
Property, Plant And Equipment [Abstract] | |
Summary Of Property, Plant And Equipment | September 1, September 2, Number of Years 2018 2017 Land — $ 28,154 $ 28,169 Building and improvements 3 - 40 186,208 182,032 Leasehold improvements The lesser of lease term or 7 3,114 2,595 Furniture, fixtures and equipment 3 - 20 185,556 178,251 Computer systems, equipment and software 3 - 5 364,050 336,685 767,082 727,732 Less: accumulated depreciation and amortization 455,397 411,427 Total $ 311,685 $ 316,305 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Sep. 01, 2018 | |
Income Taxes [Abstract] | |
Provision For Income Taxes | For the Fiscal Years Ended September 1, September 2, September 3, 2018 2017 2016 Current: Federal $ 85,205 $ 108,347 $ 109,699 State and local 16,108 16,059 15,621 101,313 124,406 125,320 Deferred: Federal (27,372) 10,938 13,993 State and local 3,025 1,217 1,202 (24,347) 12,155 15,195 Total $ 76,966 $ 136,561 $ 140,515 |
Components Of Deferred Tax Assets And Liabilities | September 1, September 2, 2018 2017 Deferred tax liabilities: Depreciation $ (36,361) $ (56,382) Deferred catalog costs (561) (1,079) Goodwill (77,023) (103,218) (113,945) (160,679) Deferred tax assets: Accounts receivable 2,812 4,441 Inventory 6,163 9,794 Deferred compensation 650 1,280 Stock-based compensation 5,329 9,140 Intangible amortization 988 9,517 Foreign Tax Credit 2,712 2,712 Less: Valuation Allowance (1,762) — Other accrued expenses/reserves 7,192 14,733 24,084 51,617 Net Deferred Tax Liabilities $ (89,861) $ (109,062) |
Reconciliation Of Statutory Federal Income Tax Rate To Effective Tax Rate | For the Fiscal Years Ended September 1, September 2, September 3, 2018 2017 2016 U.S. federal statutory rate 25.6 % 35.0 % 35.0 % State income taxes, net of federal benefit 3.4 3.0 3.0 Revaluation of net deferred tax liabilities (10.0) — — Other, net (0.1) (0.9) (0.2) Effective income tax rate 18.9 % 37.1 % 37.8 % |
Changes In Gross Unrecognized Tax Benefits | September 1, September 2, 2018 2017 Beginning balance $ 12,641 $ 10,610 Additions for tax positions relating to current year 2,811 3,261 Additions for tax positions relating to prior years 1,940 1,015 Reductions for tax positions relating to prior years (2,821) — Lapse of statute of limitations (2,628) (2,245) Ending balance $ 11,943 $ 12,641 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Sep. 01, 2018 | |
Accrued Liabilities [Abstract] | |
Schedule Of Accrued Liabilities | September 1, September 2, 2018 2017 Accrued payroll and fringe $ 33,012 $ 32,151 Accrued bonus 25,620 19,657 Accrued sales, property and income taxes 13,380 12,622 Accrued sales rebates and returns 18,832 14,458 Accrued other 30,449 25,585 Total accrued liabilities $ 121,293 $ 104,473 |
Debt And Capital Lease Obliga_2
Debt And Capital Lease Obligations (Tables) | 12 Months Ended |
Sep. 01, 2018 | |
Debt And Capital Lease Obligations [Abstract] | |
Schedule Of Debt | September 1, September 2, 2018 2017 Revolving Credit Facility $ 224,000 $ 332,000 Private Placement Debt: Senior notes, series A 75,000 75,000 Senior notes, series B 100,000 100,000 Senior notes 20,000 — Shelf Facility Agreements 90,000 — Capital lease and financing obligations 27,926 27,829 Less: unamortized debt issuance costs (1,593) (1,852) Total debt $ 535,333 $ 532,977 Less: short-term debt (1) (224,097) (331,986) Long-term debt $ 311,236 $ 200,991 __________________________ (1) Net of unamortized debt issuance costs expected to be amortized in the next 12 months. |
Schedule Of Maturities Of The New Credit Facility | Maturities of Fiscal Year Debt 2019 $ 224,000 2020 20,000 2021 20,000 2022 — 2023 125,000 Thereafter 120,000 Total $ 509,000 |
Schedule Of Future Minimum Payments Under Capital Leases And Financing Arrangements | Fiscal Year Payments under capital leases and financing arrangements 2019 $ 1,133 2020 27,448 2021 120 2022 90 Total minimum lease payments $ 28,791 Less: amount representing interest 865 Present value of minimum lease payments $ 27,926 Less: current portion 484 Long-term capital leases and financing arrangements $ 27,442 |
Associate Benefit Plans (Tables
Associate Benefit Plans (Tables) | 12 Months Ended |
Sep. 01, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule Of Stock-Based Compensation Expense | For the Fiscal Years Ended September 1, September 2, September 3, 2018 2017 2016 Stock options $ 4,534 $ 4,369 $ 4,382 Restricted share awards 2,856 4,399 6,112 Restricted stock units 7,281 4,872 3,205 Associate Stock Purchase Plan 263 285 286 Total 14,934 13,925 13,985 Deferred income tax benefit (4,376) (5,292) (5,206) Stock-based compensation expense, net $ 10,558 $ 8,633 $ 8,779 |
Summary Of Stock Option Activity | 2018 Shares Weighted-Average Exercise Price Outstanding - beginning of year 1,743 $ 70.88 Granted 436 79.60 Exercised (342) 70.96 Canceled/Forfeited (77) 72.45 Outstanding - end of year 1,760 $ 72.96 Exercisable - end of year 666 $ 73.96 |
Schedule Of Option Grant Fair Value Assumptions | 2018 2017 2016 Expected life (in years) 4.0 4.1 3.9 Risk-free interest rate 1.87 % 1.16 % 1.09 % Expected volatility 22.1 % 20.5 % 21.8 % Expected dividend yield 2.30 % 2.40 % 2.40 % Weighted-Average Grant-Date Fair Value $ 12.25 $ 9.29 $ 8.03 |
Summary Of Stock Options By Range Of Exercise Price | Range of Exercise Prices Number of Options Outstanding at September 1, 2018 Weighted-Average Remaining Contractual Life Weighted-Average Exercise Price Intrinsic Value Number of Options Exercisable at September 1, 2018 Weighted-Average Remaining Contractual Life Weighted-Average Exercise Price Intrinsic Value $ 58.90 – $ 69.46 464 3.9 $ 59.90 $ 11,869 213 3.5 $ 61.08 $ 5,188 69.47 – 72.23 460 5.2 71.33 6,501 99 5.2 71.33 1,398 72.24 – 81.76 578 5.0 80.25 3,032 171 2.2 81.75 637 81.77 – 83.03 258 3.1 83.02 635 183 3.1 83.03 450 1,760 4.5 $ 72.96 $ 22,037 666 3.3 $ 73.96 $ 7,673 |
Restricted Share Awards [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary Of Non-Vested Restricted Share Award Activity | 2018 Shares Weighted-Average Grant-Date Fair Value Non-vested restricted share awards at the beginning of the year 160 $ 80.49 Granted — — Vested (91) 79.23 Canceled/Forfeited (6) 82.43 Non-vested restricted share awards at the end of the year 63 $ 81.98 |
