Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 26, 2015 | Oct. 16, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | CHARLES RIVER LABORATORIES INTERNATIONAL INC | |
Entity Central Index Key | 1,100,682 | |
Current Fiscal Year End Date | --12-26 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 26, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 46,623,582 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | |
Income Statement [Abstract] | ||||
Service revenue | $ 222,506 | $ 204,751 | $ 633,666 | $ 588,099 |
Product revenue | 126,959 | 122,816 | 375,786 | 380,015 |
Total revenue | 349,465 | 327,567 | 1,009,452 | 968,114 |
Costs and expenses: | ||||
Cost of services provided | 145,165 | 144,053 | 425,614 | 415,976 |
Cost of products sold | 66,225 | 65,246 | 193,320 | 199,423 |
Selling, general and administrative | 76,225 | 64,476 | 218,953 | 196,999 |
Amortization of intangible assets | 6,410 | 7,620 | 17,385 | 18,813 |
Operating income | 55,440 | 46,172 | 154,180 | 136,903 |
Other income (expense): | ||||
Interest income | 177 | 376 | 758 | 803 |
Interest expense | (3,851) | (2,997) | (11,251) | (9,171) |
Other income (expense), net | 1,390 | 331 | 1,749 | 8,874 |
Income from continuing operations, before income taxes | 53,156 | 43,882 | 145,436 | 137,409 |
Provision for income taxes | 15,255 | 11,582 | 26,662 | 36,021 |
Income from continuing operations, net of income taxes | 37,901 | 32,300 | 118,774 | 101,388 |
Income (loss) from discontinued operations, net of income taxes | (34) | 52 | (48) | (862) |
Net income | 37,867 | 32,352 | 118,726 | 100,526 |
Less: Net income attributable to noncontrolling interests | (488) | (316) | (1,297) | (994) |
Net income attributable to common shareholders | $ 37,379 | $ 32,036 | $ 117,429 | $ 99,532 |
Basic: | ||||
Continuing operations attributable to common shareholders (in dollars per share) | $ 0.81 | $ 0.70 | $ 2.52 | $ 2.15 |
Discontinued operations (in dollars per share) | 0 | 0 | 0 | (0.02) |
Net income attributable to common shareholders (in dollars per share) | 0.81 | 0.70 | 2.52 | 2.13 |
Diluted: | ||||
Continuing operations attributable to common shareholders (in dollars per share) | 0.79 | 0.68 | 2.47 | 2.11 |
Discontinued operations (in dollars per share) | 0 | 0 | 0 | (0.02) |
Net income attributable to common shareholders (in dollars per share) | $ 0.79 | $ 0.68 | $ 2.47 | $ 2.09 |
CONDENSED CONSOLIDATED STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 37,867 | $ 32,352 | $ 118,726 | $ 100,526 |
Foreign currency translation adjustment and other | (31,843) | (31,635) | (46,559) | (23,751) |
Cumulative translation adjustment related to intercompany loan forgiveness | 0 | 0 | (2,341) | 0 |
Pension and other post-retirement benefit plans: | ||||
Amortization of net loss and prior service benefit included in net periodic pension cost | 695 | 291 | 2,185 | 871 |
Comprehensive income, before income taxes | 6,719 | 1,008 | 72,011 | 77,646 |
Income tax expense related to items of other comprehensive income | 220 | 125 | 700 | 273 |
Comprehensive income, net of income taxes | 6,499 | 883 | 71,311 | 77,373 |
Less: Comprehensive income (loss) related to noncontrolling interests | (443) | 712 | 435 | 852 |
Comprehensive income attributable to common shareholders | $ 6,942 | $ 171 | $ 70,876 | $ 76,521 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands | Sep. 26, 2015 | Dec. 27, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 74,032 | $ 160,023 |
Trade receivables, net | 288,836 | 257,991 |
Inventories | 98,097 | 89,043 |
Prepaid assets | 33,593 | 26,900 |
Other current assets | 84,103 | 72,941 |
Total current assets | 578,661 | 606,898 |
Property, plant and equipment, net | 671,673 | 676,797 |
Goodwill | 418,245 | 321,077 |
Other intangible assets, net | 277,686 | 178,875 |
Deferred tax asset | 21,026 | 23,193 |
Other assets | 65,552 | 72,951 |
Total assets | 2,032,843 | 1,879,791 |
Current liabilities: | ||
Current portion of long-term debt and capital leases | 16,599 | 31,904 |
Accounts payable | 31,629 | 33,815 |
Accrued compensation | 71,518 | 71,569 |
Deferred revenue | 76,019 | 78,124 |
Accrued liabilities | 94,692 | 67,380 |
Other current liabilities | 21,347 | 11,079 |
Current liabilities of discontinued operations | 2,300 | 2,299 |
Total current liabilities | 314,104 | 296,170 |
Long-term debt, net and capital leases | 835,800 | 740,557 |
Other long-term liabilities | 139,756 | 130,361 |
Long-term liabilities of discontinued operations | 7,139 | 8,357 |
Total liabilities | $ 1,296,799 | $ 1,175,445 |
Commitments and contingencies | ||
Redeemable noncontrolling interest | $ 27,447 | $ 28,419 |
Equity: | ||
Preferred stock, $0.01 par value; 20,000 shares authorized; no shares issued and outstanding | 0 | 0 |
Common stock, $0.01 par value; 120,000 shares authorized; 85,388 shares issued and 46,623 shares outstanding at September 26, 2015 and 84,503 shares issued and 47,327 shares outstanding at December 27, 2014 | 854 | 845 |
Additional paid-in capital | 2,386,342 | 2,307,640 |
Accumulated deficit | (21,346) | (138,775) |
Treasury stock, at cost 38,765 shares and 37,176 shares at September 26, 2015 and December 27, 2014, respectively | (1,540,691) | (1,423,260) |
Accumulated other comprehensive loss | (120,800) | (74,247) |
Total equity attributable to common shareholders | 704,359 | 672,203 |
Noncontrolling interests | 4,238 | 3,724 |
Total equity and redeemable noncontrolling interest | 736,044 | 704,346 |
Total liabilities, equity and redeemable noncontrolling interest | $ 2,032,843 | $ 1,879,791 |
CONDENSED CONSOLIDATED BALANCE5
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares | Sep. 26, 2015 | Dec. 27, 2014 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 120,000,000 | 120,000,000 |
Common stock, shares issued (in shares) | 85,388,000 | 84,503,000 |
Common stock, shares outstanding (in shares) | 46,623,000 | 47,327,000 |
Treasury stock (in shares) | 38,765,000 | 37,176,000 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 26, 2015 | Sep. 27, 2014 | |
Cash flows relating to operating activities | ||
Net income | $ 118,726 | $ 100,526 |
Less: Loss from discontinued operations | (48) | (862) |
Income from continuing operations | 118,774 | 101,388 |
Adjustments to reconcile net income from continuing operations to net cash provided by operating activities: | ||
Depreciation and amortization | 69,330 | 70,435 |
Amortization of debt issuance costs | 1,970 | 1,298 |
Stock-based compensation | 30,349 | 23,132 |
Deferred income taxes | (4,235) | 1,140 |
Gain on investments in limited partnerships | (3,604) | (7,377) |
Gain on bargain purchase | (9,933) | 0 |
Other, net | 1,101 | (1,546) |
Changes in assets and liabilities: | ||
Trade receivables, net | (36,430) | (40,961) |
Inventories | (470) | (4,573) |
Other assets | 8,308 | (15,055) |
Accounts payable | (894) | (1,779) |
Accrued compensation | 2,238 | 10,795 |
Deferred revenue | 1,255 | 8,826 |
Accrued liabilities | 22,189 | 13,355 |
Taxes payable and prepaid taxes | (1,906) | (3,953) |
Other liabilities | (12,147) | (2,842) |
Net cash provided by operating activities | 185,895 | 152,283 |
Cash flows relating to investing activities | ||
Acquisition of businesses and assets, net of cash acquired | (211,974) | (183,151) |
Capital expenditures | (35,008) | (29,907) |
Purchases of investments | (26,315) | (18,171) |
Proceeds from sale of investments and distributions from investments in limited partnerships | 24,562 | 15,964 |
Other, net | (244) | (1,924) |
Net cash used in investing activities | (248,979) | (217,189) |
Cash flows relating to financing activities | ||
Proceeds from long-term debt and revolving credit agreement | 453,778 | 247,920 |
Proceeds from exercises of stock options | 36,587 | 46,741 |
Payments on long-term debt, capital lease obligations and revolving credit agreement | (391,048) | (132,431) |
Purchase of treasury stock | (117,431) | (121,985) |
Other, net | 6,674 | 4,051 |
Net cash provided by (used in) financing activities | (11,440) | 44,296 |
Discontinued operations | ||
Net cash used in operating activities from discontinued operations | (1,265) | (570) |
Effect of exchange rate changes on cash and cash equivalents | (10,202) | (4,000) |
Net change in cash and cash equivalents | (85,991) | (25,180) |
Cash and cash equivalents, beginning of period | 160,023 | 155,927 |
Cash and cash equivalents, end of period | $ 74,032 | $ 130,747 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 26, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION The accompanying condensed consolidated financial statements are unaudited and have been prepared by Charles River Laboratories International, Inc. (the Company) in accordance with accounting principles generally accepted in the United States (U.S. GAAP) and pursuant to Rule 10-01 of Regulation S-X. The year-end condensed consolidated balance sheet data was derived from the Company’s audited financial statements, but does not include all disclosures required by U.S. GAAP. These interim condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the fiscal year ended December 27, 2014 . The condensed consolidated financial statements, in the opinion of management, reflect all normal and recurring adjustments necessary for a fair statement of our financial position and results of operations. Certain reclassifications have been made to prior year amounts to conform to the current year presentation. The Company’s fiscal year is the twelve-month period ending the last Saturday in December. Use of Estimates The preparation of condensed consolidated financial statements in accordance with U.S. GAAP requires that the Company make estimates and judgments that may affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates, judgments and methodologies. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions. Changes in estimates are reflected in reported results in the period in which they become known. Consolidation The Company’s consolidated financial statements reflect its financial statements and those of its subsidiaries in which the Company holds a controlling financial interest. For consolidated entities in which the Company owns or is exposed to less than 100% of the economics, the Company records net income (loss) attributable to noncontrolling interests in its consolidated statements of income equal to the percentage of the economic or ownership interest retained in such entities by the respective noncontrolling parties. Intercompany balances and transactions are eliminated in consolidation. Summary of Significant Accounting Policies The Company’s significant accounting policies are described in Note 1, “Description of Business and Summary of Significant Accounting Policies,” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 27, 2014 . Newly Adopted Accounting Pronouncements In April 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2015-03, “Simplifying the Presentation of Debt Issuance Costs,” which requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of debt discounts or premiums. The ASU is effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. During the three months ended June 27, 2015, the Company elected early adoption of this standard and applied the changes retrospectively to all prior periods presented in its consolidated financial statements. The Company historically presented deferred debt issuance costs, or fees related to directly issuing debt, as assets on the consolidated balance sheets. As of June 27, 2015 and December 27, 2014 , the adoption of this standard has resulted in the reclassification of $7.7 million and $5.4 million , respectively, from other assets to long-term debt, net and capital leases. These costs will continue to be amortized as interest expense over the term of the corresponding debt issuance. Newly Issued Accounting Pronouncements In September 2015, the FASB issued ASU 2015-16, “Simplifying the Accounting for Measurement-Period Adjustments,“ that eliminates the current requirement for an acquirer in a business combination to account for measurement-period adjustments retrospectively. Instead, acquirers will recognize measurement-period adjustments during the period in which they determine the amounts, including the effect on earnings of any amounts they would have recorded in previous periods if the accounting had been completed at the acquisition date. The ASU is effective for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. Early adoption is permitted. The Company is still evaluating the impact this standard will have on its consolidated financial statements and related disclosures. In July 2015, the FASB issued ASU 2015-11, “Simplifying the Measurement of Inventory,” that simplifies the subsequent measurement of inventories by replacing the current lower of cost or market test with a lower of cost or net realizable value test. The ASU is effective for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. Early adoption is permitted. The Company is still evaluating the impact this standard will have on its consolidated financial statements and related disclosures. In April 2015, the FASB issued ASU 2015-04, “Practical Expedient for the Measurement Date of an Employer’s Defined Benefit Obligation and Plan Assets” to provide a practical expedient related to the measurement date of the defined benefit plan assets and obligations. The practical expedient allows employers with fiscal year-end dates that do not coincide with a calendar month end to measure pension and post-retirement benefit plan assets and obligations as of the calendar month-end date closest to the fiscal year end. The standard requires entities that elect the practical expedient to adjust the measurement of benefit plan assets and obligations for contributions or significant events between the month-end measurement date and the entity fiscal year end. The ASU is effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption is permitted. The Company is still evaluating the impact the election of the practical expedient would have on its consolidated financial statements and related disclosures. In February 2015, the FASB issued ASU 2015-02, “Amendments to the Consolidation Analysis,” which amends existing consolidation requirements. The guidance affects reporting entities that are required to evaluate whether they should consolidate certain legal entities. Specifically, the guidance amends (i) the identification of variable interests (fees paid to a decision maker or service provider), (ii) the variable interest entity characteristics for a limited partnership or similar entity and (iii) the primary beneficiary determination. The ASU is effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption is permitted. The adoption of this standard is not expected to have a significant impact on the Company’s financial position or results of operations. In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” The standard requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The standard will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. The ASU was originally effective for annual and interim periods beginning after December 15, 2016; however, in August 2015, the FASB issued ASU 2015-14, “Deferral of the Effective Date,” to defer by one year the effective date of ASU 2014-09. As a result, the standard will be effective for annual and interim periods beginning after December 15, 2017. The Company has not yet selected a transition method and is evaluating the impact the adoption will have on its consolidated financial statements and related disclosures. |
Business Acquisitions
Business Acquisitions | 9 Months Ended |
Sep. 26, 2015 | |
Business Combinations [Abstract] | |
