Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 26, 2020 | Oct. 26, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Period End Date | Sep. 26, 2020 | |
Entity Registrant Name | Hillman Companies, Inc. | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 23-2874736 | |
Entity Address, Address Line One | 10590 Hamilton Avenue | |
Entity Address, City or Town | Cincinnati | |
Entity Address, State or Province | OH | |
Entity Address, Postal Zip Code | 45231 | |
Amendment Flag | false | |
Entity File Number | 1-13293 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
City Area Code | 513 | |
Local Phone Number | 851-4900 | |
Entity Central Index Key | 0001029831 | |
Current Fiscal Year End Date | --12-26 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 5,000 | |
Entity Shell Company | false | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 26, 2020 | Dec. 28, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 32,936 | $ 19,973 |
Accounts receivable, net of allowances of $1,617 ($1,891 - 2019) | 148,354 | 88,374 |
Inventories, net | 338,191 | 323,496 |
Other current assets | 23,946 | 8,828 |
Total current assets | 543,427 | 440,671 |
Property and equipment, net of accumulated depreciation of $225,253 ($179,791 - 2019) | 182,937 | 205,160 |
Goodwill | 817,781 | 819,077 |
Other intangibles, net of accumulated amortization of $275,972 ($232,060 - 2019) | 839,322 | 882,430 |
Operating lease right of use assets | 78,546 | 81,613 |
Deferred Income Tax Assets, Net | 1,514 | 702 |
Other assets | 11,154 | 11,557 |
Total assets | 2,474,681 | 2,441,210 |
Current liabilities: | ||
Accounts payable | 166,771 | 125,042 |
Current portion of debt and capital leases | 11,423 | 11,358 |
Current portion of operating lease liabilities | 12,235 | 11,459 |
Accrued expenses: | ||
Salaries and wages | 27,011 | 12,937 |
Pricing allowances | 8,664 | 6,553 |
Income and other taxes | 6,824 | 5,248 |
Interest | 17,583 | 14,726 |
Other accrued expenses | 29,704 | 21,545 |
Total current liabilities | 280,215 | 208,868 |
Long term debt | 1,562,428 | 1,584,289 |
Deferred Income Tax Liabilities, Net | 187,938 | 196,437 |
Operating lease liabilities | 70,474 | 73,227 |
Other non-current liabilities | 32,524 | 33,287 |
Total liabilities | 2,133,579 | 2,096,108 |
Commitments and contingencies | ||
Stockholder's Equity: | ||
Preferred stock, $0.01 par, 5,000 shares authorized, none issued or outstanding at September 26, 2020 and December 28, 2019 | 0 | 0 |
Common stock, $0.01 par, 5,000 shares authorized, issued and outstanding at September 26, 2020 and December 28, 2019 | 0 | 0 |
Additional paid-in capital | 557,177 | 553,359 |
Accumulated deficit | (179,535) | (176,217) |
Accumulated other comprehensive loss | (36,540) | (32,040) |
Total stockholder's equity | 341,102 | 345,102 |
Total liabilities and stockholder's equity | $ 2,474,681 | $ 2,441,210 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Sep. 26, 2020 | Dec. 28, 2019 |
Statement of Financial Position [Abstract] | ||
Accounts Receivable, Allowance for Credit Loss, Current | $ 1,617 | $ 1,891 |
Property and equipment, accumulated depreciation | 225,253 | 179,791 |
Other intangible assets, accumulated amortization | $ 275,972 | $ 232,060 |
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000 | 5,000 |
Preferred stock, shares issued | 0 | |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 5,000 | 5,000 |
Common stock, shares issued | 5,000 | 5,000 |
Common stock, shares outstanding | 5,000 | 5,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2020 | Sep. 28, 2019 | Sep. 26, 2020 | Sep. 28, 2019 | |
Income Statement [Abstract] | ||||
Net sales | $ 398,680 | $ 317,277 | $ 1,041,226 | $ 929,564 |
Cost of sales (exclusive of depreciation and amortization shown separately below) | 227,481 | 176,586 | 590,294 | 523,816 |
Selling, general and administrative expenses | 107,333 | 99,329 | 292,056 | 288,047 |
Depreciation | 15,926 | 16,269 | 50,673 | 48,740 |
Amortization | 14,883 | 14,665 | 44,596 | 44,114 |
Management fees to related party | 130 | 140 | 451 | 396 |
Other (income) expense | (2,175) | 335 | (2,120) | 5,687 |
Income from operations | 35,102 | 9,953 | 65,276 | 18,764 |
Interest expense, net | 20,688 | 24,882 | 67,746 | 77,509 |
Interest expense on junior subordinated debentures | 3,219 | 3,152 | 9,555 | 9,456 |
(Gain) loss on mark-to-market adjustment of interest rate swap | (773) | 315 | 1,169 | 3,217 |
Investment income on trust common securities | (94) | (95) | (283) | (284) |
Income (loss) before income taxes | 12,062 | (18,301) | (12,911) | (71,134) |
Income tax (benefit) expense | 1,400 | (3,775) | (9,593) | (1,844) |
Net income (loss) | 10,662 | (14,526) | (3,318) | (69,290) |
Net income (loss) from above | 10,662 | (14,526) | (3,318) | (69,290) |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments | 3,070 | (1,705) | (4,500) | 3,621 |
Total other comprehensive income (loss) | 3,070 | (1,705) | (4,500) | 3,621 |
Comprehensive income (loss) | $ 13,732 | $ (16,231) | $ (7,818) | $ (65,669) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 26, 2020 | Sep. 28, 2019 | |
Cash flows from operating activities: | ||
Net loss | $ (3,318) | $ (69,290) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 95,269 | 92,854 |
Deferred income taxes | (9,182) | (2,522) |
Deferred financing and original issue discount amortization | 2,805 | 2,779 |
Stock-based compensation expense | 3,818 | 1,906 |
Asset impairment | 210 | 6,896 |
Gain on disposal of property and equipment | (23) | (123) |
Change in fair value of contingent consideration | (1,300) | 0 |
Other non-cash interest and change in value of interest rate swap | 1,245 | 3,217 |
Changes in operating items: | ||
Accounts receivable | (60,470) | (4,707) |
Inventories | (16,793) | (13,232) |
Other assets | (15,276) | 2,212 |
Accounts payable | 42,201 | 4,508 |
Other accrued liabilities | 28,402 | 10,369 |
Net cash provided by operating activities | 67,588 | 34,867 |
Cash flows from investing activities: | ||
Payments to Acquire Businesses, Net of Cash Acquired | 800 | 6,135 |
Capital expenditures | (29,182) | (41,097) |
Proceeds from sale of property and equipment | 0 | 9,929 |
Net cash used in investing activities | (29,982) | (37,303) |
Cash flows from financing activities: | ||
Repayments of senior term loans | (7,956) | (7,956) |
Borrowings on revolving credit loans | 78,000 | 27,500 |
Repayments of revolving credit loans | (94,000) | (32,700) |
Principal payments under finance and capitalized lease obligations | (624) | (484) |
Proceeds from sale of Holdco stock | 0 | 750 |
Net cash used by financing activities | (24,580) | (12,890) |
Effect of exchange rate changes on cash | (63) | 34 |
Net increase (decrease) in cash and cash equivalents | 12,963 | (15,292) |
Cash and cash equivalents at beginning of period | 19,973 | 28,234 |
Cash and cash equivalents at end of period | 32,936 | 12,942 |
Supplemental disclosure of cash flow information: | ||
Interest paid | 59,147 | 77,340 |
Income Taxes Paid, Net | 475 | 700 |
11.6% Junior Subordinated Debentures - Preferred | ||
Supplemental disclosure of cash flow information: | ||
Interest paid | $ 9,272 | $ 9,172 |
Condensed Consolidated Statem_3
Condensed Consolidated Statement of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in-capital | Accumulated Deficit | Accumulated Other Comprehensive Loss |
Beginning Balance at Dec. 29, 2018 | $ 439,107 | $ 0 | $ 549,528 | $ (72,831) | $ (37,590) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (35,268) | (35,268) | |||
Stock-based compensation | 361 | 361 | |||
Foreign currency translation adjustments | 2,779 | 2,779 | |||
Ending Balance at Mar. 30, 2019 | 406,979 | 0 | 549,889 | (108,099) | (34,811) |
Beginning Balance at Dec. 29, 2018 | 439,107 | 0 | 549,528 | (72,831) | (37,590) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (69,290) | ||||
Proceeds from sale of Holdco stock | 750 | ||||
Foreign currency translation adjustments | 3,621 | ||||
Ending Balance at Sep. 28, 2019 | 376,094 | 0 | 552,184 | (142,121) | (33,969) |
Beginning Balance at Mar. 30, 2019 | 406,979 | 0 | 549,889 | (108,099) | (34,811) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (19,496) | (19,496) | |||
Stock-based compensation | 301 | 301 | |||
Foreign currency translation adjustments | 2,547 | 2,547 | |||
Ending Balance at Jun. 29, 2019 | 390,331 | 0 | 550,190 | (127,595) | (32,264) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (14,526) | (14,526) | |||
Stock-based compensation | 1,244 | 1,244 | |||
Proceeds from sale of Holdco stock | (750) | 750 | |||
Foreign currency translation adjustments | (1,705) | (1,705) | |||
Ending Balance at Sep. 28, 2019 | 376,094 | 0 | 552,184 | (142,121) | (33,969) |
Beginning Balance at Dec. 28, 2019 | 345,102 | 0 | 553,359 | (176,217) | (32,040) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (9,751) | (9,751) | |||
Stock-based compensation | 1,145 | 1,145 | |||
Foreign currency translation adjustments | (11,213) | (11,213) | |||
Ending Balance at Mar. 28, 2020 | 325,283 | 0 | 554,504 | (185,968) | (43,253) |
Beginning Balance at Dec. 28, 2019 | 345,102 | 0 | 553,359 | (176,217) | (32,040) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (3,318) | ||||
Proceeds from sale of Holdco stock | 0 | ||||
Foreign currency translation adjustments | (4,500) | ||||
Ending Balance at Sep. 26, 2020 | 341,102 | 0 | 557,177 | (179,535) | (36,540) |
Beginning Balance at Mar. 28, 2020 | 325,283 | 0 | 554,504 | (185,968) | (43,253) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (4,229) | (4,229) | |||
Stock-based compensation | 1,525 | 1,525 | |||
Foreign currency translation adjustments | 3,643 | 3,643 | |||
Ending Balance at Jun. 27, 2020 | 326,222 | 0 | 556,029 | (190,197) | (39,610) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | 10,662 | 10,662 | |||
Stock-based compensation | 1,148 | 1,148 | |||
Foreign currency translation adjustments | 3,070 | 3,070 | |||
Ending Balance at Sep. 26, 2020 | $ 341,102 | $ 0 | $ 557,177 | $ (179,535) | $ (36,540) |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 26, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | The accompanying unaudited financial statements include the condensed consolidated accounts of The Hillman Companies, Inc. and its wholly-owned subsidiaries (collectively “Hillman” or the “Company”) for the thirty-nine weeks ended September 26, 2020. Unless the context requires otherwise, references to "Hillman," "we," "us," "our," or "our Company" refer to The Hillman Companies, Inc. and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated. The Hillman Companies, Inc. is a wholly-owned subsidiary of HMAN Intermediate II Holdings Corp., and a wholly-owned subsidiary of HMAN Group Holdings Inc. (“Holdco”). The accompanying unaudited condensed consolidated financial statements present information in accordance with accounting principles generally accepted in the United States for interim financial information and the instructions to Form 10-Q and applicable rules of Regulation S-X. Accordingly, they do not include all information or footnotes required by U.S. generally accepted accounting principles for complete financial statements. Operating results for the thirty-nine weeks ended September 26, 2020 do not necessarily indicate the results that may be expected for the full year. For further information, refer to the consolidated financial statements and notes thereto included in the Company’s annual report filed on Form 10-K for the year ended December 28, 2019. