Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Jan. 03, 2015 | Mar. 04, 2015 | Jun. 27, 2014 | |
Document and Entity Information | |||
Entity Registrant Name | B&G Foods, Inc. | ||
Entity Central Index Key | 1278027 | ||
Document Type | 10-K | ||
Document Period End Date | 3-Jan-15 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -2 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $1,705,356,898 | ||
Entity Common Stock, Shares Outstanding | 53,758,649 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $1,490 | $4,107 |
Trade accounts receivable, less allowance for doubtful accounts and discounts of $1,005 and $1,081 in 2014 and 2013, respectively | 55,925 | 62,763 |
Inventories | 106,557 | 101,251 |
Prepaid expenses and other current assets | 14,830 | 8,079 |
Income tax receivable | 14,442 | 3,422 |
Deferred income taxes | 3,275 | 2,115 |
Total current assets | 196,519 | 181,737 |
Property, plant and equipment, net | 116,197 | 110,374 |
Goodwill | 370,424 | 319,292 |
Other intangibles, net | 947,895 | 844,141 |
Other assets | 18,318 | 28,799 |
Total assets | 1,649,353 | 1,484,343 |
Current liabilities: | ||
Trade accounts payable | 38,052 | 42,638 |
Accrued expenses | 17,644 | 19,189 |
Current portion of long-term debt | 18,750 | 26,250 |
Dividends payable | 18,246 | 17,637 |
Total current liabilities | 92,692 | 105,714 |
Long-term debt | 1,007,107 | 844,635 |
Other liabilities | 7,352 | 8,692 |
Deferred income taxes | 204,207 | 146,939 |
Total liabilities | 1,311,358 | 1,105,980 |
Commitments and contingencies (Note 13) | ||
Stockholders' equity: | ||
Preferred stock, $0.01 par value per share. Authorized 1,000,000 shares; no shares issued or outstanding | ||
Common stock, $0.01 par value per share. Authorized 125,000,000 shares; 53,663,697 and 53,445,910 issued and outstanding as of January 3, 2015 and December 28, 2013, respectively | 537 | 534 |
Additional paid-in capital | 110,349 | 183,113 |
Accumulated other comprehensive loss | -11,034 | -2,471 |
Retained earnings | 238,143 | 197,187 |
Total stockholders' equity | 337,995 | 378,363 |
Total liabilities and stockholders' equity | $1,649,353 | $1,484,343 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Consolidated Balance Sheets | ||
Trade accounts receivable, allowance for doubtful accounts and discounts (in dollars) | $1,005 | $1,081 |
Preferred stock, par value (in dollars per share) | $0.01 | $0.01 |
Preferred stock, Authorized shares | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Common stock, Authorized shares | 125,000,000 | 125,000,000 |
Common stock, shares issued | 53,663,697 | 53,445,910 |
Common stock, shares outstanding | 53,663,697 | 53,445,910 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Consolidated Statements of Operations | |||
Net sales | $848,017 | $724,973 | $633,812 |
Cost of goods sold | 600,246 | 482,050 | 410,469 |
Gross profit | 247,771 | 242,923 | 223,343 |
Operating expenses: | |||
Selling, general and administrative expenses | 93,033 | 79,043 | 66,212 |
Amortization expense | 12,692 | 9,884 | 8,126 |
Impairment of intangible assets | 34,154 | ||
Gain on change in fair value of contingent consideration | -8,206 | ||
Operating income | 116,098 | 153,996 | 149,005 |
Other expenses: | |||
Interest expense, net | 46,573 | 41,813 | 47,660 |
Loss on extinguishment of debt | 5,748 | 31,291 | 10,431 |
Income before income tax expense | 63,777 | 80,892 | 90,914 |
Income tax expense | 22,821 | 28,549 | 31,654 |
Net income | $40,956 | $52,343 | $59,260 |
Earnings per share: | |||
Basic (in dollars per share) | $0.76 | $0.99 | $1.20 |
Diluted (in dollars per share) | $0.76 | $0.98 | $1.20 |
Cash dividends declared per share (in dollars per share) | $1.36 | $1.23 | $1.10 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Consolidated Statements of Comprehensive Income | |||
Net (loss) income | $40,956 | $52,343 | $59,260 |
Other comprehensive (loss) income: | |||
Foreign currency translation adjustments | -116 | -72 | 17 |
Amortization of unrecognized prior service cost and pension deferrals, net of tax | -8,447 | 8,696 | -682 |
Other comprehensive (loss) income | -8,563 | 8,624 | -665 |
Comprehensive income | $32,393 | $60,967 | $58,595 |
Consolidated_Statements_of_Cha
Consolidated Statements of Changes in Stockholders' Equity (USD $) | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Total |
In Thousands, except Share data, unless otherwise specified | |||||
Balance at Dec. 31, 2011 | $477 | $159,916 | ($10,430) | $85,584 | $235,547 |
Balance (in shares) at Dec. 31, 2011 | 47,700,132 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Foreign currency translation adjustments | 17 | 17 | |||
Change in pension benefit (net of $317, $5036, $4,865 of during the years 2014,2013 and 2012 respectively) | -682 | -682 | |||
Net income | 59,260 | 59,260 | |||
Share-based compensation | 3,777 | 3,777 | |||
Issuance of common stock for share-based compensation | 7 | -10,704 | -10,697 | ||
Issuance of common stock for share-based compensation (in shares) | 687,093 | ||||
Issuance of common stock | 42 | 120,313 | 120,355 | ||
Issuance of common stock (in shares) | 4,173,540 | ||||
Tax benefit from issuance of common stock for share-based compensation | 8,031 | 8,031 | |||
Dividends declared on common stock, $1.36, $1.23 and $1.10 per share during the years 2014, 2013 and 2012, respectively | -54,433 | -54,433 | |||
Balance at Dec. 29, 2012 | 526 | 226,900 | -11,095 | 144,844 | 361,175 |
Balance (in shares) at Dec. 29, 2012 | 52,560,765 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Foreign currency translation adjustments | -72 | -72 | |||
Change in pension benefit (net of $317, $5036, $4,865 of during the years 2014,2013 and 2012 respectively) | 8,696 | 8,696 | |||
Net income | 52,343 | 52,343 | |||
Share-based compensation | 3,935 | 3,935 | |||
Issuance of common stock for share-based compensation | 3 | -6,815 | -6,812 | ||
Issuance of common stock for share-based compensation (in shares) | 312,599 | ||||
Issuance of common stock | 5 | 20,119 | 20,124 | ||
Issuance of common stock (in shares) | 572,546 | ||||
Tax benefit from issuance of common stock for share-based compensation | 4,192 | 4,192 | |||
Dividends declared on common stock, $1.36, $1.23 and $1.10 per share during the years 2014, 2013 and 2012, respectively | -65,218 | -65,218 | |||
Balance at Dec. 28, 2013 | 534 | 183,113 | -2,471 | 197,187 | 378,363 |
Balance (in shares) at Dec. 28, 2013 | 53,445,910 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Foreign currency translation adjustments | -116 | -116 | |||
Change in pension benefit (net of $317, $5036, $4,865 of during the years 2014,2013 and 2012 respectively) | -8,447 | -8,447 | |||
Net income | 40,956 | 40,956 | |||
Share-based compensation | 2,235 | 2,235 | |||
Issuance of common stock for share-based compensation | 3 | -4,377 | -4,374 | ||
Issuance of common stock for share-based compensation (in shares) | 217,787 | ||||
Tax benefit from issuance of common stock for share-based compensation | 2,356 | 2,356 | |||
Dividends declared on common stock, $1.36, $1.23 and $1.10 per share during the years 2014, 2013 and 2012, respectively | -72,978 | -72,978 | |||
Balance at Jan. 03, 2015 | $537 | $110,349 | ($11,034) | $238,143 | $337,995 |
Balance (in shares) at Jan. 03, 2015 | 53,663,697 |
Consolidated_Statements_of_Cha1
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Consolidated Statements of Changes in Stockholders' Equity | |||
Change in pension benefit, taxes | $4,865 | $5,036 | $317 |
Dividends declared on common stock, per share (in dollars per share) | $1.36 | $1.23 | $1.10 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Cash flows from operating activities: | |||
Net income | $40,956 | $52,343 | $59,260 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 27,434 | 24,077 | 18,853 |
Amortization of deferred debt financing costs and bond discount | 3,790 | 4,400 | 5,028 |
Deferred income taxes | 13,855 | 20,800 | 15,295 |
Interest accretion on contingent consideration | 432 | 208 | |
Gain on change in fair value of contingent consideration | -8,206 | ||
Impairment of intangible assets | 34,154 | ||
Loss on disposal of inventory | 4,535 | ||
Loss on extinguishment of debt | 5,748 | 31,291 | 10,431 |
Share-based compensation expense | 2,235 | 3,935 | 3,777 |
Excess tax benefits from share-based compensation | -2,356 | -4,192 | -8,031 |
Provision for doubtful accounts | 21 | 257 | 142 |
Changes in assets and liabilities, net of effects of businesses acquired: | |||
Trade accounts receivable | 6,617 | -13,703 | -1,106 |
Inventories | -7,672 | -3,662 | -3,065 |
Prepaid expenses and other current assets | -5,097 | -2,743 | 1,793 |
Income tax receivable | -4,652 | 5,032 | 6,298 |
Other assets | -642 | -2,695 | -36 |
Trade accounts payable | -8,373 | 9,231 | -874 |
Accrued expenses | -4,122 | -8,444 | -4,728 |
Other liabilities | 469 | -1,225 | -2,509 |
Net cash provided by operating activities | 99,126 | 114,910 | 100,528 |
Cash flows from investing activities: | |||
Capital expenditures | -19,025 | -14,649 | -10,637 |
Payments for acquisition of businesses, net of cash acquired | -154,277 | -247,281 | -62,667 |
Net cash used in investing activities | -173,302 | -261,930 | -73,304 |
Cash flows from financing activities: | |||
Repayments of long-term debt | -138,750 | -505,154 | -116,772 |
Proceeds from issuance of long-term debt | 299,250 | 700,000 | 30,000 |
Repayments of borrowings under revolving credit facility | -258,500 | -90,000 | -5,000 |
Borrowings under revolving credit facility | 252,500 | 105,000 | |
Proceeds from issuance of common stock, net | 120,355 | ||
Dividends paid | -72,369 | -62,824 | -50,161 |
Excess tax benefits from share-based compensation | 2,356 | 4,192 | 8,031 |
Payments of tax withholding on behalf of employees for net share settlement of share-based compensation | -4,374 | -6,812 | -10,697 |
Debt financing costs | -8,494 | -12,574 | -500 |
Net cash provided by (used in) financing activities | 71,619 | 131,828 | -24,744 |
Effect of exchange rate fluctuations on cash and cash equivalents | -60 | 80 | 1 |
Net increase (decrease) in cash and cash equivalents | -2,617 | -15,112 | 2,481 |
Cash and cash equivalents at beginning of year | 4,107 | 19,219 | 16,738 |
Cash and cash equivalents at end of period | 1,490 | 4,107 | 19,219 |
Supplemental disclosures of cash flow information: | |||
Cash interest payments | 42,642 | 43,942 | 53,892 |
Cash income tax payments | 13,624 | 2,722 | 10,061 |
Non-cash transactions: | |||
Dividends declared and not yet paid | $18,246 | $17,637 | $15,243 |
Nature_of_Operations
Nature of Operations | 12 Months Ended |
Jan. 03, 2015 | |
Nature of Operations | |
Nature of Operations | (1) Nature of Operations |
Organization and Nature of Operations | |
B&G Foods, Inc. is a holding company whose principal assets are the shares of capital stock of its subsidiaries. Unless the context requires otherwise, references in this report to "B&G Foods," "our company," "we," "us" and "our" refer to B&G Foods, Inc. and its subsidiaries. Our financial statements are presented on a consolidated basis. | |
We operate in a single industry segment and manufacture, sell and distribute a diverse portfolio of high-quality shelf-stable foods across the United States, Canada and Puerto Rico. Our products include hot cereals, fruit spreads, canned meats and beans, bagel chips, spices, seasonings, hot sauces, wine vinegar, maple syrup, molasses, salad dressings, Mexican-style sauces, dry soups, taco shells and kits, salsas, pickles, peppers, tomato-based products, puffed corn and rice snacks, nut clusters and other specialty products. Our products are marketed under many recognized brands, including Ac'cent, B&G, B&M, Baker's Joy, Bear Creek Country Kitchens, Brer Rabbit, Canoleo, Cary's, Cream of Rice, Cream of Wheat, Devonsheer, Don Pepino, Emeril's, Grandma's Molasses, JJ Flats, Joan of Arc, Las Palmas, MacDonald's, Maple Grove Farms of Vermont, Molly McButter, Mrs. Dash, New York Flatbreads, New York Style, Old London, Original Tings, Ortega, Pirate's Booty, Polaner, Red Devil, Regina, Rickland Orchards, Sa-són, Sclafani, Smart Puffs, Spring Tree, Sugar Twin, Trappey's, TrueNorth, Underwood, Vermont Maid and Wright's. We also sell and distribute two branded household products, Static Guard and Kleen Guard. We compete in the retail grocery, food service, specialty, private label, club and mass merchandiser channels of distribution. We sell and distribute our products directly and via a network of independent brokers and distributors to supermarket chains, food service outlets, mass merchants, warehouse clubs, non-food outlets and specialty distributors. | |
Sales of a number of our products tend to be seasonal and may be influenced by holidays, changes in seasons or other annual events. In the aggregate, however, sales of our products are not heavily weighted to any particular quarter due to the offsetting nature of demands for our diversified product portfolio. Sales during the fourth quarter are generally greater than those of the preceding three quarters. We purchase most of the produce used to make our shelf-stable pickles, relishes, peppers, tomatoes and other related specialty items during the months of July through October, and we generally purchase the majority of our maple syrup requirements during the months of April through August. Consequently, our liquidity needs are greatest during these periods. | |
Fiscal Year | |
We utilize a 52-53 week fiscal year ending on the Saturday closest to December 31. The fiscal year ended January 3, 2015 (fiscal 2014) contained 53 weeks and the fiscal years ended December 28, 2013 (fiscal 2013) and December 29, 2012 (fiscal 2012) contained 52 weeks each. | |
Business and Credit Concentrations | |
Our exposure to credit loss in the event of non-payment of accounts receivable by customers is estimated in the amount of the allowance for doubtful accounts. We perform ongoing credit evaluations of the financial condition of our customers. Our top ten customers accounted for approximately 52.4%, 48.4% and 50.7% of consolidated net sales in fiscal 2014, 2013 and 2012, respectively. Our top ten customers accounted for approximately 51.7%, 46.1% and 50.2% of our consolidated trade accounts receivables as of the end of fiscal 2014, 2013 and 2012, respectively. Other than Wal-Mart, which accounted for 19.1%, 18.5% and 19.7% of our consolidated net sales in fiscal 2014, 2013 and 2012, respectively, no single customer accounted for more than 10.0% of consolidated net sales in fiscal 2014, 2013 or 2012. Other than Wal-Mart, which accounted for 16.7%, 12.9% and 14.9% of our consolidated trade accounts receivables as of the end of fiscal 2014, 2013 and 2012, respectively, no single customer accounted for more than 10.0% of our consolidated trade accounts receivables as of the end of fiscal 2014, 2013 and 2012. As of January 3, 2015, we do not believe we have any significant concentration of credit risk with respect to our consolidated trade accounts receivable with any single customer whose failure or nonperformance would materially affect our results other than as described above with respect to Wal-Mart. | |
During fiscal 2014, 2013 and 2012, our sales to foreign countries represented approximately 3.6%, 3.2% and 2.7%, respectively, of net sales. Our foreign sales are primarily to customers in Canada. | |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Summary of Significant Accounting Policies | |||||||||||
Summary of Significant Accounting Policies | (2) Summary of Significant Accounting Policies | ||||||||||
(a) Basis of Presentation | |||||||||||
The consolidated financial statements include the accounts of B&G Foods, Inc. and its subsidiaries. All intercompany balances and transactions have been eliminated. Certain prior year amounts have been reclassified to conform to the current year's presentation. | |||||||||||
(b) Use of Estimates | |||||||||||
The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires our management to make a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Some of the more significant estimates and assumptions made by management involve trade and consumer promotion expenses; allowances for excess, obsolete and unsaleable inventories; pension benefits; acquisition accounting allocations; the recoverability of goodwill, other intangible assets, property, plant and equipment and deferred tax assets; the determination of the useful life of customer relationship and amortizable trademark intangibles; and the fair value of contingent consideration. Actual results could differ significantly from these estimates and assumptions. | |||||||||||
Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors that management believes to be reasonable under the circumstances, including the current economic environment. We adjust such estimates and assumptions when facts and circumstances dictate. Volatility in the credit and equity markets can increase the uncertainty inherent in such estimates and assumptions. | |||||||||||
(c) Subsequent Events | |||||||||||
We have evaluated subsequent events for disclosure through the date of issuance of the accompanying consolidated financial statements. | |||||||||||
(d) Cash and Cash Equivalents | |||||||||||
For purposes of the consolidated statements of cash flows, all highly liquid instruments with maturities of three months or less when acquired are considered to be cash and cash equivalents. | |||||||||||
(e) Inventories | |||||||||||
Inventories are stated at the lower of cost or market and include direct material, direct labor, overhead, warehousing and product transfer costs. Cost is determined using the first-in, first-out and average cost methods. Inventories have been reduced by an allowance for excess, obsolete and unsaleable inventories. The allowance is an estimate based on our management's review of inventories on hand compared to estimated future usage and sales. | |||||||||||
(f) Property, Plant and Equipment | |||||||||||
Property, plant and equipment are stated at cost. Depreciation on plant and equipment is calculated using the straight-line method over the estimated useful lives of the assets, 10 to 30 years for buildings and improvements, 5 to 12 years for machinery and equipment, and 2 to 5 years for office furniture and vehicles. Leasehold improvements are amortized on a straight-line basis over the shorter of the lease term or estimated useful life of the asset. Expenditures for maintenance, repairs and minor replacements are charged to current operations. Expenditures for major replacements and betterments are capitalized. We capitalize interest on qualifying assets based on our effective interest rate. During fiscal 2014, 2013 and 2012, we capitalized $0.3 million, $0.2 million and $0.2 million, respectively. | |||||||||||
(g) Goodwill and Other Intangible Assets | |||||||||||
Goodwill and unamortizable intangible assets (trademarks) are tested for impairment at least annually and whenever events or circumstances occur indicating that goodwill or unamortizable intangibles might be impaired. We perform the annual impairment tests as of the last day of each fiscal year. The annual goodwill impairment test involves a two-step process. The first step of the impairment test involves comparing our company's market capitalization with our company's carrying value, including goodwill. If the carrying value of our company exceeds our market capitalization, we perform the second step of the impairment test to determine the amount of the impairment loss. The second step of the goodwill impairment test involves comparing the implied fair value of goodwill with the carrying value and recognizing a loss for the difference. | |||||||||||
We test our unamortizable intangibles by comparing the fair value with the carrying value and recognize a loss for the difference. We estimate the fair value of our unamortizable intangibles based on discounted cash flows that reflect certain third party market value indicators. | |||||||||||
Calculating our fair value for these purposes requires significant estimates and assumptions by management. We completed our annual impairment tests for fiscal 2014, 2013 and 2012 with no adjustments to the carrying values of goodwill and unamortizable intangibles. Each annual test confirmed that the market capitalization and fair values of our goodwill and unamortizable intangibles, respectively, exceeded their current carrying values. | |||||||||||
Customer relationship intangibles and amortizable trademarks are presented at cost, net of accumulated amortization, and are amortized on a straight-line basis over their estimated useful lives of 10 to 20 years. | |||||||||||
(h) Deferred Debt Financing Costs | |||||||||||
Debt financing costs are capitalized and amortized over the term of the related debt agreements and are classified as other assets. Amortization of deferred debt financing costs for fiscal years 2014, 2013 and 2012 was $3.6 million, $4.0 million and $4.2 million, respectively. | |||||||||||
(i) Long-Lived Assets | |||||||||||
Long-lived assets, such as property, plant and equipment, and intangibles with estimated useful lives are depreciated or amortized over their respective estimated useful lives to their estimated residual values, and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future net cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future net cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Recoverability of assets held for sale is measured by a comparison of the carrying amount of an asset or asset group to their fair value less estimated costs to sell. Estimating future cash flows and calculating the fair value of assets requires significant estimates and assumptions by management. | |||||||||||