Restricted Stock Units [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary Of Non-Vested Restricted Stock Unit Award Activity | 2018 Shares Weighted-Average Grant-Date Fair Value Non-vested restricted stock unit awards at the beginning of the year 313 $ 66.66 Granted 175 81.57 Vested (81) 66.75 Canceled/Forfeited (30) 71.60 Non-vested restricted stock unit awards at the end of the year 377 $ 73.18 |
Commitments And Contingencies (
Commitments And Contingencies (Tables) | 12 Months Ended |
Sep. 01, 2018 | |
Commitments And Contingencies [Abstract] | |
Minimum Annual Rentals On Leases | Fiscal Year Total Rental Payments 2019 $ 14,687 2020 9,337 2021 6,815 2022 4,256 2023 2,824 Thereafter 5,602 Total $ 43,521 |
Summary Of Quarterly Results (T
Summary Of Quarterly Results (Tables) | 12 Months Ended |
Sep. 01, 2018 | |
Summary Of Quarterly Results [Abstract] | |
Summary Of Quarterly Financial Data | Fiscal Year Ended September 1, 2018 Fiscal Year Ended September 2, 2017 First Quarter Second Quarter (1) Third Quarter Fourth Quarter First Quarter Second Quarter Third Quarter Fourth Quarter (Unaudited) Consolidated Income Statement Data: Net sales $ 768,561 $ 768,987 $ 828,345 $ 837,985 $ 686,271 $ 703,780 $ 743,923 $ 753,770 Gross profit 335,069 337,223 361,001 359,668 308,735 314,562 329,500 333,450 Income from operations 99,278 98,103 115,382 107,790 90,600 86,645 101,776 99,979 Net income 59,585 117,552 79,069 73,017 54,288 53,559 62,836 60,748 Net income per share: Basic 1.06 2.08 1.40 1.30 0.96 0.94 1.10 1.07 Diluted 1.05 2.06 1.39 1.29 0.96 0.93 1.09 1.07 (1) In the second quarter of fiscal 2018, the Company recorded a net tax benefit of $41,199 due to the revaluation of its net deferred tax liabilities primarily related to the lower federal corporate tax rate, partially offset by the lower federal benefit for state taxes and the change from a worldwide tax system to a territorial tax system, and a net tax benefit of $16,929 attributable to the lower effective tax rate required to bring our first half into alignment with the expected full year rate. |
Business And Summary Of Signi_4
Business And Summary Of Significant Accounting Policies (Narrative) (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Jul. 31, 2018$ / shares | Sep. 01, 2018USD ($)store$ / sharesshares | Sep. 01, 2018USD ($)storewarehouse | Sep. 02, 2017USD ($) | Sep. 03, 2016USD ($)$ / sharesshares | |
Summary Of Significant Accounting Policies [Line Items] | |||||
Number of branch offices | store | 100 | 100 | |||
Number of customer fulfillment centers | warehouse | 12 | ||||
Cash equivalents | $ 0 | $ 0 | $ 0 | ||
Amortization expense | 10,513 | 8,223 | $ 14,478 | ||
Impairment loss | 0 | 0 | 0 | ||
Deferred principal catalog costs | 3,973 | $ 3,973 | 4,778 | ||
Period deferred principal catalog costs remain the most current source of sales | 1 year | ||||
Advertising costs | $ 15,530 | 16,289 | 19,242 | ||
Shipping and handling costs | 130,340 | 119,979 | 118,174 | ||
Expenditures for property, plant and equipment | 44,919 | 46,548 | 87,930 | ||
Cost of repurchase, per share | $ / shares | $ 82.64 | ||||
Purchases of treasury stock | 82,369 | 49,182 | $ 383,798 | ||
Unrecognized tax benefit that would affect effective tax rate | $ 9,407 | $ 9,407 | 5,689 | ||
Class A Common Stock [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Repurchases of common stock, Shares | shares | 45 | ||||
Cost of repurchase, per share | $ / shares | $ 82.64 | ||||
Class A Common Stock [Member] | Purchases From Class B Holders [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Shares repurchased and retired | shares | 1,152 | ||||
Cost of repurchase, per share | $ / shares | $ 72.50 | ||||
Purchases of treasury stock | $ 83,524 | ||||
Minimum [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Original manufacturers warranty period | 30 days | ||||
Maximum [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Warranty period | 1 year | ||||
Original manufacturers warranty period | 90 days | ||||
Sales Revenue, Net [Member] | Geographic Concentration Risk [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Concentration risk, percentage | 3.00% | ||||
Sid Tool Co., Inc. [Member] | Mitchmar Atlanta Properties, Inc. [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Expenditures for property, plant and equipment | $ 33,650 | ||||
Leasehold Improvements And Buildings [Member] | Minimum [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Property, plant and equipment estimated useful life | 3 years | ||||
Leasehold Improvements And Buildings [Member] | Maximum [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Property, plant and equipment estimated useful life | 40 years | ||||
Furniture, Fixtures And Equipment [Member] | Minimum [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Property, plant and equipment estimated useful life | 3 years | ||||
Furniture, Fixtures And Equipment [Member] | Maximum [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Property, plant and equipment estimated useful life | 20 years | ||||
Trademark [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Intangible assets acquired during period | 12,980 | ||||
Impairment of intangible assets | $ 129 | $ 17 | |||
Customer Relationships And Trademarks [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Intangible assets acquired during period | $ 23,285 |
Business And Summary Of Signi_5
Business And Summary Of Significant Accounting Policies (Change In The Carrying Amount Of Goodwill) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Sep. 01, 2018 | Sep. 02, 2017 | |||
Business Acquisition [Line Items] | ||||
Goodwill, Beginning Balance | $ 633,728 | $ 624,081 | ||
Acquisition | 41,939 | [1] | 8,318 | [2] |
Foreign currency translation adjustment | (1,407) | 1,329 | ||
Goodwill, Ending Balance | 674,998 | $ 633,728 | ||
DECO Tool Supply Co. [Member] | ||||