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 26, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | The significant accounting policies should be read in conjunction with the significant accounting policies included in the Form 10-K for the year ended December 28, 2019. Use of Estimates in the Preparation of Financial Statements: The preparation of financial statements in conformity with U.S. generally accepted accounting principles 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 dates of the financial statements and the reported amounts of revenues and expenses for the reporting periods. Actual results may differ from these estimates. The extent to which COVID-19 impacts the Company’s business and financial results will depend on numerous evolving factors including, but not limited to: the magnitude and duration of COVID-19, the extent to which it will impact worldwide macroeconomic conditions including interest rates, employment rates and health insurance coverage, the speed of the anticipated recovery, and governmental and business reactions to the pandemic. The Company assessed certain accounting matters that generally require consideration of forecasted financial information in context with the information reasonably available to the Company and the unknown future impacts COVID-19 as of September 26, 2020 and through the date of this report. The accounting matters assessed included, but were not limited to the carrying value of the goodwill and other long-lived assets. While there was not a material impact to the Company’s consolidated financial statements as of and for the quarter ended September 26, 2020, the Company’s future assessment of the magnitude and duration of COVID-19, as well as other factors, could result in material impacts to the Company’s consolidated financial statements in future reporting periods. Reclassifications: T he Company reclassified the mark-to-market adjustment of our interest rate swap from other income/expense to its own line on the income statement below income from operations. The reclassifications had no impact on the prior periods’ statement of financial position, net loss, cash flows, or stockholder’s equity. Revenue Recognition: Revenue is recognized when control of goods or services is transferred to our customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Sales and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue. The Company offers a variety of sales incentives to its customers primarily in the form of discounts and rebates. Discounts are recognized in the consolidated financial statements at the date of the related sale. Rebates are based on the revenue to date and the contractual rebate percentage to be paid. A portion of the cost of the rebate is allocated to each underlying sales transaction. Discounts and rebates are included in the determination of net sales. The Company also establishes reserves for customer returns and allowances. The reserve is established based on historical rates of returns and allowances. The reserve is adjusted quarterly based on actual experience. Returns and allowances are included in the determination of net sales. The following table displays our disaggregated revenue by product category: Thirteen weeks ended September 26, 2020 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue Fastening and Hardware $ 202,876 $ — $ 38,383 $ 241,259 Personal Protective 97,431 — 12 97,443 Keys and Key Accessories — 44,974 790 45,764 Engraving — 14,205 2 14,207 Resharp — 7 — 7 Consolidated $ 300,307 $ 59,186 $ 39,187 $ 398,680 Thirteen weeks ended September 28, 2019 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue Fastening and Hardware $ 163,860 $ — $ 31,362 $ 195,222 Personal Protective 59,087 — — 59,087 Keys and Key Accessories — 49,230 1,170 50,400 Engraving — 12,556 1 12,557 Resharp — 11 — 11 Consolidated $ 222,947 $ 61,797 $ 32,533 $ 317,277 Thirty-nine weeks ended September 26, 2020 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue Fastening and Hardware $ 543,832 $ — $ 98,430 $ 642,262 Personal Protective 239,151 — 78 239,229 Keys and Key Accessories — 119,001 2,039 121,040 Engraving — 38,666 5 38,671 Resharp — 24 — 24 Consolidated $ 782,983 $ 157,691 $ 100,552 $ 1,041,226 Thirty-nine weeks ended September 28, 2019 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue Fastening and Hardware $ 465,524 $ — $ 96,248 $ 561,772 Personal Protective 185,430 — — 185,430 Keys and Key Accessories — 139,718 2,983 142,701 Engraving — 39,646 4 39,650 Resharp — 11 — 11 Consolidated $ 650,954 $ 179,375 $ 99,235 $ 929,564 The following table disaggregates our revenue by geographic location: Thirteen weeks ended September 26, 2020 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue United States $ 295,689 $ 58,566 $ — $ 354,255 Canada 2,292 620 39,187 42,099 Mexico 2,326 — — 2,326 Consolidated $ 300,307 $ 59,186 $ 39,187 $ 398,680 Thirteen weeks ended September 28, 2019 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue United States $ 218,585 $ 61,241 $ — $ 279,826 Canada 1,622 556 32,533 34,711 Mexico 2,740 — — 2,740 Consolidated $ 222,947 $ 61,797 $ 32,533 $ 317,277 Thirty-nine weeks ended September 26, 2020 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue United States $ 771,064 $ 156,249 $ — $ 927,313 Canada 4,833 1,442 100,552 106,827 Mexico 7,086 — — 7,086 Consolidated $ 782,983 $ 157,691 $ 100,552 $ 1,041,226 Thirty-nine weeks ended September 28, 2019 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue United States $ 638,322 $ 178,028 $ — $ 816,350 Canada 4,045 1,347 99,235 104,627 Mexico 8,587 — — 8,587 Consolidated $ 650,954 $ 179,375 $ 99,235 $ 929,564 Our revenue by geography is allocated based on the location of our sales operations. Our Fastening, Hardware, and Personal Protective Solutions segment contains sales of Big Time Products ("Big Time") personal protective equipment into Canada. Our Consumer Connected Solutions segment contains sales of MinuteKey into Canada. Fastening, Hardware, and Personal Protective Solutions revenues consist primarily of the delivery of fasteners, anchors, specialty fastening products, and personal protective equipment such as gloves and eye-wear as well as in-store merchandising services for the related product category. Consumer Connected Solutions revenues consist primarily of sales of keys and identification tags through self service key duplication and engraving kiosks. It also includes our associate-assisted key duplication systems and key accessories. Canada revenues consist primarily of the delivery to Canadian customers of fasteners and related hardware items, threaded rod, keys, key duplicating systems, accessories, personal protective equipment, and identification items as well as in-store merchandising services for the related product category. The Company’s performance obligations under its arrangements with customers are providing products, in-store merchandising services, and access to key duplicating and engraving equipment. Generally, the price of the merchandising services and the access to the key duplicating and engraving equipment is included in the price of the related products. Control of products is transferred at the point in time when the customer accepts the goods. The Company’s obligation to provide in-store service and access to key duplicating and engraving equipment is satisfied when control of the related products is transferred. Therefore, the entire amount of consideration related to the sale of products, in-store merchandising services, and access to key duplicating and engraving equipment is recognized upon the customer’s acceptance of the products. The revenues for all performance obligations are recognized upon the customer's acceptance of the products. |
Reclassifications | Reclassifications: T he Company reclassified the mark-to-market adjustment of our interest rate swap from other income/expense to its own line on the income statement below income from operations. The reclassifications had no impact on the prior periods’ statement of financial position, net loss, cash flows, or stockholder’s equity. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 26, 2020 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses . The ASU sets forth a “current expected credit loss” (CECL) model which requires the Company to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost and applies to some off-balance sheet credit exposures. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company adopted this ASU in the first quarter of fiscal 2020, and it did not have a material impact on the Company's Condensed Consolidated Financial Statements. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting which provide optional guidance for a limited time to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. The amendments apply only to contracts and hedging relationships that reference LIBOR or another reference rate expected to be discontinued due to reference rate reform. These amendments are effective immediately and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. The Company is currently evaluating contracts and the optional expedients provided by the new standard. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 26, 2020 | |
Business Acquisition [Line Items] | |
Mergers, Acquisitions and Dispositions Disclosures [Text Block] | On February 19, 2020, the Company acquired the assets of Instafob LLC ("Instafob") for a cash payment of $800 and a total purchase price of $2,618, which includes $1,818 in contingent and non-contingent considerations that remains payable to the seller. The financial results of Instafob reside within the Company's Consumer Connected Solutions segment and have been determined to be immaterial for purposes of additional disclosure. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 26, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill amounts by reportable segment are summarized as follows: Goodwill at Acquisitions Dispositions Adjustments Other (1) Goodwill at December 28, 2019 September 26, 2020 Fastening, Hardware, and Personal Protection $ 567,847 $ — $ — $ — $ (604) $ 567,243 Consumer Connected Solutions 222,096 — — — — 222,096 Canada 29,134 — — — (692) 28,442 Total $ 819,077 $ — $ — $ — $ (1,296) $ 817,781 (1) The "Other" change to goodwill relates to adjustments resulting from fluctuations in foreign currency exchange rates for the Canada and Mexico reporting units. Other intangibles, net, as of September 26, 2020 and December 28, 2019 consist of the following: Estimated September 26, 2020 December 28, 2019 Customer relationships 13 - 20 $ 939,908 $ 941,305 Trademarks - Indefinite Indefinite 85,262 85,517 Trademarks - Other 7 - 15 26,400 26,700 Technology and patents 7 - 12 63,724 60,968 Intangible assets, gross 1,115,294 1,114,490 Less: Accumulated amortization 275,972 232,060 Other intangibles, net $ 839,322 $ 882,430 The amortization expense for amortizable assets, including the adjustments resulting from fluctuations in foreign currency exchange rates for the thirteen and thirty-nine weeks ended September 26, 2020 was $14,883 and $44,596, respectively. Amortization expense for the thirteen and thirty-nine weeks ended September 28, 2019 was $14,665 and $44,114, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 26, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 6. Commitments and Contingencies: The Company self-insures its product liability, automotive, workers' compensation, and general liability losses up to $250 per occurrence. Catastrophic coverage has been purchased from third party insurers for occurrences in excess of $250 up to $60,000. The two risk areas involving the most significant accounting estimates are workers' compensation and automotive liability. Actuarial valuations performed by the Company's outside risk insurance expert were used by the Company's management to form the basis for workers' compensation and automotive liability loss reserves. The actuary contemplated the Company's specific loss history, actual claims reported, and industry trends among statistical and other factors to estimate the range of reserves required. Risk insurance reserves are comprised of specific reserves for individual claims and additional amounts expected for development of these claims, as well as for incurred but not yet reported claims. The Company believes that the liability of approximately $2,221 recorded for such risks is adequate as of September 26, 2020. As of September 26, 2020, the Company has provided certain vendors and insurers letters of credit aggregating $19,401 related to our product purchases and insurance coverage for product liability, workers’ compensation, and general liability. The Company self-insures group health claims up to an annual stop loss limit of $250 per participant. Historical group insurance loss experience forms the basis for the recognition of group health insurance reserves. Provisions for losses expected under these programs are recorded based on an analysis of historical insurance claim data and certain actuarial assumptions. The Company believes that the liability of approximately $2,530 recorded for such risks is adequate as of September 26, 2020. On June 3, 2019, The Hillman Group, Inc. ("Hillman Group") filed a complaint for patent infringement against KeyMe, LLC ("KeyMe"), a provider of self-service key duplication kiosks, in the United States District Court for the Eastern District of Texas (Marshall Division). The case was assigned Civil Action No. 2:19-cv-0209. Hillman Group’s complaint alleges that KeyMe’s self-named and “Locksmith in a Box” key duplication kiosks infringe U.S. Patent Nos. 8,979,446 and 9,914,179, which are assigned to Hillman Group, and seeks damages and injunctive relief against KeyMe. After