Assets to be disposed of are separately presented in the consolidated balance sheets and are no longer depreciated. | |||||||||||
(j) Accumulated Other Comprehensive Loss | |||||||||||
Accumulated other comprehensive loss includes foreign currency translation adjustments relating to assets and liabilities located in our foreign subsidiaries and changes in our pension benefits due to the initial adoption and ongoing application of the authoritative accounting literature relating to pensions, net of tax. | |||||||||||
(k) Revenue Recognition | |||||||||||
Revenues are recognized when products are shipped. We report all amounts billed to a customer in a sale transaction as revenue, including those amounts related to shipping and handling. Shipping and handling costs are included in cost of goods sold. Consideration from a vendor to a retailer is presumed to be a reduction to the selling prices of the vendor's products and, therefore, is characterized as a reduction of sales when recognized in the vendor's income statement. As a result, coupon incentives, slotting and promotional expenses are recorded as a reduction of sales. | |||||||||||
(l) Selling, General and Administrative Expenses | |||||||||||
We promote our products with advertising, consumer incentives and trade promotions. These programs include, but are not limited to, discounts, slotting fees, coupons, rebates, in-store display incentives and volume-based incentives. Consumer incentive and trade promotion activities are recorded as a reduction to revenues based on amounts estimated as being due to customers and consumers at the end of a period. We base these estimates principally on historical utilization and redemption rates. We expense our advertising costs either in the period the advertising first takes place or as incurred. Advertising expenses were approximately $5.1 million, $4.3 million and $5.9 million, for the fiscal years 2014, 2013 and 2012, respectively. | |||||||||||
(m) Pension Plans | |||||||||||
We have defined benefit pension plans covering substantially all of our employees. Our funding policy is to contribute annually the amount recommended by our actuaries. From time to time, however, we voluntarily contribute greater amounts based on pension asset performance, tax considerations and other relevant factors. | |||||||||||
(n) Share Based Compensation Expense | |||||||||||
We provide compensation benefits in the form of stock options, performance share long-term incentive awards (LTIAs) and common stock to employees and non-employee directors. The cost of share based compensation is recorded at fair value at the date of grant and expensed in our consolidated statement of income over the requisite service period, if any. | |||||||||||
Performance share LTIAs granted to our executive officers and certain other members of senior management entitle each participant to earn shares of common stock upon the attainment of certain performance goals over the applicable performance period. The recognition of compensation expense for the performance share LTIAs is initially based on the probable outcome of the performance condition based on the fair value of the award on the date of grant and the anticipated number of shares to be awarded on a straight-line basis over the applicable performance period. The fair value of the awards on the date of grant is determined based upon the closing price of our common stock on the applicable measurement dates (i.e., the deemed grant dates for accounting purposes) reduced by the present value of expected dividends using the risk-free interest-rate as the award holders are not entitled to dividends or dividend equivalents during the vesting period. Our company's performance against the defined performance goals are re-evaluated on a quarterly basis throughout the applicable performance period and the recognition of compensation expense is adjusted for subsequent changes in the estimated or actual outcome. The cumulative effect of a change in the estimated number of shares of common stock to be issued in respect of performance share awards is recognized as an adjustment to earnings in the period of the revision. | |||||||||||
The fair value of stock option awards is estimated on the date of grant using the Black-Scholes option pricing model and is recognized in expense over the vesting period of the options using the straight-line method. The Black-Scholes option pricing model requires various assumptions, including the expected volatility of our stock, the expected term of the option, the risk-free interest rate and the expected dividend yield. Expected volatility is based on both historical and implied volatilities of our common stock over the estimated expected term of the award. The risk-free rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant. All stock option grants have an exercise price equal to the fair market value of our common stock on the date of grant, have a 10-year term and cliff vest three years from the date of grant. | |||||||||||
We recognize compensation expense for only that portion of share based awards that are expected to vest. We utilize historical employee termination behavior to determine our estimated forfeiture rates. If the actual forfeitures differ from those estimated by management, adjustments to compensation expense will be made in future periods. | |||||||||||
(o) Income Tax Expense Estimates and Policies | |||||||||||
Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities of our company are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided when it is more likely than not that all or some portion of the deferred tax asset will not be realized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. | |||||||||||
As part of the income tax provision process of preparing our consolidated financial statements, we are required to estimate our income taxes. This process involves estimating our current tax expenses together with assessing temporary differences resulting from differing treatment of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities. We then assess the likelihood that our deferred tax assets will be recovered from future taxable income and to the extent we believe the recovery is not likely, we establish a valuation allowance. Further, to the extent that we establish a valuation allowance or increase this allowance in a financial accounting period, we include such charge in our tax provision, or reduce our tax benefits in our consolidated statements of operations. We use our judgment to determine our provision or benefit for income taxes, deferred tax assets and liabilities and any valuation allowance recorded against our deferred tax assets. | |||||||||||
There are various factors that may cause these tax assumptions to change in the near term, and we may have to record a valuation allowance against our deferred tax assets. We cannot predict whether future U.S. federal and state income tax laws and regulations might be passed that could have a material effect on our results of operations. We assess the impact of significant changes to the U.S. federal and state income tax laws and regulations on a regular basis and update the assumptions and estimates used to prepare our consolidated financial statements when new regulations and legislation are enacted. We recognize the benefit of an uncertain tax position that we have taken or expect to take on our income tax returns we file if it is "more likely than not" that such tax position will be sustained based on its technical merits. | |||||||||||
(p) Dividends | |||||||||||
Cash dividends, if any, are accrued as a liability on our consolidated balance sheets and recorded as a decrease to additional paid-in capital when declared. | |||||||||||
(q) Earnings Per Share | |||||||||||
Basic earnings per share is calculated by dividing net income by the weighted average number of shares of common stock outstanding. Diluted earnings per share is calculated by dividing net income by the weighted average number of shares of common stock outstanding plus all additional shares of common stock that would have been outstanding if potentially dilutive shares of common stock had been issued upon the exercise of stock options or in connection with performance share LTIAs that may be earned as of the beginning of the period using the treasury stock method. | |||||||||||
Fiscal | Fiscal | Fiscal | |||||||||
2014 | 2013 | 2012 | |||||||||
(In thousands, except share and per share data) | |||||||||||
Net income | $ | 40,956 | $ | 52,343 | $ | 59,260 | |||||
Weighted average common shares outstanding: | |||||||||||
Basic | 53,658,100 | 52,998,263 | 49,238,759 | ||||||||
Net effect of dilutive share-based compensation awards | 89,111 | -1 | 184,043 | 318,067 | |||||||
| | | | | | | | | | | |
Diluted | 53,747,211 | 53,182,306 | 49,556,826 | ||||||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Earnings per share: | |||||||||||
Basic | $ | 0.76 | $ | 0.99 | $ | 1.20 | |||||
Diluted | $ | 0.76 | $ | 0.98 | $ | 1.20 | |||||
-1 | For fiscal 2014, 418,158 outstanding stock options were excluded from diluted earnings per share as the effect was antidilutive. | ||||||||||
(r) Recently Issued Accounting Standards | |||||||||||
In May 2014, the Financial Accounting Standards Board (FASB) issued new accounting requirements for the recognition of revenue from contracts with customers. The requirements of the new standard are effective for annual reporting periods beginning after December 15, 2016, and interim periods within those annual periods, which for us is the first quarter of fiscal 2017. We are currently evaluating the impact of this new standard, however, we do not expect it to have a material impact on our consolidated financial position, results of operations or liquidity. | |||||||||||
Acquisitions
Acquisitions | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Acquisitions. | |||||||||||
Acquisitions | (3) Acquisitions | ||||||||||
On April 23, 2014, we completed the acquisition of Specialty Brands of America, Inc. and related entities, including the Bear Creek Country Kitchens, Spring Tree, Cary's, MacDonald's, New York Flatbreads and Canoleo brands, from affiliates of American Capital, Ltd. and certain individual sellers for a purchase price of $154.3 million in cash. We refer to this acquisition as the "Specialty Brands acquisition." | |||||||||||
On October 7, 2013, we acquired Rickland Orchards LLC, including the Rickland Orchards brand, from Natural Instincts LLC for a base purchase price of $57.5 million, of which approximately $37.4 million was paid in cash and approximately $20.1 million was paid in shares of common stock of B&G Foods (based on the closing price of $35.15 per share on October 4, 2013), plus contingent earn-out consideration ranging from zero to a maximum of $15.0 million in the aggregate, which is payable upon the achievement of revenue growth targets during fiscal 2014, 2015 and 2016 meant to achieve operating results in excess of base purchase price acquisition model assumptions. We refer to this acquisition as the "Rickland Orchards acquisition." | |||||||||||
On July 8, 2013, we completed the acquisition of Pirate Brands, LLC, including the Pirate's Booty, Smart Puffs and Original Tings brands, from affiliates of VMG Partners and Driven Capital Management and certain other entities and individuals for a purchase price of $195.4 million in cash. We refer to this acquisition as the "Pirate Brands acquisition." | |||||||||||
On May 6, 2013, we acquired the TrueNorth brand from DeMet's Candy Company. We refer to this acquisition as the "TrueNorth acquisition." | |||||||||||
On October 31, 2012, we completed the acquisition of New York Style, Old London, Devonsheer and JJ Flats brands from Chipita America, Inc. for $62.5 million in cash. We refer to this acquisition as the "New York Style acquisition." | |||||||||||
We have accounted for each of these acquisitions using the acquisition method of accounting and, accordingly, have included the assets acquired, liabilities assumed and results of operations in our consolidated financial statements from the respective dates of acquisition. The excess of the purchase price over the fair value of identifiable net assets acquired represents goodwill. Unamortizable trademarks are deemed to have an indefinite useful life and are not amortized. Customer relationship intangibles and amortizable trademarks acquired are amortized over 10 to 20 years. Goodwill and other intangible assets, except in the case of the Specialty Brands acquisition, are deductible for income tax purposes. Inventory has been recorded at estimated selling price less costs of disposal and a reasonable profit and the property, plant and equipment and other intangible assets (including trademarks, customer relationships and other intangibles) acquired have been recorded at fair value as determined by our management with the assistance of a third-party valuation specialist. See Note 6, "Goodwill and Other Intangible Assets." | |||||||||||
The following table sets forth the preliminary allocation of the Specialty Brands acquisition purchase price to the estimated fair value of the net assets acquired at the date of acquisition. The preliminary purchase price allocation may be adjusted as a result of the finalization of our purchase price allocation procedures related to assets acquired and liabilities assumed. During the second half of fiscal 2014, we recorded a purchase price allocation adjustment by decreasing goodwill, long-term deferred income taxes and other working capital and increasing trademarks and customer relationship intangibles by $2.1 million primarily due to a change in our valuation of intangible assets and deferred income taxes as of the date of acquisition. The preliminary purchase price allocation may be adjusted as a result of the finalization of our purchase price allocation procedures related to accounts receivable, inventory and intangibles acquired. We anticipate completing the purchase price allocation before or during the second quarter of fiscal 2015. The goodwill and other intangible assets acquired are not expected to be deductible for income tax purposes. | |||||||||||
Specialty Brands Acquisition (dollars in thousands): | |||||||||||
Purchase Price: | |||||||||||
Cash paid | $ | 154,277 | |||||||||
| | | | | |||||||
Total | $ | 154,277 | |||||||||
| | | | | |||||||
| | | | | |||||||
Preliminary Allocation: | |||||||||||
Income tax receivable | $ | 4,012 | |||||||||
Short-term deferred income tax assets | 1,786 | ||||||||||
Trademarks—unamortizable intangible assets | 137,300 | ||||||||||
Goodwill | 48,852 | ||||||||||
Customer relationship intangibles—amortizable intangible assets | 13,300 | ||||||||||
Other working capital | (2,068 | ) | |||||||||
Long-term deferred income tax liabilities, net | (48,905 | ) | |||||||||
| | | | | |||||||
Total | $ | 154,277 | |||||||||
| | | | | |||||||
| | | | | |||||||
The following table sets forth the allocation of the Rickland Orchards acquisition purchase price to the estimated fair value of the net assets acquired at the date of acquisition. During fiscal 2014, we recorded a purchase price allocation adjustment by increasing goodwill and decreasing other working capital by $2.1 million due to a change in our valuation of accounts receivable and inventory as of the date of acquisition. | |||||||||||
Rickland Orchards Acquisition (dollars in thousands): | |||||||||||
Purchase Price: | |||||||||||
Cash paid | $ | 37,376 | |||||||||
Equity issued | 20,124 | ||||||||||
Fair value of contingent consideration | 7,566 | ||||||||||
| | | | | |||||||
Total | $ | 65,066 | |||||||||
| | | | | |||||||
| | | | | |||||||
Allocation: | |||||||||||
Trademarks—amortizable intangible assets | $ | 35,000 | |||||||||
Goodwill | 23,353 | ||||||||||
Customer relationship intangibles—amortizable intangible assets | 9,000 | ||||||||||
Other working capital | (2,287 | ) | |||||||||
| | | | | |||||||
Total | $ | 65,066 | |||||||||
| | | | | |||||||
| | | | | |||||||
The following table sets forth the allocation of the Pirate Brands acquisition purchase price to the estimated fair value of the net assets acquired at the date of acquisition. During fiscal 2014, we recorded a purchase price allocation adjustment by increasing goodwill and decreasing other working capital by $0.2 million due to a change in our valuation of accounts receivable as of the date of acquisition. | |||||||||||
Pirate Brands Acquisition (dollars in thousands): | |||||||||||
Purchase Price: | |||||||||||
Cash paid | $ | 195,417 | |||||||||
| | | | | |||||||
Total | $ | 195,417 | |||||||||
| | | | | |||||||
| | | | | |||||||
Allocation: | |||||||||||
Trademarks—unamortizable intangible assets | $ | 152,800 | |||||||||
Goodwill | 29,953 | ||||||||||
Customer relationship intangibles—amortizable intangible assets | 11,400 | ||||||||||
Other working capital | 1,264 | ||||||||||
| | | | | |||||||
Total | $ | 195,417 | |||||||||
| | | | | |||||||
| | | | | |||||||
The following table sets forth the allocation of the New York Style acquisition purchase price to the estimated fair value of the net assets acquired at the date of acquisition. | |||||||||||
New York Style Acquisition (dollars in thousands): | |||||||||||
Purchase Price: | |||||||||||
Cash paid | $ | 62,517 | |||||||||
| | | | | |||||||
Total | $ | 62,517 | |||||||||
| | | | | |||||||
| | | | | |||||||
Allocation: | |||||||||||
Property, Plant and Equipment | $ | 42,889 | |||||||||
Goodwill | 4,963 | ||||||||||
Customer relationship intangibles—amortizable intangible assets | 5,100 | ||||||||||
Trademarks—unamortizable intangible assets | 5,700 | ||||||||||
Other working capital | 3,865 | ||||||||||
| | | | | |||||||
Total | $ | 62,517 | |||||||||
| | | | | |||||||
| | | | | |||||||
Unaudited Pro Forma Summary of Operations | |||||||||||
The following pro forma summary of operations presents our operations as if the Specialty Brands acquisition had occurred as of the beginning of fiscal 2013 and as if the Pirate Brands and Rickland Orchards acquisitions had occurred as of the beginning of fiscal 2012. In addition to including the results of operations of these acquisitions, the pro forma information gives effect to the interest on additional borrowings, the amortization of trademark and customer relationship intangibles, and the issuance of shares of common stock. On an actual basis, Specialty Brands contributed $65.5 million of our aggregate $848.0 million of consolidated net sales for fiscal 2014. On an actual basis, Pirate Brands and Rickland Orchards contributed $32.6 million and $12.9 million, respectively, of our aggregate $725.0 million of consolidated net sales for fiscal 2013. | |||||||||||
Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | |||||||||
(dollars in thousands) | |||||||||||
Net sales | $ | 874,410 | $ | 890,728 | $ | 721,379 | |||||
Net income | 42,148 | 56,041 | 50,149 | ||||||||
Basic earnings per share | $ | 0.79 | $ | 1.05 | $ | 1.01 | |||||
Diluted earnings per share | $ | 0.78 | $ | 1.05 | $ | 1.00 | |||||
The pro forma information presented above does not purport to be indicative of the results that actually would have been attained had the Specialty Brands acquisition occurred as of the beginning of fiscal 2013 and had the Pirate Brands and Rickland Orchards acquisitions occurred as of the beginning of fiscal 2012, and is not intended to be a projection of future results. | |||||||||||
The TrueNorth acquisition and the New York Style acquisition were not material to our consolidated results of operations or financial position and, therefore, pro forma financial information is not presented. | |||||||||||
Inventories
Inventories | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
Inventories | ||||||||
Inventories | (4) Inventories | |||||||
Inventories consist of the following as of the dates indicated (in thousands): | ||||||||
January 3, 2015 | December 28, 2013 | |||||||
Raw materials and packaging | $ | 23,795 | $ | 25,075 | ||||
Finished goods | 82,762 | 76,176 | ||||||
| | | | | | | | |
Total | $ | 106,557 | $ | 101,251 | ||||
| | | | | | | | |
| | | | | | | | |
Property_Plant_and_Equipment_n
Property, Plant and Equipment, net | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
Property, Plant and Equipment, net. | ||||||||
Property, Plant and Equipment, net | (5) Property, Plant and Equipment, net | |||||||
Property, plant and equipment, net consists of the following as of the dates indicated (in thousands): | ||||||||
January 3, 2015 | December 28, 2013 | |||||||
Land | $ | 3,508 | $ | 3,512 | ||||
Buildings and improvements | 55,524 | 51,618 | ||||||
Machinery and equipment | 165,751 | 153,815 | ||||||
Office furniture and vehicles | 15,572 | 14,319 | ||||||
Construction-in-progress | 5,095 | 1,795 | ||||||
| | | | | | | | |
245,450 | 225,059 | |||||||
Less: accumulated depreciation | (129,253 | ) | (114,685 | ) | ||||
| | | | | | | | |
Total | $ | 116,197 | $ | 110,374 | ||||
| | | | | | | | |
| | | | | | | | |
Depreciation expense was $14.7 million, $14.2 million and $10.7 million for fiscal 2014, 2013 and 2012, respectively. | ||||||||
Goodwill_and_Other_Intangible_
Goodwill and Other Intangible Assets | 12 Months Ended | |||||||||||||||||||
Jan. 03, 2015 | ||||||||||||||||||||
Goodwill and Other Intangible Assets | ||||||||||||||||||||
Goodwill and Other Intangible Assets | (6) Goodwill and Other Intangible Assets | |||||||||||||||||||