BUSINESS ACQUISITIONS | BUSINESS ACQUISITIONS Celsis On July 24, 2015 , the Company acquired Celsis Group Limited (Celsis), a leading provider of rapid testing systems for non-sterile bacterial contamination for the biopharmaceutical and consumer products industries. The purpose of this acquisition was to enhance the Company’s portfolio of rapid microbial detection products and services with the addition of a rapid bioburden testing product. The purchase price for Celsis was $214.0 million , including assumed debt and certain liabilities of $10.3 million . The purchase price includes payment for estimated working capital, which is subject to a final adjustment based upon actual working capital of the acquired business. The acquisition was funded by cash on hand and borrowings on the Company’s revolving credit facility. The business is included in Microbial Solutions (formerly Endotoxin & Microbial Detection, or EMD) and reported in the Company’s Manufacturing Support (Manufacturing) reportable segment. The preliminary purchase price allocation of $211.7 million , net of $2.3 million of cash acquired, was as follows: July 24, 2015 (in thousands) Accounts receivable (contractual amount of $5,410) $ 5,288 Inventory 10,103 Other current assets (excluding cash) 13,449 Property, plant and equipment 5,086 Other long term assets 614 Definite-lived intangible assets 118,140 Goodwill 104,785 Short-term debt (9,766 ) Other current liabilities (7,382 ) Long term liabilities (28,593 ) Total purchase price allocation $ 211,724 The purchase price allocations were prepared on a preliminary basis and are subject to change as additional information becomes available concerning the fair value and tax basis of the assets acquired and liabilities assumed. Any additional adjustments to the purchase price allocation will be made as soon as practicable but no later than one year from the date of acquisition. The breakout of definite-lived intangible assets acquired was as follows: Definite-Lived Intangible Assets Weighted Average Amortization Life (in thousands) (in years) Client relationships $ 71,000 16 Developed technology 39,140 14 Trademark and trade names 5,200 14 Non-compete 2,800 5 Total definite-lived intangible assets $ 118,140 The goodwill resulting from the transaction is primarily attributed to the potential growth of the Company’s Manufacturing business from clients introduced through Celsis, the assembled workforce of the acquired business and expected cost synergies. The goodwill attributable to Celsis is not deductible for tax purposes. The Company incurred transaction and integration costs in connection with the acquisition of $3.9 million and $7.4 million during the three and nine months ended September 26, 2015 , respectively, which were included in selling, general and administrative expenses. Celsis revenue and operating loss for both the three and nine months ended September 26, 2015 were $4.9 million and $3.1 million , respectively, since Celsis was acquired on July 24, 2015 . The following selected pro forma consolidated results of operations are presented as if the Celsis acquisition had occurred as of the beginning of the period immediately preceding the period of acquisition after giving effect to certain adjustments, including additional depreciation and amortization of property, plant and equipment, inventory fair value adjustments and intangible assets of $2.4 million and $11.3 million for the nine months ended September 26, 2015 and September 27, 2014, respectively, and other nonrecurring costs. Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Revenue $ 350,819 $ 335,987 $ 1,026,643 $ 993,384 Net income attributable to common shareholders $ 40,826 $ 31,893 $ 125,863 $ 84,545 Earnings per common share Basic $ 0.88 $ 0.69 $ 2.70 $ 1.81 Diluted $ 0.86 $ 0.68 $ 2.65 $ 1.78 These pro forma results of operations have been prepared for comparative purposes only, and they do not purport to be indicative of the results of operations that actually would have resulted had the acquisition occurred on the date indicated or that may result in the future. No effect has been given for synergies, if any, that may have been realized through the acquisition. Sunrise On May 5, 2015 , the Company acquired Sunrise Farms, Inc. (Sunrise), a producer of specific-pathogen-free fertile chicken eggs and chickens used in the manufacture of live viruses. The purpose of this business acquisition was to expand the capabilities of the Company’s existing Avian Vaccine Services business. The purchase price of the acquisition was $9.6 million and was funded by cash on hand and borrowings on the Company's revolving credit facility. The business is reported in the Company's Manufacturing reportable segment. The Company recorded a bargain purchase gain of $9.9 million , which represents the excess of the estimated fair value of the net assets acquired over the preliminary purchase price. The bargain purchase gain was recorded in other income (expense), net, in the Company’s consolidated statement of income and was not recognized for tax purposes. The Company believes there were several factors that contributed to this transaction resulting in a bargain purchase gain, including the highly specialized nature of Sunrise’s business falling outside of the seller’s core activities and a limited pool of potential buyers. Before recognizing the gain from the bargain purchase, the Company reassessed its initial identification and valuation of assets acquired and liabilities assumed to validate that all assets and liabilities that the Company was able to identify at the acquisition date were properly recognized. The preliminary purchase price allocation of $9.6 million , net of less than $0.1 million of cash acquired, was as follows: May 5, 2015 (in thousands) Accounts receivable, net $ 981 Inventory 1,518 Other current assets (excluding cash) 373 Property, plant and equipment 13,866 Definite-lived intangible assets 3,400 Current liabilities (397 ) Long-term liabilities (250 ) Fair value of net assets acquired 19,491 Bargain purchase gain (9,933 ) Total purchase price allocation $ 9,558 The purchase price allocations were prepared on a preliminary basis and are subject to change as additional information becomes available concerning the fair value and tax basis of the assets acquired and liabilities assumed. During the three months ended September 26, 2015, the Company recorded measurement period adjustments related to the Sunrise acquisition that resulted in an immaterial change to the purchase price allocation and bargain purchase gain. Any additional adjustments to the purchase price allocation will be made as soon as practicable but no later than one year from the date of acquisition. The identifiable definite-lived intangible assets acquired represent the client relationships intangible, which is being amortized over the estimated useful life of approximately 15 years . The Company incurred transaction and integration costs in connection with the acquisition of $0.1 million and $0.7 million during the three and nine months ended September 26, 2015 , respectively, which were included in selling, general and administrative expenses. ChanTest On October 29, 2014 , the Company acquired ChanTest Corporation (ChanTest), a leading provider of ion channel testing services to the biopharmaceutical industry. The acquisition augments the Company’s early discovery capabilities and enhances the Company’s ability to support clients’ target discovery and lead optimization efforts. The purchase price of the acquisition was $59.2 million , including $0.3 million in contingent consideration. The aggregate, undiscounted amount of contingent consideration that could become payable is a maximum of $2.0 million . The Company estimated the fair value of this contingent consideration based on a probability-weighted set of outcomes. The business is reported in the Company’s Discovery and Safety Assessment (DSA) reportable segment. The purchase price allocation of $52.0 million , net of $7.2 million in cash acquired, was as follows: October 29, 2014 (in thousands) Current assets (excluding cash) $ 4,669 Property, plant and equipment 1,637 Definite-lived intangible assets 23,920 Goodwill 34,775 Current liabilities (3,486 ) Long-term liabilities (9,486 ) Total purchase price allocation $ 52,029 The breakout of definite-lived intangible assets acquired was as follows: October 29, 2014 Weighted average (in thousands) (in years) Client relationships $ 19,000 13 Other intangible assets 4,920 9 Total definite-lived intangible assets $ 23,920 The definite-lived intangibles are largely attributed to the expected cash flows related to client relationships existing at the acquisition closing date. The goodwill resulting from the transaction is primarily attributed to the potential growth of the business and is not deductible for tax purposes. During the three and nine months ended September 26, 2015 and September 27, 2014 , the Company incurred insignificant transaction and integration costs in connection with the acquisition, which were included in selling, general and administrative expenses. VivoPath On June 16, 2014 , the Company acquired substantially all of the assets of VivoPath LLC (VivoPath), a discovery services company specializing in the rapid, in vivo compound evaluation of molecules in the therapeutic areas of metabolism, inflammation and oncology. The purchase price was $2.3 million , including $1.6 million in contingent consideration, and was allocated primarily to the intangible assets acquired. The Company estimated the fair value of this contingent consideration based on a probability-weighted set of outcomes. The undiscounted total amount of contingent consideration was a maximum of $2.4 million , payable over three years based on the achievement of revenue growth targets and other contractual requirements. During the three months ended September 26, 2015, the Company paid the first year tranche of the contingent consideration of $0.6 million and recorded a gain of $1.0 million based upon a decrease in the expected future contingent consideration payments. As of September 26, 2015, the remaining contingent consideration payable is a maximum of $0.4 million . The business is reported in the Company’s DSA reportable segment. Argenta and BioFocus On April 1, 2014 , the Company acquired (1) 100% of the shares of the United Kingdom (U.K.) based entities Argenta and BioFocus, and (2) certain Dutch assets. These businesses have formed the core of the Company’s Early Discovery business. With this acquisition, the Company has enhanced its position as a full service, early-stage contract research organization, with integrated in vitro and in vivo capabilities from target discovery through preclinical development. The purchase price of the acquisition was $191.8 million , including $0.9 million in contingent consideration. The acquisition was funded by cash on hand and borrowings on the Company’s revolving credit facility. The businesses are reported in the Company’s DSA reportable segment. The contingent consideration earn-out period ended on April 1, 2015. As a result, the related contingent consideration liability, as adjusted for subsequent changes in fair value, was reversed and a gain of $0.8 million was recorded in selling, general and administrative expenses during the three months ended March 28, 2015, as no payments are expected to be made. The contingent consideration was a one-time payment that could have become payable in the second quarter of 2015 based on the achievement of a certain revenue target for the twelve-month period following the acquisition. The aggregate, undiscounted amount of contingent consideration that the Company could have paid was €5.0 million ( $5.6 million as of September 26, 2015 ). The Company estimated the fair value of this contingent consideration based on a probability-weighted set of outcomes. The purchase price allocation of $183.6 million , net of $8.2 million of cash acquired, was as follows: April 1, 2014 (in thousands) Current assets (excluding cash) $ 31,682 Property, plant and equipment 21,008 Other long term assets 11,140 Definite-lived intangible assets 104,470 Goodwill 65,235 Current liabilities (13,139 ) Long term liabilities (36,802 ) Total purchase price allocation $ 183,594 The breakout of definite-lived intangible assets acquired was as follows: Definite-Lived Intangible Assets Weighted Average Amortization Life (in thousands) (in years) Client relationships $ 94,000 18 Backlog 5,900 1 Trademark and trade names 1,170 3 Leasehold interests 1,000 13 Other intangible assets 2,400 19 Total definite-lived intangible assets $ 104,470 The goodwill resulting from the transaction is primarily attributed to the potential growth of the Company’s DSA businesses from clients introduced through Argenta and BioFocus, the assembled workforce of the acquired businesses and expected cost synergies. The goodwill attributable to Argenta and BioFocus is not deductible for tax purposes. The Company incurred insignificant transaction and integration costs in connection with the acquisition during the three and nine months ended September 26, 2015 and costs of $0.5 million and $5.4 million during the three and nine months ended September 27, 2014 , respectively, which were included in selling, general and administrative expenses. Argenta and BioFocus revenue and operating loss for the nine months ended September 27, 2014 were $46.8 million and $0.4 million , respectively, since Argenta and BioFocus were acquired on April 1, 2014. Beginning in the three months ended September 27, 2014, Argenta and BioFocus have been fully included in the operating results of the Company. The following selected pro forma consolidated results of operations are presented as if the Argenta and BioFocus acquisition had occurred as of the beginning of the period immediately preceding the period of acquisition after giving effect to certain adjustments, including amortization of intangible assets and depreciation of fixed assets of $3.7 million and other nonrecurring costs. Nine Months Ended September 27, 2014 (in thousands) Revenue $ 993,223 Net income attributable to common shareholders $ 101,029 Earnings per common share Basic $ 2.16 Diluted $ 2.12 These pro forma results of operations have been prepared for comparative purposes only, and they do not purport to be indicative of the results of operations that actually would have resulted had the acquisition occurred on the date indicated or that may result in the future. No effect has been given for synergies, if any, that may have been realized through the acquisition. |
Supplemental Balance Sheet Info
Supplemental Balance Sheet Information | 9 Months Ended |
Sep. 26, 2015 | |
Supplemental Balance Sheet Information [Abstract] | |
SUPPLEMENTAL BALANCE SHEET INFORMATION | SUPPLEMENTAL BALANCE SHEET INFORMATION The composition of trade receivables, net is as follows: September 26, 2015 December 27, 2014 (in thousands) Client receivables $ 240,307 $ 219,118 Unbilled revenue 54,157 43,780 Total 294,464 262,898 Less: Allowance for doubtful accounts (5,628 ) (4,907 ) Trade receivables, net $ 288,836 $ 257,991 The composition of inventories is as follows: September 26, 2015 December 27, 2014 (in thousands) Raw materials and supplies $ 15,530 $ 15,416 Work in process 13,063 11,802 Finished products 69,504 61,825 Inventories $ 98,097 $ 89,043 The composition of other current assets is as follows: September 26, 2015 December 27, 2014 (in thousands) Deferred tax asset $ 33,156 $ 27,644 Investments 17,975 16,167 Prepaid income tax 30,828 26,287 Restricted cash 1,221 2,552 Other 923 291 Other current assets $ 84,103 $ 72,941 The composition of property, plant and equipment, net is as follows: September 26, 2015 December 27, 2014 (in thousands) Land $ 42,619 $ 40,314 Buildings (1) 705,694 682,495 Machinery and equipment 381,764 384,713 Leasehold improvements 39,221 37,270 Furniture and fixtures 22,053 22,577 Vehicles 4,054 3,967 Computer hardware and software 123,285 119,474 Construction in progress 23,823 40,970 Total 1,342,513 1,331,780 Less: Accumulated depreciation (670,840 ) (654,983 ) Property, plant and equipment, net $ 671,673 $ 676,797 (1) The balance as of September 26, 2015 includes capital lease assets. See Note 7, “Long Term Debt and Capital Lease Obligations.” Depreciation expense for the three months ended September 26, 2015 and September 27, 2014 was $17.4 million and $18.4 million , respectively. Depreciation expense for the nine months ended September 26, 2015 and September 27, 2014 was $51.9 million and $51.6 million , respectively. The composition of other assets is as follows: September 26, 2015 December 27, 2014 (in thousands) Life insurance policies $ 26,458 $ 27,603 Investments in limited partnerships 29,931 27,047 Other 9,163 18,301 Other assets $ 65,552 $ 72,951 The composition of other current liabilities is as follows: September 26, 2015 December 27, 2014 (in thousands) Accrued income taxes $ 17,630 $ 9,362 Current deferred tax liability 3,389 1,484 Accrued interest and other 328 233 Other current liabilities $ 21,347 $ 11,079 The composition of other long-term liabilities is as follows: September 26, 2015 December 27, 2014 (in thousands) Deferred tax liability $ 49,016 $ 30,816 Long-term pension liability 37,878 45,135 Accrued executive supplemental life insurance retirement plan and deferred compensation plan 33,858 33,007 Other 19,004 21,403 Other long-term liabilities $ 139,756 $ 130,361 |