the United States Patent and Trademark Office issued U.S. Patent No. 10,400,474 to Hillman Group on September 3, 2019, Hillman Group filed a motion the same day to amend its initial complaint to add the new patent to the litigation. The Texas court granted the motion on September 13, 2019. KeyMe filed two motions in the case on July 25, 2019, the first seeking to dismiss Hillman Group's complaint under Rule 12(b)(3) of the Federal Rules of Civil Procedure for improper venue, or in the alternative, to move the case from Marshall, Texas to the Southern District of New York. KeyMe’s second motion seeks to transfer the venue of the case from Texas to New York under 28 U.S.C. § 1404. Subsequently, Hillman Group filed a motion on September 4, 2019 to disqualify KeyMe's counsel Cooley LLP from the litigation due to Cooley's concurrent and prior representation of Hillman Group and predecessor-in-interest MinuteKey Holdings, Inc ("MinuteKey"). Hillman Group served its initial infringement contentions for the patents-in-suit on KeyMe on September 6, 2019, and KeyMe served its initial invalidity and unenforceability contentions for the patents-in-suit on Hillman Group on November 15, 2019. The parties filed a joint claim construction statement with the Court on January 31, 2020, setting forth the disputed constructions of terms and phrases recited in the asserted claims of the patents-in-suit. On February 14, 2020, the Court granted Hillman Group’s motion to disqualify Cooley LLP, and denied KeyMe’s pending venue-related motion to dismiss and motion to transfer without prejudice to refiling. The case was stayed until March 30, 2020 to permit KeyMe to retain new legal counsel. The parties filed a joint status report on March 25, 2020, and on March 27, 2020, the Texas Court set a new case schedule with a trial in early December 2020. On April 14, 2020, KeyMe re-filed a single motion to dismiss for improper venue, or in the alternative, to transfer the case to the Southern District of New York. As of September 26, 2020, the Texas Court has not ruled on the venue motion; an oral hearing was set to be held before the Court on September 30, 2020. The Texas Court conducted a claim construction hearing in Marshall, TX, on June 23, 2020 to construe various disputed claim terms of the three patents-in-suit, and issued a claim construction order on July 2, 2020. On August 31, 2020, KeyMe filed two motions for partial summary judgment on portions of the case, and also filed a motion objecting to portions of the testimony of one of Hillman’s experts. As of September 26, 2020, those motions remain pending before the Texas Court. On September 9, 2020, the parties conducted a mediation before Ret. District Judge David Folsom of the U.S. District Court of the Eastern District of Texas. Though substantive discussion took place, no agreement on resolution of the litigation was reached. The parties are currently scheduled to hold a final pretrial conference before the Texas Court on November 9, 2020, with a jury trial set to begin on December 7, 2020. On August 16, 2019, KeyMe filed a complaint for patent infringement against Hillman Group in the United States District Court for the District of Delaware. KeyMe alleges that Hillman’s KeyKrafter key duplication machines and MinuteKey self-service key duplication kiosks infringe KeyMe’s U.S. Patent No. 8,682,468 when those machines are used in conjunction with Hillman’s KeyHero system. KeyMe seeks damages and injunctive relief against Hillman Group. Hillman Group filed an answer to KeyMe’s complaint on October 23, 2019, and asserted counterclaims seeking declaratory judgments of invalidity and noninfringement of U.S. Patent No. 8,682,468. On May 4, 2020, the Delaware Court entered a scheduling order setting trial for November 2021. KeyMe served its initial infringement contentions on June 11, 2020, with Hillman serving its initial invalidity contentions on July 16, 2020. As of September 26, 2020, claim construction briefing is underway, with a claim construction hearing scheduled before the Delaware Court on November 23, 2020. Management and legal counsel for the Company are of the opinion that KeyMe's claim is without merit and the Company should prevail in defending the suit. The Company is unable to estimate the possible loss or range of loss at this early stage in the case. On March 2, 2020, Hillman Group filed a second complaint for patent infringement against KeyMe in the United States District Court for the Eastern District of Texas (Marshall Division), alleging that KeyMe’s key duplication kiosks infringe Hillman Group’s U.S. Patent No. 10,577,830. The case was assigned Civil Action No. 2:20-cv-0070. Hillman Group added a second patent to the case, U.S. Patent No. 10,628,813, upon that patent's issuance on April 21, 2020. KeyMe filed a motion to consolidate the two Texas patent cases involving KeyMe and Hillman Group on April 14, 2020. In addition, on April 30, 2020, KeyMe filed a substantially identical motion to dismiss the case for improper venue, or in the alternative, to transfer the case to the Southern District of New York. As of September 26, 2020, the Texas Court has yet to rule on either motion; an oral hearing on both motions was set before the Texas Court for September 30, 2020. Hillman Group served its initial infringement contentions for both patents-in-suit on May 4, 2020, with KeyMe serving its initial invalidity contentions on June 29, 2020. The Texas Court issued a case schedule on June 2, 2020, setting trial for June 2021. Upon issuance of U.S. Patent No. 10,737,336 to Hillman Group on August 10, 2020, Hillman Group moved for leave of Court to add that patent to the case; KeyMe opposed the motion. As of September 26, 2020, the addition of the ’336 patent is still before the Texas Court. A claim construction hearing is set before the Texas Court in January, 2021. Hillman Group served its initial infringement contentions for both patents-in-suit on May 4, 2020. The Texas Court issued a case schedule on June 2, 2020, setting trial for June 2021. In addition, legal proceedings are pending which are either in the ordinary course of business or incidental to the Company's business. Those legal proceedings incidental to the business of the Company are generally not covered by insurance or other indemnity. In the opinion of the Company's management, the ultimate resolution of the pending litigation matters will not have a material adverse effect on the consolidated financial position, operations, or cash flows of the Company. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 26, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | The Company has recorded aggregate management fee charges and expenses from CCMP Capital Advisors, LLC (“CCMP”), Oak Hill Capital Partners III, L.P., Oak Hill Capital Management Partners III, L.P. and OHCP III HC RO, L.P. (collectively, “Oak Hill Funds”) of $130 and $451 for the thirteen and thirty-nine weeks ended September 26, 2020, respectively, and $140 and $396 for the thirteen and thirty-nine weeks ended September 28, 2019, respectively. Gregory Mann and Gabrielle Mann are employed by Hillman. The Company leases an industrial warehouse and office facility from companies under the control of the Manns. The rental expense for the lease of this facility was $88 and $263 for the thirteen and thirty-nine weeks ended September 26, 2020, respectively, and was $87 and $262 the thirteen and thirty-nine weeks ended September 28, 2019, respectively. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 26, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Accounting Standards Codification 740 (“ASC 740”) requires companies to apply their estimated annual effective tax rate on a year-to-date basis in each interim period. These rates are derived, in part, from expected annual pre-tax income or loss. In the thirteen and thirty-nine weeks ended September 26, 2020 and the thirteen and thirty-nine weeks ended September 28, 2019, the Company applied an estimated annual effective tax rate to the interim period pre-tax loss to calculate the income tax benefit or provision. On March 27, 2020, President Trump signed the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) into law. The CARES Act provides a stimulus package intended to address the impact of the COVID-19 pandemic on the American economy and provides tax relief for businesses. The Company analyzed the available stimulus provisions and has recognized certain benefits including the deferral of payroll taxes, accelerated Alternative Minimum Tax income tax refunds, and increased business interest deductions. For the thirteen and thirty-nine weeks ended September 26, 2020, the effective income tax rates were 11.6% and 74.3%, respectively. The Company recorded an income tax (benefit) expense for the thirteen and thirty-nine weeks ended September 26, 2020 of $1,400 and $(9,593), respectively. The effective tax rate for the thirteen weeks ended September 26, 2020 was the result of favorable interest deductions from the CARES Act as well as non-deductible expenses, state and foreign taxes. The effective tax rate for the thirty-nine weeks ended September 26, 2020 is primarily attributable to the increased business interest deduction afforded by the CARES Act. The CARES Act provides the Company a benefit for increased business interest deductions for 2019 and 2020. The Company discretely recorded a $6,700 income tax benefit for the period ended March 28, 2020 related to the increased business interest provision for 2019. The Company is expecting to utilize a portion of prior year interest limitation carryforwards in the 2020 period resulting in favorable impacts to the effective tax rate. The utilization of the interest carryforwards is primarily the result of the increased business interest deduction afforded by the CARES Act as well as the impact of the Company's increasing operational income on the interest limitation. The remaining differences to the effective tax rate for the thirty-nine weeks ended September 26, 2020 are due to non-deductible expenses and state and foreign income taxes. For the thirteen and thirty-nine weeks ended September 28, 2019, the effective income tax rate was 20.6% and 2.6%, respectively. The Company recorded an income tax benefit for the thirteen and thirty-nine weeks ended September 28, 2019 of $(3,775) and $(1,844), respectively. The effective tax rate for the thirteen and thirty-nine weeks ended September 28, 2019 was |
Restructuring
Restructuring | 9 Months Ended |
Sep. 26, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | 9. Restructuring Canada Restructuring During 2018, the Company initiated plans to restructure the operations of the Canada segment. The restructuring seeks to streamline operations in the greater Toronto area by consolidating facilities, exiting certain lines of business, and rationalizing stock keeping units (“SKUs”). The intended result of the Canada restructuring will be a more streamlined and scalable operation focused on delivering optimal service and a broad offering of products across the Company's core categories. The Company expects to incur increased restructuring related charges and capital expenditures in our Canada segment over the next year as plans are finalized and implemented. The following is a summary of the charges incurred: Thirteen Weeks Ended Thirteen Weeks Ended Thirty-nine Weeks Ended Thirty-nine Weeks Ended Facility consolidation (1) Labor expense (income) $ 19 $ 451 $ 396 $ 962 Inventory valuation adjustments 47 446 47 446 Consulting and legal fees 63 57 114 173 Other expense 51 541 713 1,037 Rent and related charges 434 85 1,523 265 Severance 37 — 569 — Exit of certain lines of business (2) Inventory valuation adjustments — 285 — 294 Gain on disposal of assets — (61) — (458) Severance — — — — Other expense — 70 — 392 Total $ 651 $ 1,874 $ 3,362 $ 3,111 (1) Facility consolidation includes labor expense related to organizing inventory and equipment in preparation for the facility consolidation, consulting and legal fees related to the project, and other expenses. These expenses were included in SG&A on the Condensed Consolidated Statement of Comprehensive Loss. (2) As part of the restructuring, the Company is exiting a manufacturing business line. Related charges included gains and losses on disposals of assets, and other expenses, which were included other income and expense, and SG&A on the Condensed Consolidated Statement of Comprehensive Loss, respectively. The following represents the roll forward of Canada restructuring reserves for the current period: Balance at December 28, 2019 Impact to