The carrying amounts of goodwill and other intangible assets, as of the dates indicated, consist of the following (in thousands): | ||||||||||||||||||||
As of January 3, 2015 | As of December 28, 2013 | |||||||||||||||||||
Gross Carrying | Accumulated | Net Carrying | Gross Carrying | Accumulated | Net Carrying | |||||||||||||||
Amount | Amortization | Amount | Amount | Amortization | Amount | |||||||||||||||
Amortizable Intangible Assets | ||||||||||||||||||||
Trademarks | $ | 12,056 | $ | 875 | $ | 11,181 | $ | 41,800 | $ | 1,031 | $ | 40,769 | ||||||||
Customer relationships | 192,913 | 58,400 | 134,513 | 187,569 | 49,097 | 138,472 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
$ | 204,969 | $ | 59,275 | $ | 145,694 | $ | 229,369 | $ | 50,128 | $ | 179,241 | |||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Unamortizable Intangible Assets | ||||||||||||||||||||
Goodwill | $ | 370,424 | $ | 319,292 | ||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Trademarks | $ | 802,201 | $ | 664,900 | ||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Note: The increases in carrying amounts are attributable to purchase accounting adjustments related to the Specialty Brands, Rickland Orchards and Pirate Brands acquisitions. The impairment loss relating to Rickland Orchards described below offset the increase in customer relationship intangibles and caused the decrease in amortizable trademarks. | ||||||||||||||||||||
During fiscal 2014, 2013 and 2012, we amortized $12.7 million, $9.9 million and $8.1 million, respectively, of the customer relationship and other intangibles. We expect to recognize $10.7 million of amortization expense in fiscal 2015 and for each of the next four fiscal years thereafter associated with our current other intangible assets and amortizable trademarks. | ||||||||||||||||||||
Rickland Orchards. As of the date of the Rickland Orchards acquisition, we estimated the original fair value of the contingent consideration to be approximately $7.6 million. During the remainder of fiscal 2013 and fiscal 2014, we recorded interest accretion expense on the contingent consideration liability of $0.2 million and $0.4 million, respectively. At June 28, 2014, we remeasured the fair value of the contingent consideration using actual operating results through June 28, 2014 and our revised forecasted operating results for Rickland Orchards for the remainder of 2014, 2015 and 2016. As a result of lower than expected net sales results for Rickland Orchards, and the unlikelihood of Rickland Orchards achieving the revenue growth targets, the fair value of the contingent consideration was reduced to zero, resulting in a non-cash gain of $8.2 million that is included in gain on change in fair value of contingent consideration in the consolidated statement of operations for fiscal 2014. See Note 8, "Fair Value Measurements." We also concluded that these factors were potential indicators of the impairment of certain long-lived assets (trademark and customer relationship intangibles), requiring us to perform an interim impairment analysis of the trademark and customer relationship intangibles acquired in the Rickland Orchards acquisition. Based on the results of the interim impairment analysis we performed at June 28, 2014, we determined that no impairment was required as of that date. | ||||||||||||||||||||
During the third quarter of 2014, net sales to the club channel of the core products of Rickland Orchards continued to deteriorate beyond our June 28, 2014 projections. As a result, we had as of September 27, 2014 reduced our net sales projections to the club channel and performed an interim impairment analysis of the trademark and customer relationship intangibles acquired in the Rickland Orchards acquisition. We used a discounted cash flow model to determine the fair value of the intangibles. Based on the results of the interim impairment analysis performed at September 27, 2014, we recorded non-cash impairment charges to amortizable trademarks and customer relationship intangibles of Rickland Orchards of $26.9 million and $7.3 million, respectively, which is recorded in "Impairment of intangible assets" in the consolidated statement of operations for fiscal 2014. As of January 3, 2015, the remaining balances of the Rickland Orchards amortizable trademark and customer relationship intangibles (net) were $5.1 million and $1.1 million, respectively. If operating results for the Rickland Orchards brand continue to deteriorate at rates in excess of our current projections, we may be required to record an additional non-cash charge for the impairment of long-lived intangibles relating to Rickland Orchards, and these non-cash charges would be material. | ||||||||||||||||||||
In connection with the impairment analysis of the intangibles, we also recorded during fiscal 2014 a charge to cost of goods sold of approximately $4.5 million relating to a write-off of certain raw material and finished goods inventory used in the production of Rickland Orchards products. | ||||||||||||||||||||
LongTerm_Debt
Long-Term Debt | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
Long-Term Debt | ||||||||
Long-Term Debt | (7) Long-Term Debt | |||||||
Long-term debt consists of the following, as of the dates indicated (in thousands): | ||||||||
January 3, 2015 | December 28, 2013 | |||||||
Current and former senior secured credit agreement: | ||||||||
Revolving credit facility | $ | 34,000 | $ | 40,000 | ||||
Tranche A term loan due 2019, net of unamortized discount of $643 at January 3, 2015 | 291,857 | — | ||||||
Tranche A term loan due 2016, net of unamortized discount of $365 at December 28, 2013 | — | 130,885 | ||||||
4.625% senior notes due 2021 | 700,000 | 700,000 | ||||||
| | | | | | | | |
Total long-term debt, net of unamortized discount | 1,025,857 | 870,885 | ||||||
Current portion of long-term debt | (18,750 | ) | (26,250 | ) | ||||
| | | | | | | | |
Long-term debt, net of unamortized discount and excluding current portion | $ | 1,007,107 | $ | 844,635 | ||||
| | | | | | | | |
| | | | | | | | |
Senior Secured Credit Agreement. On June 5, 2014, we entered into a new senior secured credit agreement, which includes a $500.0 million revolving credit facility and $300.0 million of tranche A term loans. The proceeds of the term loan borrowings, $46.0 million of revolving loans and cash on hand were used to repay all outstanding obligations under our prior credit agreement, which included $215.0 million of revolving loans that were used in part to fund the Specialty Brands acquisition, $121.9 million of term loan borrowings and $0.6 million of accrued and unpaid interest, and to pay $8.5 million of related transaction fees and expenses. At January 3, 2015, $292.5 million of tranche A term loans were outstanding and $34.0 million of revolving loans were outstanding under our senior secured credit agreement. | ||||||||
At January 3, 2015, the available borrowing capacity under our revolving credit facility, net of outstanding letters of credit of $1.3 million, was $464.7 million. Proceeds of the revolving credit facility may be used for general corporate purposes including acquisitions of targets in the same or a similar line of business as our company, subject to specified criteria. We are required to pay a commitment fee of 0.50% per annum on the unused portion of the revolving credit facility. The maximum letter of credit capacity under our revolving credit facility is $50.0 million, with a fronting fee of 0.25% per annum for all outstanding letters of credit and a letter of credit fee equal to the applicable margin for revolving loans that are Eurodollar (LIBOR) loans. The revolving credit facility matures on June 5, 2019. | ||||||||
The tranche A term loans are subject to principal amortization: $7.5 million was due and paid in fiscal 2014, $18.8 million is due and payable in fiscal 2015, $26.2 million is due and payable in fiscal 2016, $24.4 million is due and payable in fiscal 2017 and $76.9 million is due and payable in fiscal 2018. The balance of all borrowings under the tranche A term loan facility, or $146.2 million, is due and payable at maturity on June 5, 2019. | ||||||||
We may prepay the tranche A term loans or permanently reduce the revolving credit facility commitment under our credit agreement at any time without premium or penalty (other than customary breakage costs with respect to the early termination of LIBOR loans). Subject to certain exceptions, the credit agreement provides for mandatory prepayment upon certain asset dispositions or casualty events and issuances of indebtedness. | ||||||||
Interest under the revolving credit facility, including any outstanding letters of credit, and under the tranche A term loan facility, is determined based on alternative rates that we may choose in accordance with the credit agreement, including a base rate per annum plus an applicable margin ranging from 0.50% to 1.00%, and LIBOR plus an applicable margin ranging from 1.50% to 2.00%, in each case depending on our consolidated leverage ratio. At January 3, 2015, the revolving credit facility and the tranche A term loan interest rates were each approximately 2.16%. | ||||||||
Our obligations under our credit agreement are jointly and severally and fully and unconditionally guaranteed on a senior basis by all of our existing and certain future domestic subsidiaries. The credit facility is secured by substantially all of our and our domestic subsidiaries' assets except our and our domestic subsidiaries' real property. The credit agreement contains customary restrictive covenants, subject to certain permitted amounts and exceptions, including covenants limiting our ability to incur additional indebtedness, pay dividends and make other restricted payments, repurchase shares of our outstanding stock and create certain liens. | ||||||||
The credit agreement also contains certain financial maintenance covenants, which, among other things, specify maximum capital expenditure limits, a maximum consolidated leverage ratio and a minimum interest coverage ratio, each ratio as defined in the credit agreement. Our consolidated leverage ratio (defined as the ratio of our consolidated net debt, as of the last day of any period of four consecutive fiscal quarters to our adjusted EBITDA for such period), may not exceed 7.00 to 1.00 through the fourth quarter of 2015; 6.75 to 1.00 for the first quarter of 2016 through the fourth quarter of 2016; and 6.50 to 1.00 for the first quarter of 2017 and thereafter. We are also required to maintain a consolidated interest coverage ratio of at least 1.75 to 1.00 as of the last day of any period of four consecutive fiscal quarters. As of January 3, 2015, we were in compliance with all of the covenants, including the financial covenants, in the credit agreement. | ||||||||
The credit agreement also provides for an incremental term loan and revolving loan facility, pursuant to which we may request that the lenders under the credit agreement, and potentially other lenders, provide unlimited additional amounts of term loans or revolving loans or both on terms substantially consistent with those provided under the credit agreement. Among other things, the utilization of the incremental facility is conditioned on our ability to meet a maximum senior secured leverage ratio of 4.00 to 1.00, and a sufficient number of lenders or new lenders agreeing to participate in the facility. | ||||||||
4.625% Senior Notes due 2021. On June 4, 2013, we issued $700.0 million aggregate principal amount of 4.625% senior notes due 2021 at a price to the public of 100% of their face value. We used the net proceeds from the issuance of the 4.625% senior notes to purchase or redeem all $248.5 million principal amount of our then existing 7.625% senior notes due 2018, to repay $222.2 million principal amount of tranche B term loans and approximately $40.0 million principal amount of revolving loans under our credit agreement, and to pay related premiums, fees and expenses. We used the remaining net proceeds for the Pirate Brands acquisition. | ||||||||
Interest on the 4.625% senior notes is payable on June 1 and December 1 of each year. The 4.625% senior notes will mature on June 1, 2021, unless earlier retired or redeemed. On or after June 1, 2016, we may redeem some or all of the 4.625% senior notes at a redemption price of 103.469% beginning June 1, 2016 and thereafter at prices declining annually to 100% on or after June 1, 2019, in each case plus accrued and unpaid interest to the date of redemption. We may redeem up to 35% of the aggregate principal amount of the 4.625% senior notes prior to June 1, 2016 with the net proceeds from certain equity offerings at a redemption price of 104.625% plus accrued and unpaid interest to the date of redemption. We may also redeem some or all of the 4.625% senior notes at any time prior to June 1, 2016 at a redemption price equal to the make-whole amount set forth in the indenture governing the 4.625% senior notes. In addition, if we undergo a change of control or upon certain asset sales, we may be required to offer to repurchase the 4.625% senior notes at the repurchase price set forth in the indenture plus accrued and unpaid interest to the date of repurchase. | ||||||||
We may also, from time to time, seek to retire the 4.625% senior notes through cash repurchases of the 4.625% senior notes and/or exchanges of the 4.625% senior notes for equity securities, in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material. | ||||||||
Our obligations under the 4.625% senior notes are jointly and severally and fully and unconditionally guaranteed on a senior basis by all of our existing and certain future domestic subsidiaries. The 4.625% senior notes and the subsidiary guarantees are our and the guarantors' general unsecured obligations and are effectively junior in right of payment to all of our and the guarantors' secured indebtedness and to all existing and future indebtedness and other liabilities of our non-guarantor subsidiaries; are pari passu in right of payment to all of our and the guarantors' existing and future unsecured senior debt; and are senior in right of payment to all of our and the guarantors' future subordinated debt. Our foreign subsidiaries are not guarantors, and any future foreign or partially owned domestic subsidiaries will not be guarantors, of the 4.625% senior notes. | ||||||||
The indenture contains covenants with respect to us and the guarantors and restricts the incurrence of additional indebtedness and the issuance of capital stock; the payment of dividends or distributions on, and redemption of, capital stock; a number of other restricted payments, including certain investments; creation of specified liens, certain sale-leaseback transactions and sales of certain specified assets; fundamental changes, including consolidation, mergers and transfers of all or substantially all of our assets; and specified transactions with affiliates. Each of the covenants is subject to a number of important exceptions and qualifications. As of January 3, 2015, we were in compliance with all of the covenants in the indenture governing the 4.625% senior notes. | ||||||||
Subsidiary Guarantees. We have no assets or operations independent of our direct and indirect subsidiaries. All of our present domestic subsidiaries jointly and severally and fully and unconditionally guarantee our long-term debt, and management has determined that our Canadian subsidiaries, which are our only subsidiaries that are not guarantors of our long-term debt, are "minor subsidiaries" as that term is used in Rule 3-10 of Regulation S-X promulgated by the SEC. There are no significant restrictions on our ability and the ability of our subsidiaries to obtain funds from our respective subsidiaries by dividend or loan. Consequently, separate financial statements have not been presented for our subsidiaries because management has determined that they would not be material to investors. | ||||||||
Deferred Debt Financing Costs. During fiscal 2014, we wrote-off and expensed $5.4 million of deferred debt financing costs relating to the termination of our prior credit agreement, which included the repayment of $121.9 million aggregate principal amount of our tranche A term loans and $215.0 million of revolving loans. During fiscal 2014, we also capitalized $5.6 million and $2.9 million of debt financing costs relating to the new revolving credit facility and tranche A term loans, respectively, which are being amortized over the five year scheduled term of the new credit agreement. During fiscal 2013, we wrote-off and expensed $8.3 million of deferred debt financing costs relating to the repayment of the $248.5 million aggregate principal amount of 7.625% senior notes and our repayment of $222.2 million aggregate principal amount of tranche B term loans. During fiscal 2013, we also capitalized $12.2 million of debt financing costs, which are being amortized over the eight year scheduled term of the 4.625% senior notes and we also capitalized $0.4 million of debt financing costs in connection with an amendment to our credit facility, which are being amortized over the remainder of the five year scheduled term of our revolving credit facility. During fiscal 2012, we wrote-off and expensed $1.5 million of deferred debt financing costs relating to the partial redemption of $101.5 million aggregate principal amount of our 7.625% senior notes and wrote-off and expensed $0.4 million of deferred debt financing costs relating to the amendment of our credit agreement. During fiscal 2012, we also capitalized $0.5 million of debt financing costs, which were being amortized over the five year term of the revolving credit facility and tranche A term loans and the seven year term of the tranche B term loans until the deferred debt financing costs were written off when we refinanced the prior credit agreement. | ||||||||
As of January 3, 2015 and December 28, 2013 we had net deferred debt financing costs of $17.2 million and $17.8 million, respectively, included in other assets in the accompanying consolidated balance sheets. | ||||||||
Loss on Extinguishment of Debt. Loss on extinguishment of debt for fiscal 2014 includes costs in connection with the termination of our prior credit agreement and the repayment of all outstanding obligations thereunder. The loss on extinguishment includes the write-off of deferred debt financing costs of $5.4 million, as discussed above, and the write-off of unamortized discount of $0.3 million. Loss on extinguishment of debt for fiscal 2013 includes costs relating to our repurchase of $248.5 million aggregate principal amount of 7.625% senior notes and our repayment of $222.2 million aggregate principal amount of tranche B term loans, including the repurchase premium and other expenses of $20.2 million, the write-off of deferred debt financing costs of $8.3 million and the write-off of unamortized discount of $2.8 million. Loss on extinguishment of debt for fiscal 2012 includes costs relating to our partial redemption of $101.5 million aggregate principal amount of our 7.625% senior notes, including the repurchase premium and other expenses of $7.7 million, the write-off of deferred debt financing costs of $1.5 million and the write-off of unamortized discount of $0.5 million. Loss on extinguishment during fiscal 2012 also includes costs related to the amendment and restatement of our credit agreement, including the write-off of deferred debt financing costs of $0.4 million, unamortized discount of $0.1 million and other expenses of $0.2 million. | ||||||||
Contractual Maturities. As of January 3, 2015, the aggregate contractual maturities of long-term debt are as follows (in thousands): | ||||||||
Fiscal Year: | ||||||||
2015 | $ | 18,750 | ||||||
2016 | 26,250 | |||||||
2017 | 24,375 | |||||||
2018 | 76,875 | |||||||
2019 | 180,250 | |||||||
Thereafter | 700,000 | |||||||
| | | | | ||||
Total | $ | 1,026,500 | ||||||
| | | | | ||||
| | | | | ||||
Accrued Interest. At January 3, 2015 and December 28, 2013 accrued interest of $3.5 million and $3.3 million, respectively, is included in accrued expenses in the accompanying consolidated balance sheets. | ||||||||
Fair_Value_Measurements
Fair Value Measurements | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Fair Value Measurements | ||||||||||||||
Fair Value Measurements | (8) Fair Value Measurements | |||||||||||||
The authoritative accounting literature relating to fair value measurements defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The accounting literature outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. Under generally accepted accounting principles, certain assets and liabilities must be measured at fair value, and the accounting literature details the disclosures that are required for items measured at fair value. | ||||||||||||||
Financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy under the accounting literature. The three levels are as follows: | ||||||||||||||
Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities. | ||||||||||||||
Level 2—Observable inputs other than Level 1 quoted prices, such as quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value driver is observable for the asset or liability, either directly or indirectly. | ||||||||||||||
Level 3—Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability. | ||||||||||||||
Cash and cash equivalents, trade accounts receivable, income tax receivable, trade accounts payable, accrued expenses and dividends payable are reflected in the consolidated balance sheets at carrying value, which approximates fair value due to the short-term nature of these instruments. | ||||||||||||||