Investments in Limited Partners
Investments in Limited Partnerships and Marketable Securities | 9 Months Ended |
Sep. 26, 2015 | |
Marketable Securities and Equity-Method Affiliates [Abstract] | |
INVESTMENTS IN LIMITED PARTNERSHIPS AND MARKETABLE SECURITIES | INVESTMENTS IN LIMITED PARTNERSHIPS AND MARKETABLE SECURITIES Investments in Limited Partnerships The Company invests in several venture capital limited partnerships that invest in start-up companies primarily in the life sciences industry. The Company’s ownership interest in these limited partnerships ranges from 3.6% to 12.0% . The Company accounts for such investments under the equity method of accounting. The Company’s total commitment to these entities as of September 26, 2015 was $65.0 million , of which the Company had funded $26.3 million through September 26, 2015 . During the three and nine months ended September 26, 2015 , the Company received dividends totaling $5.3 million and $7.3 million , respectively. During the three months ended September 27, 2014, the Company did not receive any dividends. During the nine months ended September 27, 2014 , the Company received dividends totaling $7.4 million . The Company recognized a gain of $3.2 million and a loss of $0.8 million related to these investments for the three months ended September 26, 2015 and September 27, 2014 , respectively. Marketable Securities The following is a summary of the Company's marketable securities, all of which are classified as available-for-sale: September 26, 2015 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (in thousands) Mutual fund $ 4,650 $ — $ (80 ) $ 4,570 Total $ 4,650 $ — $ (80 ) $ 4,570 There were no sales of available-for-sale securities during the nine months ended September 26, 2015 . |
Fair Value
Fair Value | 9 Months Ended |
Sep. 26, 2015 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE | FAIR VALUE The Company has certain financial assets and liabilities recorded at fair value which have been classified as Level 1, 2, or 3 within the fair value hierarchy: • Level 1 - Fair values are determined utilizing quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access; • Level 2 - Fair values are determined by utilizing quoted prices for identical or similar assets and liabilities in active markets or other market observable inputs such as interest rates, yield curves, and foreign currency spot rates; • Level 3 - Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. The fair value hierarchy level is determined by asset and liability class based on the lowest level of significant input. The observability of inputs may change for certain assets or liabilities. This condition could cause an asset or liability to be reclassified between levels. The Company recognizes transfers between levels within the fair value hierarchy, if any, at the end of each quarter. During the nine months ended September 26, 2015 and September 27, 2014 , there were no transfers between levels. Valuation methodologies used for assets, liabilities, and the redeemable noncontrolling interest measured or disclosed at fair value are as follows: • Cash equivalents - Valued at quoted market prices determined through third-party pricing services. • Mutual funds - Valued at the unadjusted quoted net asset value of shares held by the Company. • Foreign currency forward contracts - Valued using readily observable market inputs, such as forward foreign exchange points and foreign exchanges rates. • Investments in life insurance policies - Valued at cash surrender value based on fair value of underlying investments. • Contingent consideration - Valued based on a probability weighting of the future cash flows associated with the potential outcomes. • Redeemable noncontrolling interest - Valued primarily using the income approach based on estimated future cash flows of the underlying business based on the Company’s projected financial data discounted by a weighted average cost of capital. Assets, liabilities, and noncontrolling interest measured at fair value on a recurring basis are summarized below: September 26, 2015 Level 1 Level 2 Level 3 Total (in thousands) Cash equivalents $ — $ 159 $ — $ 159 Other current assets: Marketable securities 4,570 — — 4,570 Foreign currency forward contracts — 16 — 16 Other assets: Life insurance policies — 19,346 — 19,346 Total assets measured at fair value $ 4,570 $ 19,521 $ — $ 24,091 Other current liabilities: Contingent consideration $ — $ — $ 1,111 $ 1,111 Foreign currency forward contracts — 306 — 306 Other long-term liabilities: Contingent consideration — — 169 169 Redeemable noncontrolling interest — — 27,447 27,447 Total liabilities and redeemable noncontrolling interest measured at fair value $ — $ 306 $ 28,727 $ 29,033 December 27, 2014 Level 1 Level 2 Level 3 Total (in thousands) Cash equivalents $ — $ 1,934 $ — $ 1,934 Other assets: Life insurance policies — 20,520 — 20,520 Total assets measured at fair value $ — $ 22,454 $ — $ 22,454 Other current liabilities: Contingent consideration $ — $ — $ 1,583 $ 1,583 Other long-term liabilities: Contingent consideration — — 1,245 1,245 Redeemable noncontrolling interest — — 28,419 28,419 Total liabilities and redeemable noncontrolling interest measured at fair value $ — $ — $ 31,247 $ 31,247 Redeemable Noncontrolling Interest The Company’s redeemable noncontrolling interest resulted from the acquisition of a 75% ownership interest in Vital River. Concurrent with the acquisition, the Company entered into a joint venture agreement with the noncontrolling interest holders that provides the Company with the right to purchase the remaining 25% of the entity for cash at its then appraised value beginning in January 2016. Additionally, the noncontrolling interest holders were granted the right to require the Company to purchase the remaining 25% of the entity at its then appraised value beginning in January 2016 for cash. These rights are accelerated in certain events. As the noncontrolling interest holders can require the Company purchase the remaining 25% interest, the noncontrolling interest is classified in the mezzanine section of the consolidated balance sheet, which is above the equity section and below liabilities. The following table provides a rollforward of the fair value of the Company’s redeemable noncontrolling interest: Nine Months Ended September 26, 2015 September 27, 2014 (in thousands) Beginning balance $ 28,419 $ 20,581 Additions — — Total gains or losses (realized/unrealized): Net income attributable to noncontrolling interest 614 523 Foreign currency translation (693 ) (113 ) Change in fair value, included in additional paid-in capital (893 ) 3,559 Ending balance $ 27,447 $ 24,550 The significant unobservable inputs used in the fair value measurement of the Company’s redeemable noncontrolling interest are the estimated future cash flows based on projected financial data and a discount rate of 18.0% . Significant changes in the timing or amounts of the estimated future cash flows would result in a significantly higher or lower fair value measurement. Significant increases or decreases in the discount rate would result in a significantly lower or higher fair value measurement, respectively. Contingent Consideration The following table provides a rollforward of the contingent consideration related to the acquisitions of Argenta, BioFocus, VivoPath and ChanTest. See Note 2, “Business Acquisitions.” Nine Months Ended September 26, 2015 September 27, 2014 (in thousands) Beginning balance $ 2,828 $ — Additions 675 2,428 Payments (600 ) — Total gains or losses (realized/unrealized): Reversal of previously recorded contingent liability and change in fair value (1,623 ) 120 Ending balance $ 1,280 $ 2,548 The significant unobservable inputs used in the fair value measurement of the Company’s contingent consideration are the probabilities of successful achievement of certain financial targets and a discount rate. Significant increases or decreases in any of the probabilities of success would result in a significantly higher or lower fair value measurement, respectively. Significant increases or decreases in the discount rate would result in a significantly lower or higher fair value measurement, respectively. Debt Instruments The book value of the Company’s term and revolving loans, which are variable rate loans carried at amortized cost, approximates their fair value based on current market pricing of similar debt. As the fair value is based on significant other observable inputs, including current interest and foreign currency exchange rates, it is deemed to be Level 2. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 26, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill The following table provides a rollforward of the Company’s goodwill: Adjustments to Goodwill December 27, 2014 Acquisitions Foreign Exchange September 26, 2015 (in thousands) Research Models and Services $ 59,196 $ — $ (698 ) $ 58,498 Discovery and Safety Assessment 229,302 (748 ) (3,470 ) 225,084 Manufacturing Support 32,579 104,972 (2,888 ) 134,663 Total $ 321,077 $ 104,224 $ (7,056 ) $ 418,245 Other Intangible Assets, net The following table displays other intangible assets, net by major class: September 26, 2015 December 27, 2014 Gross Accumulated Amortization Net Gross Accumulated Amortization Net (in thousands) Backlog $ — $ — $ — $ 8,728 $ (6,636 ) $ 2,092 Client relationships 390,585 (176,099 ) 214,486 379,339 (217,938 ) 161,401 Technology 49,204 (2,931 ) 46,273 13,474 (4,166 ) 9,308 Trademarks and trade names 6,631 (844 ) 5,787 6,603 (5,314 ) 1,289 Standard operating procedures 2,100 (1,745 ) 355 2,309 (1,642 ) 667 Other identifiable intangible assets 9,957 (2,610 ) 7,347 2,860 (2,180 ) 680 Total definite-lived intangible assets 458,477 (184,229 ) 274,248 413,313 (237,876 ) 175,437 Indefinite-lived intangibles assets 3,438 3,438 Total other intangibles assets, net $ 277,686 $ 178,875 |
Long-Term Debt and Capital Leas
Long-Term Debt and Capital Lease Obligations | 9 Months Ended |
Sep. 26, 2015 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS | LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS Long-Term Debt Long-term debt, net consists of the following: September 26, 2015 December 27, 2014 (in thousands) Term loans $ 395,000 $ 378,000 Revolving credit facility 429,871 375,536 Other long-term debt 196 214 Total debt 825,067 753,750 Less: current portion of long-term debt (15,196 ) (31,714 ) Long-term debt 809,871 722,036 Debt discount and debt issuance costs (1) (7,215 ) (5,401 ) Long-term debt, net $ 802,656 $ 716,635 (1) During the three months ended June 27, 2015, the Company adopted ASU 2015-03 and reclassified unamortized debt issuance costs from other assets to long-term debt, net and capital leases. See Note 1, “Basis of Presentation” for further discussion. In April 2015, the Company amended and restated the $970M Credit Facility, creating a $1.3 billion facility ( $1.3B Credit Facility) that provides for a $400.0 million term loan facility and a $900.0 million multi-currency revolving facility. The term loan facility matures in 20 quarterly installments with the last installment due April 22, 2020. The revolving facility matures on April 22, 2020 and requires no scheduled payment before that date. The interest rates applicable to term loans and revolving loans under our credit agreement are, at our option, equal to either the alternate base rate (which is the higher of (1) the prime rate, (2) the federal funds rate plus 0.5% or (3) the one-month adjusted LIBOR rate plus 1% ), or the adjusted LIBOR rate plus an interest rate margin based upon the our leverage ratio. As of September 26, 2015 and December 27, 2014 , the weighted average interest rate on the Company’s debt was 1.31% and 1.42% , respectively. The $1.3B Credit Facility includes certain customary representations and warranties, events of default, notices of material adverse changes to the Company’s business, and negative and affirmative covenants. As of September 26, 2015 , the Company was compliant with all covenants. At September 26, 2015 and December 27, 2014 , the Company had $4.9 million and $5.0 million in outstanding letters of credit, respectively. Capital Lease Obligations The Company acquired a build-to-suit lease as part of its acquisition of Argenta and BioFocus. In accordance with accounting guidance applicable to entities involved with the construction of an asset that will be leased when the construction is completed, the Company was considered the owner, for accounting purposes, of this property during the construction period. Accordingly, the Company recorded an asset and a corresponding financing obligation on its consolidated balance sheet for the amount of total project costs incurred related to the construction in progress for this property through completion of the construction period. Upon completion of the construction during the three months ended June 27, 2015, the Company determined that it was no longer considered the owner of the property because it did not have continuing involvement. Consequently, the Company recorded a successful sale leaseback and derecognized the property and the associated financing obligation from the Company’s consolidated balance sheet and recorded a capital lease asset and a corresponding liability of $35.8 million . The Company’s capital lease obligations amounted to $34.5 million and $1.0 million at September 26, 2015 and December 27, 2014 , respectively. |
Equity
Equity | 9 Months Ended |
Sep. 26, 2015 | |
Equity [Abstract] | |
EQUITY | EQUITY Earnings Per Share The following table reconciles the numerator and denominator in the computations of basic and diluted earnings per share: Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Numerator: Net income from continuing operations attributable to common shareholders $ 37,413 $ 31,984 $ 117,477 $ 100,394 Loss (income) from discontinued operations, net of income taxes (34 ) 52 (48 ) (862 ) Net income attributable to common shareholders $ 37,379 $ 32,036 $ 117,429 $ 99,532 Denominator: Weighted-average shares outstanding—Basic 46,290 46,016 46,572 46,683 Effect of dilutive securities: Stock options, restricted stock units, performance stock units and contingently issuable restricted stock 955 862 1,012 883 Weighted-average shares outstanding—Diluted 47,245 46,878 47,584 47,566 Options to purchase approximately 0.5 million and 0.9 million shares were not included in computing diluted earnings per share for the three months ended September 26, 2015 and September 27, 2014 , respectively, because their inclusion would have been anti-dilutive. For the nine months ended September 26, 2015 and September 27, 2014 , anti-dilutive options were 0.5 million and 0.8 million shares, respectively. Basic weighted average shares outstanding for the three and nine months ended September 26, 2015 and September 27, 2014 excluded the impact of approximately 1.1 million and 1.2 million shares, respectively, of non-vested restricted stock and restricted stock units. Treasury Shares In July 2010, the Company’s Board of Directors authorized a $500.0 million stock repurchase program, and subsequently approved increases to the stock repurchase program of $250.0 million in 2010, $250.0 million in 2013 and $150.0 million in 2014, for an aggregate authorization of $1,150.0 million . The Company repurchased approximately 1.5 million shares for $108.8 million and approximately 2.1 million shares for $110.6 million in the nine months ended September 26, 2015 and September 27, 2014 , respectively. As of September 26, 2015 , the Company had $69.7 million remaining on the authorized stock repurchase program. The Company’s 2007 Incentive Plan permits the netting of common stock upon vesting of restricted stock and restricted stock units in order to satisfy individual minimum statutory tax withholding requirements. During the nine months ended September 26, 2015 and September 27, 2014 , the Company acquired approximately 0.1 million shares for $8.7 million and approximately 0.1 million shares for $6.7 million , respectively. Accumulated Other Comprehensive Income (Loss) Changes to each component of accumulated other comprehensive income (loss), net of income tax, are as follows: Foreign Currency Translation and Other Pension and Other Post-Retirement Benefit Plans Total (in thousands) December 27, 2014 $ (19,891 ) $ (54,356 ) $ (74,247 ) Other