Business Acquisition [Line Items] | ||||
Post-closing working capital adjustment from acquisition | 738 | |||
Goodwill, Ending Balance | 41,939 | |||
All Integrated Solutions ("AIS") [Member] | ||||
Business Acquisition [Line Items] | ||||
Post-closing working capital adjustment from acquisition | 1,210 | |||
Goodwill, Ending Balance | $ 41,939 | |||
[1] | Acquired All Integrated Solutions ("AIS") in April 2018, including post-closing working capital adjustment of $1,155. See Note 4 "Business Combinations" for further discussion on these acquisitions. | |||
[2] | Acquired DECO Tool Supply Co. ("DECO") in July 2017. |
Business And Summary Of Signi_6
Business And Summary Of Significant Accounting Policies (Components Of Other Intangible Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 01, 2018 | Sep. 02, 2017 | |
Intangible Assets By Major Class [Line Items] | ||
Gross Carrying Amount, Total | $ 252,124 | $ 228,968 |
Accumulated Amortization | (129,400) | (118,539) |
Customer Relationships [Member] | ||
Intangible Assets By Major Class [Line Items] | ||
Gross Carrying Amount | 208,260 | 187,260 |
Accumulated Amortization | $ (101,916) | (92,381) |
Customer Relationships [Member] | Minimum [Member] | ||
Intangible Assets By Major Class [Line Items] | ||
Weighted Average Useful Life (in years) | 5 years | |
Customer Relationships [Member] | Maximum [Member] | ||
Intangible Assets By Major Class [Line Items] | ||
Weighted Average Useful Life (in years) | 18 years | |
Contract Rights [Member] | ||
Intangible Assets By Major Class [Line Items] | ||
Weighted Average Useful Life (in years) | 10 years | |
Gross Carrying Amount | $ 23,100 | 23,100 |
Accumulated Amortization | (23,100) | (23,100) |
Trademark [Member] | ||
Intangible Assets By Major Class [Line Items] | ||
Gross Carrying Amount | 6,630 | 4,403 |
Accumulated Amortization | $ (4,384) | (3,058) |
Trademark [Member] | Minimum [Member] | ||
Intangible Assets By Major Class [Line Items] | ||
Weighted Average Useful Life (in years) | 1 year | |
Trademark [Member] | Maximum [Member] | ||
Intangible Assets By Major Class [Line Items] | ||
Weighted Average Useful Life (in years) | 5 years | |
Trademarks [Member] | ||
Intangible Assets By Major Class [Line Items] | ||
Gross Carrying Amount, Indefinite | $ 14,134 | $ 14,205 |
Business And Summary Of Signi_7
Business And Summary Of Significant Accounting Policies (Schedule Of Estimated Amortization Expense) (Details) $ in Thousands | Sep. 01, 2018USD ($) |
Business And Summary Of Significant Accounting Policies [Abstract] | |
2,019 | $ 11,190 |
2,020 | 10,216 |
2,021 | 9,534 |
2,022 | 9,520 |
2,023 | $ 9,375 |
Fair Value (Details)
Fair Value (Details) - USD ($) | 12 Months Ended | |
Sep. 01, 2018 | Sep. 02, 2017 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents, fair value | $ 0 | $ 0 |
Gains and losses on securities | 0 | |
Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of non-financial assets on non-recurring basis | 0 | 0 |
Fair value of non-financial liabilities on non-recurring basis | 0 | 0 |
Corporate Bond Securities [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Taxable bonds | $ 27,025,000 | $ 27,025,000 |
Interest rate on bonds | 2.40% |
Net Income Per Share (Details)
Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Sep. 01, 2018 | Jun. 02, 2018 | Mar. 03, 2018 | [1] | Dec. 02, 2017 | Sep. 02, 2017 | Jun. 03, 2017 | Mar. 04, 2017 | Dec. 03, 2016 | Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | |
Net Income Per Share [Abstract] | ||||||||||||
Net income as reported | $ 73,017 | $ 79,069 | $ 117,552 | $ 59,585 | $ 60,748 | $ 62,836 | $ 53,559 | $ 54,288 | $ 329,223 | $ 231,431 | $ 231,216 | |
Less: Distributed net income available to participating securities | (89) | (206) | (308) | |||||||||
Less: Undistributed net income available to participating securities | (291) | (410) | (601) | |||||||||
Undistributed and distributed net income available to common shareholders | 328,843 | 230,815 | 230,307 | |||||||||
Add: Undistributed net income allocated to participating securities | 291 | 410 | 601 | |||||||||
Less: Undistributed net income reallocated to participating securities | (290) | (408) | (600) | |||||||||
Undistributed and distributed net income available to common shareholders | $ 328,844 | $ 230,817 | $ 230,308 | |||||||||
Weighted average shares outstanding for basic net income per share | 56,355 | 56,591 | 60,908 | |||||||||
Effect of dilutive securities | 352 | 380 | 168 | |||||||||
Weighted average shares outstanding for diluted net income per share | 56,707 | 56,971 | 61,076 | |||||||||
Basic | $ 1.30 | $ 1.40 | $ 2.08 | $ 1.06 | $ 1.07 | $ 1.10 | $ 0.94 | $ 0.96 | $ 5.84 | $ 4.08 | $ 3.78 | |
Diluted | $ 1.29 | $ 1.39 | $ 2.06 | $ 1.05 | $ 1.07 | $ 1.09 | $ 0.93 | $ 0.96 | $ 5.80 | $ 4.05 | $ 3.77 | |
Potentially dilutive securities | 207 | 843 | ||||||||||
[1] | In the second quarter of fiscal 2018, the Company recorded a net tax benefit of $41,199 due to the revaluation of its net deferred tax liabilities primarily related to the lower federal corporate tax rate, partially offset by the lower federal benefit for state taxes and the change from a worldwide tax system to a territorial tax system, and a net tax benefit of $16,929 attributable to the lower effective tax rate required to bring our first half into alignment with the expected full year rate. |
Business Combination (Narrative
Business Combination (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | |
Business Acquisition [Line Items] | |||
Goodwill | $ 674,998 | $ 633,728 | $ 624,081 |
DECO Tool Supply Co. [Member] | |||
Business Acquisition [Line Items] | |||
Acquisition date | Jul. 31, 2017 | ||
Purchase price | $ 43,083 | ||
Acquired intangible assets | 23,200 | ||
Goodwill | 41,939 | ||
Goodwill adjustments | $ 738 | ||
All Integrated Solutions ("AIS") [Member] | |||
Business Acquisition [Line Items] | |||
Interest acquired | 100.00% | ||
Acquisition date | Apr. 30, 2018 | ||
Payments to acquire business | $ 87,848 | ||
Non-recurring transaction and integration costs | 866 | ||