The carrying values and fair values of our revolving credit loans, term loans and senior notes as of January 3, 2015 and December 28, 2013 are as follows (in thousands): | ||||||||||||||
January 3, 2015 | December 28, 2013 | |||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||
Revolving Credit Loans | 34,000 | 34,000 | -1 | 40,000 | 40,000 | -1 | ||||||||
Tranche A Term Loans due 2016 | — | — | 130,885 | -2 | 131,250 | -1 | ||||||||
Tranche A Term Loans due 2019 | 291,857 | -2 | 292,500 | -1 | — | — | ||||||||
4.625% Senior Notes due 2021 | 700,000 | 675,500 | -3 | 700,000 | 672,000 | -3 | ||||||||
-1 | Fair values are estimated based on Level 2 inputs, which were quoted prices for identical or similar instruments in markets that are not active. | |||||||||||||
-2 | The carrying values of the tranche A term loans are net of discount. At January 3, 2015 and December 28, 2013, the face amounts of the tranche A term loans were $292.5 million and $131.3 million, respectively. | |||||||||||||
-3 | Fair values are estimated based on quoted market prices. | |||||||||||||
For the Rickland Orchards acquisition, additional purchase price payments ranging from zero to $15.0 million are contingent upon the achievement of certain revenue growth targets during fiscal 2014, 2015 and 2016 meant to achieve revenue growth in excess of base purchase price acquisition model assumptions. We estimated the original fair value of the contingent consideration as the present value of the expected contingent payments, determined using the weighted probabilities of the possible payments. As of the date of acquisition we estimated the original fair value of the contingent consideration to be approximately $7.6 million. | ||||||||||||||
During fiscal 2014 and fiscal 2013, we recorded interest accretion expense on the contingent consideration liability of $0.4 million and $0.2 million, respectively. We are required to reassess the fair value of the contingent consideration at each reporting period. At June 28, 2014, we remeasured the fair value of the contingent consideration using actual operating results through June 28, 2014 and revised our forecasted operating results for Rickland Orchards for the remainder of fiscal 2014, 2015 and 2016. As a result of lower than expected net sales results for Rickland Orchards and the unlikelihood of Rickland Orchards achieving the revenue growth targets, the fair value of the contingent consideration was reduced to zero, resulting in a non-cash gain of $8.2 million that is included in gain on change in fair value of contingent consideration in the accompanying audited consolidated statements of operations for fiscal 2014. The significant inputs used in these estimates include numerous possible scenarios for the contingent earn-out payments based on the contractual terms of the contingent consideration, for which probabilities are assigned to each scenario, which are then discounted based on an individual risk analysis of the respective liabilities. Although we believe our assumptions are reasonable, different assumptions or changes in the future may result in different estimated amounts. | ||||||||||||||
The following table summarized the Level 3 activity (in thousands): | ||||||||||||||
January 3, | December 28, | |||||||||||||
2015 | 2013 | |||||||||||||
Balance at beginning of year | $ | 7,774 | $ | 7,566 | ||||||||||
Contingent consideration accretion expense | 432 | 208 | ||||||||||||
Gain on change in fair value of contingent consideration | (8,206 | ) | — | |||||||||||
| | | | | | | | |||||||
Balance at end of year | $ | — | $ | 7,774 | ||||||||||
| | | | | | | | |||||||
| | | | | | | | |||||||
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Loss | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Accumulated Other Comprehensive Loss. | |||||||||||
Accumulated Other Comprehensive Loss | (9) Accumulated Other Comprehensive Loss | ||||||||||
The reclassification from accumulated other comprehensive loss for fiscal 2014 and 2013 are as follows (in thousands): | |||||||||||
Amount Reclassified | |||||||||||
From AOCL | |||||||||||
Details about AOCL Components | January 3, | December 28, | Affected Line Item in the | ||||||||
2015 | 2013 | Statement Where Net Income | |||||||||
(loss) is Presented | |||||||||||
Defined benefit pension plan items | |||||||||||
Amortization of prior service cost | $ | 45 | $ | 44 | See (1) below | ||||||
Amortization of unrecognized loss | — | 815 | See (1) below | ||||||||
| | | | | | | | | |||
45 | 859 | Total before tax | |||||||||
(17 | ) | (315 | ) | Income tax expense | |||||||
| | | | | | | | | |||
Total reclassification | $ | 28 | $ | 544 | Net of tax | ||||||
| | | | | | | | | |||
| | | | | | | | | |||
-1 | These items are included in the computation of net periodic pension cost. See Note 12, "Pension Benefits," for additional information. | ||||||||||
Changes in accumulated other comprehensive loss for fiscal 2014 and 2013 are as follows (in thousands): | |||||||||||
Defined Benefit | Foreign Currency | Total | |||||||||
Pension Plan Items | Translation | ||||||||||
Adjustments | |||||||||||
Balance at December 29, 2012 | $ | (11,036 | ) | $ | (59 | ) | $ | (11,095 | ) | ||
Other comprehensive loss before reclassifications | 8,152 | (72 | ) | 8,080 | |||||||
Amounts reclassified from AOCL | 544 | — | 544 | ||||||||
| | | | | | | | | | | |
Net current period other comprehensive income (loss) | 8,696 | (72 | ) | 8,624 | |||||||
| | | | | | | | | | | |
Balance at December 28, 2013 | $ | (2,340 | ) | $ | (131 | ) | $ | (2,471 | ) | ||
Other comprehensive loss before reclassifications | (8,475 | ) | (116 | ) | (8,591 | ) | |||||
Amounts reclassified from AOCL | 28 | — | 28 | ||||||||
| | | | | | | | | | | |
Net current period other comprehensive income (loss) | (8,447 | ) | (116 | ) | (8,563 | ) | |||||
| | | | | | | | | | | |
Balance at January 3, 2015 | $ | (10,787 | ) | $ | (247 | ) | $ | (11,034 | ) | ||
| | | | | | | | | | | |
| | | | | | | | | | | |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Income Taxes | |||||||||||
Income Taxes | (10) Income Taxes | ||||||||||
The components of income before income tax expense consist of the following (in thousands): | |||||||||||
Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | |||||||||
U.S. | $ | 63,232 | $ | 80,291 | $ | 90,646 | |||||
Foreign | 545 | 601 | 268 | ||||||||
| | | | | | | | | | | |
Total | $ | 63,777 | $ | 80,892 | $ | 90,914 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Income tax expense (benefit) consists of the following (in thousands): | |||||||||||
Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | |||||||||
Current: | |||||||||||
Federal | $ | 7,993 | $ | 6,853 | $ | 15,024 | |||||
State | 820 | 728 | 1,260 | ||||||||
Foreign | 153 | 168 | 75 | ||||||||
| | | | | | | | | | | |
Subtotal | 8,966 | 7,749 | 16,359 | ||||||||
Deferred: | |||||||||||
Federal | 13,330 | 20,200 | 15,438 | ||||||||
State | 525 | 600 | (143 | ) | |||||||
| | | | | | | | | | | |
Subtotal | 13,855 | 20,800 | 15,295 | ||||||||
| | | | | | | | | | | |
Total | $ | 22,821 | $ | 28,549 | $ | 31,654 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Income tax expense differs from the expected income tax expense (computed by applying the U.S. federal income tax rate of 35% for fiscal years 2014, 2013 and 2012 to income before income tax expense) as a result of the following: | |||||||||||
Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | |||||||||
Expected tax expense | 35.0 | % | 35.0 | % | 35.0 | % | |||||
Increase (decrease): | |||||||||||
State income taxes, net of federal income tax benefit | 1.8 | % | 1.8 | % | 1.8 | % | |||||
Impact on deferred taxes from changes in state tax rates | — | (0.4 | )% | (0.9 | )% | ||||||
Foreign income taxes | — | — | 0.1 | % | |||||||
Permanent differences | (1.0 | )% | (1.1 | )% | (1.2 | )% | |||||
| | | | | | | | | | | |
Total | 35.8 | % | 35.3 | % | 34.8 | % | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
In fiscal 2014, 2013 and 2012, changes in state apportionments or state tax laws resulted in a decrease of our blended state rate, resulting in a tax benefit of less than $0.1 million, $0.3 million and $0.9 million, respectively. | |||||||||||
The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below (in thousands): | |||||||||||
January 3, | December 28, | ||||||||||
2015 | 2013 | ||||||||||
Deferred tax assets: | |||||||||||
Accounts receivable, principally due to allowance | $ | 37 | $ | 37 | |||||||
Inventories, principally due to additional costs capitalized for tax purposes | 1,050 | 1,088 | |||||||||
Accruals and other liabilities | 5,196 | 301 | |||||||||
Net operating loss and tax credit carry forwards | 1,157 | — | |||||||||
Other liabilities | — | 76 | |||||||||
| | | | | | | | ||||
Total gross deferred tax assets | 7,440 | 1,502 | |||||||||
Deferred tax liabilities: | |||||||||||
Plant and equipment | (13,060 | ) | (9,908 | ) | |||||||
Goodwill and other intangible assets | (194,406 | ) | (135,341 | ) | |||||||
Prepaid expenses | (906 | ) | (1,077 | ) | |||||||
| | | | | | | | ||||
Total gross deferred tax liabilities | (208,372 | ) | (146,326 | ) | |||||||
| | | | | | | | ||||
Net deferred tax liability | $ | (200,932 | ) | $ | (144,824 | ) | |||||
| | | | | | | | ||||
| | | | | | | | ||||
In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income and reversal of deferred tax liabilities over the periods in which the deferred tax assets are deductible, management believes it is more likely than not that we will realize the benefits of these deductible differences, at January 3, 2015. The amount of the deferred tax assets considered realizable, however, could be reduced in the near term if estimates of future taxable income during future periods are reduced. The valuation allowance at January 3, 2015 and December 28, 2013 was $0. | |||||||||||
At January 3, 2015 we had intangibles of $651.5 million for tax purposes, which are amortizable through 2029. | |||||||||||
We operate in multiple taxing jurisdictions within the United States and Canada and from time to time face audits from various tax authorities regarding the deductibility of certain expenses, state income tax nexus, intercompany transactions, transfer pricing and other matters. In January 2015, our company received notice that the IRS intends to conduct an audit of our 2012 tax year. There have been no further communications from the IRS since then and the audit has not yet commenced. Although the final resolution of the audit is uncertain, we believe that the ultimate disposition will not have a material adverse effect on our consolidated financial position, results of operations or liquidity. Although we do not believe that we are otherwise currently under examination in any of our major tax jurisdictions, we remain subject to examination in all of our tax jurisdictions until the applicable statutes of limitations expire. As of January 3, 2015, a summary of the tax years that remain subject to examination in our major tax jurisdictions are: | |||||||||||
United States—Federal | 2011 and forward | ||||||||||
United States—States | 2010 and forward | ||||||||||
Canada | 2010 and forward | ||||||||||
As of January 3, 2015, we do not have any reserves for uncertain tax positions. Our policy is to classify interest and penalties that result from any income tax uncertainties as income tax expense. | |||||||||||
Capital_Stock
Capital Stock | 12 Months Ended |
Jan. 03, 2015 | |
Capital Stock | |
Capital Stock | (11) Capital Stock |
Voting Rights. The holders of our common stock are entitled to one vote per share with respect to each matter on which the holders of our common stock are entitled to vote. The holders of our common stock are not entitled to cumulate their votes in the election of our directors. | |
Dividends. The holders of our common stock are entitled to receive dividends, if any, as they may be lawfully declared from time to time by our board of directors, subject to any preferential rights of holders of any outstanding shares of preferred stock. In the event of any liquidation, dissolution or winding up of our company, common stockholders are entitled to share ratably in our assets available for distribution to the stockholders, subject to the prior rights of holders of any outstanding preferred stock. See Note 16, "Quarterly Financial Data (unaudited)," for dividends declared for each quarter of fiscal 2014 and 2013. | |
Additional Issuance of Our Authorized Common Stock and Preferred Stock. Additional shares of our authorized common stock and preferred stock may be issued, as determined by our board of directors from time to time, without approval of holders of our common stock, except as may be required by applicable law or the rules of any stock exchange or automated quotation system on which our securities may be listed or traded. Our board of directors has the authority by resolution to determine and fix, with respect to each series of preferred stock prior to the issuance of any shares of the series to which such resolution relates, the designations, powers, preferences and rights of the shares of preferred stock of such series and any qualifications, limitations or restrictions thereof. | |
Stock Repurchases. We did not repurchase any shares of common stock during fiscal 2014, 2013 or 2012. | |
Common Stock Issued. In October 2013, as partial consideration for the Rickland Orchards acquisition, we issued to 572,546 shares of common stock valued at $20.1 million to the seller. See Note 3, "Acquisitions." | |
In October 2012, we completed an underwritten public offering of 4,173,540 shares of our common stock at a price to the public of $30.25 per share. The proceeds of the offering were approximately $120.4 million, after deducting underwriting discounts and commissions and other estimated offering expenses. The offering was made by means of a prospectus and related prospectus supplement included as part of an effective shelf registration statement previously filed with the SEC. We used the net proceeds of the offering, together with cash on hand, for the partial redemption of our then outstanding 7.625% senior notes plus accrued and unpaid interest and general corporate purposes. | |
Pension_Benefits
Pension Benefits | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Pension Benefits | ||||||||||||||
Pension Benefits | (12) Pension Benefits | |||||||||||||
We have three defined benefit pension plans covering substantially all of our employees. The benefits are based on years of service and the employee's compensation, as defined. | ||||||||||||||
The following table sets forth our defined benefit pension plans' benefit obligation, fair value of plan assets and funded status recognized in the consolidated balance sheets. We used January 3, 2015 and December 28, 2013 measurement dates for fiscal 2014 and 2013, respectively, to calculate end of year benefit obligations, fair value of plan assets and annual net periodic benefit cost. | ||||||||||||||
January 3, | December 28, | |||||||||||||
2015 | 2013 | |||||||||||||
(in thousands) | ||||||||||||||
Change in projected benefit obligation: | ||||||||||||||
Projected benefit obligation at beginning of year | $ | 50,679 | $ | 54,549 | ||||||||||
Actuarial loss (gain) | 12,365 | (7,672 | ) | |||||||||||
Service cost | 2,940 | 3,285 | ||||||||||||
Interest cost | 2,387 | 2,111 | ||||||||||||
Benefits paid | (1,644 | ) | (1,594 | ) | ||||||||||
| | | | | | | | |||||||
Projected benefit obligation at end of year | 66,727 | 50,679 | ||||||||||||
| | | | | | | | |||||||
Change in plan assets: | ||||||||||||||
Fair value of plan assets at beginning of year | 59,701 | 47,709 | ||||||||||||
Actual gain on plan assets | 3,356 | 8,836 | ||||||||||||
Employer contributions | 1,750 | 4,750 | ||||||||||||
Benefits paid | (1,644 | ) | (1,594 | ) | ||||||||||
| | | | | | | | |||||||
Fair value of plan assets at end of year | 63,163 | 59,701 | ||||||||||||
| | | | | | | | |||||||
Net amount recognized: | ||||||||||||||
Other assets | $ | 804 | $ | 9,022 | ||||||||||
Other long-term liabilities | (4,368 | ) | — | |||||||||||
| | | | | | | | |||||||
Funded status at the end of the year | $ | 3,564 | $ | 9,022 | ||||||||||
| | | | | | | | |||||||
| | | | | | | | |||||||
Amount recognized in accumulated other comprehensive loss (income) consist of: | ||||||||||||||
Prior service cost | $ | (126 | ) | $ | (171 | ) | ||||||||
Actuarial loss | (16,875 | ) | (3,518 | ) | ||||||||||
Deferred taxes | 6,214 | 1,349 | ||||||||||||
| | | | | | | | |||||||
Accumulated other comprehensive loss | $ | (10,787 | ) | $ | (2,340 | ) | ||||||||
| | | | | | | | |||||||
| | | | | | | | |||||||
The accumulated benefit obligations of the three plans were $58.9 million and $44.9 million at January 3, 2015 and December 28, 2013, respectively. The following information is presented for those plans with an accumulated benefit obligation in excess of plan assets: | ||||||||||||||
January 3, | December 28, | |||||||||||||
2015 | 2013 | |||||||||||||
Accumulated benefit obligation | $ | 5,665 | — | |||||||||||
Fair value of plan assets | $ | 5,244 | — | |||||||||||
The amounts in accumulated other comprehensive loss that are expected to be recognized as components of net periodic benefit cost in fiscal 2015 are as follows (in thousands): | ||||||||||||||
Prior service cost | $ | 45 | ||||||||||||
Actuarial loss | 704 | |||||||||||||
| | | | | ||||||||||
$ | 749 | |||||||||||||
| | | | | ||||||||||
| | | | | ||||||||||
January 3, | December 28, | |||||||||||||
2015 | 2013 | |||||||||||||
Weighted-average assumptions: | ||||||||||||||
Discount rate | 3.882 | % | 4.815 | % | ||||||||||
Rate of compensation increase | 3.00 | % | 3.00 | % | ||||||||||
Expected long-term rate of return | 6.50 | % | 7.25 | % | ||||||||||
The discount rate used to determine year-end fiscal 2014 and fiscal 2013 pension benefit obligations was derived by matching the plans' expected future cash flows to the corresponding yields from the Citigroup Pension Discount Curve. This yield curve has been constructed to represent the available yields on high-quality fixed-income investments across a broad range of future maturities. | ||||||||||||||
The overall expected long-term rate of return on plan assets assumption is based upon a building-block method, whereby the expected rate of return on each asset class is broken down into the following components: (1) inflation; (2) the real risk-free rate of return (i.e., the long-term estimate of future returns on default-free U.S. government securities); and (3) the risk premium for each asset class (i.e., the expected return in excess of the risk-free rate). | ||||||||||||||
All three components are based primarily on historical data, with modest adjustments to take into account additional relevant information that is currently available. For the inflation and risk-free return components, the most significant additional information is that provided by the market for nominal and inflation-indexed U.S. Treasury securities. That market provides implied forecasts of both the inflation rate and risk-free rate for the period over which currently available securities mature. The historical data on risk premiums for each asset class is adjusted to reflect any systemic changes that have occurred in the relevant markets; e.g., the higher current valuations for equities, as a multiple of earnings, relative to the longer-term average for such valuations. | ||||||||||||||
Net periodic cost includes the following components (in thousands): | ||||||||||||||
Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | ||||||||||||
Service cost—benefits earned during the period | $ | 2,940 | $ | 3,284 | $ | 2,393 | ||||||||
Interest cost on projected benefit obligation | 2,387 | 2,111 | 2,036 | |||||||||||
Expected return on plan assets | (4,347 | ) | (3,635 | ) | (2,918 | ) | ||||||||
Amortization of unrecognized prior service cost | 45 | 44 | 45 | |||||||||||
Amortization of loss | — | 815 | 921 | |||||||||||
| | | | | | | | | | | ||||
Net pension cost | $ | 1,025 | $ | 2,619 | $ | 2,477 | ||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
The asset allocation for our pension plans at the end of fiscal 2014 and fiscal 2013, and the target allocation for fiscal 2015, by asset category, follows. | ||||||||||||||
Our pension plan assets are managed by outside investment managers; assets are rebalanced at the end of each quarter. Our investment strategy with respect to pension assets is to maximize return while protecting principal. The investment manager has the flexibility to adjust the asset allocation and move funds to the asset class that offers the most opportunity for investment returns. | ||||||||||||||
Percentage of Plan Assets | ||||||||||||||
at Year End | ||||||||||||||
Asset Category | Target | January 3, | December 28, | |||||||||||
Allocation | 2015 | 2013 | ||||||||||||
Equity securities | 75 | % | 80 | % | 79 | % | ||||||||
Fixed income securities | 25 | % | 15 | % | 17 | % | ||||||||
Other | — | 5 | % | 4 | % | |||||||||
| | | | | | | | | | | ||||
Total | 100 | % | 100 | % | ||||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
The general investment objective of each of the pension plans is to grow the plan assets in relation to the plan liabilities while prudently managing the risk of a decrease in the plan's assets relative to those liabilities. To meet this objective, our management has adopted the above target allocations that it reconsiders from time to time as circumstances change. The actual plan asset allocations may be within a range around these targets. The actual asset allocations are reviewed and rebalanced on a periodic basis. | ||||||||||||||