comprehensive loss before reclassifications (45,697 ) — (45,697 ) Amounts reclassified from accumulated other comprehensive income (loss) (2,341 ) 2,185 (156 ) Net current period other comprehensive income (loss) (48,038 ) 2,185 (45,853 ) Income tax expense — 700 700 September 26, 2015 $ (67,929 ) $ (52,871 ) $ (120,800 ) Foreign currency translation and other includes an insignificant amount of unrealized gains (losses) on available-for-sale marketable securities. Nonredeemable Noncontrolling Interests The Company has investments in several entities, whose financial results are consolidated in the Company’s financial statements, as it has the ability to exercise control over these entities. The interests of the respective noncontrolling parties in these entities have been recorded as noncontrolling interests. The activity within the nonredeemable noncontrolling interests was insignificant during the three and nine months ended September 26, 2015 and September 27, 2014 . |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 26, 2015 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company’s overall effective tax rate for the three months ended September 26, 2015 and September 27, 2014 was 28.7% and 26.4% , respectively. The Company’s overall effective tax rate was 18.3% and 26.2% for each of the nine months ended September 26, 2015 and September 27, 2014 , respectively. For the three months ended September 26, 2015 the increase was primarily attributable to the amount and mix of domestic and foreign earnings and discrete tax cost of $1.4 million related to nondeductible transaction costs incurred in 2015 for the acquisition of Celsis, offset by a $0.9 million release of an uncertain tax position resulting from an ability to offset tax on a capital gain from an investment in a limited partnership. For the nine months ended September 26, 2015 , the decrease reflects the items above as well as a reduction in unrecognized tax benefits and related interest of $10.4 million due to the expiration of the statute of limitations associated with pre-acquisition tax positions on forgiveness of debt, an additional $1.8 million release of an uncertain tax position resulting from an ability to offset tax on a capital gain from an investment in a limited partnership, and a non-taxable bargain purchase gain of $9.9 million associated with the acquisition of Sunrise. During the three months ended September 26, 2015 , the Company’s unrecognized tax benefits decreased by $1.0 million to $22.0 million primarily due to the $0.9 million release resulting from an ability to offset tax on a capital gain from an investment in a limited partnership and benefit from foreign exchange, offset by pre-acquisition tax positions taken by Celsis. The amount of unrecognized income tax benefits that would impact the effective tax rate decreased by $1.4 million , to $18.7 million . The amount of accrued interest on unrecognized tax benefits was $1.0 million at September 26, 2015 . The Company believes that it is reasonably possible that the unrecognized tax benefits will decrease by up to $0.4 million over the next twelve-month period, as a result of the settlement of audits and the lapse of statute of limitations. The Company conducts business in a number of tax jurisdictions. As a result, it is subject to tax audits in jurisdictions including the U.S., U.K., Japan, France, Germany, and Canada. With few exceptions, the Company is no longer subject to U.S. and international income tax examinations for years before 2011. The Company and certain of its subsidiaries are currently under audit by various tax authorities in the U.S., Canada, and France. The Company does not believe that resolution of these controversies will have a material impact on its financial position or results of operations. On October 21, 2015, the Quebec government enacted Bill 13, which will provide a one-time retroactive benefit to operating income in the fourth quarter of 2015 related to tax years 2012 through 2014 and will provide a corresponding increase to the Company’s effective income tax rate. Additionally, the tax law change will provide an ongoing reduction in benefit to operating income and an additional corresponding increase to the Company’s effective income tax rate beginning in 2015 and beyond. The impact of this law change will be realized in the fourth quarter results. In accordance with the Company’s policy, the remaining undistributed earnings of its non-U.S. subsidiaries remain indefinitely reinvested as of the end of the three months ended September 26, 2015 as they are required to fund needs outside the U.S. and cannot be repatriated in a manner that is substantially tax free. The income tax expense (benefit) related to items of other comprehensive income are as follows: Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Income tax benefit related to foreign currency translation adjustment $ — $ — $ — $ (105 ) Income tax expense related to change in unrecognized pension gains, losses and prior service costs 220 125 700 378 Income tax expense related to items of other comprehensive income $ 220 $ 125 $ 700 $ 273 |
Pension and Other Post-Retireme
Pension and Other Post-Retirement Benefit Plans | 9 Months Ended |
Sep. 26, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS | PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS The following table provides the components of net periodic cost (benefit) for the Company’s pension and other post-retirement benefit plans for the three months ended September 26, 2015 and September 27, 2014 : Pension Plans Other Post-Retirement Benefit Plans September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Service cost $ 935 $ 880 $ 214 $ 190 Interest cost 3,070 3,211 265 252 Expected return on plan assets (4,383 ) (4,540 ) — — Amortization of prior service cost (credit) (150 ) (166 ) — 159 Amortization of net loss 780 238 65 60 Net periodic cost (benefit) $ 252 $ (377 ) $ 544 $ 661 The following table provides the components of net periodic cost (benefit) for the Company’s pension and other post-retirement benefit plans for the nine months ended September 26, 2015 and September 27, 2014 : Pension Plans Other Post-Retirement Benefit Plans September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Service cost $ 2,806 $ 2,565 $ 642 $ 569 Interest cost 9,210 9,633 796 757 Expected return on plan assets (13,147 ) (13,095 ) — — Amortization of prior service cost (credit) (451 ) (484 ) — 489 Amortization of net loss 2,433 684 203 185 Net periodic cost (benefit) $ 851 $ (697 ) $ 1,641 $ 2,000 |
Stock Plans and Stock-Based Com
Stock Plans and Stock-Based Compensation | 9 Months Ended |
Sep. 26, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION The Company has stock-based compensation plans under which employees and non-employee directors may be granted stock-based awards such as stock options, restricted stock, restricted stock units and performance share units (PSUs). The following table provides stock-based compensation by the financial statement line item in which it is reflected: Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Cost of revenue $ 1,670 $ 1,337 $ 4,959 $ 4,008 Selling, general and administrative 8,806 6,914 25,390 19,124 Stock-based compensation, before income taxes 10,476 8,251 30,349 23,132 Provision for income taxes (3,733 ) (2,943 ) (10,737 ) (8,271 ) Stock-based compensation, net of income taxes $ 6,743 $ 5,308 $ 19,612 $ 14,861 During the nine months ended September 26, 2015 , the Company issued approximately 0.2 million restricted stock units with a per share weighted average grant date fair value of $76.66 , less than 0.1 million shares of restricted stock with a per share weighted average grant date fair value of $70.29 , approximately 0.5 million stock options with a per share weighted average grant date fair value of $17.25 , and approximately 0.2 million PSUs with a per share weighted average grant date fair value of $87.50 . The maximum number of common shares to be issued upon vesting of PSUs granted during the nine months ended September 26, 2015 is approximately 0.3 million . During the three months ended March 28, 2015, the Company modified certain stock-based awards granted in previous years as part of executive retirement transitions. For the stock-based awards granted to employees during the nine months ended September 26, 2015 the Company introduced a new retirement provision, which allows for continued vesting of such awards after the employee’s retirement if certain eligibility conditions are met. The introduction of the new retirement provision and stock-based award modifications increased the Company’s stock-based compensation expense for the nine months ended September 26, 2015 by $3.8 million . |
Foreign Currency Contracts
Foreign Currency Contracts | 9 Months Ended |
Sep. 26, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
FOREIGN CURRENCY CONTRACTS | FOREIGN CURRENCY CONTRACTS During the three months ended September 26, 2015, the Company entered into foreign exchange forward contracts to limit its foreign currency exposure related to intercompany loans denominated in British Pound and Euro that are not of a long-term investment nature. These contracts are recorded at fair value in the Company’s consolidated balance sheet and are not designated as hedging instruments. Any gains or losses on such contracts are immediately recognized in other income (expense), net, and are largely offset by the remeasurement of the underlying intercompany loan balances. The notional amount and fair value of the Company’s foreign currency forward contracts is summarized as follows: September 26, 2015 Notional Amount Fair Value Balance Sheet Location (in thousands) $ 39,661 $ 16 Other current assets $ 88,417 $ 306 Other current liabilities The following table summarizes the effect of foreign exchange forward contracts on the Company’s consolidated statement of income: Three Months Ended September 26, 2015 Location of Gain (Loss) Gain (Loss) Recognized (in thousands) Other income (expense), net $ (3,194 ) The forward contracts outstanding as of September 26, 2015 had durations of 1 to 3 months. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 26, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Litigation Various lawsuits, claims, and proceedings of a nature considered normal to its business are pending against the Company. While the outcome of any of these proceedings cannot be accurately predicted, the Company does not believe the ultimate resolution of any of these existing matters would have a material adverse effect on the Company’s business or financial condition. In May 2013, the Company commenced an investigation into inaccurate billing with respect to certain government contracts. The Company promptly reported these matters to the relevant government contracting officers, the Department of Health and Human Services’ Office of the Inspector General, and the Department of Justice, and the Company is cooperating with these agencies to ensure the proper repayment and resolution of this matter. The Company identified approximately $1.5 million of excess amounts billed on these contracts since January 1, 2007 and reserved such amount. Because of the ongoing discussions with the government and complex nature of this matter, the Company believes that it is reasonably possible that additional losses may be incurred; however, the Company cannot at this time estimate the potential range of loss beyond the current reserve of $1.5 million . On July 31, 2015, IDEXX Laboratories, Inc. and IDEXX Distribution, Inc. (collectively, IDEXX) filed a complaint in the United States District Court for the District of Delaware alleging the Company has infringed three recently issued patents related to a blood spot sample collection method used in determining the presence or absence of an infectious disease in a population of rodents. On September 21, 2015, the Company timely filed a motion to dismiss the complaint on the grounds that all of the claims are directed to unpatentable subject matter and therefore are invalid. On October, 7, 2015, IDEXX filed an amended complaint which substantially asserts the same patents and infringement allegations as asserted in the original complaint, and on October 26, 2015, the Company timely filed a motion to dismiss this amended complaint. While no prediction may be made as to the outcome of litigation, we intend to defend against this proceeding vigorously and therefore an estimate of the possible loss or range of loss cannot be made . Lease Commitments During the nine months ended September 26, 2015 , the Company assumed or entered into new lease agreements or exercised options to extend the lease terms for certain existing leases. As a result, the Company’s lease obligations through August 2024 increased by $17.9 million . |
Segment Information
Segment Information | 9 Months Ended |
Sep. 26, 2015 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION The Company reports its financial performance in three segments: Research Models and Services, Discovery and Safety Assessment, and Manufacturing Support. The following table presents revenue and other financial information by reportable segment: Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Research Models and Services Revenue $ 118,451 $ 124,021 $ 358,506 $ 389,636 Gross margin 47,841 45,295 143,352 149,392 Operating income 31,494 28,056 93,800 97,734 Depreciation and amortization 5,319 7,277 16,712 20,277 Capital expenditures 3,022 4,110 12,111 11,528 Discovery and Safety Assessment Revenue $ 158,272 $ 140,862 $ 451,659 $ 388,614 Gross margin 53,721 39,968 146,660 105,084 Operating income 33,191 19,329 84,856 48,840 Depreciation and amortization 11,509 13,340 35,060 33,867 Capital expenditures 4,277 3,436 13,756 11,330 Manufacturing Support Revenue $ 72,742 $ 62,684 $ 199,287 $ 189,864 Gross margin 36,513 33,005 100,506 98,239 Operating income 18,424 19,220 55,653 58,091 Depreciation and amortization 5,139 3,513 12,034 10,625 Capital expenditures 2,139 1,463 5,475 5,444 For the three months ended September 26, 2015 , reconciliations of segment operating income, depreciation and amortization, and capital expenditures to the respective consolidated amounts are as follows: Operating Income Depreciation and Amortization Capital Expenditures September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Total reportable segments $ 83,109 $ 66,605 $ 21,967 $ 24,130 $ 9,438 $ 9,009 Unallocated corporate (27,669 ) (20,433 ) 1,847 1,938 1,014 393 Total consolidated $ 55,440 $ 46,172 $ 23,814 $ 26,068 $ 10,452 $ 9,402 For the nine months ended September 26, 2015 , reconciliations of segment operating income, depreciation and amortization, and capital expenditures to the respective consolidated amounts are as follows: Operating Income Depreciation and Amortization Capital Expenditures September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Total reportable segments $ 234,309 $ 204,665 $ 63,806 $ 64,769 $ 31,342 $ 28,302 Unallocated corporate (80,129 ) (67,762 ) 5,524 5,666 3,666 1,605 Total consolidated $ 154,180 $ 136,903 $ 69,330 $ 70,435 $ 35,008 $ 29,907 Revenue for each significant product or service area is as follows: Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Research models and services $ 118,451 $ 124,021 $ 358,506 $ 389,636 Discovery and safety assessment 158,272 140,862 451,659 388,614 Microbial Solutions 39,110 31,834 105,589 97,879 Other manufacturing support 33,632 30,850 93,698 91,985 Manufacturing support 72,742 62,684 199,287 189,864 Total revenue $ 349,465 $ 327,567 $ 1,009,452 $ 968,114 A summary of unallocated corporate overhead consists of the following : Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Stock-based compensation expense $ 6,802 $ 4,918 $ 19,501 $ 13,525 Salary, bonus and fringe 6,821 5,892 24,751 23,597 Consulting, audit and professional services 4,280 3,053 11,051 8,721 IT related expenses 2,618 1,767 6,167 4,667 Depreciation expense 1,847 1,954 5,524 5,666 Acquisition related adjustments 3,478 580 7,072 5,256 Other general unallocated corporate expenses 1,823 2,269 6,063 6,330 Total unallocated corporate overhead costs $ 27,669 $ 20,433 $ 80,129 $ 67,762 Other general unallocated corporate expenses consist of various departmental costs including those associated with departments such as senior executives, corporate accounting, legal, tax, human resources, treasury, and investor relations. The total assets of the Manufacturing segment increased by $300.5 million since December 27, 2014 , due primarily to the acquisitions of Sunrise and Celsis. Refer to Note 2, “Business Acquisitions.” |