Earnings Cash Paid Balance at September 26, 2020 Severance and related $ 1,121 569 (680) $ 1,010 United States Restructuring During fiscal 2019, the Company began implementing a plan to restructure the management and operations within the United States to achieve synergies and cost savings associated with the Company's acquisition activities. This restructuring includes management realignment, integration of sales and operating functions, and strategic review of the Company's product offerings. This plan was finalized during the fourth quarter of fiscal 2019. The Company expects to incur restructuring charges in the Fastening, Hardware, and Personal Protective Solutions segment and in the Consumer Connected Solutions segment during fiscal 2020 as the plans are implemented. Charges incurred include: Thirteen Weeks Ended Thirteen Weeks Ended Thirty-nine Weeks Ended Thirty-nine Weeks Ended Inventory valuation adjustments $ 1,568 $ — $ 1,568 $ — Severance 237 — 1,117 $ — Other 382 — 382 — Total $ 2,187 $ — $ 3,067 $ — The following represents the roll forward of United States restructuring reserves for the current period: Balance at December 28, 2019 Impact to Earnings Cash Paid Balance at September 26, 2020 Severance and related $ 3,286 1,117 (3,224) $ 1,179 |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 26, 2020 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | The following table summarizes the Company’s debt: September 26, 2020 December 28, 2019 Revolving loans $ 97,000 $ 113,000 Senior term loan, due 2025 1,039,696 1,047,653 6.375% Senior Notes, due 2022 330,000 330,000 11.6% Junior Subordinated Debentures - Preferred 105,443 105,443 Junior Subordinated Debentures - Common 3,261 3,261 Capital & finance leases 2,035 2,275 1,577,435 1,601,632 Unamortized premium on 11.6% Junior Subordinated Debentures 14,984 16,110 Unamortized discount on Senior term loan (6,908) (8,040) Current portion of long term debt, capital leases and finance leases (11,423) (11,358) Deferred financing fees (11,660) (14,055) Total long term debt, net $ 1,562,428 $ 1,584,289 As of September 26, 2020, there was $1,039,696 outstanding under the 2018 Term Loan. As of September 26, 2020, the Company had $97,000 outstanding under the ABL Revolver along with $19,401 of letters of credit. The Company has approximately $133,599 of available borrowings under the ABL Revolver as a source of liquidity. Additional information with respect to the fair value of the Company’s fixed rate senior notes and junior subordinated debentures is included in Note 13 - Fair Value Measurements. |
Leases
Leases | 9 Months Ended |
Sep. 26, 2020 | |
Leases [Abstract] | |
Finance Leases | 11. Leases Lessee The Company determines if a contract is or contains a lease at inception or modification of a contract. A contract is or contains a lease if the contract conveys the right to control the use of an identified asset for a period in exchange for consideration. Control over the use of the identified asset means the lessee has both (a) the right to obtain substantially all of the economic benefits from the use of the asset and (b) the right to direct the use of the asset. The Company leases certain distribution center locations, vehicles, forklifts, computer equipment, and its corporate headquarters with expiration dates through 2032. Certain lease arrangements include escalating rent payments and options to extend the lease term. Expected lease terms include these options to extend or terminate the lease when it is reasonably certain the Company will exercise the option. The Company's leasing arrangements do not contain material residual value guarantees nor material restrictive covenants. The components of operating and finance lease cost for the thirteen and thirty-nine weeks ended September 26, 2020 and thirteen and thirty-nine weeks ended September 28, 2019 were as follows: Thirteen Weeks Ended Thirty-nine Weeks Ended Thirteen Weeks Ended Thirty-nine Weeks Ended Operating lease cost $ 4,989 $ 14,283 $ 5,101 $ 14,399 Short term lease costs 633 1,682 668 2,644 Variable lease costs 104 775 720 1,795 Finance lease cost: Amortization of right of use assets 206 608 190 425 Interest on lease liabilities 34 106 35 78 Rent expense totaled $5,726 and $6,489 in the thirteen weeks ended September 26, 2020 and thirteen weeks ended September 28, 2019, respectively. Rent expense totaled $16,740 and $18,838 in the thirty-nine weeks ended September 26, 2020 and thirty-nine weeks ended September 28, 2019, respectively. Rent expense includes operating lease cost as well as expense for non-lease components such as common area maintenance, real estate taxes, real estate insurance, variable costs related to our leased vehicles and also short-term rental expenses. The implicit rate is not determinable in most of the Company’s leases, as such management uses the Company’s incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The weighted average remaining lease terms and discount rates for all of our operating and finance leases were as follows as of September 26, 2020 and December 28, 2019: September 26, 2020 December 28, 2019 Operating Leases Finance Leases Operating Leases Finance Leases Weighted average remaining lease term 7.36 2.81 7.88 3.46 Weighted average discount rate 8.24 % 6.84 % 7.81 % 6.49 % Supplemental balance sheet information related to the Company's finance leases was as follows as of September 26, 2020 and December 28, 2019: September 26, 2020 December 28, 2019 Finance lease assets, net, included in property plant and equipment $ 1,902 $ 2,101 Current portion of long-term debt 814 749 Long-term debt, less current portion 1,221 1,526 Total principal payable on finance leases 2,035 2,275 Supplemental cash flow information related to the Company's operating leases was as follows for the thirty-nine weeks ended September 26, 2020 and thirty-nine weeks ended September 28, 2019: Thirty-nine Weeks Ended Thirty-nine Weeks Ended Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflow from operating leases $ 13,821 $ 13,872 Operating cash outflow from finance leases 106 66 Financing cash outflow from finance leases 624 484 Maturities of our lease liabilities for all operating and finance leases are as follows as of September 26, 2020: Operating Leases Finance Leases Less than one year $ 18,428 $ 932 1 to 2 years 15,845 692 2 to 3 years 13,846 414 3 to 4 years 13,019 211 4 to 5 years 12,080 — After 5 years 37,814 — Total future minimum rental commitments 111,032 2,249 Less - amounts representing interest (28,323) (214) Present value of lease liabilities $ 82,709 $ 2,035 As of December 28, 2019, maturities of our lease liabilities for all operating and finance leases were expected to be as follows: Operating Leases Finance Leases Less than one year $ 17,525 $ 873 1 to 2 years 15,956 712 2 to 3 years 13,925 456 3 to 4 years 12,045 383 4 to 5 years 11,716 127 After 5 years 43,591 — Total future minimum rental commitments 114,758 2,551 Less - amounts representing interest (30,072) (276) Present value of lease liabilities 84,686 2,275 Lessor The Company has certain arrangements for key duplication equipment under which we are the lessor. These leases meet the criteria for operating lease classification. Lease income associated with these leases is not material. |
Operating Leases | 11. Leases Lessee The Company determines if a contract is or contains a lease at inception or modification of a contract. A contract is or contains a lease if the contract conveys the right to control the use of an identified asset for a period in exchange for consideration. Control over the use of the identified asset means the lessee has both (a) the right to obtain substantially all of the economic benefits from the use of the asset and (b) the right to direct the use of the asset. The Company leases certain distribution center locations, vehicles, forklifts, computer equipment, and its corporate headquarters with expiration dates through 2032. Certain lease arrangements include escalating rent payments and options to extend the lease term. Expected lease terms include these options to extend or terminate the lease when it is reasonably certain the Company will exercise the option. The Company's leasing arrangements do not contain material residual value guarantees nor material restrictive covenants. The components of operating and finance lease cost for the thirteen and thirty-nine weeks ended September 26, 2020 and thirteen and thirty-nine weeks ended September 28, 2019 were as follows: Thirteen Weeks Ended Thirty-nine Weeks Ended Thirteen Weeks Ended Thirty-nine Weeks Ended Operating lease cost $ 4,989 $ 14,283 $ 5,101 $ 14,399 Short term lease costs 633 1,682 668 2,644 Variable lease costs 104 775 720 1,795 Finance lease cost: Amortization of right of use assets 206 608 190 425 Interest on lease liabilities 34 106 35 78 Rent expense totaled $5,726 and $6,489 in the thirteen weeks ended September 26, 2020 and thirteen weeks ended September 28, 2019, respectively. Rent expense totaled $16,740 and $18,838 in the thirty-nine weeks ended September 26, 2020 and thirty-nine weeks ended September 28, 2019, respectively. Rent expense includes operating lease cost as well as expense for non-lease components such as common area maintenance, real estate taxes, real estate insurance, variable costs related to our leased vehicles and also short-term rental expenses. The implicit rate is not determinable in most of the Company’s leases, as such management uses the Company’s incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The weighted average remaining lease terms and discount rates for all of our operating and finance leases were as follows as of September 26, 2020 and December 28, 2019: September 26, 2020 December 28, 2019 Operating Leases Finance Leases Operating Leases Finance Leases Weighted average remaining lease term 7.36 2.81 7.88 3.46 Weighted average discount rate 8.24 % 6.84 % 7.81 % 6.49 % Supplemental balance sheet information related to the Company's finance leases was as follows as of September 26, 2020 and December 28, 2019: September 26, 2020 December 28, 2019 Finance lease assets, net, included in property plant and equipment $ 1,902 $ 2,101 Current portion of long-term debt 814 749 Long-term debt, less current portion 1,221 1,526 Total principal payable on finance leases 2,035 2,275 Supplemental cash flow information related to the Company's operating leases was as follows for the thirty-nine weeks ended September 26, 2020 and thirty-nine weeks ended September 28, 2019: Thirty-nine Weeks Ended Thirty-nine Weeks Ended Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflow from operating leases $ 13,821 $ 13,872 Operating cash outflow from finance leases 106 66 Financing cash outflow from finance leases 624 484 Maturities of our lease liabilities for all operating and finance leases are as follows as of September 26, 2020: Operating Leases Finance Leases Less than one year $ 18,428 $ 932 1 to 2 years 15,845 692 2 to 3 years 13,846 414 3 to 4 years 13,019 211 4 to 5 years 12,080 — After 5 years 37,814 — Total future minimum rental commitments 111,032 2,249 Less - amounts representing interest (28,323) (214) Present value of lease liabilities $ 82,709 $ 2,035 As of December 28, 2019, maturities of our lease liabilities for all operating and finance leases were expected to be as follows: Operating Leases Finance Leases Less than one year $ 17,525 $ 873 1 to 2 years 15,956 712 2 to 3 years 13,925 456 3 to 4 years 12,045 383 4 to 5 years 11,716 127 After 5 years 43,591 — Total future minimum rental commitments 114,758 2,551 Less - amounts representing interest (30,072) (276) Present value of lease liabilities 84,686 2,275 Lessor The Company has certain arrangements for key duplication equipment under which we are the lessor. These leases meet the criteria for operating lease classification. Lease income associated with these leases is not material. |
Derivatives and Hedging
Derivatives and Hedging | 9 Months Ended |