The fair values of our pension plan assets at January 3, 2015 and December 28, 2013, utilizing the fair value hierarchy discussed in Note 8, "Fair Value Measurements" follow (in thousands): | ||||||||||||||
January 3, 2015 | December 28, 2013 | |||||||||||||
Level 1 | Levels 2 & 3 | Level 1 | Levels 2 & 3 | |||||||||||
Asset Category | ||||||||||||||
Cash | $ | 2,934 | $ | — | $ | 2,480 | $ | — | ||||||
Equity securities: | ||||||||||||||
U.S. mutual funds | 12,409 | — | 25,921 | — | ||||||||||
Foreign mutual funds | 2,542 | — | — | — | ||||||||||
U.S. common stocks | 33,228 | — | 17,832 | — | ||||||||||
Foreign common stocks | 2,414 | — | 3,374 | — | ||||||||||
Fixed income securities: | ||||||||||||||
U.S. mutual funds | 9,636 | — | 10,094 | — | ||||||||||
| | | | | | | | | | | | | | |
Total | $ | 63,163 | $ | — | $ | 59,701 | $ | — | ||||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
The investment portfolio contains a diversified blend of common stocks, bonds, cash equivalents and other investments, which may reflect varying rates of return. The investments are further diversified within each asset classification. The portfolio diversification provides protection against a single security or class of securities having a disproportionate impact on aggregate performance. Of the $33.2 million of U.S. common stocks in the investment portfolio at the end of fiscal 2014, $4.9 million was invested in B&G Foods' common stock. Of the $17.8 million of U.S. common stocks in the investment portfolio at the end of fiscal 2013, $5.5 million was invested in B&G Foods' common stock. | ||||||||||||||
Information about the expected cash flows for the pension plan follows (in thousands): | ||||||||||||||
Pension Payments | ||||||||||||||
Benefit payments: | ||||||||||||||
2015 | $ | 1,648 | ||||||||||||
2016 | 1,760 | |||||||||||||
2017 | 1,987 | |||||||||||||
2018 | 2,242 | |||||||||||||
2019 | 2,620 | |||||||||||||
2020 to 2024 | 16,799 | |||||||||||||
We currently anticipate making contributions of approximately $3.5 million to our pension plan in fiscal 2015. | ||||||||||||||
We also sponsor a defined contribution plan covering substantially all of our employees. Employees may contribute to this plan and these contributions are matched by us at varying amounts. Contributions for the matching component of this plan amounted to $1.0 million, $1.0 million and $0.8 million for fiscal 2014, 2013 and 2012, respectively. | ||||||||||||||
Multi-Employer Defined Benefit Pension Plan. We also contribute to the Bakery and Confectionary Union and Industry International Pension Fund (EIN 52-6118572, Plan No. 001), a multi-employer defined benefit pension plan, sponsored by the Bakery, Confectionary, Tobacco Workers and Grain Millers International Union (BCTGM). The plan provides multiple plan benefits with corresponding contribution rates that are collectively bargained between participating employers and their affiliated BCTGM local unions. The collective bargaining agreement for our Portland, Maine employees participating in the plan expires on April 25, 2015. | ||||||||||||||
We were notified that for the plan year beginning January 1, 2012, the plan was in critical status and classified in the Red Zone. As of the date of the accompanying audited consolidated financial statements, the plan remains in critical status. The law requires that all contributing employers pay to the plan a surcharge to help correct the plan's financial situation. The amount of the surcharge is equal to a percentage of the amount an employer is otherwise required to contribute to the plan under the applicable collective bargaining agreement. A 5% surcharge payable on hours worked on and after June 1, 2012 until December 31, 2012 was charged for plan year 2012, the initial critical year. A 10% surcharge payable on hours worked on and after January 1, 2013 will be applicable for each succeeding plan year that the plan is in critical status until we agree to a collective bargaining agreement that implements a rehabilitation plan. B&G Foods made contributions to the plan of $1.0 million in each of fiscal 2014, 2013 and 2012, respectively. These contributions represented less than five percent of total contributions made to the plan. In each of fiscal 2012, fiscal 2013 and fiscal 2014, we paid less than $0.1 million in surcharges and expect to pay surcharges of less than $0.1 million in fiscal 2015 assuming consistent hours are worked. | ||||||||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||
Jan. 03, 2015 | |||||
Commitments and Contingencies | |||||
Commitments and Contingencies | (13) Commitments and Contingencies | ||||
Operating Leases. We have several noncancelable operating leases, primarily for our corporate headquarters, one of our manufacturing facilities, warehouses, transportation equipment and machinery. These leases generally require us to pay all executory costs such as maintenance, taxes and insurance. Total rental expense for our operating leases was $7.3 million, $6.4 million and $5.5 million, for fiscal 2014, 2013 and 2012, respectively. | |||||
As of January 3, 2015, future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) for the periods set forth below are as follows (in thousands): | |||||
Fiscal year ending: | Third Parties | ||||
2015 | $ | 7,350 | |||
2016 | 7,289 | ||||
2017 | 4,947 | ||||
2018 | 4,910 | ||||
2019 | 4,981 | ||||
Thereafter | 4,945 | ||||
| | | | | |
Total | $ | 34,422 | |||
| | | | | |
| | | | | |
Legal Proceedings. We are from time to time involved in various claims and legal actions arising in the ordinary course of business, including proceedings involving product liability claims, product labeling claims, worker's compensation and other employee claims, and tort and other general liability claims, as well as trademark, copyright, patent infringement and related claims and legal actions. While we cannot predict with certainty the results of these claims and legal actions in which we are currently or in the future may be involved, we do not expect that the ultimate disposition of any currently pending claims or actions will have a material adverse effect on our consolidated financial position, results of operations or liquidity. | |||||
Beginning in December 2012, Pirate Brands was named as a defendant in six duplicative putative class action lawsuits filed in United States District Courts, two of which were filed prior to our ownership of Pirate Brands, alleging that Pirate Brands' products were improperly labeled as "natural" because they contained "genetically modified" and "highly processed" ingredients. Each case was filed on behalf of a plaintiff and purported similarly situated individuals. In 2013, all of the cases were transferred to the Eastern District of New York. Pirate Brands had moved to dismiss each of the actions when, in December 2014, each case was voluntarily dismissed with prejudice by the respective plaintiffs for an immaterial settlement amount. The dismissal of these actions did not have a material effect on B&G Foods' consolidated financial position, results of operations or liquidity. | |||||
B&G Foods was named as a defendant in two additional putative class action lawsuits alleging that certain of our products were improperly labeled as "natural" because they contained "genetically modified" and/or "highly processed" ingredients. The first case was filed in the United States District Court for the Southern District of Florida in September 2014 by Bonnie Jo Pettinga, Caleb Johnson, Shawn Teufel and Joseph Grey, individually and purportedly on behalf of similarly situated individuals. This action was voluntarily dismissed without prejudice by the plaintiffs on or about October 17, 2014. The second case was filed in the United States District Court for the Southern District of New York in October 2014 by Carolina Alduey, purportedly on behalf of herself and similarly situated individuals. In November 2014, Ms. Alduey voluntarily dismissed her action with prejudice for an immaterial settlement amount. The dismissal of these actions did not have a material effect on B&G Foods' consolidated financial position, results of operations or liquidity. | |||||
Selling, general and administrative expenses for fiscal 2013 include a gain of $1.5 million relating to a legal settlement. | |||||
Environmental. We are subject to environmental laws and regulations in the normal course of business. We did not make any material expenditures during fiscal 2014, 2013 or 2012 in order to comply with environmental laws and regulations. Based on our experience to date, management believes that the future cost of compliance with existing environmental laws and regulations (and liability for any known environmental conditions) will not have a material adverse effect on our consolidated financial position, results of operations or liquidity. However, we cannot predict what environmental or health and safety legislation or regulations will be enacted in the future or how existing or future laws or regulations will be enforced, administered or interpreted, nor can we predict the amount of future expenditures that may be required in order to comply with such environmental or health and safety laws or regulations or to respond to such environmental claims. | |||||
Collective Bargaining Agreements. As of January 3, 2015, approximately 327 of our 956 employees, or 34%, were covered by collective bargaining agreements, of which approximately 95 were covered by a collective bargaining agreement expiring within the next 12 months. Our collective bargaining agreement with the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, AFL-CIO, Local No. 334 that covers certain employees at our Portland, Maine manufacturing facility is scheduled to expire on April 25, 2015. We are currently in negotiations for a new collective bargaining agreement for our Portland, Maine facility. While we believe that our relations with our union employees are in general good, we cannot assure you that we will be able to negotiate a new collective bargaining agreement for the Portland, Maine manufacturing facility on terms satisfactory to us, or at all, and without production interruptions, including labor stoppages. As of the date of the accompanying audited financial statements, however, management does not expect the outcome of these negotiations to have a material adverse effect on our business, financial condition or results of operations. None of our other collective bargaining agreements is scheduled to expire within one year. | |||||
Severance and Change of Control Agreements. We have employment agreements with each of our seven executive officers. The agreements generally continue until terminated by the executive or by us, and provide for severance payments under certain circumstances, including termination by us without cause (as defined in the agreements) or as a result of the employee's death or disability, or termination by us or a deemed termination upon a change of control (as defined in the agreements). Severance benefits generally include payments for salary continuation, continuation of health care and insurance benefits, present value of additional pension credits and, in the case of a change of control, accelerated vesting under compensation plans and, in certain cases, potential gross up payments for excise tax liability. | |||||
Ortega and Las Palmas Recall. On November 14, 2014, we announced a voluntary recall for certain Ortega and Las Palmas products after learning that one or more of the spice ingredients purchased from a third party supplier contained peanuts and almonds, allergens that are not declared on the products' ingredient statements. The cost impact of this recall during fiscal 2014 (not including lost sales during the period of time production and distribution of the affected products were suspended), net of expected insurance recoveries of $5.0 million, was $12.8 million, of which $4.1 million was recorded as a decrease in net sales related to customer refunds; $8.2 million was recorded as an increase in cost of goods sold primarily related to costs associated with product retrieval, destruction charges, customer fees and inventory write-offs; and $0.5 million was recorded as an increase in selling, general, and administrative expenses related to administrative costs. The charges we recorded are based upon costs incurred to date and management's estimates of costs that have yet to be incurred that relate to 2014. As of January 3, 2015, the reserves related to the recall remaining on our consolidated balance sheets include $4.0 million in accounts receivable reserves and $0.6 million of accrued expenses. We have recorded a $5.0 million receivable for the expected insurance recoveries in prepaid expenses in our consolidated balance sheet as of January 3, 2015. | |||||
Incentive_Plans
Incentive Plans | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Incentive Plans | ||||||||||||||
Incentive Plans | (14) Incentive Plans | |||||||||||||
Annual Bonus Plan. Annually, our board of directors establishes a bonus plan that provides for cash awards to be made to our executive officers and other senior managers upon our company's attainment of pre-set annual financial objectives. Awards are normally paid in cash in a lump sum following the close of each plan year. At January 3, 2015, we did not have an accrual for the annual bonus plan. At December 28, 2013, accrued expenses in the accompanying consolidated balance sheets include an accrual for the annual bonus plan of $4.7 million. | ||||||||||||||
2008 Omnibus Incentive Compensation Plan. Upon the recommendation of our compensation committee, our board of directors on March 10, 2008 adopted (subject to stockholder approval) the B&G Foods, Inc. 2008 Omnibus Incentive Compensation Plan, which we refer to as the 2008 Omnibus Plan. Our stockholders approved the 2008 Omnibus Plan at our annual meeting on May 6, 2008. Our stockholders reapproved the material terms of the performance goals in our 2008 Omnibus Plan at our annual meeting on May 16, 2013. | ||||||||||||||
The 2008 Omnibus Plan authorizes the grant of performance share awards, restricted stock, options, stock appreciation rights, deferred stock, stock units and cash-based awards to employees, non-employee directors and consultants. Subject to adjustment as provided in the plan, the total number of shares of common stock available for awards under the plan is 4,500,000, of which 2,689,645 were available for future issuance as of January 3, 2015. Some of those shares are subject to outstanding performance share long-term incentive awards (LTIAs) and stock options as described in the table below. | ||||||||||||||
Performance Share Awards. Beginning in fiscal 2008, our compensation committee has made annual grants of performance share LTIAs to our executive officers and certain other members of senior management under the 2008 Omnibus Plan. The performance share LTIAs entitle the participants to earn shares of common stock upon the attainment of certain performance goals over the applicable performance period. The performance period is typically three years. | ||||||||||||||
Each performance share LTIA has a threshold, target and maximum payout. The awards are settled based upon our performance over the applicable performance period. For the performance share LTIAs granted to date, the applicable performance metric is and has been "excess cash" (as defined in the award agreements). If our performance fails to meet the performance threshold, then the awards will not vest and no shares will be issued pursuant to the awards. If our performance meets or exceeds the performance threshold, then a varying amount of shares from the threshold amount (50% of the target number of shares) up to the maximum amount (200% of the target number of shares) may be earned. | ||||||||||||||
Subject to the performance goal for the applicable performance period being certified in writing by our compensation committee as having been achieved, shares of common stock are issued prior to March 15 following the completion of the performance period. | ||||||||||||||
The following table details the activity in our performance share LTIAs for fiscal 2014: | ||||||||||||||
Number of | Weighted Average | |||||||||||||
Performance Shares | Grant Date Fair | |||||||||||||
Value (per share)(2) | ||||||||||||||
Beginning of fiscal 2014 | 611,819 | -1 | $ | 17.05 | ||||||||||
Granted | 174,834 | -1 | $ | 27.54 | ||||||||||
Vested | (342,576 | ) | $ | 11.78 | ||||||||||
Forfeited | (63,099 | ) | $ | 27.75 | ||||||||||
| | | | | | | | |||||||
End of fiscal 2014 | 380,978 | -1 | $ | 24.82 | ||||||||||
| | | | | | | | |||||||
| | | | | | | | |||||||
-1 | Solely for purposes of this table, the number of performance shares is based on the participants earning the maximum number of performance shares (i.e., 200% of the target number of performance shares). | |||||||||||||
-2 | The fair value of the awards was determined based upon the closing price of our common stock on the applicable measurement dates (i.e., the deemed grant dates for accounting purposes) reduced by the present value of expected dividends using the risk-free interest-rate as the award holders are not entitled to dividends or dividend equivalents during the vesting period. | |||||||||||||
Employee Stock Options. The following table details our stock option activity for fiscal 2014: | ||||||||||||||
Options | Weighted | Weighted Average | Aggregate | |||||||||||
Average | Contractual Life | Intrinsic | ||||||||||||
Exercise Price | Remaining (Years) | Value | ||||||||||||
Outstanding at beginning of fiscal 2014 | — | |||||||||||||
Granted | 418,158 | $ | 30.94 | 9.8 | 0.00 | |||||||||
Exercised | — | N/A | ||||||||||||
Forfeited | — | N/A | ||||||||||||
| | | | | | | | | | | | | | |
Outstanding at end of fiscal 2014 | 418,158 | $ | 30.94 | 9.8 | 0.00 | |||||||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
Exercisable at end of fiscal 2014 | — | — | — | — | ||||||||||
The fair value of the options was estimated on the date of grant using the Black-Scholes option-pricing model utilizing the following assumptions. Expected volatility was based on both historical and implied volatilities of our common stock over the estimated expected term of the award. The expected term of the options granted represents the period of time that options were expected to be outstanding and is based on the "simplified method" in accordance with accounting guidance. We utilized the simplified method to determine the expected term of the options as we do not have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term. The risk-free interest rate was based on the U.S. Treasury yield curve in effect at the time of the grant, which corresponds to the expected term of the options. | ||||||||||||||
Weighted average grant date fair value | $ | 6.74 | ||||||||||||
Expected volatility | 34.8 | % | ||||||||||||
Expected term | 6.5 years | |||||||||||||
Risk-free interest rate | 1.9 | % | ||||||||||||
Dividend yield | 4.4 | % | ||||||||||||
No stock options were issued or outstanding in fiscal 2013 or fiscal 2012. | ||||||||||||||
Non-Employee Director Stock Grants. Each of our non-employee directors receives an annual equity grant as part of his or her non-employee director compensation. These shares fully vest when issued. | ||||||||||||||
The following table details the number of shares of common stock issued by our company during fiscal 2014, 2013 and 2012 upon the vesting of performance share long-term incentive awards and for non-employee director annual equity grants and other share based compensation: | ||||||||||||||
January 3, | December 28, | December 29, | ||||||||||||
2015 | 2013 | 2012 | ||||||||||||
Number of performance shares vested | 342,576 | 512,885 | 1,124,205 | |||||||||||
Shares withheld to fund statutory minimum tax withholding | 138,799 | 214,878 | 463,942 | |||||||||||
| | | | | | | | | | | ||||
Shares of common stock issued for performance share long-term incentive awards | 203,777 | 298,007 | 660,263 | |||||||||||
Shares of common stock issued to non-employee directors for annual equity grants | 14,010 | 14,592 | 17,436 | |||||||||||
Shares of common stock issued for other share based compensation, net of shares withheld to fund statutory minimum tax withholding | — | — | 9,394 | |||||||||||
| | | | | | | | | | | ||||
Total shares of common stock issued | 217,787 | 312,599 | 687,093 | |||||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
Excess tax benefit recorded to additional paid in capital | $ | 2,356 | $ | 4,192 | $ | 8,031 | ||||||||
| | | | | | | | | | | ||||
The following table sets forth the compensation expense recognized for share-based payments (performance share LTIAs, stock options, non-employee director stock grants and other share based payments) during the last three fiscal years and where that expense is reflected in our consolidated statements of operations (in thousands): | ||||||||||||||
Consolidated Statements of Operations Location | Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | |||||||||||
Compensation expense included in cost of goods sold | $ | 1,075 | $ | 855 | $ | 772 | ||||||||
Compensation expense included in selling, general and administrative expenses | 1,160 | 3,080 | 3,005 | |||||||||||
| | | | | | | | | | | ||||