Acquired intangible assets | 23,200 | ||
Customer relationships | 21,000 | ||
Finite lived trademark | 2,200 | ||
Goodwill | 41,939 | ||
Tax deductible goodwill | 4,900 | ||
Revenue of acquiree | 24,659 | ||
Loss of acquiree | 4,443 | ||
Post-closing working capital adjustment paid out | 1,155 | ||
Adjustment to tax liability | 1,210 | ||
Goodwill adjustments | $ 1,210 | ||
All Integrated Solutions ("AIS") [Member] | Customer Relationships [Member] | |||
Business Acquisition [Line Items] | |||
Acquired intangible assets useful life | 10 years | ||
All Integrated Solutions ("AIS") [Member] | Trademark [Member] | |||
Business Acquisition [Line Items] | |||
Acquired intangible assets useful life | 5 years |
Business Combination (Summary O
Business Combination (Summary Of Purchase Price Allocation) (Details) - USD ($) $ in Thousands | Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 |
Business Acquisition [Line Items] | |||
Goodwill | $ 674,998 | $ 633,728 | $ 624,081 |
DECO Tool Supply Co. [Member] | |||
Business Acquisition [Line Items] | |||
Cash | 1,586 | ||
Inventories | 20,629 | ||
Accounts receivable | 9,834 | ||
Prepaid expenses and other current assets | 1,303 | ||
Identifiable intangibles | 23,200 | ||
Goodwill | 41,939 | ||
Property, plant and equipment | 1,561 | ||
Other assets | 121 | ||
Total assets acquired | 100,173 | ||
Accounts payable | 3,119 | ||
Accrued liabilities | 4,971 | ||
Deferred income taxes and tax uncertainties | 4,235 | ||
Total Liabilities Assumed | 12,325 | ||
Net Assets Acquired | 87,848 | ||
All Integrated Solutions ("AIS") [Member] | |||
Business Acquisition [Line Items] | |||
Identifiable intangibles | 23,200 | ||
Goodwill | $ 41,939 |
Property, Plant And Equipment_2
Property, Plant And Equipment (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | |
Property, Plant And Equipment [Abstract] | |||
Capitalized interest, net of accumulated amortization | $ 716 | $ 754 | |
Depreciation expense | $ 52,113 | $ 54,356 | $ 57,052 |
Property, Plant And Equipment_3
Property, Plant And Equipment (Summary Of Property, Plant And Equipment) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 01, 2018 | Sep. 02, 2017 | |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 767,082 | $ 727,732 |
Less: accumulated depreciation and amortization | 455,397 | 411,427 |
Total | 311,685 | 316,305 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 28,154 | 28,169 |
Building And Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 186,208 | 182,032 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 3,114 | 2,595 |
Furniture, Fixtures And Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 185,556 | 178,251 |
Computer Systems, Equipment And Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 364,050 | $ 336,685 |
Minimum [Member] | Building And Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment estimated useful life | 3 years | |
Minimum [Member] | Furniture, Fixtures And Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment estimated useful life | 3 years | |
Minimum [Member] | Computer Systems, Equipment And Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment estimated useful life | 3 years | |
Maximum [Member] | Building And Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment estimated useful life | 40 years | |
Maximum [Member] | Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment estimated useful life | 7 years | |
Maximum [Member] | Furniture, Fixtures And Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment estimated useful life | 20 years | |
Maximum [Member] | Computer Systems, Equipment And Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment estimated useful life | 5 years |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Mar. 03, 2018 | Aug. 31, 2019 | Dec. 31, 2018 | Sep. 01, 2018 | Dec. 31, 2017 | Sep. 02, 2017 | Sep. 03, 2016 | |
Unrecognized tax benefits related to tax positions | $ 1,217 | ||||||
Provision for income taxes, interest and penalties | 44 | $ 245 | $ 6 | ||||
Accrued interest and penalties on income taxes | 447 | $ 305 | |||||
Tax credit carryforward | 2,712 | ||||||
Tax credit carryforward, valuation allowance | $ 1,762 | ||||||
U.S. federal statutory rate | 25.60% | 35.00% | 35.00% | 35.00% | |||
Net tax benefit, revaluation of deferred tax liabilities | $ 41,199 | $ 40,464 | |||||
Scenario, Plan [Member] | |||||||
U.S. federal statutory rate | 21.00% | 21.00% |
Income Taxes (Provision For Inc
Income Taxes (Provision For Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | |
Income Taxes [Abstract] | |||
Current: Federal | $ 85,205 | $ 108,347 | $ 109,699 |
Current: State and local | 16,108 | 16,059 | 15,621 |
Current: Total | 101,313 | 124,406 | 125,320 |
Deferred: Federal | (27,372) | 10,938 | 13,993 |
Deferred: State and local | 3,025 | 1,217 | 1,202 |
Deferred: Total | (24,347) | 12,155 | 15,195 |
Total | $ 76,966 | $ 136,561 | $ 140,515 |
Income Taxes (Components Of Def
Income Taxes (Components Of Deferred Tax Assets And Liabilities) (Details) - USD ($) $ in Thousands | Sep. 01, 2018 | Sep. 02, 2017 |
Income Taxes [Abstract] | ||
Deferred tax liabilities: Depreciation | $ (36,361) | $ (56,382) |
Deferred tax liabilities: Deferred catalog costs | (561) | (1,079) |
Deferred tax liabilities: Goodwill | (77,023) | (103,218) |
Deferred tax liabilities | (113,945) | (160,679) |
Deferred tax assets: Accounts receivable | 2,812 | 4,441 |
Deferred tax assets: Inventory | 6,163 | 9,794 |
Deferred tax assets: Deferred compensation | 650 | 1,280 |
Deferred tax assets: Stock based compensation | 5,329 | 9,140 |
Deferred tax assets: Intangible amortization | 988 | 9,517 |
Foreign Tax Credit | 2,712 | 2,712 |
Less: Valuation Allowance | (1,762) | |
Deferred tax assets: Other accrued expenses/reserves | 7,192 | 14,733 |
Deferred tax assets | 24,084 | 51,617 |
Net Deferred Tax Liabilities | $ (89,861) | $ (109,062) |
Income Taxes (Reconciliation Of
Income Taxes (Reconciliation Of Statutory Federal Income Tax Rate To Effective Tax Rate) (Details) | 12 Months Ended | |||
Sep. 01, 2018 | Dec. 31, 2017 | Sep. 02, 2017 | Sep. 03, 2016 | |