Sep. 26, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities Disclosure [Text Block] | The Company uses derivative financial instruments to manage our exposures to (1) interest rate fluctuations on our floating rate senior debt and (2) fluctuations in foreign currency exchange rates. The Company measures those instruments at fair value and recognizes changes in the fair value of derivatives in earnings in the period of change, unless the derivative qualifies as an effective hedge that offsets certain exposures. Interest Rate Swap Agreements On January 8, 2018, the Company entered into a forward Interest Rate Swap Agreement ("2018 Swap 1") with three On November 8, 2018, the Company entered into another new forward Interest Rate Swap Agreement ("2018 Swap 2") with three The fair value of the 2018 Swap 1 was $1,022 as of September 26, 2020 and it was reported on the Condensed Consolidated Balance Sheets within other accrued expenses. The fair value of the 2018 Swap 2 was $3,740 as of September 26, 2020 and it was reported on the Condensed Consolidated Balance Sheets within other non-current liabilities. An increase in other expense was recorded in the Statement of Comprehensive Loss for the unfavorable change of $1,170 in fair value since December 28, 2019. The fair value of 2018 Swaps was $3,592 as of December 28, 2019 and they were was reported on the Consolidated Balance Sheets in other non-current liabilities. The Company's interest rate swap agreements do not qualify for hedge accounting treatment because they did not meet the provisions specified in ASC 815, Derivatives and Hedging (“ASC 815”). Accordingly, the gain or loss on these derivatives was recognized in current earnings. The Company does not enter into derivative transactions for speculative purposes and, therefore, holds no derivative instruments for trading purposes. Additional information with respect to the fair value of derivative instruments is included in Note 13 - Fair Value Measurements. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 26, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | The Company uses the accounting guidance that applies to all assets and liabilities that are being measured and reported on a fair value basis. The guidance defines 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 guidance also establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. Assets and liabilities carried at fair value are classified and disclosed in one of the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs reflecting the reporting entity’s own assumptions. The following tables set forth the Company’s financial assets and liabilities that were measured at fair value on a recurring basis during the period, by level, within the fair value hierarchy: As of September 26, 2020 Level 1 Level 2 Level 3 Total Trading securities $ 1,609 $ — $ — $ 1,609 Interest rate swaps — (4,762) — (4,762) Contingent consideration payable — — (18,418) (18,418) As of December 28, 2019 Level 1 Level 2 Level 3 Total Trading securities $ 1,911 $ — $ — $ 1,911 Interest rate swaps — (3,592) — (3,592) Contingent consideration payable — — (18,100) (18,100) Trading securities are valued using quoted prices on an active exchange. Trading securities represent assets held in a Rabbi Trust to fund deferred compensation liabilities and are included as other assets on the accompanying Condensed Consolidated Balance Sheets. The Company utilizes interest rate swap contracts to manage our targeted mix of fixed and floating rate debt, and these contracts are valued using observable benchmark rates at commonly quoted intervals for the full term of the swap contracts. As of September 26, 2020, the 2018 Swap 1 was recorded within other accrued expenses and the 2018 Swap 2 was recorded within other non-current liabilities on the accompanying Condensed Consolidated Balance Sheets. As of December 28, 2019, both the 2018 Swap 1 and 2018 Swap 2 were recorded within other non-current liabilities on the accompanying Condensed Consolidated Balance Sheets. The contingent consideration represents future potential earn-out payments related to the Resharp acquisition in fiscal 2019 and the Instafob acquisition in the first quarter of 2020. The estimated fair value of the contingent earn-outs was determined using a Monte Carlo analysis examining the frequency and mean value of the resulting earn-out payments. The resulting value captures the risk associated with the form of the payout structure. The risk neutral method is applied, resulting in a value that captures the risk associated with the form of the payout structure and the projection risk. The carrying amount of the liability may fluctuate significantly and actual amounts paid may be materially different from the estimated value of the liability. As of September 26, 2020, the total contingent consideration was recorded as $2,035 of other accrued expenses and $16,383 in other non-current liabilities on the Condensed Consolidated Balance Sheets. As of December 28, 2019, the total contingent consideration was recorded as $2,275 of other accrued expenses and $15,825 in other non-current liabilities on the Condensed Consolidated Balance Sheets. This change in value was determined by using a simulation model of the Monte Carlo analysis that included updated projections applicable to the liability valuation as of September 26, 2020. The $1,300 decrease in the contingent consideration liability as of September 26, 2020 compared to as of December 28, 2019 related to the Resharp contingent consideration liability and was recorded within other income on the Condensed Consolidated Statements of Comprehensive Income (Loss) during the thirty-nine weeks ended September 26, 2020. There were no material changes to the Resharp contingent consideration liability in the thirteen weeks ended September 26, 2020. There were no material adjustments to the Instafob contingent consideration for the thirteen and thirty-nine weeks ended September 26, 2020. The fair value of the Company's fixed rate senior notes and junior subordinated debentures as of September 26, 2020 and December 28, 2019 were determined by utilizing current trading prices obtained from indicative market data. As a result, the fair value measurements of the Company's senior term notes and debentures are considered to be Level 2. September 26, 2020 December 28, 2019 Carrying Estimated Carrying Estimated 6.375% Senior Notes $ 328,055 $ 314,325 $ 327,222 $ 305,250 Junior Subordinated Debentures 123,688 121,821 124,814 148,731 Cash, accounts receivable, accounts payable, and accrued liabilities are reflected in the Condensed Consolidated Financial Statements at book value, which approximates fair value, due to the short-term nature of these instruments. The carrying |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 26, 2020 | |
Segment Reporting [Abstract] | |
Segment Reporting | The Company’s segment reporting structure uses the Company’s management reporting structure as the foundation for how the Company manages its business. The Company periodically evaluates its segment reporting structure in accordance with ASC 350-20-55 and has concluded that it has three reportable segments as of September 26, 2020: Fastening, Hardware, and Personal Protective Solutions, Consumer Connected Solutions, and Canada. The Company evaluates the performance of its segments based on revenue and income (loss) from operations, and does not include segment assets nor non-operating income/expense items for management reporting purposes. The table below presents revenues and income (loss) from operations for our reportable segments for the thirteen and thirty-nine weeks ended September 26, 2020 and thirteen and thirty-nine weeks ended September 28, 2019. Thirteen Weeks Ended Thirteen Weeks Ended Thirty-nine Weeks Ended Thirty-nine Weeks Ended Revenues Fastening, Hardware, and Personal Protective Solutions $ 300,307 $ 222,947 $ 782,983 $ 650,954 Consumer Connected Solutions 59,186 61,797 157,691 179,375 Canada 39,187 32,533 100,552 99,235 Total revenues $ 398,680 $ 317,277 $ 1,041,226 $ 929,564 Segment income (loss) from operations Fastening, Hardware, and Personal Protective Solutions $ 30,107 $ 8,000 $ 63,383 $ 16,361 Consumer Connected Solutions 3,046 4,243 4,432 3,859 Canada 1,949 (2,290) (2,539) (1,456) Total income from operations $ 35,102 $ 9,953 $ 65,276 $ 18,764 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 26, 2020 | |
Accounting Policies [Abstract] | |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements: The preparation of financial statements in conformity with U.S. generally accepted accounting principles 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 dates of the financial statements and the reported amounts of revenues and expenses for the reporting periods. Actual results may differ from these estimates. The extent to which COVID-19 impacts the Company’s business and financial results will depend on numerous evolving factors including, but not limited to: the magnitude and duration of COVID-19, the extent to which it will impact worldwide macroeconomic conditions including interest rates, employment rates and health insurance coverage, the speed of the anticipated recovery, and governmental and business reactions to the pandemic. The Company assessed certain accounting matters that generally require consideration of forecasted financial information in context with the information reasonably available to the Company and the unknown future impacts COVID-19 as of September 26, 2020 and through the date of this report. The accounting matters assessed included, but were not limited to the carrying value of the goodwill and other long-lived assets. While there was not a material impact to the Company’s consolidated financial statements as of and for the quarter ended September 26, 2020, the Company’s future assessment of the magnitude and duration of COVID-19, as well as other factors, could result in material impacts to the Company’s consolidated financial statements in future reporting periods. |
Revenue Recognition | Revenue Recognition: Revenue is recognized when control of goods or services is transferred to our customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Sales and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue. The Company offers a variety of sales incentives to its customers primarily in the form of discounts and rebates. Discounts are recognized in the consolidated financial statements at the date of the related sale. Rebates are based on the revenue to date and the contractual rebate percentage to be paid. A portion of the cost of the rebate is allocated to each underlying sales transaction. Discounts and rebates are included in the determination of net sales. The Company also establishes reserves for customer returns and allowances. The reserve is established based on historical rates of returns and allowances. The reserve is adjusted quarterly based on actual experience. Returns and allowances are included in the determination of net sales. The following table displays our disaggregated revenue by product category: Thirteen weeks ended September 26, 2020 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue Fastening and Hardware $ 202,876 $ — $ 38,383 $ 241,259 Personal Protective 97,431 — 12 97,443 Keys and Key Accessories — 44,974 790 45,764 Engraving — 14,205 2 14,207 Resharp — 7 — 7 Consolidated $ 300,307 $ 59,186 $ 39,187 $ 398,680 Thirteen weeks ended September 28, 2019 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue Fastening and Hardware $ 163,860 $ — $ 31,362 $ 195,222 Personal Protective 59,087 — — 59,087 Keys and Key Accessories — 49,230 1,170 50,400 Engraving — 12,556 1 12,557 Resharp — 11 — 11 Consolidated $ 222,947 $ 61,797 $ 32,533 $ 317,277 Thirty-nine weeks ended September 26, 2020 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue Fastening and Hardware $ 543,832 $ — $ 98,430 $ 642,262 Personal Protective 239,151 — 78 239,229 Keys and Key Accessories — 119,001 2,039 121,040 Engraving — 38,666 5 38,671 Resharp — 24 — 24 Consolidated $ 782,983 $ 157,691 $ 100,552 $ 1,041,226 Thirty-nine weeks ended September 28, 2019 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue Fastening and Hardware $ 465,524 $ — $ 96,248 $ 561,772 Personal Protective 185,430 — — 185,430 Keys and Key Accessories — 139,718 2,983 142,701 Engraving — 39,646 4 39,650 Resharp — 11 — 11 Consolidated $ 650,954 $ 179,375 $ 99,235 $ 929,564 The following table disaggregates our revenue by geographic location: Thirteen weeks ended September 26, 2020 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue United States $ 295,689 $ 58,566 $ — $ 354,255 Canada 2,292 620 39,187 42,099 Mexico 2,326 — — 2,326 Consolidated $ 300,307 $ 59,186 $ 39,187 $ 398,680 Thirteen weeks ended September 28, 2019 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue United States $ 218,585 $ 61,241 $ — $ 279,826 Canada 1,622 556 32,533 34,711 Mexico 2,740 — — 2,740 Consolidated $ 222,947 $ 61,797 $ 32,533 $ 317,277 Thirty-nine weeks ended September 26, 2020 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue United States $ 771,064 $ 156,249 $ — $ 927,313 Canada 4,833 1,442 100,552 106,827 Mexico 7,086 — — 7,086 Consolidated $ 782,983 $ 157,691 $ 100,552 $ 1,041,226 