Total compensation expense for share-based payments | $ | 2,235 | $ | 3,935 | $ | 3,777 | ||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
As of January 3, 2015, there was $0.7 million of unrecognized compensation expense related to LTIAs, which is expected to be recognized over the next two years and $2.5 million of unrecognized compensation expense related to stock options, which is expected to be recognized over the next three years. | ||||||||||||||
Net_Sales_by_Brand
Net Sales by Brand | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Net Sales by Brand | |||||||||||
Net Sales by Brand | (15) Net Sales by Brand | ||||||||||
The following table sets forth net sales by brand (in thousands): | |||||||||||
Fiscal 2014(8) | Fiscal 2013 | Fiscal 2012 | |||||||||
Brand(1): | |||||||||||
Ortega | $ | 134,374 | $ | 137,192 | $ | 135,147 | |||||
Pirate Brands(2) | 82,563 | 32,545 | — | ||||||||
Maple Grove Farms of Vermont | 79,177 | 77,084 | 74,846 | ||||||||
Mrs. Dash | 64,105 | 61,846 | 62,089 | ||||||||
Cream of Wheat | 62,494 | 65,202 | 64,850 | ||||||||
Bear Creek Country Kitchens(3) | 41,432 | — | — | ||||||||
Polaner | 36,136 | 37,036 | 38,394 | ||||||||
Las Palmas | 35,121 | 34,486 | 35,541 | ||||||||
New York Style(4) | 28,075 | 32,995 | 5,910 | ||||||||
Bloch & Guggenheimer | 26,889 | 26,988 | 28,746 | ||||||||
Spring Tree(3) | 15,183 | — | — | ||||||||
TrueNorth(5) | 21,635 | 13,045 | — | ||||||||
Rickland Orchards(6) | 21,343 | 12,867 | — | ||||||||
B&M | 19,958 | 21,210 | 23,061 | ||||||||
Underwood | 19,603 | 19,996 | 21,348 | ||||||||
Ac'cent | 18,899 | 18,824 | 19,326 | ||||||||
All other brands(7) | 141,030 | 133,657 | 124,554 | ||||||||
| | | | | | | | | | | |
Total | $ | 848,017 | $ | 724,973 | $ | 633,812 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
-1 | Net sales for each brand also includes branded net sales and, if applicable, any private label and food service net sales attributable to the brand. | ||||||||||
-2 | We completed the acquisition of Pirate Brands on July 8, 2013. | ||||||||||
-3 | We completed the acquisition of Specialty Brands on April 23, 2014, including the Bear Creek Country Kitchens and Spring Tree brands. | ||||||||||
-4 | We completed the acquisition of the New York Style brand on October 31, 2012. | ||||||||||
-5 | We acquired the TrueNorth brand on May 6, 2013. | ||||||||||
-6 | We acquired the Rickland Orchards brand on October 7, 2013. | ||||||||||
-7 | Net sales for "all other brands" has been impacted by the acquisition of the Cary's, MacDonald's, New York Flatbreads and Canoleo brands acquired as part of the Specialty Brands acquisition, which was completed on April 23, 2014. | ||||||||||
-8 | Fiscal 2014 contained 53 weeks and fiscal 2013 and fiscal 2012 each contained 52 weeks. | ||||||||||
Quarterly_Financial_Data_unaud
Quarterly Financial Data (unaudited) | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Quarterly Financial Data (unaudited) | ||||||||||||||
Quarterly Financial Data (unaudited) | (16) Quarterly Financial Data (unaudited) | |||||||||||||
First | Second | Third | Fourth | |||||||||||
Quarter | Quarter | Quarter | Quarter | |||||||||||
(in thousands, expect per share data) | ||||||||||||||
Net sales | ||||||||||||||
2014 | $ | 198,140 | $ | 202,889 | $ | 208,998 | $ | 237,990 | ||||||
2013 | $ | 171,194 | $ | 160,882 | $ | 181,350 | $ | 211,547 | ||||||
Gross profit | ||||||||||||||
2014 | $ | 64,669 | $ | 63,027 | $ | 63,062 | $ | 57,013 | ||||||
2013 | $ | 58,812 | $ | 55,697 | $ | 61,266 | $ | 67,148 | ||||||
Net income (loss) | ||||||||||||||
2014 | $ | 17,777 | $ | 16,138 | $ | (4,413 | ) | $ | 11,454 | |||||
2013 | $ | 19,634 | $ | (1,433 | ) | $ | 15,350 | $ | 18,792 | |||||
Basic and diluted earnings (loss) per share | ||||||||||||||
2014 | $ | 0.33 | $ | 0.3 | $ | (0.08 | ) | $ | 0.21 | |||||
2013 | $ | 0.37 | $ | (0.03 | ) | $ | 0.29 | $ | 0.35 | |||||
Cash dividends declared per share | ||||||||||||||
2014 | $ | 0.34 | $ | 0.34 | $ | 0.34 | $ | 0.34 | ||||||
2013 | $ | 0.29 | $ | 0.29 | $ | 0.32 | $ | 0.33 | ||||||
Earnings per share were computed individually for each of the quarters presented using the weighted average number of shares outstanding during each quarterly period, while earnings per share for the full year were computed using the weighted average number of shares outstanding during the full year; therefore, the sum of the earnings per share amounts for the quarters may not equal the total for the full year. | ||||||||||||||
Related_Party_Transactions
Related Party Transactions | 12 Months Ended |
Jan. 03, 2015 | |
Related Party Transactions | |
Related Party Transactions | (17) Related Party Transactions |
Except as noted below, there were no related party transactions in fiscal 2014 with any director or executive officer of B&G Foods or any other related person, as defined in Rule 404 under Regulation S-K promulgated under the Securities Act of 1933, as amended, and none is proposed. | |
On October 7, 2013, we completed the acquisition of all the issued and outstanding equity interests of Rickland Orchards LLC from Natural Instincts LLC for a purchase price of $57.5 million, of which approximately $37.4 million was paid in cash and approximately $20.1 million was paid in shares of common stock of B&G Foods (based on the closing price of $35.15 per share on October 4, 2013), plus consideration of up to a maximum of $15.0 million in the aggregate, which is payable based upon the achievement of specified operating results during fiscal 2014, 2015 and 2016. Following the completion of the acquisition, Jason Cohen, a co-founder and the former chief executive officer of Rickland Orchards, and Michael Sands, a co-founder and the former chief operating officer of Rickland Orchards, began serving as an executive vice president and a vice president, respectively, of B&G Foods. Mr. Sands was promoted to executive vice president of snacks of B&G Foods effective March 11, 2014. Mr. Cohen resigned as executive vice president of club channel of B&G Foods effective March 31, 2014. Mr. Cohen is a member of the board of managers of Natural Instincts as well as a member of Natural Instincts. Mr. Sands is a member of Natural Instincts. Mr. Cohen has an approximately 40% interest in Natural Instincts and Mr. Sands has an approximately 1.5% interest in Natural Instincts. In addition, in connection with Mr. Cohen's resignation from B&G Foods, Replenish Capital LLC agreed to become a strategic advisor to B&G Foods' executive management team on a non-exclusive basis. Under that arrangement, Replenish Capital was able to earn $20,000 per month plus commissions on incremental sales of B&G Foods products to the club channel that are facilitated by Replenish Capital. Mr. Cohen is the sole member of Replenish Capital. On August 1, 2014, Replenish Capital and B&G Foods mutually agreed to terminate the consulting arrangement, with an effective date of termination of September 30, 2014. | |
Schedule_II_Schedule_of_Valuat
Schedule II Schedule of Valuation and Qualifying Accounts | 12 Months Ended | ||||||||||||||||
Jan. 03, 2015 | |||||||||||||||||
Schedule II Schedule of Valuation and Qualifying Accounts | |||||||||||||||||
Schedule II Schedule of Valuation and Qualifying Accounts | Schedule of Valuation and Qualifying Accounts | ||||||||||||||||
(In thousands) | |||||||||||||||||
Column A | Column B | Column C | Column D | Column E | |||||||||||||
Additions | |||||||||||||||||
Description | Balance at | Charged to | Charged to | Deductions— | Balance at | ||||||||||||
beginning of | costs and | other accounts— | describe | end of period | |||||||||||||
period | expenses | describe | |||||||||||||||
Year ended December 29, 2012: | |||||||||||||||||
Allowance for doubtful accounts and discounts | $ | 723 | $ | 142 | — | $ | 34 | (a) | $ | 831 | |||||||
Year ended December 28, 2013: | |||||||||||||||||
Allowance for doubtful accounts and discounts | $ | 831 | $ | 257 | — | $ | 7 | (a) | $ | 1,081 | |||||||
Year ended January 3, 2015: | |||||||||||||||||
Allowance for doubtful accounts and discounts | $ | 1,081 | $ | 21 | — | $ | 97 | (a) | $ | 1,005 | |||||||
(a) | Represents bad-debt write-offs. | ||||||||||||||||
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Summary of Significant Accounting Policies | |||||||||||
Basis of Presentation | (a) Basis of Presentation | ||||||||||
The consolidated financial statements include the accounts of B&G Foods, Inc. and its subsidiaries. All intercompany balances and transactions have been eliminated. Certain prior year amounts have been reclassified to conform to the current year's presentation. | |||||||||||
Use of Estimates | (b) Use of Estimates | ||||||||||
The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires our management to make a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Some of the more significant estimates and assumptions made by management involve trade and consumer promotion expenses; allowances for excess, obsolete and unsaleable inventories; pension benefits; acquisition accounting allocations; the recoverability of goodwill, other intangible assets, property, plant and equipment and deferred tax assets; the determination of the useful life of customer relationship and amortizable trademark intangibles; and the fair value of contingent consideration. Actual results could differ significantly from these estimates and assumptions. | |||||||||||
Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors that management believes to be reasonable under the circumstances, including the current economic environment. We adjust such estimates and assumptions when facts and circumstances dictate. Volatility in the credit and equity markets can increase the uncertainty inherent in such estimates and assumptions. | |||||||||||
Subsequent Events | (c) Subsequent Events | ||||||||||
We have evaluated subsequent events for disclosure through the date of issuance of the accompanying consolidated financial statements. | |||||||||||
Cash and Cash Equivalents | (d) Cash and Cash Equivalents | ||||||||||
For purposes of the consolidated statements of cash flows, all highly liquid instruments with maturities of three months or less when acquired are considered to be cash and cash equivalents. | |||||||||||
Inventories | (e) Inventories | ||||||||||
Inventories are stated at the lower of cost or market and include direct material, direct labor, overhead, warehousing and product transfer costs. Cost is determined using the first-in, first-out and average cost methods. Inventories have been reduced by an allowance for excess, obsolete and unsaleable inventories. The allowance is an estimate based on our management's review of inventories on hand compared to estimated future usage and sales. | |||||||||||
Property, Plant and Equipment | (f) Property, Plant and Equipment | ||||||||||
Property, plant and equipment are stated at cost. Depreciation on plant and equipment is calculated using the straight-line method over the estimated useful lives of the assets, 10 to 30 years for buildings and improvements, 5 to 12 years for machinery and equipment, and 2 to 5 years for office furniture and vehicles. Leasehold improvements are amortized on a straight-line basis over the shorter of the lease term or estimated useful life of the asset. Expenditures for maintenance, repairs and minor replacements are charged to current operations. Expenditures for major replacements and betterments are capitalized. We capitalize interest on qualifying assets based on our effective interest rate. During fiscal 2014, 2013 and 2012, we capitalized $0.3 million, $0.2 million and $0.2 million, respectively. | |||||||||||
Goodwill and Other Intangible Assets | (g) Goodwill and Other Intangible Assets | ||||||||||
Goodwill and unamortizable intangible assets (trademarks) are tested for impairment at least annually and whenever events or circumstances occur indicating that goodwill or unamortizable intangibles might be impaired. We perform the annual impairment tests as of the last day of each fiscal year. The annual goodwill impairment test involves a two-step process. The first step of the impairment test involves comparing our company's market capitalization with our company's carrying value, including goodwill. If the carrying value of our company exceeds our market capitalization, we perform the second step of the impairment test to determine the amount of the impairment loss. The second step of the goodwill impairment test involves comparing the implied fair value of goodwill with the carrying value and recognizing a loss for the difference. | |||||||||||
We test our unamortizable intangibles by comparing the fair value with the carrying value and recognize a loss for the difference. We estimate the fair value of our unamortizable intangibles based on discounted cash flows that reflect certain third party market value indicators. | |||||||||||
Calculating our fair value for these purposes requires significant estimates and assumptions by management. We completed our annual impairment tests for fiscal 2014, 2013 and 2012 with no adjustments to the carrying values of goodwill and unamortizable intangibles. Each annual test confirmed that the market capitalization and fair values of our goodwill and unamortizable intangibles, respectively, exceeded their current carrying values. | |||||||||||
Customer relationship intangibles and amortizable trademarks are presented at cost, net of accumulated amortization, and are amortized on a straight-line basis over their estimated useful lives of 10 to 20 years. | |||||||||||
Deferred Debt Financing Costs | (h) Deferred Debt Financing Costs | ||||||||||
Debt financing costs are capitalized and amortized over the term of the related debt agreements and are classified as other assets. Amortization of deferred debt financing costs for fiscal years 2014, 2013 and 2012 was $3.6 million, $4.0 million and $4.2 million, respectively. | |||||||||||
Long-Lived Assets | (i) Long-Lived Assets | ||||||||||
Long-lived assets, such as property, plant and equipment, and intangibles with estimated useful lives are depreciated or amortized over their respective estimated useful lives to their estimated residual values, and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future net cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future net cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Recoverability of assets held for sale is measured by a comparison of the carrying amount of an asset or asset group to their fair value less estimated costs to sell. Estimating future cash flows and calculating the fair value of assets requires significant estimates and assumptions by management. | |||||||||||
Assets to be disposed of are separately presented in the consolidated balance sheets and are no longer depreciated. | |||||||||||
Accumulated Other Comprehensive Loss | (j) Accumulated Other Comprehensive Loss | ||||||||||
Accumulated other comprehensive loss includes foreign currency translation adjustments relating to assets and liabilities located in our foreign subsidiaries and changes in our pension benefits due to the initial adoption and ongoing application of the authoritative accounting literature relating to pensions, net of tax. | |||||||||||
Revenue Recognition | (k) Revenue Recognition | ||||||||||
Revenues are recognized when products are shipped. We report all amounts billed to a customer in a sale transaction as revenue, including those amounts related to shipping and handling. Shipping and handling costs are included in cost of goods sold. Consideration from a vendor to a retailer is presumed to be a reduction to the selling prices of the vendor's products and, therefore, is characterized as a reduction of sales when recognized in the vendor's income statement. As a result, coupon incentives, slotting and promotional expenses are recorded as a reduction of sales. | |||||||||||
Selling, General and Administrative Expenses | (l) Selling, General and Administrative Expenses | ||||||||||
We promote our products with advertising, consumer incentives and trade promotions. These programs include, but are not limited to, discounts, slotting fees, coupons, rebates, in-store display incentives and volume-based incentives. Consumer incentive and trade promotion activities are recorded as a reduction to revenues based on amounts estimated as being due to customers and consumers at the end of a period. We base these estimates principally on historical utilization and redemption rates. We expense our advertising costs either in the period the advertising first takes place or as incurred. Advertising expenses were approximately $5.1 million, $4.3 million and $5.9 million, for the fiscal years 2014, 2013 and 2012, respectively. | |||||||||||
Pension Plans | (m) Pension Plans | ||||||||||
We have defined benefit pension plans covering substantially all of our employees. Our funding policy is to contribute annually the amount recommended by our actuaries. From time to time, however, we voluntarily contribute greater amounts based on pension asset performance, tax considerations and other relevant factors. | |||||||||||
Share Based Compensation Expense | (n) Share Based Compensation Expense | ||||||||||
We provide compensation benefits in the form of stock options, performance share long-term incentive awards (LTIAs) and common stock to employees and non-employee directors. The cost of share based compensation is recorded at fair value at the date of grant and expensed in our consolidated statement of income over the requisite service period, if any. | |||||||||||
Performance share LTIAs granted to our executive officers and certain other members of senior management entitle each participant to earn shares of common stock upon the attainment of certain performance goals over the applicable performance period. The recognition of compensation expense for the performance share LTIAs is initially based on the probable outcome of the performance condition based on the fair value of the award on the date of grant and the anticipated number of shares to be awarded on a straight-line basis over the applicable performance period. The fair value of the awards on the date of grant is determined based upon the closing price of our common stock on the applicable measurement dates (i.e., the deemed grant dates for accounting purposes) reduced by the present value of expected dividends using the risk-free interest-rate as the award holders are not entitled to dividends or dividend equivalents during the vesting period. Our company's performance against the defined performance goals are re-evaluated on a quarterly basis throughout the applicable performance period and the recognition of compensation expense is adjusted for subsequent changes in the estimated or actual outcome. The cumulative effect of a change in the estimated number of shares of common stock to be issued in respect of performance share awards is recognized as an adjustment to earnings in the period of the revision. | |||||||||||
The fair value of stock option awards is estimated on the date of grant using the Black-Scholes option pricing model and is recognized in expense over the vesting period of the options using the straight-line method. The Black-Scholes option pricing model requires various assumptions, including the expected volatility of our stock, the expected term of the option, the risk-free interest rate and the expected dividend yield. Expected volatility is based on both historical and implied volatilities of our common stock over the estimated expected term of the award. The risk-free rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant. All stock option grants have an exercise price equal to the fair market value of our common stock on the date of grant, have a 10-year term and cliff vest three years from the date of grant. | |||||||||||
We recognize compensation expense for only that portion of share based awards that are expected to vest. We utilize historical employee termination behavior to determine our estimated forfeiture rates. If the actual forfeitures differ from those estimated by management, adjustments to compensation expense will be made in future periods. | |||||||||||
Income Tax Expense Estimates and Policies | (o) Income Tax Expense Estimates and Policies | ||||||||||
Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities of our company are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided when it is more likely than not that all or some portion of the deferred tax asset will not be realized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. | |||||||||||
As part of the income tax provision process of preparing our consolidated financial statements, we are required to estimate our income taxes. This process involves estimating our current tax expenses together with assessing temporary differences resulting from differing treatment of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities. We then assess the likelihood that our deferred tax assets will be recovered from future taxable income and to the extent we believe the recovery is not likely, we establish a valuation allowance. Further, to the extent that we establish a valuation allowance or increase this allowance in a financial accounting period, we include such charge in our tax provision, or reduce our tax benefits in our consolidated statements of operations. We use our judgment to determine our provision or benefit for income taxes, deferred tax assets and liabilities and any valuation allowance recorded against our deferred tax assets. | |||||||||||