Income Taxes [Abstract] | ||||
U.S. federal statutory rate | 25.60% | 35.00% | 35.00% | 35.00% |
State income taxes, net of federal benefit | 3.40% | 3.00% | 3.00% | |
Revaluation of net deferred tax liabilities | (10.00%) | |||
Other, net | (0.10%) | (0.90%) | (0.20%) | |
Effective income tax rate | 18.90% | 37.10% | 37.80% |
Income Taxes (Changes In Gross
Income Taxes (Changes In Gross Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 01, 2018 | Sep. 02, 2017 | |
Income Taxes [Abstract] | ||
Beginning balance | $ 12,641 | $ 10,610 |
Additions for tax positions relating to current year | 2,811 | 3,261 |
Additions for tax positions relating to prior years | 1,940 | 1,015 |
Reductions for tax positions relating to prior years | (2,821) | |
Lapse of statute of limitations | (2,628) | (2,245) |
Ending balance | $ 11,943 | $ 12,641 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Sep. 01, 2018 | Sep. 02, 2017 |
Accrued Liabilities [Abstract] | ||
Accrued payroll and fringe | $ 33,012 | $ 32,151 |
Accrued bonus | 25,620 | 19,657 |
Accrued sales, property and income taxes | 13,380 | 12,622 |
Accrued sales rebates and returns | 18,832 | 14,458 |
Accrued other | 30,449 | 25,585 |
Total accrued liabilities | $ 121,293 | $ 104,473 |
Debt And Capital Lease Obliga_3
Debt And Capital Lease Obligations (Credit Facility) (Narrative) (Details) $ in Thousands | 12 Months Ended | ||
Sep. 01, 2018USD ($) | Sep. 02, 2017USD ($) | Sep. 03, 2016USD ($) | |
Debt Instrument [Line Items] | |||
Maximum consolidated leverage ratio of total indebtedness to EBITDA | 3 | ||
Minimum consolidated interest coverage ratio of EBITDA to total interest expense | 3 | ||
Borrowings under Credit Facility | $ 242,000 | $ 546,000 | $ 305,000 |
Repayments of debt | 350,000 | $ 618,500 | $ 301,000 |
New Credit Facility [Member] | |||
Debt Instrument [Line Items] | |||
Credit facility, maximum borrowing capacity | $ 600,000 | ||
Maturity date | Apr. 14, 2022 | ||
Credit facility, expiration term | 5 years | ||
Available increase in amount borrowed | $ 300,000 | ||
Borrowing rate under Credit Facility | 3.20% | ||
Letter of Credit [Member] | |||
Debt Instrument [Line Items] | |||
Credit facility, maximum borrowing capacity | $ 50,000 | ||
LIBOR [Member] | New Credit Facility [Member] | |||
Debt Instrument [Line Items] | |||
Percentage points in addition to reference rate used in computation of variable rate on debt instrument | 1.125% |
Debt And Capital Lease Obliga_4
Debt And Capital Lease Obligations (Private Placement Debt) (Narrative) (Details) - Private Placement Debt [Member] - USD ($) | 12 Months Ended | |
Sep. 01, 2018 | Sep. 02, 2017 | |
Senior Notes Series A [Member] | ||
Debt Instrument [Line Items] | ||
Principal amount | $ 75,000,000 | $ 75,000,000 |
Interest rate | 2.65% | |
Maturity date | Jul. 28, 2023 | |
Senior Notes Series B [Member] | ||
Debt Instrument [Line Items] | ||
Principal amount | $ 100,000,000 | $ 100,000,000 |
Interest rate | 2.90% | |
Maturity date | Jul. 28, 2026 | |
Senior Notes Due June 11, 2025 [Member] | ||
Debt Instrument [Line Items] | ||
Principal amount | $ 20,000,000 | |
Interest rate | 3.79% | |
Maturity date | Jun. 11, 2025 |
Debt And Capital Lease Obliga_5
Debt And Capital Lease Obligations (Shelf Facility Agreements) (Narrative) (Details) | 12 Months Ended |
Sep. 01, 2018USD ($) | |
Line of Credit Facility [Line Items] | |
Maximum consolidated leverage ratio of total indebtedness to EBITDA | 3 |
Maximum consolidated leverage ratio of total indebtedness to EBITDA after material acquisition | 3.50 |
Minimum consolidated interest coverage ratio of EBITDA to total interest expense | 3 |
Met Life Note Purchase Agreement [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, maximum borrowing capacity | $ 250,000,000 |
Remaining borrowing capacity | 210,000,000 |
Met Life Note Purchase Agreement [Member] | Series 2018A Notes [Member] | |
Line of Credit Facility [Line Items] | |
Principal amount | $ 20,000,000 |
Interest rate | 3.22% |
Met Life Note Purchase Agreement [Member] | Series 2018B Notes [Member] | |
Line of Credit Facility [Line Items] | |
Principal amount | $ 20,000,000 |
Interest rate | 3.42% |
Prudential Note Purchase Agreement [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, maximum borrowing capacity | $ 250,000,000 |
Principal amount | $ 50,000,000 |
Interest rate | 3.04% |
Remaining borrowing capacity | $ 200,000,000 |
Debt And Capital Lease Obliga_6
Debt And Capital Lease Obligations (Capital Lease And Financing Obligations) (Narrative) (Details) - USD ($) | 12 Months Ended | |
Sep. 01, 2018 | Sep. 02, 2017 | |
Capital Leased Assets [Line Items] | ||
Amount due under capital leases and financing agreements | $ 27,926,000 | $ 27,829,000 |
Property and equipment acquired under capital leases and financing agreements | 442,000 | |
Non-cash financing activity related to the capital lease | 1,163,000 | |
Amortization of capital leases | $ 0 | |
Fulfillment Center [Member] | ||
Capital Leased Assets [Line Items] | ||
Capital lease term | 20 years | |
Amount due under capital leases and financing agreements | $ 27,025,000 | $ 27,025,000 |
Minimum [Member] | Fulfillment Center [Member] | ||
Capital Leased Assets [Line Items] | ||
Capital lease, prepayment term with no penalty | 7 years | |
Maximum [Member] | Fulfillment Center [Member] | ||
Capital Leased Assets [Line Items] | ||
Capital lease, prepayment term with no penalty | 20 years |
Debt And Capital Lease Obliga_7
Debt And Capital Lease Obligations (Schedule Of Debt) (Details) - USD ($) | Sep. 01, 2018 | Sep. 02, 2017 | |
Debt Instrument [Line Items] | |||
Capital lease and financing obligations | $ 27,926,000 | $ 27,829,000 | |
Less: unamortized debt issuance costs | (1,593,000) | (1,852,000) | |
Total debt | 535,333,000 | 532,977,000 | |
Less: short-term debt | [1] | (224,097,000) | (331,986,000) |
Long-term debt | 311,236,000 | 200,991,000 | |
New Credit Facility [Member] | |||
Debt Instrument [Line Items] | |||
Credit Facility | 224,000,000 | 332,000,000 | |
Shelf Facility Agreement [Member] | |||