Basis of Presentation - Signifi
Basis of Presentation - Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 26, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Use of Estimates | The preparation of condensed consolidated financial statements in accordance with U.S. GAAP requires that the Company make estimates and judgments that may affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates, judgments and methodologies. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions. Changes in estimates are reflected in reported results in the period in which they become known. |
Consolidation | The Company’s consolidated financial statements reflect its financial statements and those of its subsidiaries in which the Company holds a controlling financial interest. For consolidated entities in which the Company owns or is exposed to less than 100% of the economics, the Company records net income (loss) attributable to noncontrolling interests in its consolidated statements of income equal to the percentage of the economic or ownership interest retained in such entities by the respective noncontrolling parties. Intercompany balances and transactions are eliminated in consolidation. |
Newly Adopted and Issued Accounting Pronouncements | In September 2015, the FASB issued ASU 2015-16, “Simplifying the Accounting for Measurement-Period Adjustments,“ that eliminates the current requirement for an acquirer in a business combination to account for measurement-period adjustments retrospectively. Instead, acquirers will recognize measurement-period adjustments during the period in which they determine the amounts, including the effect on earnings of any amounts they would have recorded in previous periods if the accounting had been completed at the acquisition date. The ASU is effective for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. Early adoption is permitted. The Company is still evaluating the impact this standard will have on its consolidated financial statements and related disclosures. In July 2015, the FASB issued ASU 2015-11, “Simplifying the Measurement of Inventory,” that simplifies the subsequent measurement of inventories by replacing the current lower of cost or market test with a lower of cost or net realizable value test. The ASU is effective for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. Early adoption is permitted. The Company is still evaluating the impact this standard will have on its consolidated financial statements and related disclosures. In April 2015, the FASB issued ASU 2015-04, “Practical Expedient for the Measurement Date of an Employer’s Defined Benefit Obligation and Plan Assets” to provide a practical expedient related to the measurement date of the defined benefit plan assets and obligations. The practical expedient allows employers with fiscal year-end dates that do not coincide with a calendar month end to measure pension and post-retirement benefit plan assets and obligations as of the calendar month-end date closest to the fiscal year end. The standard requires entities that elect the practical expedient to adjust the measurement of benefit plan assets and obligations for contributions or significant events between the month-end measurement date and the entity fiscal year end. The ASU is effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption is permitted. The Company is still evaluating the impact the election of the practical expedient would have on its consolidated financial statements and related disclosures. In February 2015, the FASB issued ASU 2015-02, “Amendments to the Consolidation Analysis,” which amends existing consolidation requirements. The guidance affects reporting entities that are required to evaluate whether they should consolidate certain legal entities. Specifically, the guidance amends (i) the identification of variable interests (fees paid to a decision maker or service provider), (ii) the variable interest entity characteristics for a limited partnership or similar entity and (iii) the primary beneficiary determination. The ASU is effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption is permitted. The adoption of this standard is not expected to have a significant impact on the Company’s financial position or results of operations. In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” The standard requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The standard will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. The ASU was originally effective for annual and interim periods beginning after December 15, 2016; however, in August 2015, the FASB issued ASU 2015-14, “Deferral of the Effective Date,” to defer by one year the effective date of ASU 2014-09. As a result, the standard will be effective for annual and interim periods beginning after December 15, 2017. The Company has not yet selected a transition method and is evaluating the impact the adoption will have on its consolidated financial statements and related disclosures. In April 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2015-03, “Simplifying the Presentation of Debt Issuance Costs,” which requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of debt discounts or premiums. The ASU is effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. During the three months ended June 27, 2015, the Company elected early adoption of this standard and applied the changes retrospectively to all prior periods presented in its consolidated financial statements. The Company historically presented deferred debt issuance costs, or fees related to directly issuing debt, as assets on the consolidated balance sheets. As of June 27, 2015 and December 27, 2014 , the adoption of this standard has resulted in the reclassification of $7.7 million and $5.4 million , respectively, from other assets to long-term debt, net and capital leases. These costs will continue to be amortized as interest expense over the term of the corresponding debt issuance. |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 9 Months Ended |
Sep. 26, 2015 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The preliminary purchase price allocation of $211.7 million , net of $2.3 million of cash acquired, was as follows: July 24, 2015 (in thousands) Accounts receivable (contractual amount of $5,410) $ 5,288 Inventory 10,103 Other current assets (excluding cash) 13,449 Property, plant and equipment 5,086 Other long term assets 614 Definite-lived intangible assets 118,140 Goodwill 104,785 Short-term debt (9,766 ) Other current liabilities (7,382 ) Long term liabilities (28,593 ) Total purchase price allocation $ 211,724 The purchase price allocation of $52.0 million , net of $7.2 million in cash acquired, was as follows: October 29, 2014 (in thousands) Current assets (excluding cash) $ 4,669 Property, plant and equipment 1,637 Definite-lived intangible assets 23,920 Goodwill 34,775 Current liabilities (3,486 ) Long-term liabilities (9,486 ) Total purchase price allocation $ 52,029 The preliminary purchase price allocation of $9.6 million , net of less than $0.1 million of cash acquired, was as follows: May 5, 2015 (in thousands) Accounts receivable, net $ 981 Inventory 1,518 Other current assets (excluding cash) 373 Property, plant and equipment 13,866 Definite-lived intangible assets 3,400 Current liabilities (397 ) Long-term liabilities (250 ) Fair value of net assets acquired 19,491 Bargain purchase gain (9,933 ) Total purchase price allocation $ 9,558 |
Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination | The breakout of definite-lived intangible assets acquired was as follows: October 29, 2014 Weighted average (in thousands) (in years) Client relationships $ 19,000 13 Other intangible assets 4,920 9 Total definite-lived intangible assets $ 23,920 The breakout of definite-lived intangible assets acquired was as follows: Definite-Lived Intangible Assets Weighted Average Amortization Life (in thousands) (in years) Client relationships $ 71,000 16 Developed technology 39,140 14 Trademark and trade names 5,200 14 Non-compete 2,800 5 Total definite-lived intangible assets $ 118,140 |
Business Acquisition, Pro Forma Information | The following selected pro forma consolidated results of operations are presented as if the Argenta and BioFocus acquisition had occurred as of the beginning of the period immediately preceding the period of acquisition after giving effect to certain adjustments, including amortization of intangible assets and depreciation of fixed assets of $3.7 million and other nonrecurring costs. Nine Months Ended September 27, 2014 (in thousands) Revenue $ 993,223 Net income attributable to common shareholders $ 101,029 Earnings per common share Basic $ 2.16 Diluted $ 2.12 The following selected pro forma consolidated results of operations are presented as if the Celsis acquisition had occurred as of the beginning of the period immediately preceding the period of acquisition after giving effect to certain adjustments, including additional depreciation and amortization of property, plant and equipment, inventory fair value adjustments and intangible assets of $2.4 million and $11.3 million for the nine months ended September 26, 2015 and September 27, 2014, respectively, and other nonrecurring costs. Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Revenue $ 350,819 $ 335,987 $ 1,026,643 $ 993,384 Net income attributable to common shareholders $ 40,826 $ 31,893 $ 125,863 $ 84,545 Earnings per common share Basic $ 0.88 $ 0.69 $ 2.70 $ 1.81 Diluted $ 0.86 $ 0.68 $ 2.65 $ 1.78 |
Schedule of Assets and Liabilities Acquired | The purchase price allocation of $183.6 million , net of $8.2 million of cash acquired, was as follows: April 1, 2014 (in thousands) Current assets (excluding cash) $ 31,682 Property, plant and equipment 21,008 Other long term assets 11,140 Definite-lived intangible assets 104,470 Goodwill 65,235 Current liabilities (13,139 ) Long term liabilities (36,802 ) Total purchase price allocation $ 183,594 |
Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination | The breakout of definite-lived intangible assets acquired was as follows: Definite-Lived Intangible Assets Weighted Average Amortization Life (in thousands) (in years) Client relationships $ 94,000 18 Backlog 5,900 1 Trademark and trade names 1,170 3 Leasehold interests 1,000 13 Other intangible assets 2,400 19 Total definite-lived intangible assets $ 104,470 |
Supplemental Balance Sheet In23
Supplemental Balance Sheet Information (Tables) | 9 Months Ended |
Sep. 26, 2015 | |
Supplemental Balance Sheet Information [Abstract] | |
Composition of Net Trade Receivables | The composition of trade receivables, net is as follows: September 26, 2015 December 27, 2014 (in thousands) Client receivables $ 240,307 $ 219,118 Unbilled revenue 54,157 43,780 Total 294,464 262,898 Less: Allowance for doubtful accounts (5,628 ) (4,907 ) Trade receivables, net $ 288,836 $ 257,991 |
Composition of Inventories | The composition of inventories is as follows: September 26, 2015 December 27, 2014 (in thousands) Raw materials and supplies $ 15,530 $ 15,416 Work in process 13,063 11,802 Finished products 69,504 61,825 Inventories $ 98,097 $ 89,043 |
Composition of Other Current Assets | The composition of other current assets is as follows: September 26, 2015 December 27, 2014 (in thousands) Deferred tax asset $ 33,156 $ 27,644 Investments 17,975 16,167 Prepaid income tax 30,828 26,287 Restricted cash 1,221 2,552 Other 923 291 Other current assets $ 84,103 $ 72,941 |
Composition of Net Property, Plant and Equipment | The composition of property, plant and equipment, net is as follows: September 26, 2015 December 27, 2014 (in thousands) Land $ 42,619 $ 40,314 Buildings (1) 705,694 682,495 Machinery and equipment 381,764 384,713 Leasehold improvements 39,221 37,270 Furniture and fixtures 22,053 22,577 Vehicles 4,054 3,967 Computer hardware and software 123,285 119,474 Construction in progress 23,823 40,970 Total 1,342,513 1,331,780 Less: Accumulated depreciation (670,840 ) (654,983 ) Property, plant and equipment, net $ 671,673 $ 676,797 (1) The balance as of September 26, 2015 includes capital lease assets. See Note 7, “Long Term Debt and Capital Lease Obligations.” |
Composition of Other Assets | The composition of other assets is as follows: September 26, 2015 December 27, 2014 (in thousands) Life insurance policies $ 26,458 $ 27,603 Investments in limited partnerships 29,931 27,047 Other 9,163 18,301 Other assets $ 65,552 $ 72,951 |
Composition of Current Liabilities | The composition of other current liabilities is as follows: September 26, 2015 December 27, 2014 (in thousands) Accrued income taxes $ 17,630 $ 9,362 Current deferred tax liability 3,389 1,484 Accrued interest and other 328 233 Other current liabilities $ 21,347 $ 11,079 |
Composition of Other Long-Term Liabilities | The composition of other long-term liabilities is as follows: September 26, 2015 December 27, 2014 (in thousands) Deferred tax liability $ 49,016 $ 30,816 Long-term pension liability 37,878 45,135 Accrued executive supplemental life insurance retirement plan and deferred compensation plan 33,858 33,007 Other 19,004 21,403 Other long-term liabilities $ 139,756 $ 130,361 |
Investments in Limited Partne24
Investments in Limited Partnerships and Marketable Securities (Tables) | 9 Months Ended |
Sep. 26, 2015 | |
Marketable Securities and Equity-Method Affiliates [Abstract] | |
Schedule of Available-for-sale Securities Reconciliation | The following is a summary of the Company's marketable securities, all of which are classified as available-for-sale: September 26, 2015 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (in thousands) Mutual fund $ 4,650 $ — $ (80 ) $ 4,570 Total $ 4,650 $ — $ (80 ) $ 4,570 |
Fair Value (Tables)
Fair Value (Tables) | 9 Months Ended |
Sep. 26, 2015 | |
Fair Value Disclosures [Abstract] | |
Summary of Assets and Liabilities Measured at Fair Value on a Recurring Basis | Assets, liabilities, and noncontrolling interest measured at fair value on a recurring basis are summarized below: September 26, 2015 Level 1 Level 2 Level 3 Total (in thousands) Cash equivalents $ — $ 159 $ — $ 159 Other current assets: Marketable securities 4,570 — — 4,570 Foreign currency forward contracts — 16 — 16 Other assets: Life insurance policies — 19,346 — 19,346 Total assets measured at fair value $ 4,570 $ 19,521 $ — $ 24,091 Other current liabilities: Contingent consideration $ — $ — $ 1,111 $ 1,111 Foreign currency forward contracts — 306 — 306 Other long-term liabilities: Contingent consideration — — 169 169 Redeemable noncontrolling interest — — 27,447 27,447 Total liabilities and redeemable noncontrolling interest measured at fair value $ — $ 306 $ 28,727 $ 29,033 December 27, 2014 Level 1 Level 2 Level 3 Total (in thousands) Cash equivalents $ — $ 1,934 $ — $ 1,934 Other assets: Life insurance policies — 20,520 — 20,520 Total assets measured at fair value $ — $ 22,454 $ — $ 22,454 Other current liabilities: Contingent consideration $ — $ — $ 1,583 $ 1,583 Other long-term liabilities: Contingent consideration — — 1,245 1,245 Redeemable noncontrolling interest — — 28,419 28,419 Total liabilities and redeemable noncontrolling interest measured at fair value $ — $ — $ 31,247 $ 31,247 |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following table provides a rollforward of the fair value of the Company’s redeemable noncontrolling interest: Nine Months Ended September 26, 2015 September 27, 2014 (in thousands) Beginning balance $ 28,419 $ 20,581 Additions — — Total gains or losses (realized/unrealized): Net income attributable to noncontrolling interest 614 523 Foreign currency translation (693 ) (113 ) Change in fair value, included in additional paid-in capital (893 ) 3,559 Ending balance $ 27,447 $ 24,550 |
Fair Value, Contingent Consideration | The following table provides a rollforward of the contingent consideration related to the acquisitions of Argenta, BioFocus, VivoPath and ChanTest. See Note 2, “Business Acquisitions.” Nine Months Ended September 26, 2015 September 27, 2014 (in thousands) Beginning balance $ 2,828 $ — Additions 675 2,428 Payments (600 ) — Total gains or losses (realized/unrealized): Reversal of previously recorded contingent liability and change in fair value (1,623 ) 120 Ending balance $ 1,280 $ 2,548 |
Goodwill and Other Intangible26