There are various factors that may cause these tax assumptions to change in the near term, and we may have to record a valuation allowance against our deferred tax assets. We cannot predict whether future U.S. federal and state income tax laws and regulations might be passed that could have a material effect on our results of operations. We assess the impact of significant changes to the U.S. federal and state income tax laws and regulations on a regular basis and update the assumptions and estimates used to prepare our consolidated financial statements when new regulations and legislation are enacted. We recognize the benefit of an uncertain tax position that we have taken or expect to take on our income tax returns we file if it is "more likely than not" that such tax position will be sustained based on its technical merits. | |||||||||||
Dividends | (p) Dividends | ||||||||||
Cash dividends, if any, are accrued as a liability on our consolidated balance sheets and recorded as a decrease to additional paid-in capital when declared. | |||||||||||
Earnings Per Share | (q) Earnings Per Share | ||||||||||
Basic earnings per share is calculated by dividing net income by the weighted average number of shares of common stock outstanding. Diluted earnings per share is calculated by dividing net income by the weighted average number of shares of common stock outstanding plus all additional shares of common stock that would have been outstanding if potentially dilutive shares of common stock had been issued upon the exercise of stock options or in connection with performance share LTIAs that may be earned as of the beginning of the period using the treasury stock method. | |||||||||||
Fiscal | Fiscal | Fiscal | |||||||||
2014 | 2013 | 2012 | |||||||||
(In thousands, except share and per share data) | |||||||||||
Net income | $ | 40,956 | $ | 52,343 | $ | 59,260 | |||||
Weighted average common shares outstanding: | |||||||||||
Basic | 53,658,100 | 52,998,263 | 49,238,759 | ||||||||
Net effect of dilutive share-based compensation awards | 89,111 | -1 | 184,043 | 318,067 | |||||||
| | | | | | | | | | | |
Diluted | 53,747,211 | 53,182,306 | 49,556,826 | ||||||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Earnings per share: | |||||||||||
Basic | $ | 0.76 | $ | 0.99 | $ | 1.20 | |||||
Diluted | $ | 0.76 | $ | 0.98 | $ | 1.20 | |||||
-1 | For fiscal 2014, 418,158 outstanding stock options were excluded from diluted earnings per share as the effect was antidilutive. | ||||||||||
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Summary of Significant Accounting Policies | |||||||||||
Schedule of calculations related to basic and diluted earning per share | |||||||||||
Fiscal | Fiscal | Fiscal | |||||||||
2014 | 2013 | 2012 | |||||||||
(In thousands, except share and per share data) | |||||||||||
Net income | $ | 40,956 | $ | 52,343 | $ | 59,260 | |||||
Weighted average common shares outstanding: | |||||||||||
Basic | 53,658,100 | 52,998,263 | 49,238,759 | ||||||||
Net effect of dilutive share-based compensation awards | 89,111 | -1 | 184,043 | 318,067 | |||||||
| | | | | | | | | | | |
Diluted | 53,747,211 | 53,182,306 | 49,556,826 | ||||||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Earnings per share: | |||||||||||
Basic | $ | 0.76 | $ | 0.99 | $ | 1.20 | |||||
Diluted | $ | 0.76 | $ | 0.98 | $ | 1.20 | |||||
-1 | For fiscal 2014, 418,158 outstanding stock options were excluded from diluted earnings per share as the effect was antidilutive. | ||||||||||
Acquisitions_Tables
Acquisitions (Tables) | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Business Acquisition | |||||||||||
Schedule of unaudited pro forma summary of operations | |||||||||||
Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | |||||||||
(dollars in thousands) | |||||||||||
Net sales | $ | 874,410 | $ | 890,728 | $ | 721,379 | |||||
Net income | 42,148 | 56,041 | 50,149 | ||||||||
Basic earnings per share | $ | 0.79 | $ | 1.05 | $ | 1.01 | |||||
Diluted earnings per share | $ | 0.78 | $ | 1.05 | $ | 1.00 | |||||
Specialty Brands of America Acquisition | |||||||||||
Business Acquisition | |||||||||||
Schedule of preliminary allocation of purchase price to the estimated fair value of the net assets acquired | |||||||||||
Specialty Brands Acquisition (dollars in thousands): | |||||||||||
Purchase Price: | |||||||||||
Cash paid | $ | 154,277 | |||||||||
| | | | | |||||||
Total | $ | 154,277 | |||||||||
| | | | | |||||||
| | | | | |||||||
Preliminary Allocation: | |||||||||||
Income tax receivable | $ | 4,012 | |||||||||
Short-term deferred income tax assets | 1,786 | ||||||||||
Trademarks—unamortizable intangible assets | 137,300 | ||||||||||
Goodwill | 48,852 | ||||||||||
Customer relationship intangibles—amortizable intangible assets | 13,300 | ||||||||||
Other working capital | (2,068 | ) | |||||||||
Long-term deferred income tax liabilities, net | (48,905 | ) | |||||||||
| | | | | |||||||
Total | $ | 154,277 | |||||||||
| | | | | |||||||
| | | | | |||||||
Rickland Orchards acquisition | |||||||||||
Business Acquisition | |||||||||||
Schedule of preliminary allocation of purchase price to the estimated fair value of the net assets acquired | Rickland Orchards Acquisition (dollars in thousands): | ||||||||||
Purchase Price: | |||||||||||
Cash paid | $ | 37,376 | |||||||||
Equity issued | 20,124 | ||||||||||
Fair value of contingent consideration | 7,566 | ||||||||||
| | | | | |||||||
Total | $ | 65,066 | |||||||||
| | | | | |||||||
| | | | | |||||||
Allocation: | |||||||||||
Trademarks—amortizable intangible assets | $ | 35,000 | |||||||||
Goodwill | 23,353 | ||||||||||
Customer relationship intangibles—amortizable intangible assets | 9,000 | ||||||||||
Other working capital | (2,287 | ) | |||||||||
| | | | | |||||||
Total | $ | 65,066 | |||||||||
| | | | | |||||||
| | | | | |||||||
Pirate Brands Acquisition | |||||||||||
Business Acquisition | |||||||||||
Schedule of preliminary allocation of purchase price to the estimated fair value of the net assets acquired | Pirate Brands Acquisition (dollars in thousands): | ||||||||||
Purchase Price: | |||||||||||
Cash paid | $ | 195,417 | |||||||||
| | | | | |||||||
Total | $ | 195,417 | |||||||||
| | | | | |||||||
| | | | | |||||||
Allocation: | |||||||||||
Trademarks—unamortizable intangible assets | $ | 152,800 | |||||||||
Goodwill | 29,953 | ||||||||||
Customer relationship intangibles—amortizable intangible assets | 11,400 | ||||||||||
Other working capital | 1,264 | ||||||||||
| | | | | |||||||
Total | $ | 195,417 | |||||||||
| | | | | |||||||
| | | | | |||||||
New York Style | |||||||||||
Business Acquisition | |||||||||||
Schedule of preliminary allocation of purchase price to the estimated fair value of the net assets acquired | New York Style Acquisition (dollars in thousands): | ||||||||||
Purchase Price: | |||||||||||
Cash paid | $ | 62,517 | |||||||||
| | | | | |||||||
Total | $ | 62,517 | |||||||||
| | | | | |||||||
| | | | | |||||||
Allocation: | |||||||||||
Property, Plant and Equipment | $ | 42,889 | |||||||||
Goodwill | 4,963 | ||||||||||
Customer relationship intangibles—amortizable intangible assets | 5,100 | ||||||||||
Trademarks—unamortizable intangible assets | 5,700 | ||||||||||
Other working capital | 3,865 | ||||||||||
| | | | | |||||||
Total | $ | 62,517 | |||||||||
| | | | | |||||||
| | | | | |||||||
Inventories_Tables
Inventories (Tables) | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
Inventories | ||||||||
Summary of Inventories | Inventories consist of the following as of the dates indicated (in thousands): | |||||||
January 3, 2015 | December 28, 2013 | |||||||
Raw materials and packaging | $ | 23,795 | $ | 25,075 | ||||
Finished goods | 82,762 | 76,176 | ||||||
| | | | | | | | |
Total | $ | 106,557 | $ | 101,251 | ||||
| | | | | | | | |
| | | | | | | | |
Property_Plant_and_Equipment_n1
Property, Plant and Equipment, net (Tables) | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
Property, Plant and Equipment, net. | ||||||||
Schedule of Property, Plant and Equipment, net | Property, plant and equipment, net consists of the following as of the dates indicated (in thousands): | |||||||
January 3, 2015 | December 28, 2013 | |||||||
Land | $ | 3,508 | $ | 3,512 | ||||
Buildings and improvements | 55,524 | 51,618 | ||||||
Machinery and equipment | 165,751 | 153,815 | ||||||
Office furniture and vehicles | 15,572 | 14,319 | ||||||
Construction-in-progress | 5,095 | 1,795 | ||||||
| | | | | | | | |
245,450 | 225,059 | |||||||
Less: accumulated depreciation | (129,253 | ) | (114,685 | ) | ||||
| | | | | | | | |
Total | $ | 116,197 | $ | 110,374 | ||||
| | | | | | | | |
| | | | | | | | |
Goodwill_and_Other_Intangible_1
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended | |||||||||||||||||||
Jan. 03, 2015 | ||||||||||||||||||||
Goodwill and Other Intangible Assets | ||||||||||||||||||||
Schedule of goodwill and other intangible assets | The carrying amounts of goodwill and other intangible assets, as of the dates indicated, consist of the following (in thousands): | |||||||||||||||||||
As of January 3, 2015 | As of December 28, 2013 | |||||||||||||||||||
Gross Carrying | Accumulated | Net Carrying | Gross Carrying | Accumulated | Net Carrying | |||||||||||||||
Amount | Amortization | Amount | Amount | Amortization | Amount | |||||||||||||||
Amortizable Intangible Assets | ||||||||||||||||||||
Trademarks | $ | 12,056 | $ | 875 | $ | 11,181 | $ | 41,800 | $ | 1,031 | $ | 40,769 | ||||||||
Customer relationships | 192,913 | 58,400 | 134,513 | 187,569 | 49,097 | 138,472 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
$ | 204,969 | $ | 59,275 | $ | 145,694 | $ | 229,369 | $ | 50,128 | $ | 179,241 | |||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Unamortizable Intangible Assets | ||||||||||||||||||||
Goodwill | $ | 370,424 | $ | 319,292 | ||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Trademarks | $ | 802,201 | $ | 664,900 | ||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Note: The increases in carrying amounts are attributable to purchase accounting adjustments related to the Specialty Brands, Rickland Orchards and Pirate Brands acquisitions. The impairment loss relating to Rickland Orchards described below offset the increase in customer relationship intangibles and caused the decrease in amortizable trademarks. | ||||||||||||||||||||
LongTerm_Debt_Tables
Long-Term Debt (Tables) | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
Long-Term Debt | ||||||||
Schedule of Long-term debt | Long-term debt consists of the following, as of the dates indicated (in thousands): | |||||||
January 3, 2015 | December 28, 2013 | |||||||
Current and former senior secured credit agreement: | ||||||||
Revolving credit facility | $ | 34,000 | $ | 40,000 | ||||
Tranche A term loan due 2019, net of unamortized discount of $643 at January 3, 2015 | 291,857 | — | ||||||
Tranche A term loan due 2016, net of unamortized discount of $365 at December 28, 2013 | — | 130,885 | ||||||
4.625% senior notes due 2021 | 700,000 | 700,000 | ||||||
| | | | | | | | |
Total long-term debt, net of unamortized discount | 1,025,857 | 870,885 | ||||||
Current portion of long-term debt | (18,750 | ) | (26,250 | ) | ||||
| | | | | | | | |
Long-term debt, net of unamortized discount and excluding current portion | $ | 1,007,107 | $ | 844,635 | ||||
| | | | | | | | |
| | | | | | | | |
Schedule of aggregate contractual maturities of long-term debt | As of January 3, 2015, the aggregate contractual maturities of long-term debt are as follows (in thousands): | |||||||
Fiscal Year: | ||||||||
2015 | $ | 18,750 | ||||||
2016 | 26,250 | |||||||
2017 | 24,375 | |||||||
2018 | 76,875 | |||||||
2019 | 180,250 | |||||||
Thereafter | 700,000 | |||||||
| | | | | ||||
Total | $ | 1,026,500 | ||||||
| | | | | ||||
| | | | | ||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Fair Value Measurements | ||||||||||||||
Summary of carrying values and fair values of revolving credit loan borrowings, term loan borrowings and senior notes | The carrying values and fair values of our revolving credit loans, term loans and senior notes as of January 3, 2015 and December 28, 2013 are as follows (in thousands): | |||||||||||||
January 3, 2015 | December 28, 2013 | |||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||
Revolving Credit Loans | 34,000 | 34,000 | -1 | 40,000 | 40,000 | -1 | ||||||||
Tranche A Term Loans due 2016 | — | — | 130,885 | -2 | 131,250 | -1 | ||||||||
Tranche A Term Loans due 2019 | 291,857 | -2 | 292,500 | -1 | — | — | ||||||||
4.625% Senior Notes due 2021 | 700,000 | 675,500 | -3 | 700,000 | 672,000 | -3 | ||||||||
-1 | Fair values are estimated based on Level 2 inputs, which were quoted prices for identical or similar instruments in markets that are not active. | |||||||||||||
-2 | The carrying values of the tranche A term loans are net of discount. At January 3, 2015 and December 28, 2013, the face amounts of the tranche A term loans were $292.5 million and $131.3 million, respectively. | |||||||||||||
-3 | Fair values are estimated based on quoted market prices. | |||||||||||||
Summary of changes in contingent consideration measured at level 3 | The following table summarized the Level 3 activity (in thousands): | |||||||||||||
January 3, | December 28, | |||||||||||||
2015 | 2013 | |||||||||||||
Balance at beginning of year | $ | 7,774 | $ | 7,566 | ||||||||||
Contingent consideration accretion expense | 432 | 208 | ||||||||||||
Gain on change in fair value of contingent consideration | (8,206 | ) | — | |||||||||||
| | | | | | | | |||||||
Balance at end of year | $ | — | $ | 7,774 | ||||||||||
| | | | | | | | |||||||
| | | | | | | | |||||||
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Accumulated Other Comprehensive Loss. | |||||||||||
Schedule of reclassification from accumulated other comprehensive loss | The reclassification from accumulated other comprehensive loss for fiscal 2014 and 2013 are as follows (in thousands): | ||||||||||
Amount Reclassified | |||||||||||
From AOCL | |||||||||||
Details about AOCL Components | January 3, | December 28, | Affected Line Item in the | ||||||||
2015 | 2013 | Statement Where Net Income | |||||||||
(loss) is Presented | |||||||||||
Defined benefit pension plan items | |||||||||||
Amortization of prior service cost | $ | 45 | $ | 44 | See (1) below | ||||||
Amortization of unrecognized loss | — | 815 | See (1) below | ||||||||
| | | | | | | | | |||
45 | 859 | Total before tax | |||||||||
(17 | ) | (315 | ) | Income tax expense | |||||||
| | | | | | | | | |||
Total reclassification | $ | 28 | $ | 544 | Net of tax | ||||||
| | | | | | | | | |||
| | | | | | | | | |||
-1 | These items are included in the computation of net periodic pension cost. See Note 12, "Pension Benefits," for additional information. | ||||||||||
Schedule of changes in accumulated other comprehensive loss | Changes in accumulated other comprehensive loss for fiscal 2014 and 2013 are as follows (in thousands): | ||||||||||
Defined Benefit | Foreign Currency | Total | |||||||||
Pension Plan Items | Translation | ||||||||||
Adjustments | |||||||||||
Balance at December 29, 2012 | $ | (11,036 | ) | $ | (59 | ) | $ | (11,095 | ) | ||
Other comprehensive loss before reclassifications | 8,152 | (72 | ) | 8,080 | |||||||
Amounts reclassified from AOCL | 544 | — | 544 | ||||||||
| | | | | | | | | | | |
Net current period other comprehensive income (loss) | 8,696 | (72 | ) | 8,624 | |||||||
| | | | | | | | | | | |
Balance at December 28, 2013 | $ | (2,340 | ) | $ | (131 | ) | $ | (2,471 | ) | ||
Other comprehensive loss before reclassifications | (8,475 | ) | (116 | ) | (8,591 | ) | |||||
Amounts reclassified from AOCL | 28 | — | 28 | ||||||||
| | | | | | | | | | | |
Net current period other comprehensive income (loss) | (8,447 | ) | (116 | ) | (8,563 | ) | |||||
| | | | | | | | | | | |
Balance at January 3, 2015 | $ | (10,787 | ) | $ | (247 | ) | $ | (11,034 | ) | ||
| | | | | | | | | | | |
| | | | | | | | | | | |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Income Taxes | |||||||||||
Schedule of components of income before income tax expense | The components of income before income tax expense consist of the following (in thousands): | ||||||||||
Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | |||||||||
U.S. | $ | 63,232 | $ | 80,291 | $ | 90,646 | |||||
Foreign | 545 | 601 | 268 | ||||||||
| | | | | | | | | | | |
Total | $ | 63,777 | $ | 80,892 | $ | 90,914 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Summary of income tax expense (benefit) | Income tax expense (benefit) consists of the following (in thousands): | ||||||||||
Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | |||||||||
Current: | |||||||||||
Federal | $ | 7,993 | $ | 6,853 | $ | 15,024 | |||||
State | 820 | 728 | 1,260 | ||||||||
Foreign | 153 | 168 | 75 | ||||||||
| | | | | | | | | | | |
Subtotal | 8,966 | 7,749 | 16,359 | ||||||||
Deferred: | |||||||||||
Federal | 13,330 | 20,200 | 15,438 | ||||||||
State | 525 | 600 | (143 | ) | |||||||
| | | | | | | | | | | |
Subtotal | 13,855 | 20,800 | 15,295 | ||||||||
| | | | | | | | | | | |
Total | $ | 22,821 | $ | 28,549 | $ | 31,654 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Reconciliation of provision for income taxes at the statutory rate and the effective tax rate | |||||||||||
Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | |||||||||
Expected tax expense | 35.0 | % | 35.0 | % | 35.0 | % | |||||
Increase (decrease): | |||||||||||
State income taxes, net of federal income tax benefit | 1.8 | % | 1.8 | % | 1.8 | % | |||||
Impact on deferred taxes from changes in state tax rates | — | (0.4 | )% | (0.9 | )% | ||||||
Foreign income taxes | — | — | 0.1 | % | |||||||
Permanent differences | (1.0 | )% | (1.1 | )% | (1.2 | )% | |||||
| | | | | | | | | | | |
Total | 35.8 | % | 35.3 | % | 34.8 | % | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities | The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below (in thousands): | ||||||||||
January 3, | December 28, | ||||||||||
2015 | 2013 | ||||||||||
Deferred tax assets: | |||||||||||
Accounts receivable, principally due to allowance | $ | 37 | $ | 37 | |||||||
Inventories, principally due to additional costs capitalized for tax purposes | 1,050 | 1,088 | |||||||||
Accruals and other liabilities | 5,196 | 301 | |||||||||
Net operating loss and tax credit carry forwards | 1,157 | — | |||||||||
Other liabilities | — | 76 | |||||||||
| | | | | | | | ||||
Total gross deferred tax assets | 7,440 | 1,502 | |||||||||
Deferred tax liabilities: | |||||||||||
Plant and equipment | (13,060 | ) | (9,908 | ) | |||||||
Goodwill and other intangible assets | (194,406 | ) | (135,341 | ) | |||||||
Prepaid expenses | (906 | ) | (1,077 | ) | |||||||
| | | | | | | | ||||
Total gross deferred tax liabilities | (208,372 | ) | (146,326 | ) | |||||||
| | | | | | | | ||||
Net deferred tax liability | $ | (200,932 | ) | $ | (144,824 | ) | |||||
| | | | | | | | ||||
| | | | | | | | ||||
Summary of the tax years that remain subject to examination | |||||||||||
United States—Federal | 2011 and forward | ||||||||||
United States—States | 2010 and forward | ||||||||||
Canada | 2010 and forward | ||||||||||
Pension_Benefits_Tables
Pension Benefits (Tables) | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Pension Benefits | ||||||||||||||
Schedule of defined benefit pension plans' benefit obligation, fair value of plans assets and funded status recognized in the consolidated balance sheets | ||||||||||||||
January 3, | December 28, | |||||||||||||
2015 | 2013 | |||||||||||||
(in thousands) | ||||||||||||||
Change in projected benefit obligation: | ||||||||||||||
Projected benefit obligation at beginning of year | $ | 50,679 | $ | 54,549 | ||||||||||
Actuarial loss (gain) | 12,365 | (7,672 | ) | |||||||||||
Service cost | 2,940 | 3,285 | ||||||||||||
Interest cost | 2,387 | 2,111 | ||||||||||||
Benefits paid | (1,644 | ) | (1,594 | ) | ||||||||||
| | | | | | | | |||||||
Projected benefit obligation at end of year | 66,727 | 50,679 | ||||||||||||
| | | | | | | | |||||||
Change in plan assets: | ||||||||||||||
Fair value of plan assets at beginning of year | 59,701 | 47,709 | ||||||||||||
Actual gain on plan assets | 3,356 | 8,836 | ||||||||||||
Employer contributions | 1,750 | 4,750 | ||||||||||||
Benefits paid | (1,644 | ) | (1,594 | ) | ||||||||||
| | | | | | | | |||||||
Fair value of plan assets at end of year | 63,163 | 59,701 | ||||||||||||
| | | | | | | | |||||||
Net amount recognized: | ||||||||||||||
Other assets | $ | 804 | $ | 9,022 | ||||||||||
Other long-term liabilities | (4,368 | ) | — | |||||||||||
| | | | | | | | |||||||
Funded status at the end of the year | $ | 3,564 | $ | 9,022 | ||||||||||
| | | | | | | | |||||||
| | | | | | | | |||||||
Amount recognized in accumulated other comprehensive loss (income) consist of: | ||||||||||||||
Prior service cost | $ | (126 | ) | $ | (171 | ) | ||||||||
Actuarial loss | (16,875 | ) | (3,518 | ) | ||||||||||
Deferred taxes | 6,214 | 1,349 | ||||||||||||
| | | | | | | | |||||||
Accumulated other comprehensive loss | $ | (10,787 | ) | $ | (2,340 | ) | ||||||||
| | | | | | | | |||||||
| | | | | | | | |||||||
Schedule of Changes in Accumulated Postemployment Benefit Obligations | ||||||||||||||
January 3, | December 28, | |||||||||||||
2015 | 2013 | |||||||||||||
Accumulated benefit obligation | $ | 5,665 | — | |||||||||||
Fair value of plan assets | $ | 5,244 | — | |||||||||||
Schedule of amounts in accumulated other comprehensive loss that are expected to be recognized as components of net periodic benefit cost in next fiscal year | The amounts in accumulated other comprehensive loss that are expected to be recognized as components of net periodic benefit cost in fiscal 2015 are as follows (in thousands): | |||||||||||||