Debt Instrument [Line Items] | |||
Principal amount | 90,000,000 | ||
Senior Notes Series A [Member] | Private Placement Debt [Member] | |||
Debt Instrument [Line Items] | |||
Principal amount | 75,000,000 | 75,000,000 | |
Senior Notes Series B [Member] | Private Placement Debt [Member] | |||
Debt Instrument [Line Items] | |||
Principal amount | 100,000,000 | $ 100,000,000 | |
Senior Notes Due June 11, 2025 [Member] | Private Placement Debt [Member] | |||
Debt Instrument [Line Items] | |||
Principal amount | $ 20,000,000 | ||
[1] | Net of unamortized debt issuance costs expected to be amortized in the next 12 months. |
Debt And Capital Lease Obliga_8
Debt And Capital Lease Obligations (Schedule Of Maturities Of The New Credit Facility) (Details) - New Credit Facility [Member] $ in Thousands | Sep. 01, 2018USD ($) |
Line of Credit Facility [Line Items] | |
2,019 | $ 224,000 |
2,020 | 20,000 |
2,021 | 20,000 |
2,022 | |
2,023 | 125,000 |
Thereafter | 120,000 |
Total | $ 509,000 |
Debt And Capital Lease Obliga_9
Debt And Capital Lease Obligations (Schedule Of Future Minimum Payments Under Capital Leases And Financing Arrangements) (Details) $ in Thousands | Sep. 01, 2018USD ($) |
Debt And Capital Lease Obligations [Abstract] | |
2,019 | $ 1,133 |
2,020 | 27,448 |
2,021 | 120 |
2,022 | 90 |
Total minimum lease payments | 28,791 |
Less: amount representing interest | 865 |
Present value of minimum lease payments | 27,926 |
Less: current portion | 484 |
Long-term capital leases and financing arrangements | $ 27,442 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | Oct. 18, 2018 | Oct. 31, 2018 | Sep. 30, 2018 | Jul. 31, 2018 | Sep. 01, 2018 | Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 |
Components Of Shareholders Equity [Line Items] | ||||||||
Purchase of treasury stock | $ 25,432 | $ 48,869 | $ 384,111 | |||||
Cost of repurchase, per share | $ 82.64 | |||||||
Shares purchased by qualified associates | 45,000 | |||||||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | 5,000,000 | |||||
Preferred stock, shares issued | 0 | 0 | 0 | |||||
Preferred stock, shares outstanding | 0 | 0 | 0 | |||||
Subsequent Event [Member] | ||||||||
Components Of Shareholders Equity [Line Items] | ||||||||
Dividends declared date | Oct. 18, 2018 | |||||||
Dividends payable per share | $ 0.63 | |||||||
Dividend payable date | Nov. 27, 2018 | |||||||
Dividends record date | Nov. 13, 2018 | |||||||
Dividend payable amount | $ 35,400,000 | |||||||
Cost of repurchase, per share | $ 81.22 | $ 85 | ||||||
Subsequent Event [Member] | Purchases From Class B Holders [Member] | ||||||||
Components Of Shareholders Equity [Line Items] | ||||||||
Cost of repurchase, per share | $ 85 | $ 84.29 | ||||||
Class A Common Stock [Member] | ||||||||
Components Of Shareholders Equity [Line Items] | ||||||||
Common stock shares repurchased | 45,000 | |||||||
Cost of repurchase, per share | $ 82.64 | |||||||
Class A Common Stock [Member] | Purchases From Class B Holders [Member] | ||||||||
Components Of Shareholders Equity [Line Items] | ||||||||
Cost of repurchase, per share | $ 72.50 | |||||||
Class A Treasury Stock [Member] | ||||||||
Components Of Shareholders Equity [Line Items] | ||||||||
Common stock shares repurchased | 292,000 | 685,000 | 5,344,000 | |||||
Purchase of treasury stock | $ 25,432 | $ 48,869 | $ 384,111 | |||||
Cost of share repurchase | $ (362,153) | |||||||
Treasury stock repurchased, and treasury stock repurchased and retired, shares | 972,000 | |||||||
Treasury stock repurchased, and treasury stock repurchased and retired, amount | $ 82,369 | |||||||
Retirement of treasury stock, Shares | 4,973,000 | |||||||
Shares repurchased by the company for associates' tax withholding liability associated with share-based compensation | 54,000 | 43,000 | ||||||
Number of shares authorized for repurchase | 5,000,000 | 5,000,000 | ||||||
Maximum number of shares that can be repurchased | 1,930,000 | 1,930,000 | ||||||
Treasury stock reissued to fund plan. shares | 57,000 |
Associate Benefit Plans (Narrat
Associate Benefit Plans (Narrative) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||
Jul. 31, 2018 | Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | Aug. 29, 2015 | Jan. 14, 2015 | Jan. 06, 2009 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Plan shares authorized | 5,217 | ||||||
Shares reserved for issuance under plan | 3,404 | ||||||
Shares purchased by qualified associates | 45 | ||||||
Associate Stock Purchase Plan [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Plan shares authorized | 1,500 | 1,150 | 800 | ||||
Shares reserved for issuance under plan | 126 | ||||||
Maximum number of shares available for purchase per qualified associate | 5 | ||||||
Associate purchase price as percent of closing price | 90.00% | ||||||
Shares purchased by qualified associates | 57 | ||||||
Share price | $ 78.65 | $ 74.81 | |||||
Savings Plan [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Company contributions to savings plan | $ 7,730 | $ 7,048 | $ 6,594 | ||||
Stock Options [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Unrecognized share-based compensation cost | $ 7,529 | ||||||
Unrecognized share-based compensation weighted average period | 2 years 1 month 6 days | ||||||
Vesting period | 4 years | ||||||
Expiration period | 7 years | ||||||
Total intrinsic value of options exercised | $ 7,516 | 9,474 | 3,129 | ||||
Restricted Share Awards [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Fair value of shares vested | 7,222 | $ 7,357 | $ 7,518 | ||||
Unrecognized share-based compensation cost | $ 1,920 | ||||||
Unrecognized share-based compensation weighted average period | 10 months 24 days | ||||||
Restricted Stock Units [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Unrecognized share-based compensation cost | $ 21,158 | ||||||
Unrecognized share-based compensation weighted average period | 3 years 2 months 12 days |
Associate Benefit Plans (Schedu
Associate Benefit Plans (Schedule Of Stock-Based Compensation Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | $ 14,934 | $ 13,925 | $ 13,985 |