Thirty-nine weeks ended September 28, 2019 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue United States $ 638,322 $ 178,028 $ — $ 816,350 Canada 4,045 1,347 99,235 104,627 Mexico 8,587 — — 8,587 Consolidated $ 650,954 $ 179,375 $ 99,235 $ 929,564 Our revenue by geography is allocated based on the location of our sales operations. Our Fastening, Hardware, and Personal Protective Solutions segment contains sales of Big Time Products ("Big Time") personal protective equipment into Canada. Our Consumer Connected Solutions segment contains sales of MinuteKey into Canada. Fastening, Hardware, and Personal Protective Solutions revenues consist primarily of the delivery of fasteners, anchors, specialty fastening products, and personal protective equipment such as gloves and eye-wear as well as in-store merchandising services for the related product category. Consumer Connected Solutions revenues consist primarily of sales of keys and identification tags through self service key duplication and engraving kiosks. It also includes our associate-assisted key duplication systems and key accessories. Canada revenues consist primarily of the delivery to Canadian customers of fasteners and related hardware items, threaded rod, keys, key duplicating systems, accessories, personal protective equipment, and identification items as well as in-store merchandising services for the related product category. The Company’s performance obligations under its arrangements with customers are providing products, in-store merchandising services, and access to key duplicating and engraving equipment. Generally, the price of the merchandising services and the access to the key duplicating and engraving equipment is included in the price of the related products. Control of products is transferred at the point in time when the customer accepts the goods. The Company’s obligation to provide in-store service and access to key duplicating and engraving equipment is satisfied when control of the related products is transferred. Therefore, the entire amount of consideration related to the sale of products, in-store merchandising services, and access to key duplicating and engraving equipment is recognized upon the customer’s acceptance of the products. The revenues for all performance obligations are recognized upon the customer's acceptance of the products. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 9 Months Ended |
Sep. 26, 2020 | |
Accounting Policies [Abstract] | |
New Accounting Pronouncements, Policy | In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses . The ASU sets forth a “current expected credit loss” (CECL) model which requires the Company to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost and applies to some off-balance sheet credit exposures. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company adopted this ASU in the first quarter of fiscal 2020, and it did not have a material impact on the Company's Condensed Consolidated Financial Statements. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting which provide optional guidance for a limited time to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. The amendments apply only to contracts and hedging relationships that reference LIBOR or another reference rate expected to be discontinued due to reference rate reform. These amendments are effective immediately and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. The Company is currently evaluating contracts and the optional expedients provided by the new standard. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 26, 2020 | |
Accounting Policies [Abstract] | |
Disaggregation of Revenue | The following table displays our disaggregated revenue by product category: Thirteen weeks ended September 26, 2020 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue Fastening and Hardware $ 202,876 $ — $ 38,383 $ 241,259 Personal Protective 97,431 — 12 97,443 Keys and Key Accessories — 44,974 790 45,764 Engraving — 14,205 2 14,207 Resharp — 7 — 7 Consolidated $ 300,307 $ 59,186 $ 39,187 $ 398,680 Thirteen weeks ended September 28, 2019 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue Fastening and Hardware $ 163,860 $ — $ 31,362 $ 195,222 Personal Protective 59,087 — — 59,087 Keys and Key Accessories — 49,230 1,170 50,400 Engraving — 12,556 1 12,557 Resharp — 11 — 11 Consolidated $ 222,947 $ 61,797 $ 32,533 $ 317,277 Thirty-nine weeks ended September 26, 2020 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue Fastening and Hardware $ 543,832 $ — $ 98,430 $ 642,262 Personal Protective 239,151 — 78 239,229 Keys and Key Accessories — 119,001 2,039 121,040 Engraving — 38,666 5 38,671 Resharp — 24 — 24 Consolidated $ 782,983 $ 157,691 $ 100,552 $ 1,041,226 Thirty-nine weeks ended September 28, 2019 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue Fastening and Hardware $ 465,524 $ — $ 96,248 $ 561,772 Personal Protective 185,430 — — 185,430 Keys and Key Accessories — 139,718 2,983 142,701 Engraving — 39,646 4 39,650 Resharp — 11 — 11 Consolidated $ 650,954 $ 179,375 $ 99,235 $ 929,564 The following table disaggregates our revenue by geographic location: Thirteen weeks ended September 26, 2020 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue United States $ 295,689 $ 58,566 $ — $ 354,255 Canada 2,292 620 39,187 42,099 Mexico 2,326 — — 2,326 Consolidated $ 300,307 $ 59,186 $ 39,187 $ 398,680 Thirteen weeks ended September 28, 2019 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue United States $ 218,585 $ 61,241 $ — $ 279,826 Canada 1,622 556 32,533 34,711 Mexico 2,740 — — 2,740 Consolidated $ 222,947 $ 61,797 $ 32,533 $ 317,277 Thirty-nine weeks ended September 26, 2020 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue United States $ 771,064 $ 156,249 $ — $ 927,313 Canada 4,833 1,442 100,552 106,827 Mexico 7,086 — — 7,086 Consolidated $ 782,983 $ 157,691 $ 100,552 $ 1,041,226 Thirty-nine weeks ended September 28, 2019 Fastening, Hardware, and Personal Protective Solutions Consumer Connected Solutions Canada Total Revenue United States $ 638,322 $ 178,028 $ — $ 816,350 Canada 4,045 1,347 99,235 104,627 Mexico 8,587 — — 8,587 Consolidated $ 650,954 $ 179,375 $ 99,235 $ 929,564 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 26, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Goodwill Amounts by Operating Segment | Goodwill amounts by reportable segment are summarized as follows: Goodwill at Acquisitions Dispositions Adjustments Other (1) Goodwill at December 28, 2019 September 26, 2020 Fastening, Hardware, and Personal Protection $ 567,847 $ — $ — $ — $ (604) $ 567,243 Consumer Connected Solutions 222,096 — — — — 222,096 Canada 29,134 — — — (692) 28,442 Total $ 819,077 $ — $ — $ — $ (1,296) $ 817,781 |
Schedule of Finite-Lived Intangible Assets | Other intangibles, net, as of September 26, 2020 and December 28, 2019 consist of the following: Estimated September 26, 2020 December 28, 2019 Customer relationships 13 - 20 $ 939,908 $ 941,305 Trademarks - Indefinite Indefinite 85,262 85,517 Trademarks - Other 7 - 15 26,400 26,700 Technology and patents 7 - 12 63,724 60,968 Intangible assets, gross 1,115,294 1,114,490 Less: Accumulated amortization 275,972 232,060 Other intangibles, net $ 839,322 $ 882,430 |
Schedule of Indefinite-Lived Intangible Assets | Other intangibles, net, as of September 26, 2020 and December 28, 2019 consist of the following: Estimated September 26, 2020 December 28, 2019 Customer relationships 13 - 20 $ 939,908 $ 941,305 Trademarks - Indefinite Indefinite 85,262 85,517 Trademarks - Other 7 - 15 26,400 26,700 Technology and patents 7 - 12 63,724 60,968 Intangible assets, gross 1,115,294 1,114,490 Less: Accumulated amortization 275,972 232,060 Other intangibles, net $ 839,322 $ 882,430 |
Restructuring Restructuring (Ta
Restructuring Restructuring (Tables) | 9 Months Ended |
Sep. 26, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | The following is a summary of the charges incurred: Thirteen Weeks Ended Thirteen Weeks Ended Thirty-nine Weeks Ended Thirty-nine Weeks Ended Facility consolidation (1) Labor expense (income) $ 19 $ 451 $ 396 $ 962 Inventory valuation adjustments 47 446 47 446 Consulting and legal fees 63 57 114 173 Other expense 51 541 713 1,037 Rent and related charges 434 85 1,523 265 Severance 37 — 569 — Exit of certain lines of business (2) Inventory valuation adjustments — 285 — 294 Gain on disposal of assets — (61) — (458) Severance — — — — Other expense — 70 — 392 Total $ 651 $ 1,874 $ 3,362 $ 3,111 (1) Facility consolidation includes labor expense related to organizing inventory and equipment in preparation for the facility consolidation, consulting and legal fees related to the project, and other expenses. These expenses were included in SG&A on the Condensed Consolidated Statement of Comprehensive Loss. (2) As part of the restructuring, the Company is exiting a manufacturing business line. Related charges included gains and losses on disposals of assets, and other expenses, which were included other income and expense, and SG&A on the Condensed Consolidated Statement of Comprehensive Loss, respectively. Thirteen Weeks Ended Thirteen Weeks Ended Thirty-nine Weeks Ended Thirty-nine Weeks Ended Inventory valuation adjustments $ 1,568 $ — $ 1,568 $ — Severance 237 — 1,117 $ — Other 382 — 382 — Total $ 2,187 $ — $ 3,067 $ — |
Schedule of Restructuring Reserve by Type of Cost | The following represents the roll forward of Canada restructuring reserves for the current period: Balance at December 28, 2019 Impact to Earnings Cash Paid Balance at September 26, 2020 Severance and related $ 1,121 569 (680) $ 1,010 The following represents the roll forward of United States restructuring reserves for the current period: Balance at December 28, 2019 Impact to Earnings Cash Paid Balance at September 26, 2020 Severance and related $ 3,286 1,117 (3,224) $ 1,179 |
Long-Term Debt Long Term Debt (
Long-Term Debt Long Term Debt (Tables) | 9 Months Ended |
Sep. 26, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | The following table summarizes the Company’s debt: September 26, 2020 December 28, 2019 Revolving loans $ 97,000 $ 113,000 Senior term loan, due 2025 1,039,696 1,047,653 6.375% Senior Notes, due 2022 330,000 330,000 11.6% Junior Subordinated Debentures - Preferred 105,443 105,443 Junior Subordinated Debentures - Common 3,261 3,261 Capital & finance leases 2,035 2,275 1,577,435 1,601,632 Unamortized premium on 11.6% Junior Subordinated Debentures 14,984 16,110 Unamortized discount on Senior term loan (6,908) (8,040) Current portion of long term debt, capital leases and finance leases (11,423) (11,358) Deferred financing fees (11,660) (14,055) Total long term debt, net $ 1,562,428 $ 1,584,289 |
Leases Leases (Tables)
Leases Leases (Tables) | 9 Months Ended |
Sep. 26, 2020 | |
Leases [Abstract] | |
Lease, Cost | The components of operating and finance lease cost for the thirteen and thirty-nine weeks ended September 26, 2020 and thirteen and thirty-nine weeks ended September 28, 2019 were as follows: Thirteen Weeks Ended Thirty-nine Weeks Ended Thirteen Weeks Ended Thirty-nine Weeks Ended Operating lease cost $ 4,989 $ 14,283 $ 5,101 $ 14,399 Short term lease costs 633 1,682 668 2,644 Variable lease costs 104 775 720 1,795 Finance lease cost: Amortization of right of use assets 206 608 190 425 Interest on lease liabilities 34 106 35 78 September 26, 2020 December 28, 2019 Operating Leases Finance Leases Operating Leases Finance Leases Weighted average remaining lease term 7.36 2.81 7.88 3.46 Weighted average discount rate 8.24 % 6.84 % 7.81 % 6.49 % Supplemental cash flow information related to the Company's operating leases was as follows for the thirty-nine weeks ended September 26, 2020 and thirty-nine weeks ended September 28, 2019: Thirty-nine Weeks Ended Thirty-nine Weeks Ended Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflow from operating leases $ 13,821 $ 13,872 Operating cash outflow from finance leases 106 66 Financing cash outflow from finance leases 624 484 |
Assets and Liabilities, Lessee | Supplemental balance sheet information related to the Company's finance leases was as follows as of September 26, 2020 and December 28, 2019: September 26, 2020 December 28, 2019 Finance lease assets, net, included in property plant and equipment $ 1,902 $ 2,101 Current portion of long-term debt 814 749 Long-term debt, less current portion 1,221 1,526 Total principal payable on finance leases 2,035 2,275 |