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 26, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in the Gross Carrying Amount and Accumulated Amortization of Goodwill | The following table provides a rollforward of the Company’s goodwill: Adjustments to Goodwill December 27, 2014 Acquisitions Foreign Exchange September 26, 2015 (in thousands) Research Models and Services $ 59,196 $ — $ (698 ) $ 58,498 Discovery and Safety Assessment 229,302 (748 ) (3,470 ) 225,084 Manufacturing Support 32,579 104,972 (2,888 ) 134,663 Total $ 321,077 $ 104,224 $ (7,056 ) $ 418,245 |
Schedule of Finite-Lived Intangible Assets | The following table displays other intangible assets, net by major class: September 26, 2015 December 27, 2014 Gross Accumulated Amortization Net Gross Accumulated Amortization Net (in thousands) Backlog $ — $ — $ — $ 8,728 $ (6,636 ) $ 2,092 Client relationships 390,585 (176,099 ) 214,486 379,339 (217,938 ) 161,401 Technology 49,204 (2,931 ) 46,273 13,474 (4,166 ) 9,308 Trademarks and trade names 6,631 (844 ) 5,787 6,603 (5,314 ) 1,289 Standard operating procedures 2,100 (1,745 ) 355 2,309 (1,642 ) 667 Other identifiable intangible assets 9,957 (2,610 ) 7,347 2,860 (2,180 ) 680 Total definite-lived intangible assets 458,477 (184,229 ) 274,248 413,313 (237,876 ) 175,437 Indefinite-lived intangibles assets 3,438 3,438 Total other intangibles assets, net $ 277,686 $ 178,875 |
Long-Term Debt and Capital Le27
Long-Term Debt and Capital Lease Obligations (Tables) | 9 Months Ended |
Sep. 26, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Long-term debt, net consists of the following: September 26, 2015 December 27, 2014 (in thousands) Term loans $ 395,000 $ 378,000 Revolving credit facility 429,871 375,536 Other long-term debt 196 214 Total debt 825,067 753,750 Less: current portion of long-term debt (15,196 ) (31,714 ) Long-term debt 809,871 722,036 Debt discount and debt issuance costs (1) (7,215 ) (5,401 ) Long-term debt, net $ 802,656 $ 716,635 (1) During the three months ended June 27, 2015, the Company adopted ASU 2015-03 and reclassified unamortized debt issuance costs from other assets to long-term debt, net and capital leases. See Note 1, “Basis of Presentation” for further discussion. |
Equity (Tables)
Equity (Tables) | 9 Months Ended |
Sep. 26, 2015 | |
Equity [Abstract] | |
Reconciliation of the Numerator and Denominator in the Computations of the Basic and Diluted Earnings Per Share | The following table reconciles the numerator and denominator in the computations of basic and diluted earnings per share: Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Numerator: Net income from continuing operations attributable to common shareholders $ 37,413 $ 31,984 $ 117,477 $ 100,394 Loss (income) from discontinued operations, net of income taxes (34 ) 52 (48 ) (862 ) Net income attributable to common shareholders $ 37,379 $ 32,036 $ 117,429 $ 99,532 Denominator: Weighted-average shares outstanding—Basic 46,290 46,016 46,572 46,683 Effect of dilutive securities: Stock options, restricted stock units, performance stock units and contingently issuable restricted stock 955 862 1,012 883 Weighted-average shares outstanding—Diluted 47,245 46,878 47,584 47,566 |
Schedule of Accumulated Other Comprehensive Income (Loss) | Changes to each component of accumulated other comprehensive income (loss), net of income tax, are as follows: Foreign Currency Translation and Other Pension and Other Post-Retirement Benefit Plans Total (in thousands) December 27, 2014 $ (19,891 ) $ (54,356 ) $ (74,247 ) Other comprehensive loss before reclassifications (45,697 ) — (45,697 ) Amounts reclassified from accumulated other comprehensive income (loss) (2,341 ) 2,185 (156 ) Net current period other comprehensive income (loss) (48,038 ) 2,185 (45,853 ) Income tax expense — 700 700 September 26, 2015 $ (67,929 ) $ (52,871 ) $ (120,800 ) The income tax expense (benefit) related to items of other comprehensive income are as follows: Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Income tax benefit related to foreign currency translation adjustment $ — $ — $ — $ (105 ) Income tax expense related to change in unrecognized pension gains, losses and prior service costs 220 125 700 378 Income tax expense related to items of other comprehensive income $ 220 $ 125 $ 700 $ 273 |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 26, 2015 | |
Income Tax Disclosure [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | Changes to each component of accumulated other comprehensive income (loss), net of income tax, are as follows: Foreign Currency Translation and Other Pension and Other Post-Retirement Benefit Plans Total (in thousands) December 27, 2014 $ (19,891 ) $ (54,356 ) $ (74,247 ) Other comprehensive loss before reclassifications (45,697 ) — (45,697 ) Amounts reclassified from accumulated other comprehensive income (loss) (2,341 ) 2,185 (156 ) Net current period other comprehensive income (loss) (48,038 ) 2,185 (45,853 ) Income tax expense — 700 700 September 26, 2015 $ (67,929 ) $ (52,871 ) $ (120,800 ) The income tax expense (benefit) related to items of other comprehensive income are as follows: Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Income tax benefit related to foreign currency translation adjustment $ — $ — $ — $ (105 ) Income tax expense related to change in unrecognized pension gains, losses and prior service costs 220 125 700 378 Income tax expense related to items of other comprehensive income $ 220 $ 125 $ 700 $ 273 |
Pension and Other Post-Retire30
Pension and Other Post-Retirement Benefit Plans Employee Benefits (Tables) | 9 Months Ended |
Sep. 26, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
Schedule of Net Benefit Costs | The following table provides the components of net periodic cost (benefit) for the Company’s pension and other post-retirement benefit plans for the three months ended September 26, 2015 and September 27, 2014 : Pension Plans Other Post-Retirement Benefit Plans September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Service cost $ 935 $ 880 $ 214 $ 190 Interest cost 3,070 3,211 265 252 Expected return on plan assets (4,383 ) (4,540 ) — — Amortization of prior service cost (credit) (150 ) (166 ) — 159 Amortization of net loss 780 238 65 60 Net periodic cost (benefit) $ 252 $ (377 ) $ 544 $ 661 The following table provides the components of net periodic cost (benefit) for the Company’s pension and other post-retirement benefit plans for the nine months ended September 26, 2015 and September 27, 2014 : Pension Plans Other Post-Retirement Benefit Plans September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Service cost $ 2,806 $ 2,565 $ 642 $ 569 Interest cost 9,210 9,633 796 757 Expected return on plan assets (13,147 ) (13,095 ) — — Amortization of prior service cost (credit) (451 ) (484 ) — 489 Amortization of net loss 2,433 684 203 185 Net periodic cost (benefit) $ 851 $ (697 ) $ 1,641 $ 2,000 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 26, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Stock-Based Compensation Expense | The following table provides stock-based compensation by the financial statement line item in which it is reflected: Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Cost of revenue $ 1,670 $ 1,337 $ 4,959 $ 4,008 Selling, general and administrative 8,806 6,914 25,390 19,124 Stock-based compensation, before income taxes 10,476 8,251 30,349 23,132 Provision for income taxes (3,733 ) (2,943 ) (10,737 ) (8,271 ) Stock-based compensation, net of income taxes $ 6,743 $ 5,308 $ 19,612 $ 14,861 |
Foreign Currency Contracts (Tab
Foreign Currency Contracts (Tables) | 9 Months Ended |
Sep. 26, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Foreign Currency Contracts | The notional amount and fair value of the Company’s foreign currency forward contracts is summarized as follows: September 26, 2015 Notional Amount Fair Value Balance Sheet Location (in thousands) $ 39,661 $ 16 Other current assets $ 88,417 $ 306 Other current liabilities |
Derivative Instruments, Gain (Loss) | The following table summarizes the effect of foreign exchange forward contracts on the Company’s consolidated statement of income: Three Months Ended September 26, 2015 Location of Gain (Loss) Gain (Loss) Recognized (in thousands) Other income (expense), net $ (3,194 ) |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 26, 2015 | |
Segment Reporting [Abstract] | |
Schedule of Sales and Other Financial Information by Business Segment | The following table presents revenue and other financial information by reportable segment: Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Research Models and Services Revenue $ 118,451 $ 124,021 $ 358,506 $ 389,636 Gross margin 47,841 45,295 143,352 149,392 Operating income 31,494 28,056 93,800 97,734 Depreciation and amortization 5,319 7,277 16,712 20,277 Capital expenditures 3,022 4,110 12,111 11,528 Discovery and Safety Assessment Revenue $ 158,272 $ 140,862 $ 451,659 $ 388,614 Gross margin 53,721 39,968 146,660 105,084 Operating income 33,191 19,329 84,856 48,840 Depreciation and amortization 11,509 13,340 35,060 33,867 Capital expenditures 4,277 3,436 13,756 11,330 Manufacturing Support Revenue $ 72,742 $ 62,684 $ 199,287 $ 189,864 Gross margin 36,513 33,005 100,506 98,239 Operating income 18,424 19,220 55,653 58,091 Depreciation and amortization 5,139 3,513 12,034 10,625 Capital expenditures 2,139 1,463 5,475 5,444 |
Reconciliation of Segment Operating Income to Consolidated Operating Income | For the three months ended September 26, 2015 , reconciliations of segment operating income, depreciation and amortization, and capital expenditures to the respective consolidated amounts are as follows: Operating Income Depreciation and Amortization Capital Expenditures September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Total reportable segments $ 83,109 $ 66,605 $ 21,967 $ 24,130 $ 9,438 $ 9,009 Unallocated corporate (27,669 ) (20,433 ) 1,847 1,938 1,014 393 Total consolidated $ 55,440 $ 46,172 $ 23,814 $ 26,068 $ 10,452 $ 9,402 For the nine months ended September 26, 2015 , reconciliations of segment operating income, depreciation and amortization, and capital expenditures to the respective consolidated amounts are as follows: Operating Income Depreciation and Amortization Capital Expenditures September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Total reportable segments $ 234,309 $ 204,665 $ 63,806 $ 64,769 $ 31,342 $ 28,302 Unallocated corporate (80,129 ) (67,762 ) 5,524 5,666 3,666 1,605 Total consolidated $ 154,180 $ 136,903 $ 69,330 $ 70,435 $ 35,008 $ 29,907 |
Schedule of Net Sales for Each Significant Service Area | Revenue for each significant product or service area is as follows: Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Research models and services $ 118,451 $ 124,021 $ 358,506 $ 389,636 Discovery and safety assessment 158,272 140,862 451,659 388,614 Microbial Solutions 39,110 31,834 105,589 97,879 Other manufacturing support 33,632 30,850 93,698 91,985 Manufacturing support 72,742 62,684 199,287 189,864 Total revenue $ 349,465 $ 327,567 $ 1,009,452 $ 968,114 |
Summary of Unallocated Corporate Overhead | A summary of unallocated corporate overhead consists of the following : Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 (in thousands) Stock-based compensation expense $ 6,802 $ 4,918 $ 19,501 $ 13,525 Salary, bonus and fringe 6,821 5,892 24,751 23,597 Consulting, audit and professional services 4,280 3,053 11,051 8,721 IT related expenses 2,618 1,767 6,167 4,667 Depreciation expense 1,847 1,954 5,524 5,666 Acquisition related adjustments 3,478 580 7,072 5,256 Other general unallocated corporate expenses 1,823 2,269 6,063 6,330 Total unallocated corporate overhead costs $ 27,669 $ 20,433 $ 80,129 $ 67,762 |
Basis of Presentation Basis of
Basis of Presentation Basis of Presentation (Details) - USD ($) $ in Thousands | Sep. 26, 2015 | Dec. 27, 2014 |
New Accounting Pronouncement, Early Adoption [Line Items] | ||
Long-term debt | $ (809,871) | $ (722,036) |
Early Adoption | ||
New Accounting Pronouncement, Early Adoption [Line Items] | ||
Long-term debt | (7,700) | (5,400) |
Other Assets | $ 7,700 | $ 5,400 |
Business Acquisitions - Celsis,
Business Acquisitions - Celsis, Additional Information (Details) - Celsis - USD ($) $ in Thousands | Jul. 24, 2015 | Sep. 26, 2015 | Sep. 26, 2015 | Sep. 27, 2014 |
Business Acquisition [Line Items] | ||||
Accounts receivable (contractual amount) | $ 5,410 | |||
Acquisition purchase price | 214,000 | |||
Assumed liabilities | 10,300 | |||
Total purchase price allocation | 211,724 | |||
Cash acquired | $ (2,300) | |||
Price allocation adjustment period, maximum | 1 year | |||
Transaction and integration costs | $ 3,900 | $ 7,400 | ||
Revenue | 4,900 | 4,900 | ||
Operating loss | $ 3,100 | 3,100 | ||
Pro forma adjustments, acquisitions | $ 2,400 | $ 11,300 |
Business Acquisitions - Celsis
Business Acquisitions - Celsis Purchase Price Allocation (Details) - USD ($) $ in Thousands | Sep. 26, 2015 | Jul. 24, 2015 | Dec. 27, 2014 |
Business Acquisition [Line Items] | |||
Goodwill | $ 418,245 | $ 321,077 | |
Celsis | |||
Business Acquisition [Line Items] | |||
Accounts receivable (contractual amount) | $ 5,410 | ||
Accounts receivable, net | 5,288 | ||
Inventory | 10,103 | ||
Other current assets (excluding cash) | 13,449 | ||
Property, plant and equipment | 5,086 | ||
Other long term assets | 614 | ||
Definite-lived intangible assets | 118,140 | ||
Goodwill | 104,785 | ||
Short-term debt | (9,766) | ||
Other current liabilities | (7,382) | ||
Long term liabilities | (28,593) | ||
Total purchase price allocation | $ 211,724 |
Business Acquisitions - Celsi37
Business Acquisitions - Celsis Definite-Lived Intangible Assets (Details) - Celsis $ in Thousands | Jul. 24, 2015USD ($) |
Business Acquisition [Line Items] | |
Definite-Lived Intangible Assets | $ 118,140 |
Client relationships | |
Business Acquisition [Line Items] | |
Definite-Lived Intangible Assets | $ 71,000 |
Weighted average amortization life | 16 years |
Developed technology | |
Business Acquisition [Line Items] | |
Definite-Lived Intangible Assets | $ 39,140 |
Weighted average amortization life | 14 years |
Trademark and trade names | |
Business Acquisition [Line Items] | |
Definite-Lived Intangible Assets | $ 5,200 |
Weighted average amortization life | 14 years |
Non-compete | |
Business Acquisition [Line Items] | |
Definite-Lived Intangible Assets | $ 2,800 |
Weighted average amortization life | 5 years |
Business Acquisitions - Celsi38
Business Acquisitions - Celsis Pro Forma Results (Details) - Celsis - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | |
Business Acquisition [Line Items] | ||||
Revenue | $ 350,819 | $ 335,987 | $ 1,026,643 | $ 993,384 |
Net income attributable to common shareholders | $ 40,826 | $ 31,893 | $ 125,863 | $ 84,545 |
Earnings per common share | ||||
Basic (in dollars per share) | $ 0.88 | $ 0.69 | $ 2.70 | $ 1.81 |
Diluted (in dollars per share) | $ 0.86 | $ 0.68 | $ 2.65 | $ 1.78 |
Business Acquisitions - Sunrise
Business Acquisitions - Sunrise, Additional Information (Details) - USD ($) $ in Thousands | May. 05, 2015 | Sep. 26, 2015 | Sep. 26, 2015 | Sep. 27, 2014 |
Business Acquisition [Line Items] | ||||
Gain on bargain purchase | $ 9,933 | $ 0 | ||
Sunrise | ||||
Business Acquisition [Line Items] | ||||
Preliminary purchase price | $ 9,558 | |||
Gain on bargain purchase | 9,933 | |||
Cash acquired | $ 100 | |||
Price allocation adjustment period, maximum | 1 year | |||
Transaction and integration costs | $ 100 | $ 700 | ||
Client relationships | Sunrise | ||||
Business Acquisition [Line Items] | ||||
Useful life of intangible assets acquired | 15 years |
Business Acquisitions - Sunri40
Business Acquisitions - Sunrise Purchase Price Allocation (Details) - USD ($) $ in Thousands | May. 05, 2015 | Sep. 26, 2015 | Sep. 27, 2014 |
Business Acquisition [Line Items] | |||
Bargain purchase gain | $ (9,933) | $ 0 | |
Sunrise | |||
Business Acquisition [Line Items] | |||
Accounts receivable, net | $ 981 | ||
Inventory | 1,518 | ||
Other current assets (excluding cash) | 373 | ||
Property, plant and equipment | 13,866 | ||
Definite-lived intangible assets | 3,400 | ||
Current liabilities | (397) | ||
Long-term liabilities | (250) | ||
Fair value of net assets acquired | 19,491 | ||
Bargain purchase gain | (9,933) | ||
Total purchase price allocation | $ 9,558 |
Business Acquisitions - ChanTes
Business Acquisitions - ChanTest, Additional Information (Details) - USD ($) | Oct. 29, 2014 | Sep. 26, 2015 | Sep. 27, 2014 |
Business Acquisition [Line Items] | |||