Deferred income tax benefit | (4,376) | (5,292) | (5,206) |
Stock-based compensation expense, net | 10,558 | 8,633 | 8,779 |
Stock Options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 4,534 | 4,369 | 4,382 |
Restricted Share Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 2,856 | 4,399 | 6,112 |
Restricted Stock Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 7,281 | 4,872 | 3,205 |
Associate Stock Purchase Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | $ 263 | $ 285 | $ 286 |
Associate Benefit Plans (Summar
Associate Benefit Plans (Summary Of Stock Option Activity) (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended |
Sep. 01, 2018USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding, Ending Balance, Aggregate Intrinsic Value | $ | $ 22,037 |
Exercisable, Ending Balance, Aggregate Intrinsic Value | $ | $ 7,673 |
Stock Options [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding, Beginning Balance, Options | shares | 1,743 |
Granted, Options | shares | 436 |
Exercised, Options | shares | (342) |
Canceled/Forfeited, Options | shares | (77) |
Outstanding, Ending Balance, Options | shares | 1,760 |
Exercisable, Ending Balance, Options | shares | 666 |
Outstanding, Beginning Balance, Weighted-Average Exercise Price per Share | $ / shares | $ 70.88 |
Granted, Weighted-Average Exercise Price per Share | $ / shares | 79.60 |
Exercised, Weighted-Average Exercise Price per Share | $ / shares | 70.96 |
Canceled/Forfeited, Weighted-Average Exercise Price per Share | $ / shares | 72.45 |
Outstanding, Ending Balance, Weighted-Average Exercise Price per Share | $ / shares | 72.96 |
Exercisable, Ending Balance, Weighted-Average Exercise Price per Share | $ / shares | $ 73.96 |
Associate Benefit Plans (Sche_2
Associate Benefit Plans (Schedule Of Option Grant Fair Value Assumptions) (Details) - $ / shares | 12 Months Ended | ||
Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | |
Associate Benefit Plans [Abstract] | |||
Expected life (in years) | 4 years | 4 years 1 month 6 days | 3 years 10 months 24 days |
Risk-free interest rate | 1.87% | 1.16% | 1.09% |
Expected volatility | 22.10% | 20.50% | 21.80% |
Expected dividend yield | 2.30% | 2.40% | 2.40% |
Weighted-average grant-date fair value | $ 12.25 | $ 9.29 | $ 8.03 |
Associate Benefit Plans (Summ_2
Associate Benefit Plans (Summary Of Stock Options By Range Of Exercise Price) (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended |
Sep. 01, 2018USD ($)$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number of options outstanding at September 1, 2018 | shares | 1,760 |
Weighted average remaining contractual life of options outstanding | 4 years 6 months |
Weighted average exercise price of options outstanding | $ 72.96 |
Intrinsic Value of options outstanding | $ | $ 22,037 |
Number of options exercisable at September 1, 2018 | shares | 666 |
Weighted average remaining contractual life of options exercisable | 3 years 3 months 18 days |
Weighted average exercise price of options exercisable | $ 73.96 |
Intrinsic Value of options exercisable | $ | $ 7,673 |
58.90 - 69.46 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of exercise prices, lower limit | $ 58.90 |
Range of exercise prices, upper limit | $ 69.46 |
Number of options outstanding at September 1, 2018 | shares | 464 |
Weighted average remaining contractual life of options outstanding | 3 years 10 months 24 days |
Weighted average exercise price of options outstanding | $ 59.90 |
Intrinsic Value of options outstanding | $ | $ 11,869 |
Number of options exercisable at September 1, 2018 | shares | 213 |
Weighted average remaining contractual life of options exercisable | 3 years 6 months |
Weighted average exercise price of options exercisable | $ 61.08 |
Intrinsic Value of options exercisable | $ | $ 5,188 |
69.47 - 72.33 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of exercise prices, lower limit | $ 69.47 |
Range of exercise prices, upper limit | $ 72.23 |
Number of options outstanding at September 1, 2018 | shares | 460 |
Weighted average remaining contractual life of options outstanding | 5 years 2 months 12 days |
Weighted average exercise price of options outstanding | $ 71.33 |
Intrinsic Value of options outstanding | $ | $ 6,501 |
Number of options exercisable at September 1, 2018 | shares | 99 |
Weighted average remaining contractual life of options exercisable | 5 years 2 months 12 days |
Weighted average exercise price of options exercisable | $ 71.33 |
Intrinsic Value of options exercisable | $ | $ 1,398 |
72.34 - 81.76 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of exercise prices, lower limit | $ 72.24 |
Range of exercise prices, upper limit | $ 81.76 |
Number of options outstanding at September 1, 2018 | shares | 578 |
Weighted average remaining contractual life of options outstanding | 5 years |
Weighted average exercise price of options outstanding | $ 80.25 |
Intrinsic Value of options outstanding | $ | $ 3,032 |
Number of options exercisable at September 1, 2018 | shares | 171 |
Weighted average remaining contractual life of options exercisable | 2 years 2 months 12 days |
Weighted average exercise price of options exercisable | $ 81.75 |
Intrinsic Value of options exercisable | $ | $ 637 |
81.77 - 83.03 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of exercise prices, lower limit | $ 81.77 |
Range of exercise prices, upper limit | $ 83.03 |
Number of options outstanding at September 1, 2018 | shares | 258 |
Weighted average remaining contractual life of options outstanding | 3 years 1 month 6 days |
Weighted average exercise price of options outstanding | $ 83.02 |
Intrinsic Value of options outstanding | $ | $ 635 |
Number of options exercisable at September 1, 2018 | shares | 183 |
Weighted average remaining contractual life of options exercisable | 3 years 1 month 6 days |
Weighted average exercise price of options exercisable | $ 83.03 |
Intrinsic Value of options exercisable | $ | $ 450 |
Associate Benefit Plans (Summ_3