Lessee, Operating Lease, Liability Maturity | Maturities of our lease liabilities for all operating and finance leases are as follows as of September 26, 2020: Operating Leases Finance Leases Less than one year $ 18,428 $ 932 1 to 2 years 15,845 692 2 to 3 years 13,846 414 3 to 4 years 13,019 211 4 to 5 years 12,080 — After 5 years 37,814 — Total future minimum rental commitments 111,032 2,249 Less - amounts representing interest (28,323) (214) Present value of lease liabilities $ 82,709 $ 2,035 |
Lessee, Financing Lease, Liability Maturity | Maturities of our lease liabilities for all operating and finance leases are as follows as of September 26, 2020: Operating Leases Finance Leases Less than one year $ 18,428 $ 932 1 to 2 years 15,845 692 2 to 3 years 13,846 414 3 to 4 years 13,019 211 4 to 5 years 12,080 — After 5 years 37,814 — Total future minimum rental commitments 111,032 2,249 Less - amounts representing interest (28,323) (214) Present value of lease liabilities $ 82,709 $ 2,035 |
Schedule of Future Minimum Rental Payments for Operating Leases | As of December 28, 2019, maturities of our lease liabilities for all operating and finance leases were expected to be as follows: Operating Leases Finance Leases Less than one year $ 17,525 $ 873 1 to 2 years 15,956 712 2 to 3 years 13,925 456 3 to 4 years 12,045 383 4 to 5 years 11,716 127 After 5 years 43,591 — Total future minimum rental commitments 114,758 2,551 Less - amounts representing interest (30,072) (276) Present value of lease liabilities 84,686 2,275 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 26, 2020 | |
Fair Value Disclosures [Abstract] | |
Measurement of Assets and Liabilities at Fair Value on Recurring Basis | The following tables set forth the Company’s financial assets and liabilities that were measured at fair value on a recurring basis during the period, by level, within the fair value hierarchy: As of September 26, 2020 Level 1 Level 2 Level 3 Total Trading securities $ 1,609 $ — $ — $ 1,609 Interest rate swaps — (4,762) — (4,762) Contingent consideration payable — — (18,418) (18,418) As of December 28, 2019 Level 1 Level 2 Level 3 Total Trading securities $ 1,911 $ — $ — $ 1,911 Interest rate swaps — (3,592) — (3,592) Contingent consideration payable — — (18,100) (18,100) |
Fair Value of Company's Fixed Rate Senior Notes and Junior Subordinated Debentures | The fair value of the Company's fixed rate senior notes and junior subordinated debentures as of September 26, 2020 and December 28, 2019 were determined by utilizing current trading prices obtained from indicative market data. As a result, the fair value measurements of the Company's senior term notes and debentures are considered to be Level 2. September 26, 2020 December 28, 2019 Carrying Estimated Carrying Estimated 6.375% Senior Notes $ 328,055 $ 314,325 $ 327,222 $ 305,250 Junior Subordinated Debentures 123,688 121,821 124,814 148,731 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 26, 2020 | |
Segment Reporting [Abstract] | |
Revenues and Income from Operations for Reportable Segments | The table below presents revenues and income (loss) from operations for our reportable segments for the thirteen and thirty-nine weeks ended September 26, 2020 and thirteen and thirty-nine weeks ended September 28, 2019. Thirteen Weeks Ended Thirteen Weeks Ended Thirty-nine Weeks Ended Thirty-nine Weeks Ended Revenues Fastening, Hardware, and Personal Protective Solutions $ 300,307 $ 222,947 $ 782,983 $ 650,954 Consumer Connected Solutions 59,186 61,797 157,691 179,375 Canada 39,187 32,533 100,552 99,235 Total revenues $ 398,680 $ 317,277 $ 1,041,226 $ 929,564 Segment income (loss) from operations Fastening, Hardware, and Personal Protective Solutions $ 30,107 $ 8,000 $ 63,383 $ 16,361 Consumer Connected Solutions 3,046 4,243 4,432 3,859 Canada 1,949 (2,290) (2,539) (1,456) Total income from operations $ 35,102 $ 9,953 $ 65,276 $ 18,764 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2020 | Sep. 28, 2019 | Sep. 26, 2020 | Sep. 28, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 398,680 | $ 317,277 | $ 1,041,226 | $ 929,564 |
Fastening and Hardware [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 241,259 | 195,222 | 642,262 | 561,772 |
Personal Protective Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 97,443 | 59,087 | 239,229 | 185,430 |
Key and Key Accessories [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 45,764 | 50,400 | 121,040 | 142,701 |
Engraving [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 14,207 | 12,557 | 38,671 | 39,650 |
Resharp | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 7 | 11 | 24 | 11 |
Fasteners, Hardware and Personal Protection Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 300,307 | 222,947 | 782,983 | 650,954 |
Fasteners, Hardware and Personal Protection Segment [Member] | Fastening and Hardware [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 202,876 | 163,860 | 543,832 | 465,524 |
Fasteners, Hardware and Personal Protection Segment [Member] | Personal Protective Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 97,431 | 59,087 | 239,151 | 185,430 |
Fasteners, Hardware and Personal Protection Segment [Member] | Key and Key Accessories [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Fasteners, Hardware and Personal Protection Segment [Member] | Engraving [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Fasteners, Hardware and Personal Protection Segment [Member] | Resharp | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Consumer Connected Solutions Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 59,186 | 61,797 | 157,691 | 179,375 |
Consumer Connected Solutions Segment [Member] | Fastening and Hardware [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Consumer Connected Solutions Segment [Member] | Personal Protective Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Consumer Connected Solutions Segment [Member] | Key and Key Accessories [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 44,974 | 49,230 | 119,001 | 139,718 |
Consumer Connected Solutions Segment [Member] | Engraving [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 14,205 | 12,556 | 38,666 | 39,646 |
Consumer Connected Solutions Segment [Member] | Resharp | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 7 | 11 | 24 | 11 |
Canada Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 39,187 | 32,533 | 100,552 | 99,235 |
Canada Segment [Member] | Fastening and Hardware [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 38,383 | 31,362 | 98,430 | 96,248 |
Canada Segment [Member] | Personal Protective Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 12 | 0 | 78 | 0 |
Canada Segment [Member] | Key and Key Accessories [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 790 | 1,170 | 2,039 | 2,983 |
Canada Segment [Member] | Engraving [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2 | 1 | 5 | 4 |
Canada Segment [Member] | Resharp | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
UNITED STATES | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 354,255 | 279,826 | 927,313 | 816,350 |
UNITED STATES | Fasteners, Hardware and Personal Protection Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 295,689 | 218,585 | 771,064 | 638,322 |
UNITED STATES | Consumer Connected Solutions Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 58,566 | 61,241 | 156,249 | 178,028 |
UNITED STATES | Canada Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
CANADA | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 42,099 | 34,711 | 106,827 | 104,627 |
CANADA | Fasteners, Hardware and Personal Protection Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2,292 | 1,622 | 4,833 | 4,045 |
CANADA | Consumer Connected Solutions Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 620 | 556 | 1,442 | 1,347 |
CANADA | Canada Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 39,187 | 32,533 | 100,552 | 99,235 |
OTHER [Domain] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2,326 | 2,740 | 7,086 | 8,587 |
OTHER [Domain] | Fasteners, Hardware and Personal Protection Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2,326 | 2,740 | 7,086 | 8,587 |
OTHER [Domain] | Consumer Connected Solutions Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
OTHER [Domain] | Canada Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 0 | $ 0 | $ 0 | $ 0 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - USD ($) $ in Thousands | Feb. 19, 2020 | Sep. 26, 2020 | Sep. 28, 2019 |
Business Acquisition [Line Items] | |||
Payments to Acquire Businesses, Net of Cash Acquired | $ (800) | $ (6,135) | |
Instafob [Member] | |||
Business Acquisition [Line Items] | |||
Business Combination, Consideration Transferred | $ 2,618 | ||
Payments to Acquire Businesses, Net of Cash Acquired | $ (800) | ||
Business Combination, Consideration Transferred, Liabilities Incurred | $ 1,818 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Summary of Goodwill Amounts by Operating Segment (Detail) $ in Thousands | 9 Months Ended |
Sep. 26, 2020USD ($) | |
Goodwill [Roll Forward] | |
Beginning balance | $ 819,077 |
Acquisitions | 0 |
Dispositions | 0 |
Goodwill, Purchase Accounting Adjustments | 0 |
Other | (1,296) |
Ending balance | 817,781 |
Fasteners, Hardware and Personal Protection Segment [Member] | |
Goodwill [Roll Forward] | |
Beginning balance | 567,847 |
Acquisitions | 0 |
Dispositions | 0 |
Goodwill, Purchase Accounting Adjustments | 0 |
Other | (604) |
Ending balance | 567,243 |
Consumer Connected Solutions Segment [Member] | |
Goodwill [Roll Forward] | |
Beginning balance | 222,096 |
Acquisitions | 0 |
Dispositions | 0 |
Goodwill, Purchase Accounting Adjustments | 0 |
Other | 0 |
Ending balance | 222,096 |
Canada Segment [Member] | |
Goodwill [Roll Forward] | |
Beginning balance | 29,134 |
Acquisitions | 0 |
Dispositions | 0 |
Goodwill, Purchase Accounting Adjustments | 0 |
Other | (692) |
Ending balance | $ 28,442 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Components of Other Intangibles, Net (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 26, 2020 | Sep. 28, 2019 | Sep. 26, 2020 | Sep. 28, 2019 | Dec. 28, 2019 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Intangible assets, gross | $ 1,115,294,000 | $ 1,115,294,000 | $ 1,114,490,000 | ||
Less: Accumulated amortization | 275,972,000 | 275,972,000 | 232,060,000 | ||
Other intangibles, net | 839,322,000 | 839,322,000 | 882,430,000 | ||
Amortization | 14,883,000 | $ 14,665,000 | 44,596,000 | $ 44,114,000 | |
Amortization | 14,883,000 | $ 14,665,000 | 44,596,000 | $ 44,114,000 | |
Trademarks | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Indefinite Intangible assets, gross | 85,262,000 | 85,262,000 | 85,517,000 | ||
Customer relationships | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Finite-lived intangible assets, gross | 939,908,000 | $ 939,908,000 | 941,305,000 | ||
Customer relationships | Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 13 years | ||||
Customer relationships | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 20 years | ||||
Trademarks | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Finite-lived intangible assets, gross | 26,400,000 | $ 26,400,000 | 26,700,000 | ||
Trademarks | Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 7 years | ||||
Trademarks | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 15 years | ||||
Technology and patents | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Finite-lived intangible assets, gross | $ 63,724,000 | $ 63,724,000 | $ 60,968,000 | ||
Technology and patents | Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 7 years | ||||
Technology and patents | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 12 years |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2020 | Sep. 28, 2019 | Sep. 26, 2020 | Sep. 28, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization of intangible assets | $ 14,883 | $ 14,665 | $ 44,596 | $ 44,114 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Detail) | 3 Months Ended |
Sep. 26, 2020USD ($) | |
Loss Contingencies [Line Items] | |
Losses up to per occurrence related to product liability, automotive, workers' compensation and general liability | $ 250,000 |
Letters of credit, outstanding | 19,401,000 |
Maximum | |
Loss Contingencies [Line Items] | |
Occurrences in excess for purchased catastrophic coverage | 60,000,000 |
Minimum | |
Loss Contingencies [Line Items] | |
Occurrences in excess for purchased catastrophic coverage | 250,000 |
Insurance Claims | |
Loss Contingencies [Line Items] | |
Liability recorded for such risk insurance reserves | 2,221,000 |
Group Health Insurance Claims | |
Loss Contingencies [Line Items] | |
Losses up to per occurrence related to product liability, automotive, workers' compensation and general liability | 250,000 |