Total purchase price allocation | $ 211,974,000 | $ 183,151,000 | |
ChanTest | |||
Business Acquisition [Line Items] | |||
Preliminary purchase price | $ 59,200,000 | ||
Contingent consideration | 300,000 | ||
Maximum contingent consideration limit | 2,000,000 | ||
Total purchase price allocation | 52,029,000 | ||
Cash acquired from acquisition | $ 7,200,000 |
Business Acquisitions - Chan Te
Business Acquisitions - Chan Test Preliminary Purchase Price (Details) - USD ($) $ in Thousands | Oct. 29, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | Dec. 27, 2014 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 418,245 | $ 321,077 | ||
Total purchase price allocation | $ 211,974 | $ 183,151 | ||
ChanTest | ||||
Business Acquisition [Line Items] | ||||
Current assets (excluding cash) | $ 4,669 | |||
Property, plant and equipment | 1,637 | |||
Definite-lived intangible assets | 23,920 | |||
Goodwill | 34,775 | |||
Current liabilities | (3,486) | |||
Long-term liabilities | (9,486) | |||
Total purchase price allocation | $ 52,029 |
Business Acquisitions - ChanT43
Business Acquisitions - ChanTest Breakout of Definite-Lived Intangible Assets Acquired (Details) - ChanTest $ in Thousands | Oct. 29, 2014USD ($) |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Total definite-lived intangible assets | $ 23,920 |
Client relationships | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets acquired | $ 19,000 |
Weighted average amortization life | 13 years |
Other intangible assets | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets acquired | $ 4,920 |
Weighted average amortization life | 9 years |
Business Acquisitions - VivoPat
Business Acquisitions - VivoPath (Details) € in Millions | 3 Months Ended | ||||||
Sep. 26, 2015USD ($) | Mar. 28, 2015USD ($) | Sep. 26, 2015EUR (€) | Sep. 26, 2015USD ($) | Jun. 30, 2014USD ($) | Jun. 16, 2014USD ($) | Apr. 01, 2014USD ($) | |
VivoPath [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Acquisition purchase price | $ 2,300,000 | ||||||
Contingent consideration | 1,600,000 | ||||||
Aggregate undiscounted amount of contingent consideration | $ 400,000 | 2,400,000 | |||||
Contingent consideration | $ 600,000 | ||||||
Gain on decrease in the expected future contingent consideration payment | $ 1,000,000 | ||||||
Argenta and BioFocus [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Acquisition purchase price | $ 191,800,000 | ||||||
Contingent consideration | $ 900,000 | ||||||
Aggregate undiscounted amount of contingent consideration | € 5 | $ 5,600,000 | |||||
Gain on decrease in the expected future contingent consideration payment | $ 800,000 |
Business Acquisitions - Early D
Business Acquisitions - Early Discovery, Additional Information (Details) - Argenta and BioFocus [Member] $ in Thousands, € in Millions | Apr. 01, 2014USD ($) | Mar. 28, 2015USD ($) | Sep. 27, 2014USD ($) | Sep. 27, 2014USD ($) | Sep. 26, 2015EUR (€) | Sep. 26, 2015USD ($) |
Business Acquisition [Line Items] | ||||||
Percentage of voting interests acquired | 100.00% | |||||
Acquisition purchase price | $ 191,800 | |||||
Contingent consideration | 900 | |||||
Gain on decrease in the expected future contingent consideration payment | $ 800 | |||||
Aggregate undiscounted amount of contingent consideration | € 5 | $ 5,600 | ||||
Total purchase price allocation | 183,594 | |||||
Purchase price allocation, cash | 8,200 | |||||
Acquisition related adjustments | $ 500 | $ 5,400 | ||||
Revenue | 46,800 | |||||
Operating loss | $ (400) | |||||
Pro forma adjustments, acquisitions | $ 3,700 |
Business Acquisitions - Early46
Business Acquisitions - Early Discovery Purchase Price Allocation (Details) - USD ($) $ in Thousands | Sep. 26, 2015 | Dec. 27, 2014 | Apr. 01, 2014 |
Business Acquisition [Line Items] | |||
Goodwill | $ 418,245 | $ 321,077 | |
Argenta and BioFocus [Member] | |||
Business Acquisition [Line Items] | |||
Current assets (excluding cash) | $ 31,682 | ||
Property, plant and equipment | 21,008 | ||
Other long term assets | 11,140 | ||
Definite-lived intangible assets | 104,470 | ||
Goodwill | 65,235 | ||
Current liabilities | (13,139) | ||
Long term liabilities | (36,802) | ||
Total purchase price allocation | $ 183,594 |
Business Acquisitions - Early47
Business Acquisitions - Early Discovery Breakout of Definite-Lived Intangible Assets Acquired (Details) - Argenta and BioFocus [Member] - USD ($) $ in Thousands | Apr. 01, 2015 | Apr. 01, 2014 |
Definite-Lived Intangible Assets | ||
Client relationships | $ 94,000 | |
Backlog | 5,900 | |
Trademark and trade names | 1,170 | |
Leasehold interests | 1,000 | |
Other intangible assets | 2,400 | |
Total definite-lived intangible assets | $ 104,470 | |
Client relationships | ||
Definite-Lived Intangible Assets | ||
Weighted average amortization life | 18 years | |
Backlog | ||
Definite-Lived Intangible Assets | ||
Weighted average amortization life | 1 year | |
Trademark and trade names | ||
Definite-Lived Intangible Assets | ||
Weighted average amortization life | 3 years | |
Leasehold interests | ||
Definite-Lived Intangible Assets | ||
Weighted average amortization life | 13 years | |
Other intangible assets | ||
Definite-Lived Intangible Assets | ||
Weighted average amortization life | 19 years |
Business Acquisitions Business
Business Acquisitions Business Acquisitions - Early Discovery Pro Forma Information (Details) - Argenta and BioFocus [Member] $ / shares in Units, $ in Thousands | 9 Months Ended |
Sep. 27, 2014USD ($)$ / shares | |
Business Acquisition [Line Items] | |
Revenue | $ | $ 993,223 |
Net income attributable to common shareholders | $ | $ 101,029 |
Earnings per common share | |
Basic (in dollars per share) | $ 2.16 |
Diluted (in dollars per share) | $ 2.12 |
Supplemental Balance Sheet In49
Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | Dec. 27, 2014 | |
Composition of trade receivables | |||||
Client receivables | $ 240,307 | $ 240,307 | $ 219,118 | ||
Unbilled revenue | 54,157 | 54,157 | 43,780 | ||
Total | 294,464 | 294,464 | 262,898 | ||
Less: Allowance for doubtful accounts | (5,628) | (5,628) | (4,907) | ||
Trade receivables, net | 288,836 | 288,836 | 257,991 | ||
Composition of inventories | |||||
Raw materials and supplies | 15,530 | 15,530 | 15,416 | ||
Work in process | 13,063 | 13,063 | 11,802 | ||
Finished products | 69,504 | 69,504 | 61,825 | ||
Inventories | 98,097 | 98,097 | 89,043 | ||
Composition of other current assets | |||||
Deferred tax asset | 33,156 | 33,156 | 27,644 | ||
Investments | 17,975 | 17,975 | 16,167 | ||
Prepaid income tax | 30,828 | 30,828 | 26,287 | ||
Restricted cash | 1,221 | 1,221 | 2,552 | ||
Other | 923 | 923 | 291 | ||
Other current assets | 84,103 | 84,103 | 72,941 | ||
Property, Plant and Equipment [Line Items] | |||||
Total | 1,342,513 | 1,342,513 | 1,331,780 | ||
Less: Accumulated depreciation | (670,840) | (670,840) | (654,983) | ||
Property, plant and equipment, net | 671,673 | 671,673 | 676,797 | ||
Depreciation expense | 17,400 | $ 18,400 | 51,900 | $ 51,600 | |
Composition of other assets | |||||
Life insurance policies | 26,458 | 26,458 | 27,603 | ||
Investments in limited partnerships | 29,931 | 29,931 | 27,047 | ||
Other | 9,163 | 9,163 | 18,301 | ||
Other assets | 65,552 | 65,552 | 72,951 | ||
Composition of other current liabilities | |||||
Accrued income taxes | 17,630 | 17,630 | 9,362 | ||
Current deferred tax liability | 3,389 | 3,389 | 1,484 | ||
Accrued interest and other | 328 | 328 | 233 | ||
Other current liabilities | 21,347 | 21,347 | 11,079 | ||
Composition of other long-term liabilities | |||||
Deferred tax liability | 49,016 | 49,016 | 30,816 | ||
Long-term pension liability | 37,878 | 37,878 | 45,135 | ||
Accrued executive supplemental life insurance retirement plan and deferred compensation plan | 33,858 | 33,858 | 33,007 | ||
Other | 19,004 | 19,004 | 21,403 | ||
Other long-term liabilities | 139,756 | 139,756 | 130,361 | ||
Land | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 42,619 | 42,619 | 40,314 | ||
Buildings | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 705,694 | 705,694 | 682,495 | ||
Machinery and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 381,764 | 381,764 | 384,713 | ||
Leasehold improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 39,221 | 39,221 | 37,270 | ||
Furniture and fixtures | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 22,053 | 22,053 | 22,577 | ||
Vehicles | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 4,054 | 4,054 | 3,967 | ||
Computer hardware and software | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 123,285 | 123,285 | 119,474 | ||
Construction in progress | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | $ 23,823 | $ 23,823 | $ 40,970 |
Investments in Limited Partne50
Investments in Limited Partnerships and Marketable Securities - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | |
Schedule of Equity Method Investments [Line Items] | ||||
Committed contribution | $ 65,000,000 | $ 65,000,000 | ||
Committed contributions funded | 26,300,000 | 26,300,000 | ||
Dividends in cash and securities received | 5,300,000 | $ 0 | 7,300,000 | $ 7,400,000 |
Income (loss) from investments in limited partnerships | $ 3,240,000 | $ (803,000) | $ 3,604,000 | $ 7,377,000 |
Minimum | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Ownership percentage | 3.60% | 3.60% | ||
Maximum | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Ownership percentage | 12.00% | 12.00% |
Investments in Limited Partne51
Investments in Limited Partnerships and Marketable Securities - Summary of Marketable Securities (Details) $ in Thousands | Sep. 26, 2015USD ($) |
Schedule of Available-for-sale Securities [Line Items] | |
Amortized Cost | $ 4,650 |
Gross Unrealized Gains | 0 |
Gross Unrealized Losses | (80) |
Fair Value | 4,570 |
Mutual fund | |
Schedule of Available-for-sale Securities [Line Items] | |
Amortized Cost | 4,650 |
Gross Unrealized Gains | 0 |
Gross Unrealized Losses | (80) |
Fair Value | $ 4,570 |
Fair Value - Fair Value of Asse
Fair Value - Fair Value of Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 26, 2015 | Dec. 27, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 159 | $ 1,934 |
Other current assets: | ||
Marketable securities | 4,570 | |
Foreign currency forward contracts | 16 | |
Other assets: | ||
Life insurance policies | 19,346 | 20,520 |
Total assets measured at fair value | 24,091 | 22,454 |
Other current liabilities: | ||
Contingent consideration | 1,111 | 1,583 |
Foreign currency forward contracts | 306 | |
Other long-term liabilities: | ||
Contingent consideration | 169 | 1,245 |
Redeemable noncontrolling interest | 27,447 | 28,419 |
Total liabilities and redeemable noncontrolling interest measured at fair value | 29,033 | 31,247 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Other current assets: | ||
Marketable securities | 4,570 | |
Foreign currency forward contracts | 0 | |
Other assets: | ||
Life insurance policies | 0 | 0 |
Total assets measured at fair value | 4,570 | 0 |
Other current liabilities: | ||
Contingent consideration | 0 | 0 |
Foreign currency forward contracts | 0 | |
Other long-term liabilities: | ||
Contingent consideration | 0 | 0 |
Redeemable noncontrolling interest | 0 | 0 |
Total liabilities and redeemable noncontrolling interest measured at fair value | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 159 | 1,934 |
Other current assets: | ||
Marketable securities | 0 | |
Foreign currency forward contracts | 16 | |
Other assets: | ||
Life insurance policies | 19,346 | 20,520 |
Total assets measured at fair value | 19,521 | 22,454 |
Other current liabilities: | ||
Contingent consideration | 0 | 0 |
Foreign currency forward contracts | 306 | |
Other long-term liabilities: | ||
Contingent consideration | 0 | 0 |
Redeemable noncontrolling interest | 0 | 0 |
Total liabilities and redeemable noncontrolling interest measured at fair value | 306 | 0 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Other current assets: | ||
Marketable securities | 0 | |
Foreign currency forward contracts | 0 | |
Other assets: | ||
Life insurance policies | 0 | 0 |
Total assets measured at fair value | 0 | 0 |
Other current liabilities: | ||
Contingent consideration | 1,111 | 1,583 |
Foreign currency forward contracts | 0 | |
Other long-term liabilities: | ||
Contingent consideration | 169 | 1,245 |
Redeemable noncontrolling interest | 27,447 | 28,419 |
Total liabilities and redeemable noncontrolling interest measured at fair value | $ 28,727 | $ 31,247 |
Fair Value - Redeemable Noncont
Fair Value - Redeemable Noncontrolling Interest (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 26, 2015 | Sep. 27, 2014 | |
Fair Value Disclosures [Abstract] | ||
Percentage of voting interests acquired | 75.00% | |
Remaining ownership percentage available | 25.00% | |
Total gains or losses (realized/unrealized): | ||
Discount rate | 18.00% | |
Level 3 | Redeemable Noncontrolling Interest | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | $ 28,419 | $ 20,581 |
Additions | 0 | 0 |
Total gains or losses (realized/unrealized): | ||
Net income attributable to noncontrolling interest | 614 | 523 |
Foreign currency translation | (693) | (113) |
Change in fair value, included in additional paid-in capital | (893) | 3,559 |
Ending balance | $ 27,447 | $ 24,550 |
Fair Value - Contingent Conside
Fair Value - Contingent Consideration (Details) - Contingent Consideration - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 26, 2015 | Sep. 27, 2014 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | $ 2,828 | $ 0 |
Additions | 675 | 2,428 |
Payments | (600) | 0 |
Total gains or losses (realized/unrealized): | ||
Reversal of previously recorded contingent liability and change in fair value | (1,623) | 120 |
Ending balance | $ 1,280 | $ 2,548 |
Goodwill and Other Intangible55
Goodwill and Other Intangible Assets - Gross Carrying Amount and Accumulated Amortization of Goodwill (Details) $ in Thousands | 9 Months Ended |
Sep. 26, 2015USD ($) | |
Changes in gross carrying amount and accumulated amortization of goodwill | |
Gross carrying amount, balance at the beginning of the period | $ 321,077 |
Adjustments to Goodwill, Acquisitions | 104,224 |
Adjustments to Goodwill, Foreign Exchange | (7,056) |
Gross carrying amount, balance at the end of the period | 418,245 |
Research Models and Services | |
Changes in gross carrying amount and accumulated amortization of goodwill | |
Gross carrying amount, balance at the beginning of the period | 59,196 |
Adjustments to Goodwill, Acquisitions | 0 |
Adjustments to Goodwill, Foreign Exchange | (698) |
Gross carrying amount, balance at the end of the period | 58,498 |
Discovery and Safety Assessment | |
Changes in gross carrying amount and accumulated amortization of goodwill | |
Gross carrying amount, balance at the beginning of the period | 229,302 |
Adjustments to Goodwill, Acquisitions | (748) |
Adjustments to Goodwill, Foreign Exchange | (3,470) |
Gross carrying amount, balance at the end of the period | 225,084 |
Manufacturing Support | |
Changes in gross carrying amount and accumulated amortization of goodwill | |
Gross carrying amount, balance at the beginning of the period | 32,579 |
Adjustments to Goodwill, Acquisitions | 104,972 |
Adjustments to Goodwill, Foreign Exchange | (2,888) |
Gross carrying amount, balance at the end of the period | $ 134,663 |
Goodwill and Other Intangible56
Goodwill and Other Intangible Assets - Schedule of Other Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 26, 2015 | Dec. 27, 2014 |
Other intangible assets | ||
Gross | $ 458,477 | $ 413,313 |
Accumulated Amortization | (184,229) | (237,876) |
Net | 274,248 | 175,437 |
Indefinite-lived intangibles assets | 3,438 | 3,438 |
Total other intangibles assets, net | 277,686 | 178,875 |
Backlog | ||
Other intangible assets | ||
Gross | 0 | 8,728 |
Accumulated Amortization | 0 | (6,636) |
Net | 0 | 2,092 |
Client relationships | ||
Other intangible assets | ||
Gross | 390,585 | 379,339 |
Accumulated Amortization | (176,099) | (217,938) |
Net | 214,486 | 161,401 |
Developed technology | ||
Other intangible assets | ||
Gross | 49,204 | 13,474 |
Accumulated Amortization | (2,931) | (4,166) |
Net | 46,273 | 9,308 |
Trademarks and trade names | ||
Other intangible assets | ||
Gross | 6,631 | 6,603 |
Accumulated Amortization | (844) | (5,314) |
Net | 5,787 | 1,289 |
Standard operating procedures | ||
Other intangible assets | ||
Gross | 2,100 | 2,309 |
Accumulated Amortization | (1,745) | (1,642) |
Net | 355 | 667 |
Other identifiable intangible assets | ||