Associate Benefit Plans (Summary Of Non-Vested Restricted Share Award Activity) (Details) shares in Thousands | 12 Months Ended |
Sep. 01, 2018$ / sharesshares | |
Restricted Share Awards [Member] | 2005 Omnibus Incentive Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Non-vested restricted share awards, Beginning balance, Shares | shares | 160 |
Vested, Shares | shares | (91) |
Canceled/Forfeited, Shares | shares | (6) |
Non-vested restricted share awards, Ending balance, Shares | shares | 63 |
Non-vested restricted share awards, Beginning balance, Weighted-Average Grant-Date Fair Value | $ / shares | $ 80.49 |
Vested, Weighted-Average Grant-Date Fair Value | $ / shares | 79.23 |
Canceled/Forfeited, Weighted-Average Grant-Date Fair Value | $ / shares | 82.43 |
Non-vested restricted share awards, Ending balance, Weighted-Average Grant-Date Fair Value | $ / shares | $ 81.98 |
Restricted Stock Units [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Non-vested restricted share awards, Beginning balance, Shares | shares | 313 |
Granted, Shares | shares | 175 |
Vested, Shares | shares | (81) |
Canceled/Forfeited, Shares | shares | (30) |
Non-vested restricted share awards, Ending balance, Shares | shares | 377 |
Non-vested restricted share awards, Beginning balance, Weighted-Average Grant-Date Fair Value | $ / shares | $ 66.66 |
Granted, Weighted-Average Grant-Date Fair Value | $ / shares | 81.57 |
Vested, Weighted-Average Grant-Date Fair Value | $ / shares | 66.75 |
Canceled/Forfeited, Weighted-Average Grant-Date Fair Value | $ / shares | 71.60 |
Non-vested restricted share awards, Ending balance, Weighted-Average Grant-Date Fair Value | $ / shares | $ 73.18 |
Commitments And Contingencies_2
Commitments And Contingencies (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | |
Commitments And Contingencies [Line Items] | |||
Rental expense, operating leases | $ 12,477 | $ 12,541 | $ 13,428 |
Maximum [Member] | |||
Commitments And Contingencies [Line Items] | |||
Lease expiration date | 2,028 | ||
Related Party Commitments [Member] | |||
Commitments And Contingencies [Line Items] | |||
Rental expense, operating leases | $ 1,044 | ||
Equipment And Automobile [Member] | |||
Commitments And Contingencies [Line Items] | |||
Lease expiration date | 2,022 |
Commitments And Contingencies_3
Commitments And Contingencies (Minimum Annual Rentals On Leases) (Details) $ in Thousands | Sep. 01, 2018USD ($) |
Commitments And Contingencies [Abstract] | |
2,019 | $ 14,687 |
2,020 | 9,337 |
2,021 | 6,815 |
2,022 | 4,256 |
2,023 | 2,824 |
Thereafter | 5,602 |
Total | $ 43,521 |
Summary Of Quarterly Results (D
Summary Of Quarterly Results (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Sep. 01, 2018 | Jun. 02, 2018 | Mar. 03, 2018 | Dec. 02, 2017 | Sep. 02, 2017 | Jun. 03, 2017 | Mar. 04, 2017 | Dec. 03, 2016 | Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | ||
Summary Of Quarterly Results [Abstract] | ||||||||||||
Net sales | $ 837,985 | $ 828,345 | $ 768,987 | [1] | $ 768,561 | $ 753,770 | $ 743,923 | $ 703,780 | $ 686,271 | $ 3,203,878 | $ 2,887,744 | $ 2,863,505 |
Gross profit | 359,668 | 361,001 | 337,223 | [1] | 335,069 | 333,450 | 329,500 | 314,562 | 308,735 | 1,392,961 | 1,286,247 | 1,288,858 |
Income from operations | 107,790 | 115,382 | 98,103 | [1] | 99,278 | 99,979 | 101,776 | 86,645 | 90,600 | 420,553 | 379,000 | 375,960 |
Net income | $ 73,017 | $ 79,069 | $ 117,552 | [1] | $ 59,585 | $ 60,748 | $ 62,836 | $ 53,559 | $ 54,288 | $ 329,223 | $ 231,431 | $ 231,216 |
Basic | $ 1.30 | $ 1.40 | $ 2.08 | [1] | $ 1.06 | $ 1.07 | $ 1.10 | $ 0.94 | $ 0.96 | $ 5.84 | $ 4.08 | $ 3.78 |
Diluted | $ 1.29 | $ 1.39 | $ 2.06 | [1] | $ 1.05 | $ 1.07 | $ 1.09 | $ 0.93 | $ 0.96 | $ 5.80 | $ 4.05 | $ 3.77 |
Net tax benefit, revaluation of deferred tax liabilities | $ 41,199 | $ 40,464 | ||||||||||
Tax benefit attributable to lower effective tax rate | $ 16,929 | |||||||||||
[1] | In the second quarter of fiscal 2018, the Company recorded a net tax benefit of $41,199 due to the revaluation of its net deferred tax liabilities primarily related to the lower federal corporate tax rate, partially offset by the lower federal benefit for state taxes and the change from a worldwide tax system to a territorial tax system, and a net tax benefit of $16,929 attributable to the lower effective tax rate required to bring our first half into alignment with the expected full year rate. |
Subsequent Events (Details)
Subsequent Events (Details) - $ / shares shares in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Oct. 31, 2018 | Sep. 30, 2018 | Jul. 31, 2018 | Sep. 01, 2018 | Sep. 03, 2016 | |
Subsequent Event [Line Items] | |||||
Cost of repurchase, per share | $ 82.64 | ||||
Subsequent Event [Member] | |||||
Subsequent Event [Line Items] | |||||
Shares repurchased and retired | 493 | 7 | |||
Cost of repurchase, per share | $ 81.22 | $ 85 | |||
Purchases From Class B Holders [Member] | Subsequent Event [Member] | |||||
Subsequent Event [Line Items] | |||||
Shares repurchased and retired | 2 | 113 | |||
Cost of repurchase, per share | $ 85 | $ 84.29 | |||
Class A Common Stock [Member] | |||||
Subsequent Event [Line Items] | |||||
Cost of repurchase, per share | $ 82.64 | ||||
Class A Common Stock [Member] | Purchases From Class B Holders [Member] | |||||
Subsequent Event [Line Items] | |||||
Shares repurchased and retired | 1,152 | ||||
Cost of repurchase, per share | $ 72.50 |
Schedule II - Valuation And Q_2
Schedule II - Valuation And Qualifying Accounts (Details) - SEC Schedule, 12-09, Allowance, Credit Loss [Member] - USD ($) $ in Thousands | 12 Months Ended | |||
Sep. 01, 2018 | Sep. 02, 2017 | Sep. 03, 2016 | ||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | ||||
Balance at Beginning of Year | [1] | $ 13,278 | $ 12,353 | $ 11,312 |
Charged to Costs and Expenses | [1] | 6,938 | 7,048 | 6,997 |
Charged to Other Accounts | [1] | |||
Deductions | [1],[2] | 7,224 | 6,123 | 5,956 |
Balance at End of Year | [1] | $ 12,992 | $ 13,278 | $ 12,353 |
[1] | Included in accounts receivable. | |||
[2] | Comprised of uncollected accounts charged against the allowance. |