Liability recorded for such risk insurance reserves | $ 2,530,000 |
Related Party Transactions - Na
Related Party Transactions - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2020 | Sep. 28, 2019 | Sep. 26, 2020 | Sep. 28, 2019 | |
Related Party Transaction [Line Items] | ||||
Related party expenses | $ 130 | $ 140 | $ 451 | $ 396 |
Industrial Warehouse and Office Facility Lease Agreement - Manns | Affiliated Entity | ||||
Related Party Transaction [Line Items] | ||||
Related party expenses | $ 88 | $ 87 | $ 263 | $ 262 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2020 | Sep. 28, 2019 | Sep. 26, 2020 | Sep. 28, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rates | 11.60% | 20.60% | 74.30% | 2.60% |
Income tax (benefit) expense | $ 1,400 | $ (3,775) | $ (9,593) | $ (1,844) |
Restructuring - Summary of Cost
Restructuring - Summary of Costs Incurred (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2020 | Sep. 28, 2019 | Sep. 26, 2020 | Sep. 28, 2019 | |
CANADA | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total | $ 651 | $ 1,874 | $ 3,362 | $ 3,111 |
CANADA | Facility Consolidation | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Labor expense (income) | 19 | 451 | 396 | 962 |
Other expense | 51 | 541 | 713 | 1,037 |
Rent and related charges | 434 | 85 | 1,523 | 265 |
Inventory valuation adjustments | 47 | 446 | 47 | 446 |
Consulting and Legal Expenses | 63 | 57 | 114 | 173 |
Severance Costs | 37 | 0 | 569 | 0 |
CANADA | Exit of certain lines of business | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Other expense | 0 | 70 | 0 | 392 |
Inventory valuation adjustments | 0 | 285 | 0 | 294 |
Gain on disposal of assets | 0 | (61) | 0 | (458) |
Severance Costs | 0 | 0 | 0 | 0 |
UNITED STATES | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Other expense | 382 | 0 | 382 | 0 |
Inventory valuation adjustments | 1,568 | 0 | 1,568 | 0 |
Severance Costs | 237 | 0 | 1,117 | 0 |
Total | $ 2,187 | $ 0 | $ 3,067 | $ 0 |
Restructuring - Restructuring R
Restructuring - Restructuring Reserve (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2020 | Sep. 28, 2019 | Sep. 26, 2020 | Sep. 28, 2019 | |
UNITED STATES | ||||
Restructuring Reserve [Roll Forward] | ||||
Impact to Earnings | $ 2,187 | $ 0 | $ 3,067 | $ 0 |
UNITED STATES | Severance and related | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning balance | 3,286 | |||
Impact to Earnings | 1,117 | |||
Cash Paid | (3,224) | |||
Ending balance | 1,179 | 1,179 | ||
CANADA | ||||
Restructuring Reserve [Roll Forward] | ||||
Impact to Earnings | 651 | $ 1,874 | 3,362 | $ 3,111 |
CANADA | Severance and related | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning balance | 1,121 | |||
Impact to Earnings | 569 | |||
Cash Paid | (680) | |||
Ending balance | $ 1,010 | $ 1,010 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Detail) - USD ($) $ in Thousands | Sep. 26, 2020 | Dec. 28, 2019 |
Debt Instrument [Line Items] | ||
Letters of credit, outstanding | $ 19,401 | |
Revolving loans | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 97,000 | $ 113,000 |
Remaining borrowing capacity | 133,599 | |
Senior term loan, due 2025 | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 1,039,696 | $ 1,047,653 |
Long-Term Debt - Summary of Lon
Long-Term Debt - Summary of Long-term Debt (Details) - USD ($) $ in Thousands | Sep. 26, 2020 | Dec. 28, 2019 |
Debt Instrument [Line Items] | ||
Capital & finance leases | $ 2,035 | $ 2,275 |
Long-term debt, capital and finance leases | 1,577,435 | 1,601,632 |
Unamortized premium on 11.6% Junior Subordinated Debentures | 14,984 | 16,110 |
Unamortized discount on Senior term loan | 6,908 | 8,040 |
Current portion of long term debt, capital leases and finance leases | (11,423) | (11,358) |
Deferred financing fees | 11,660 | 14,055 |
Long-term debt | 1,562,428 | 1,584,289 |
Revolving loans | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 97,000 | 113,000 |
Senior term loan, due 2025 | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 1,039,696 | 1,047,653 |
6.375% Senior Notes, due 2022 | ||
Debt Instrument [Line Items] | ||
Debt instrument, stated rate | 6.375% | |
Long-term debt, gross | $ 330,000 | 330,000 |
11.6% Junior Subordinated Debentures - Preferred | ||
Debt Instrument [Line Items] | ||
Debt instrument, stated rate | 11.60% | |
Long-term debt, gross | $ 105,443 | 105,443 |
Junior Subordinated Debentures - Common | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 3,261 | $ 3,261 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2020 | Sep. 28, 2019 | Sep. 26, 2020 | Sep. 28, 2019 | |
Leases [Abstract] | ||||
Operating lease cost | $ 4,989 | $ 5,101 | $ 14,283 | $ 14,399 |
Short term lease costs | 633 | 668 | 1,682 | 2,644 |
Variable lease costs | 104 | 720 | 775 | 1,795 |
Amortization of right of use assets | 206 | 190 | 608 | 425 |
Interest on lease liabilities | $ 34 | $ 35 | $ 106 | $ 78 |
Leases - Lease Maturities (Deta
Leases - Lease Maturities (Details) - USD ($) $ in Thousands | Sep. 26, 2020 | Dec. 28, 2019 |
Operating Leases | ||
Less than one year | $ 18,428 | $ 17,525 |
1 to 2 years | 15,845 | 15,956 |
2 to 3 years | 13,846 | 13,925 |
3 to 4 years | 13,019 | 12,045 |
4 to 5 years | 12,080 | 11,716 |
After 5 years | 37,814 | 43,591 |
Total future minimum rental commitments | 111,032 | 114,758 |
Less - amounts representing interest | (28,323) | (30,072) |
Present value of lease liabilities | 82,709 | 84,686 |
Finance Leases | ||
Less than one year | 932 | 873 |
1 to 2 years | 692 | 712 |
2 to 3 years | 414 | 456 |
3 to 4 years | 211 | 383 |
4 to 5 years | 0 | 127 |
After 5 years | 0 | 0 |
Total future minimum rental commitments | 2,249 | 2,551 |
Less - amounts representing interest | (214) | (276) |
Present value of lease liabilities | $ 2,035 | $ 2,275 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2020 | Sep. 28, 2019 | Sep. 26, 2020 | Sep. 28, 2019 | |
Leases [Abstract] | ||||
Rent expense | $ 5,726 | $ 6,489 | $ 16,740 | $ 18,838 |
Leases - Weighted Average Assum
Leases - Weighted Average Assumptions (Details) | Sep. 26, 2020 | Dec. 28, 2019 |
Leases [Abstract] | ||
Operating leases, weighted average remaining term | 7 years 4 months 9 days | 7 years 10 months 17 days |
Finance lease, weighted average remaining term | 2 years 9 months 21 days | 3 years 5 months 15 days |
Operating lease, weighted average discount rate | 8.24% | 7.81% |
Finance lease, weighted average discount rate | 6.84% | 6.49% |
Leases - Finance Lease Balance
Leases - Finance Lease Balance Sheet Locations (Details) - USD ($) $ in Thousands | Sep. 26, 2020 | Dec. 28, 2019 |
Leases [Abstract] | ||
Finance lease, right of use assets | $ 1,902 | $ 2,101 |
Current portion of long-term debt | 814 | 749 |
Long-term debt, less current portion | 1,221 | 1,526 |
Total principal payable on finance leases | $ 2,035 | $ 2,275 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 26, 2020 | Sep. 28, 2019 | |
Leases [Abstract] | ||
Operating cash outflow from operating leases | $ 13,821 | $ 13,872 |
Operating cash outflow from finance leases | 106 | 66 |
Financing cash outflow from finance leases | $ 624 | $ 484 |
Derivatives and Hedging - Narra
Derivatives and Hedging - Narrative (Details) - USD ($) $ in Thousands | Nov. 08, 2018 | Jan. 08, 2018 | Sep. 26, 2020 | Dec. 28, 2019 |
Interest Rate Swap Agreement - 2018 Swap 1 | ||||
Derivative [Line Items] | ||||
Term of derivative instrument | 3 years | |||
Interest Rate Swap Agreement - 2018 Swap 2 | ||||
Derivative [Line Items] | ||||
Term of derivative instrument | 3 years | |||
Not Designated as Hedging Instrument | Interest rate swaps | ||||
Derivative [Line Items] | ||||
Gain (loss) on change in fair value | $ 1,170 | |||
Not Designated as Hedging Instrument | Interest Rate Swap Agreement - 2018 Swap 1 | ||||
Derivative [Line Items] | ||||
Derivative, Notional Amount | $ 90,000 | |||
Fixed interest rate | 2.30% | |||
Basis spread on variable rate | 4.00% | |||
Variable interest rate | 6.30% | |||
Not Designated as Hedging Instrument | Interest Rate Swap Agreement - 2018 Swap 2 | ||||
Derivative [Line Items] | ||||
Derivative, Notional Amount | $ 60,000 | |||
Fixed interest rate | 3.10% | |||
Basis spread on variable rate | 4.00% | |||
Variable interest rate | 7.10% | |||
Other Current Liabilities [Member] | Not Designated as Hedging Instrument | Interest rate swaps | ||||
Derivative [Line Items] | ||||
Derivative liability | $ (1,022) | |||
Other Noncurrent Liabilities [Member] | Not Designated as Hedging Instrument | Interest rate swaps | ||||
Derivative [Line Items] | ||||
Derivative liability | $ (3,740) | $ (3,592) |
Fair Value Measurements - Measu
Fair Value Measurements - Measurement of Assets and Liabilities at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 26, 2020 | Sep. 28, 2019 | Dec. 28, 2019 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Business Combination, Contingent Consideration, Liability | $ (18,418) | $ (18,100) | |
Change in fair value of contingent consideration | (1,300) | $ 0 | |
Resharp | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Change in fair value of contingent consideration | (1,300) | ||
Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Business Combination, Contingent Consideration, Liability | 0 | 0 | |
Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Business Combination, Contingent Consideration, Liability | 0 | 0 | |
Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Business Combination, Contingent Consideration, Liability | (18,418) | (18,100) | |
Fair Value Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Trading securities | 1,609 | 1,911 | |
Fair Value Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Trading securities | 1,609 | 1,911 | |
Fair Value Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Trading securities | 0 | 0 | |
Fair Value Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Trading securities | 0 | 0 | |
Interest rate swaps | Fair Value Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative liability | (4,762) | (3,592) | |
Interest rate swaps | Fair Value Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative liability | 0 | 0 | |
Interest rate swaps | Fair Value Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative liability | (4,762) | (3,592) | |
Interest rate swaps | Fair Value Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative liability | 0 | 0 | |
Other Current Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Business Combination, Contingent Consideration, Liability, Current | 2,035 | 2,275 | |
Other Noncurrent Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Business Combination, Contingent Consideration, Liability, Noncurrent | $ 16,383 | $ 15,825 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value of Company's Fixed Rate Senior Notes and Junior Subordinated Debentures (Details) - USD ($) $ in Thousands | Sep. 26, 2020 | Dec. 28, 2019 |
6.375% Senior Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, stated rate | 6.375% | |
6.375% Senior Notes | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | $ 328,055 | $ 327,222 |
6.375% Senior Notes | Estimated Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | 314,325 | 305,250 |
Junior Subordinated Debentures | Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | 123,688 | 124,814 |
Junior Subordinated Debentures | Estimated Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | $ 121,821 | $ 148,731 |
Segment Reporting - Narrative (
Segment Reporting - Narrative (Details) | 9 Months Ended |
Sep. 26, 2020Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Segment Reporting - Revenues an
Segment Reporting - Revenues and Income from Operations for Reportable Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2020 | Sep. 28, 2019 | Sep. 26, 2020 | Sep. 28, 2019 | |
Revenues | ||||
Net sales | $ 398,680 | $ 317,277 | $ 1,041,226 | $ 929,564 |
Segment income (loss) from operations | ||||
Total income from operations | 35,102 | 9,953 | 65,276 | 18,764 |
Fasteners, Hardware and Personal Protection Segment [Member] | ||||
Revenues | ||||
Net sales | 300,307 | 222,947 | 782,983 | 650,954 |
Segment income (loss) from operations | ||||
Total income from operations | 30,107 | 8,000 | 63,383 | 16,361 |
Consumer Connected Solutions Segment [Member] | ||||
Revenues | ||||
Net sales | 59,186 | 61,797 | 157,691 | 179,375 |
Segment income (loss) from operations | ||||
Total income from operations | 3,046 | 4,243 | 4,432 | 3,859 |
Canada Segment [Member] | ||||
Revenues | ||||
Net sales | 39,187 | 32,533 | 100,552 | 99,235 |
Segment income (loss) from operations | ||||
Total income from operations | $ 1,949 | $ (2,290) | $ (2,539) | $ (1,456) |