Other intangible assets | ||
Gross | 9,957 | 2,860 |
Accumulated Amortization | (2,610) | (2,180) |
Net | $ 7,347 | $ 680 |
Long-Term Debt and Capital Le57
Long-Term Debt and Capital Lease Obligations - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands | Sep. 26, 2015 | Dec. 27, 2014 |
Debt Instrument [Line Items] | ||
Total debt | $ 825,067 | $ 753,750 |
Less: current portion of long-term debt | (15,196) | (31,714) |
Long-term debt | 809,871 | 722,036 |
Debt discount and debt issuance costs | (7,215) | (5,401) |
Long-term debt, net | 802,656 | 716,635 |
Term loan facilities | ||
Debt Instrument [Line Items] | ||
Total debt | 395,000 | 378,000 |
Revolving credit facility | ||
Debt Instrument [Line Items] | ||
Total debt | 429,871 | 375,536 |
Other long-term debt | ||
Debt Instrument [Line Items] | ||
Total debt | $ 196 | $ 214 |
Long-Term Debt and Capital Le58
Long-Term Debt and Capital Lease Obligations - Additional Information (Details) | 9 Months Ended | |||
Sep. 26, 2015USD ($) | Apr. 30, 2015USD ($)payment | Mar. 28, 2015USD ($) | Dec. 27, 2014USD ($) | |
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity, Term Loan and Line of Credit | $ 1,300,000,000 | $ 970,000,000 | ||
Term loan facility | 400,000,000 | |||
Multi-currency revolving credit facility | $ 900,000,000 | |||
Number of quarterly installment payments | payment | 20 | |||
Weighted average interest rate | 1.31% | 1.42% | ||
Letters of credit outstanding | $ 4,900,000 | $ 5,000,000 | ||
Financing Obligation | Argenta and BioFocus [Member] | ||||
Debt Instrument [Line Items] | ||||
Other capital lease obligations | 35,800,000 | |||
Other Capital Lease Obligations | ||||
Debt Instrument [Line Items] | ||||
Other capital lease obligations | $ 34,500,000 | $ 1,000,000 | ||
Federal Funds Rate | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 0.50% | |||
LIBOR | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 1.00% |
Equity - Earnings Per Share (De
Equity - Earnings Per Share (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | |
Numerator: | ||||
Net income from continuing operations attributable to common shareholders | $ 37,413 | $ 31,984 | $ 117,477 | $ 100,394 |
Loss (income) from discontinued operations, net of income taxes | (34) | 52 | (48) | (862) |
Net income attributable to common shareholders | $ 37,379 | $ 32,036 | $ 117,429 | $ 99,532 |
Denominator: | ||||
Weighted-average shares outstanding—Basic (in shares) | 46,290 | 46,016 | 46,572 | 46,683 |
Effect of dilutive securities: | ||||
Stock options, restricted stock units, performance stock units and contingently issuable restricted stock (in shares) | 955 | 862 | 1,012 | 883 |
Weighted-average shares outstanding—Diluted (in shares) | 47,245 | 46,878 | 47,584 | 47,566 |
Equity - Earnings Per Share, Ad
Equity - Earnings Per Share, Additional Information (Details) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | |
Employee Stock Option | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 0.5 | 0.9 | 0.5 | 0.8 |
Restricted Stock and Restricted Stock Units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 1.1 | 1.2 | 1.1 | 1.2 |
Equity - Treasury Shares (Detai
Equity - Treasury Shares (Details) - USD ($) shares in Millions | 9 Months Ended | 12 Months Ended | ||||
Sep. 26, 2015 | Sep. 27, 2014 | Dec. 27, 2014 | Dec. 28, 2013 | Dec. 25, 2010 | Jul. 31, 2010 | |
Treasury Shares | ||||||
Purchase of treasury stock | $ 117,431,000 | $ 121,985,000 | ||||
2010 Share Repurchase Program | ||||||
Treasury Shares | ||||||
Authorized stock repurchase amount | $ 1,150,000,000 | $ 500,000,000 | ||||
Authorized increase, stock repurchase | $ 150,000,000 | $ 250,000,000 | $ 250,000,000 | |||
Stock repurchased during period (in shares) | 1.5 | 2.1 | ||||
Purchase of treasury stock | $ 108,800,000 | $ 110,600,000 | ||||
Remaining authorized repurchase amount | $ 69,700,000 | |||||
2007 Incentive Plan | ||||||
Treasury Shares | ||||||
Number of shares of common stock repurchased (in shares) | 0.1 | 0.1 | ||||
Open market repurchases | ||||||
Treasury Shares | ||||||
Purchase of treasury stock | $ 8,700,000 | $ 6,700,000 |
Equity - Accumulated Other Comp
Equity - Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | |
Accumulated Other Comprehensive Income (Loss), before Tax [Roll Forward] | ||||
December 27, 2014 | $ (74,247) | |||
Other comprehensive loss before reclassifications | (45,697) | |||
Amounts reclassified from accumulated other comprehensive income (loss) | (156) | |||
Net current period other comprehensive income (loss) | (45,853) | |||
Income tax expense | $ 220 | $ 125 | 700 | $ 273 |
September 26, 2015 | (120,800) | (120,800) | ||
Foreign Currency Translation and Other | ||||
Accumulated Other Comprehensive Income (Loss), before Tax [Roll Forward] | ||||
December 27, 2014 | (19,891) | |||
Other comprehensive loss before reclassifications | (45,697) | |||
Amounts reclassified from accumulated other comprehensive income (loss) | (2,341) | |||
Net current period other comprehensive income (loss) | (48,038) | |||
Income tax expense | 0 | |||
September 26, 2015 | (67,929) | (67,929) | ||
Pension and Other Post-Retirement Benefit Plans | ||||
Accumulated Other Comprehensive Income (Loss), before Tax [Roll Forward] | ||||
December 27, 2014 | (54,356) | |||
Other comprehensive loss before reclassifications | 0 | |||
Amounts reclassified from accumulated other comprehensive income (loss) | 2,185 | |||
Net current period other comprehensive income (loss) | 2,185 | |||
Income tax expense | 700 | |||
September 26, 2015 | $ (52,871) | $ (52,871) |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | May. 05, 2015 | Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 |
Income Tax Disclosure [Abstract] | |||||
Effective tax rate (as a percentage) | 28.70% | 26.40% | 18.30% | 26.20% | |
Decrease resulting from acquisition | $ 1,400 | $ 10,400 | |||
Release of uncertain tax position | 900 | 1,800 | |||
Business Acquisition [Line Items] | |||||
Gain on bargain purchase | 9,933 | $ 0 | |||
Decrease in unrecognized tax benefits | 1,000 | ||||
Unrecognized tax benefits | 22,000 | 22,000 | |||
Decrease resulting from foreign currency translation | 900 | ||||
Unrecognized income tax benefits that would impact rate | (1,400) | ||||
Unrecognized tax benefits that would impact effective tax rate favorably, if recognized | 18,700 | 18,700 | |||
Accrued interest on unrecognized tax benefits | 1,000 | 1,000 | |||
Possible decrease of unrecognized tax benefits | $ 400 | $ 400 | |||
Sunrise | |||||
Business Acquisition [Line Items] | |||||
Gain on bargain purchase | $ 9,933 |
Income Taxes - Income Tax Expe
Income Taxes - Income Tax Expense (Benefit) Related to Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | |
Income Tax Disclosure [Abstract] | ||||
Income tax benefit related to foreign currency translation adjustment | $ 0 | $ 0 | $ 0 | $ (105) |
Income tax expense related to change in unrecognized pension gains, losses and prior service costs | 220 | 125 | 700 | 378 |
Income tax expense related to items of other comprehensive income | $ 220 | $ 125 | $ 700 | $ 273 |
Pension and Other Post-Retire65
Pension and Other Post-Retirement Benefit Plans (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | |
Pension Plans | ||||
Employee benefits | ||||
Service cost | $ 935 | $ 880 | $ 2,806 | $ 2,565 |
Interest cost | 3,070 | 3,211 | 9,210 | 9,633 |
Expected return on plan assets | (4,383) | (4,540) | (13,147) | (13,095) |
Amortization of prior service cost (credit) | (150) | (166) | (451) | (484) |
Amortization of net loss | 780 | 238 | 2,433 | 684 |
Net periodic cost (benefit) | 252 | (377) | 851 | (697) |
Other Post-Retirement Benefit Plans | ||||
Employee benefits | ||||
Service cost | 214 | 190 | 642 | 569 |
Interest cost | 265 | 252 | 796 | 757 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Amortization of prior service cost (credit) | 0 | 159 | 0 | 489 |
Amortization of net loss | 65 | 60 | 203 | 185 |
Net periodic cost (benefit) | $ 544 | $ 661 | $ 1,641 | $ 2,000 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | |
Stock-based compensation expense | ||||
Stock-based compensation, before income taxes | $ 10,476 | $ 8,251 | $ 30,349 | $ 23,132 |
Provision for income taxes | (3,733) | (2,943) | (10,737) | (8,271) |
Stock-based compensation, net of income taxes | 6,743 | 5,308 | 19,612 | 14,861 |
Cost of revenue | ||||
Stock-based compensation expense | ||||
Stock-based compensation, before income taxes | 1,670 | 1,337 | 4,959 | 4,008 |
Selling, general and administrative | ||||
Stock-based compensation expense | ||||
Stock-based compensation, before income taxes | $ 8,806 | $ 6,914 | $ 25,390 | $ 19,124 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock-Based Compensation Grants (Details) $ / shares in Units, $ in Millions | 9 Months Ended |
Sep. 26, 2015USD ($)$ / sharesshares | |
Stock Issued or Granted During Period, Share-based Compensation [Abstract] | |
Increase in stock-based compensation expense | $ | $ 3.8 |
Restricted Stock Units | |
Stock Issued or Granted During Period, Share-based Compensation [Abstract] | |
Shares granted (in shares) | 200,000 |
Weighted-average grant date fair value (in dollars per share) | $ / shares | $ 76.66 |
Restricted Stock | |
Stock Issued or Granted During Period, Share-based Compensation [Abstract] | |
Shares granted (in shares) | 100,000 |
Weighted-average grant date fair value (in dollars per share) | $ / shares | $ 70.29 |
Stock Options | |
Stock Issued or Granted During Period, Share-based Compensation [Abstract] | |
Stock options granted (in shares) | 500,000 |
Stock options weighted average grant date fair value (in dollars per share) | $ / shares | $ 17.25 |
Performance Stock Units | |
Stock Issued or Granted During Period, Share-based Compensation [Abstract] | |
Shares granted (in shares) | 200,000 |
Weighted-average grant date fair value (in dollars per share) | $ / shares | $ 87.50 |
Maximum shares to be awarded under plan | 300,000 |
Foreign Currency Contracts - No
Foreign Currency Contracts - Notional Amount and Fair Value (Details) - Foreign Exchange Contract $ in Thousands | Sep. 26, 2015USD ($) |
Derivative [Line Items] | |
Other current assets, notional amount | $ 39,661 |
Other current liabilities, notional amount | 88,417 |
Other Current Assets [Member] | |
Derivative [Line Items] | |
Other current assets, fair value | 16 |
Other Current Liabilities [Member] | |
Derivative [Line Items] | |
Other current liabilities, fair value | $ 306 |
Foreign Currency Contracts - Ef
Foreign Currency Contracts - Effect on Statement of Income (Details) $ in Thousands | 3 Months Ended |
Sep. 26, 2015USD ($) | |
Derivatives, Fair Value [Line Items] | |
Lower remaining maturity range | 1 month |
Higher remaining maturity range | 3 months |
Other Expense | Foreign Exchange Contract | |
Derivatives, Fair Value [Line Items] | |
Gain (Loss) Recognized | $ (3,194) |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | 3 Months Ended | 9 Months Ended |
Sep. 26, 2015USD ($) | Sep. 26, 2015USD ($) | |
Loss Contingencies [Line Items] | ||
Increase in lease obligations | $ 17.9 | |
Government billing | ||
Loss Contingencies [Line Items] | ||
Reserve for estimated possible loss | $ 1.5 | $ 1.5 |
Pending Litigation | Idexx | ||
Loss Contingencies [Line Items] | ||
Number of patents infringed upon | 3 | |
Inestimable loss | we intend to defend against this proceeding vigorously and therefore an estimate of the possible loss or range of loss cannot be made |
Segment Information - Revenue a
Segment Information - Revenue and Other Financial Information by Reportable Segment (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015USD ($) | Sep. 27, 2014USD ($) | Sep. 26, 2015USD ($)segments | Sep. 27, 2014USD ($) | |
Segment Reporting [Abstract] | ||||
Number of reportable segments | segments | 3 | |||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 349,465 | $ 327,567 | $ 1,009,452 | $ 968,114 |
Operating income | 55,440 | 46,172 | 154,180 | 136,903 |
Depreciation and amortization | 23,814 | 26,068 | 69,330 | 70,435 |
Capital expenditures | 10,452 | 9,402 | 35,008 | 29,907 |
Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Operating income | 83,109 | 66,605 | 234,309 | 204,665 |
Depreciation and amortization | 21,967 | 24,130 | 63,806 | 64,769 |
Capital expenditures | 9,438 | 9,009 | 31,342 | 28,302 |
Research Models and Services | Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 118,451 | 124,021 | 358,506 | 389,636 |
Gross margin | 47,841 | 45,295 | 143,352 | 149,392 |
Operating income | 31,494 | 28,056 | 93,800 | 97,734 |
Depreciation and amortization | 5,319 | 7,277 | 16,712 | 20,277 |
Capital expenditures | 3,022 | 4,110 | 12,111 | 11,528 |
Discovery and Safety Assessment | Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 158,272 | 140,862 | 451,659 | 388,614 |
Gross margin | 53,721 | 39,968 | 146,660 | 105,084 |
Operating income | 33,191 | 19,329 | 84,856 | 48,840 |
Depreciation and amortization | 11,509 | 13,340 | 35,060 | 33,867 |
Capital expenditures | 4,277 | 3,436 | 13,756 | 11,330 |
Manufacturing Support | Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 72,742 | 62,684 | 199,287 | 189,864 |
Gross margin | 36,513 | 33,005 | 100,506 | 98,239 |
Operating income | 18,424 | 19,220 | 55,653 | 58,091 |
Depreciation and amortization | 5,139 | 3,513 | 12,034 | 10,625 |
Capital expenditures | $ 2,139 | $ 1,463 | $ 5,475 | $ 5,444 |
Segment Information - Reconcili
Segment Information - Reconciliation of Segment Operating Income, Depreciation and Amortization, and Capital Expenditures (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | |
Segment Reporting Information [Line Items] | ||||
Operating income | $ 55,440 | $ 46,172 | $ 154,180 | $ 136,903 |
Depreciation and amortization | 23,814 | 26,068 | 69,330 | 70,435 |
Capital expenditures | 10,452 | 9,402 | 35,008 | 29,907 |
Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Operating income | 83,109 | 66,605 | 234,309 | 204,665 |
Depreciation and amortization | 21,967 | 24,130 | 63,806 | 64,769 |
Capital expenditures | 9,438 | 9,009 | 31,342 | 28,302 |
Unallocated corporate | ||||
Segment Reporting Information [Line Items] | ||||
Operating income | (27,669) | (20,433) | (80,129) | (67,762) |
Depreciation and amortization | 1,847 | 1,938 | 5,524 | 5,666 |
Capital expenditures | $ 1,014 | $ 393 | $ 3,666 | $ 1,605 |
Segment Information - Revenue P
Segment Information - Revenue Per Significant Product or Service (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 349,465 | $ 327,567 | $ 1,009,452 | $ 968,114 |
Operating segments | Research Models and Services | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 118,451 | 124,021 | 358,506 | 389,636 |
Operating segments | Discovery and Safety Assessment | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 158,272 | 140,862 | 451,659 | 388,614 |
Operating segments | Microbial Solutions | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 39,110 | 31,834 | 105,589 | 97,879 |
Operating segments | Other manufacturing support | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 33,632 | 30,850 | 93,698 | 91,985 |
Operating segments | Manufacturing Support | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 72,742 | $ 62,684 | $ 199,287 | $ 189,864 |
Segment Information - Summary o
Segment Information - Summary of Unallocated Corporate Overhead (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 26, 2015 | Sep. 27, 2014 | Sep. 26, 2015 | Sep. 27, 2014 | |
Segment Reporting Information [Line Items] | ||||
Stock-based compensation expense | $ 10,476 | $ 8,251 | $ 30,349 | $ 23,132 |
Depreciation expense | 17,400 | 18,400 | 51,900 | 51,600 |
Unallocated corporate | ||||
Segment Reporting Information [Line Items] | ||||
Stock-based compensation expense | 6,802 | 4,918 | 19,501 | 13,525 |
Salary, bonus and fringe | 6,821 | 5,892 | 24,751 | 23,597 |
Consulting, audit and professional services | 4,280 | 3,053 | 11,051 | 8,721 |
IT related expenses | 2,618 | 1,767 | 6,167 | 4,667 |
Depreciation expense | 1,847 | 1,954 | 5,524 | 5,666 |
Acquisition related adjustments | 3,478 | 580 | 7,072 | 5,256 |
Other general unallocated corporate expenses | 1,823 | 2,269 | 6,063 | 6,330 |
Total unallocated corporate overhead costs | $ 27,669 | $ 20,433 | $ 80,129 | $ 67,762 |
Segment Information - Additiona
Segment Information - Additional Information (Details) $ in Millions | 9 Months Ended |
Sep. 26, 2015USD ($) | |
Operating segments | Manufacturing Support | |
Segment Reporting Information [Line Items] | |
Increase in manufacturing segment assets | $ 300.5 |