Prior service cost | $ | 45 | ||||||||||||
Actuarial loss | 704 | |||||||||||||
| | | | | ||||||||||
$ | 749 | |||||||||||||
| | | | | ||||||||||
| | | | | ||||||||||
Schedule of weighted-average assumptions | ||||||||||||||
January 3, | December 28, | |||||||||||||
2015 | 2013 | |||||||||||||
Weighted-average assumptions: | ||||||||||||||
Discount rate | 3.882 | % | 4.815 | % | ||||||||||
Rate of compensation increase | 3.00 | % | 3.00 | % | ||||||||||
Expected long-term rate of return | 6.50 | % | 7.25 | % | ||||||||||
Schedule of components of net periodic pension costs | Net periodic cost includes the following components (in thousands): | |||||||||||||
Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | ||||||||||||
Service cost—benefits earned during the period | $ | 2,940 | $ | 3,284 | $ | 2,393 | ||||||||
Interest cost on projected benefit obligation | 2,387 | 2,111 | 2,036 | |||||||||||
Expected return on plan assets | (4,347 | ) | (3,635 | ) | (2,918 | ) | ||||||||
Amortization of unrecognized prior service cost | 45 | 44 | 45 | |||||||||||
Amortization of loss | — | 815 | 921 | |||||||||||
| | | | | | | | | | | ||||
Net pension cost | $ | 1,025 | $ | 2,619 | $ | 2,477 | ||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
Schedule of target asset allocation and plan assets at year end | ||||||||||||||
Percentage of Plan Assets | ||||||||||||||
at Year End | ||||||||||||||
Asset Category | Target | January 3, | December 28, | |||||||||||
Allocation | 2015 | 2013 | ||||||||||||
Equity securities | 75 | % | 80 | % | 79 | % | ||||||||
Fixed income securities | 25 | % | 15 | % | 17 | % | ||||||||
Other | — | 5 | % | 4 | % | |||||||||
| | | | | | | | | | | ||||
Total | 100 | % | 100 | % | ||||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
Schedule of fair values of pension plan assets utilizing the fair value hierarchy | The fair values of our pension plan assets at January 3, 2015 and December 28, 2013, utilizing the fair value hierarchy discussed in Note 8, "Fair Value Measurements" follow (in thousands): | |||||||||||||
January 3, 2015 | December 28, 2013 | |||||||||||||
Level 1 | Levels 2 & 3 | Level 1 | Levels 2 & 3 | |||||||||||
Asset Category | ||||||||||||||
Cash | $ | 2,934 | $ | — | $ | 2,480 | $ | — | ||||||
Equity securities: | ||||||||||||||
U.S. mutual funds | 12,409 | — | 25,921 | — | ||||||||||
Foreign mutual funds | 2,542 | — | — | — | ||||||||||
U.S. common stocks | 33,228 | — | 17,832 | — | ||||||||||
Foreign common stocks | 2,414 | — | 3,374 | — | ||||||||||
Fixed income securities: | ||||||||||||||
U.S. mutual funds | 9,636 | — | 10,094 | — | ||||||||||
| | | | | | | | | | | | | | |
Total | $ | 63,163 | $ | — | $ | 59,701 | $ | — | ||||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
Schedule of expected cash flows for the pension plan | Information about the expected cash flows for the pension plan follows (in thousands): | |||||||||||||
Pension Payments | ||||||||||||||
Benefit payments: | ||||||||||||||
2015 | $ | 1,648 | ||||||||||||
2016 | 1,760 | |||||||||||||
2017 | 1,987 | |||||||||||||
2018 | 2,242 | |||||||||||||
2019 | 2,620 | |||||||||||||
2020 to 2024 | 16,799 | |||||||||||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||
Jan. 03, 2015 | |||||
Commitments and Contingencies | |||||
Summary of future minimum lease payments under non-cancelable operating leases | As of January 3, 2015, future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) for the periods set forth below are as follows (in thousands): | ||||
Fiscal year ending: | Third Parties | ||||
2015 | $ | 7,350 | |||
2016 | 7,289 | ||||
2017 | 4,947 | ||||
2018 | 4,910 | ||||
2019 | 4,981 | ||||
Thereafter | 4,945 | ||||
| | | | | |
Total | $ | 34,422 | |||
| | | | | |
| | | | | |
Incentive_Plans_Tables
Incentive Plans (Tables) | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Incentive Plans | ||||||||||||||
Schedule of non-vested performance share long-term incentive award activity | The following table details the activity in our performance share LTIAs for fiscal 2014: | |||||||||||||
Number of | Weighted Average | |||||||||||||
Performance Shares | Grant Date Fair | |||||||||||||
Value (per share)(2) | ||||||||||||||
Beginning of fiscal 2014 | 611,819 | -1 | $ | 17.05 | ||||||||||
Granted | 174,834 | -1 | $ | 27.54 | ||||||||||
Vested | (342,576 | ) | $ | 11.78 | ||||||||||
Forfeited | (63,099 | ) | $ | 27.75 | ||||||||||
| | | | | | | | |||||||
End of fiscal 2014 | 380,978 | -1 | $ | 24.82 | ||||||||||
| | | | | | | | |||||||
| | | | | | | | |||||||
-1 | Solely for purposes of this table, the number of performance shares is based on the participants earning the maximum number of performance shares (i.e., 200% of the target number of performance shares). | |||||||||||||
-2 | The fair value of the awards was determined based upon the closing price of our common stock on the applicable measurement dates (i.e., the deemed grant dates for accounting purposes) reduced by the present value of expected dividends using the risk-free interest-rate as the award holders are not entitled to dividends or dividend equivalents during the vesting period. | |||||||||||||
Schedule of stock option activity | ||||||||||||||
Options | Weighted | Weighted Average | Aggregate | |||||||||||
Average | Contractual Life | Intrinsic | ||||||||||||
Exercise Price | Remaining (Years) | Value | ||||||||||||
Outstanding at beginning of fiscal 2014 | — | |||||||||||||
Granted | 418,158 | $ | 30.94 | 9.8 | 0.00 | |||||||||
Exercised | — | N/A | ||||||||||||
Forfeited | — | N/A | ||||||||||||
| | | | | | | | | | | | | | |
Outstanding at end of fiscal 2014 | 418,158 | $ | 30.94 | 9.8 | 0.00 | |||||||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
Exercisable at end of fiscal 2014 | — | — | — | — | ||||||||||
Schedule of stock options, valuation assumption | ||||||||||||||
Weighted average grant date fair value | $ | 6.74 | ||||||||||||
Expected volatility | 34.8 | % | ||||||||||||
Expected term | 6.5 years | |||||||||||||
Risk-free interest rate | 1.9 | % | ||||||||||||
Dividend yield | 4.4 | % | ||||||||||||
Schedule of number of shares of common stock issued by our entity upon the vesting of performance share long-term incentive awards and for non-employee director annual equity grants and other share based compensation | ||||||||||||||
January 3, | December 28, | December 29, | ||||||||||||
2015 | 2013 | 2012 | ||||||||||||
Number of performance shares vested | 342,576 | 512,885 | 1,124,205 | |||||||||||
Shares withheld to fund statutory minimum tax withholding | 138,799 | 214,878 | 463,942 | |||||||||||
| | | | | | | | | | | ||||
Shares of common stock issued for performance share long-term incentive awards | 203,777 | 298,007 | 660,263 | |||||||||||
Shares of common stock issued to non-employee directors for annual equity grants | 14,010 | 14,592 | 17,436 | |||||||||||
Shares of common stock issued for other share based compensation, net of shares withheld to fund statutory minimum tax withholding | — | — | 9,394 | |||||||||||
| | | | | | | | | | | ||||
Total shares of common stock issued | 217,787 | 312,599 | 687,093 | |||||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
Excess tax benefit recorded to additional paid in capital | $ | 2,356 | $ | 4,192 | $ | 8,031 | ||||||||
| | | | | | | | | | | ||||
Schedule of compensation expense recognized for share-based payments | The following table sets forth the compensation expense recognized for share-based payments (performance share LTIAs, stock options, non-employee director stock grants and other share based payments) during the last three fiscal years and where that expense is reflected in our consolidated statements of operations (in thousands): | |||||||||||||
Consolidated Statements of Operations Location | Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | |||||||||||
Compensation expense included in cost of goods sold | $ | 1,075 | $ | 855 | $ | 772 | ||||||||
Compensation expense included in selling, general and administrative expenses | 1,160 | 3,080 | 3,005 | |||||||||||
| | | | | | | | | | | ||||
Total compensation expense for share-based payments | $ | 2,235 | $ | 3,935 | $ | 3,777 | ||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
Net_Sales_by_Brand_Tables
Net Sales by Brand (Tables) | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Net Sales by Brand | |||||||||||
Schedule of net sales by brand | The following table sets forth net sales by brand (in thousands): | ||||||||||
Fiscal 2014(8) | Fiscal 2013 | Fiscal 2012 | |||||||||
Brand(1): | |||||||||||
Ortega | $ | 134,374 | $ | 137,192 | $ | 135,147 | |||||
Pirate Brands(2) | 82,563 | 32,545 | — | ||||||||
Maple Grove Farms of Vermont | 79,177 | 77,084 | 74,846 | ||||||||
Mrs. Dash | 64,105 | 61,846 | 62,089 | ||||||||
Cream of Wheat | 62,494 | 65,202 | 64,850 | ||||||||
Bear Creek Country Kitchens(3) | 41,432 | — | — | ||||||||
Polaner | 36,136 | 37,036 | 38,394 | ||||||||
Las Palmas | 35,121 | 34,486 | 35,541 | ||||||||
New York Style(4) | 28,075 | 32,995 | 5,910 | ||||||||
Bloch & Guggenheimer | 26,889 | 26,988 | 28,746 | ||||||||
Spring Tree(3) | 15,183 | — | — | ||||||||
TrueNorth(5) | 21,635 | 13,045 | — | ||||||||
Rickland Orchards(6) | 21,343 | 12,867 | — | ||||||||
B&M | 19,958 | 21,210 | 23,061 | ||||||||
Underwood | 19,603 | 19,996 | 21,348 | ||||||||
Ac'cent | 18,899 | 18,824 | 19,326 | ||||||||
All other brands(7) | 141,030 | 133,657 | 124,554 | ||||||||
| | | | | | | | | | | |
Total | $ | 848,017 | $ | 724,973 | $ | 633,812 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
-1 | Net sales for each brand also includes branded net sales and, if applicable, any private label and food service net sales attributable to the brand. | ||||||||||
-2 | We completed the acquisition of Pirate Brands on July 8, 2013. | ||||||||||
-3 | We completed the acquisition of Specialty Brands on April 23, 2014, including the Bear Creek Country Kitchens and Spring Tree brands. | ||||||||||
-4 | We completed the acquisition of the New York Style brand on October 31, 2012. | ||||||||||
-5 | We acquired the TrueNorth brand on May 6, 2013. | ||||||||||
-6 | We acquired the Rickland Orchards brand on October 7, 2013. | ||||||||||
-7 | Net sales for "all other brands" has been impacted by the acquisition of the Cary's, MacDonald's, New York Flatbreads and Canoleo brands acquired as part of the Specialty Brands acquisition, which was completed on April 23, 2014. | ||||||||||
-8 | Fiscal 2014 contained 53 weeks and fiscal 2013 and fiscal 2012 each contained 52 weeks. | ||||||||||
Quarterly_Financial_Data_unaud1
Quarterly Financial Data (unaudited) (Tables) | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Quarterly Financial Data (unaudited) | ||||||||||||||
Schedule of quarterly financial data (unaudited) | ||||||||||||||
First | Second | Third | Fourth | |||||||||||
Quarter | Quarter | Quarter | Quarter | |||||||||||
(in thousands, expect per share data) | ||||||||||||||
Net sales | ||||||||||||||
2014 | $ | 198,140 | $ | 202,889 | $ | 208,998 | $ | 237,990 | ||||||
2013 | $ | 171,194 | $ | 160,882 | $ | 181,350 | $ | 211,547 | ||||||
Gross profit | ||||||||||||||
2014 | $ | 64,669 | $ | 63,027 | $ | 63,062 | $ | 57,013 | ||||||
2013 | $ | 58,812 | $ | 55,697 | $ | 61,266 | $ | 67,148 | ||||||
Net income (loss) | ||||||||||||||
2014 | $ | 17,777 | $ | 16,138 | $ | (4,413 | ) | $ | 11,454 | |||||
2013 | $ | 19,634 | $ | (1,433 | ) | $ | 15,350 | $ | 18,792 | |||||
Basic and diluted earnings (loss) per share | ||||||||||||||
2014 | $ | 0.33 | $ | 0.3 | $ | (0.08 | ) | $ | 0.21 | |||||
2013 | $ | 0.37 | $ | (0.03 | ) | $ | 0.29 | $ | 0.35 | |||||
Cash dividends declared per share | ||||||||||||||
2014 | $ | 0.34 | $ | 0.34 | $ | 0.34 | $ | 0.34 | ||||||
2013 | $ | 0.29 | $ | 0.29 | $ | 0.32 | $ | 0.33 | ||||||
Nature_of_Operations_Details
Nature of Operations (Details) | 12 Months Ended | ||
Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | |
item | |||
Nature of Operations | |||
Number of branded household products | 2 | ||
Fiscal Year | |||
Number of weeks in fiscal year | 371 days | 364 days | 364 days |
Number of top customers | 10 | ||
Minimum | |||
Fiscal Year | |||
Number of weeks in fiscal year | 364 days | ||
Maximum | |||
Fiscal Year | |||
Number of weeks in fiscal year | 371 days | ||
Net sales | Consolidated net sales | |||
Fiscal Year | |||
Maximum percentage of net sales to foreign countries | 3.60% | 3.20% | 2.70% |
Net sales | Consolidated net sales | Wal-Mart | |||
Fiscal Year | |||
Percentage of concentration risk | 19.10% | 18.50% | 19.70% |
Net sales | Consolidated net sales | Top ten customers | |||
Fiscal Year | |||
Percentage of concentration risk | 52.40% | 48.40% | 50.70% |
Accounts receivable | Trade accounts receivables | Wal-Mart | |||
Fiscal Year | |||
Percentage of concentration risk | 16.70% | 12.90% | 14.90% |
Accounts receivable | Trade accounts receivables | Top ten customers | |||
Fiscal Year | |||
Percentage of concentration risk | 51.70% | 46.10% | 50.20% |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Information related to useful life of property, plant and equipment | |||
Interest on qualifying assets capitalized | $0.30 | $0.20 | $0.20 |
Building and improvements | Minimum | |||
Information related to useful life of property, plant and equipment | |||
Estimated useful life | 10 years | ||
Building and improvements | Maximum | |||
Information related to useful life of property, plant and equipment | |||
Estimated useful life | 30 years | ||
Machinery and equipment | Minimum | |||
Information related to useful life of property, plant and equipment | |||
Estimated useful life | 5 years | ||
Machinery and equipment | Maximum | |||
Information related to useful life of property, plant and equipment | |||
Estimated useful life | 12 years | ||
Office furniture and vehicles | Minimum | |||
Information related to useful life of property, plant and equipment | |||
Estimated useful life | 2 years | ||
Office furniture and vehicles | Maximum | |||
Information related to useful life of property, plant and equipment | |||
Estimated useful life | 5 years |
Summary_of_Significant_Account4
Summary of Significant Accounting Policies (Details 2) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | Sep. 28, 2013 | Jun. 29, 2013 | Mar. 30, 2013 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | |
Information related to useful life of finite-lived intangible assets | |||||||||||
Amortization expense | $12,692,000 | $9,884,000 | $8,126,000 | ||||||||
Information related to deferred debt financing costs | |||||||||||
Amortization of Deferred Debt Financing Costs | 3,600,000 | 4,000,000 | 4,200,000 | ||||||||
Information related to advertising costs | |||||||||||
Advertising costs | 5,100,000 | 4,300,000 | 5,900,000 | ||||||||
Information related to earning per share | |||||||||||
Net (loss) income | $11,454,000 | ($4,413,000) | $16,138,000 | $17,777,000 | $18,792,000 | $15,350,000 | ($1,433,000) | $19,634,000 | $40,956,000 | $52,343,000 | $59,260,000 |
Weighted average common shares outstanding: | |||||||||||
Basic (in shares) | 53,658,100 | 52,998,263 | 49,238,759 | ||||||||
Net effect of potentially dilutive share-based compensation awards (in shares) | 89,111 | 184,043 | 318,067 | ||||||||
Diluted (in shares) | 53,747,211 | 53,182,306 | 49,556,826 | ||||||||
Basic (in dollars per share) | $0.76 | $0.99 | $1.20 | ||||||||
Diluted (in dollars per share) | $0.76 | $0.98 | $1.20 | ||||||||
Vesting period(in years) | 10 years | ||||||||||
Customer Relationship Intangibles | Minimum | |||||||||||
Information related to useful life of finite-lived intangible assets | |||||||||||
Estimated useful life | 10 years | ||||||||||
Customer Relationship Intangibles | Maximum | |||||||||||
Information related to useful life of finite-lived intangible assets | |||||||||||
Estimated useful life | 20 years |
Acquisitions_Details
Acquisitions (Details) (USD $) | 1 Months Ended | 3 Months Ended | 12 Months Ended | 1 Months Ended | 0 Months Ended | |||||||||||||||
Oct. 31, 2013 | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | Sep. 28, 2013 | Jun. 29, 2013 | Mar. 30, 2013 | Jan. 03, 2015 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | Sep. 27, 2014 | Apr. 23, 2014 | Oct. 07, 2013 | Sep. 27, 2014 | Jul. 08, 2013 | Oct. 31, 2012 | Oct. 04, 2013 | |
Business Acquisition | ||||||||||||||||||||
Non-cash gain on change in fair value of contingent consideration | $8,206,000 | |||||||||||||||||||
Impairment of intangible assets | 34,154,000 | |||||||||||||||||||
Purchase Price | ||||||||||||||||||||
Equity issued | 20,100,000 | |||||||||||||||||||
Allocation: | ||||||||||||||||||||
Goodwill | 370,424,000 | 319,292,000 | 370,424,000 | 370,424,000 | 319,292,000 | |||||||||||||||
Finite-Lived Intangible Assets, Net | 145,694,000 | 179,241,000 | 145,694,000 | 145,694,000 | 179,241,000 | |||||||||||||||
Unaudited Pro Forma Summary of Operations | ||||||||||||||||||||
Net sales | 875,410,000 | 890,728,000 | 721,379,000 | |||||||||||||||||
Net income (loss) | 42,148,000 | 56,041,000 | 50,149,000 | |||||||||||||||||
Basic earnings (loss) per share (in dollars per share) | $0.79 | $1.05 | $1.01 | |||||||||||||||||
Diluted earnings (loss) per share (in dollars per share) | $0.78 | $1.05 | $1 | |||||||||||||||||
Net sales | 237,990,000 | 208,998,000 | 202,889,000 | 198,140,000 | 211,547,000 | 181,350,000 | 160,882,000 | 171,194,000 | 848,017,000 | 724,973,000 | 633,812,000 | |||||||||
Customer Relationship Intangibles | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Purchase price allocation adjustment of intangible assets and deferred income taxes | 2,100,000 | |||||||||||||||||||
Allocation: | ||||||||||||||||||||
Finite-Lived Intangible Assets, Net | 134,513,000 | 138,472,000 | 134,513,000 | 134,513,000 | 138,472,000 | |||||||||||||||
Customer Relationship Intangibles | Minimum | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Estimated useful life | 10 years | |||||||||||||||||||
Customer Relationship Intangibles | Maximum | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Estimated useful life | 20 years | |||||||||||||||||||
Trademarks | ||||||||||||||||||||
Allocation: | ||||||||||||||||||||
Finite-Lived Intangible Assets, Net | 11,181,000 | 40,769,000 | 11,181,000 | 11,181,000 | 40,769,000 | |||||||||||||||
Specialty Brands of America Acquisition | ||||||||||||||||||||
Purchase Price | ||||||||||||||||||||
Cash paid | 154,277,000 | |||||||||||||||||||
Allocation: | ||||||||||||||||||||
Income tax receivable | 4,012,000 | |||||||||||||||||||
Short-term deferred income tax assets | 1,786,000 | |||||||||||||||||||
Trademarks - unamortizable intangible assets | 137,300,000 | |||||||||||||||||||
Goodwill | 48,852,000 | |||||||||||||||||||
Other working capital | -2,068,000 | |||||||||||||||||||
Long-term deferred income tax liabilities | -48,905,000 | |||||||||||||||||||
Total | 154,277,000 | |||||||||||||||||||
Unaudited Pro Forma Summary of Operations | ||||||||||||||||||||
Net sales | 65,500,000 | |||||||||||||||||||
Specialty Brands of America Acquisition | Customer Relationship Intangibles | ||||||||||||||||||||
Allocation: | ||||||||||||||||||||
Amortizable intangible assets | 13,300,000 | |||||||||||||||||||
Rickland Orchards acquisition | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Non-cash gain on change in fair value of contingent consideration | 8,200,000 | |||||||||||||||||||
Write-off of certain raw material and finished goods inventory | 4,500,000 | |||||||||||||||||||
Purchase Price | ||||||||||||||||||||
Cash paid | 37,376,000 | |||||||||||||||||||
Equity issued | 20,124,000 | |||||||||||||||||||
Maximum consideration payable upon achievement of specified operating results | 15,000,000 | |||||||||||||||||||
Fair value of contingent consideration | 0 | 0 | 0 | 7,566,000 | ||||||||||||||||
Expense recorded due to increase in liability related to contingent consideration | 400,000 | 200,000 | ||||||||||||||||||
Allocation: | ||||||||||||||||||||
Goodwill | 23,353,000 | |||||||||||||||||||
Other working capital | -2,287,000 | |||||||||||||||||||
Total | 65,066,000 | |||||||||||||||||||
Unaudited Pro Forma Summary of Operations | ||||||||||||||||||||
Net sales | 12,900,000 | |||||||||||||||||||
Rickland Orchards acquisition | Natural Instincts LLC | ||||||||||||||||||||
Purchase Price | ||||||||||||||||||||
Cash paid | 57,500,000 | |||||||||||||||||||
Closing Price (in dollars per share) | $35.15 | |||||||||||||||||||
Rickland Orchards acquisition | Customer Relationship Intangibles | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Impairment of intangible assets | 7,300,000 | |||||||||||||||||||
Allocation: | ||||||||||||||||||||
Amortizable intangible assets | 9,000,000 | |||||||||||||||||||
Finite-Lived Intangible Assets, Net | 1,100,000 | 1,100,000 | 1,100,000 | |||||||||||||||||
Rickland Orchards acquisition | Trademarks | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Impairment of intangible assets | 26,900,000 | |||||||||||||||||||
Allocation: | ||||||||||||||||||||
Amortizable intangible assets | 35,000,000 | |||||||||||||||||||
Finite-Lived Intangible Assets, Net | 5,100,000 | 5,100,000 | 5,100,000 | |||||||||||||||||
Rickland Orchards acquisition | Accounts receivable and inventory | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Goodwill and other working capital purchase accounting adjustment | 2,100,000 | |||||||||||||||||||
Pirate Brands Acquisition | ||||||||||||||||||||
Purchase Price | ||||||||||||||||||||
Cash paid | 195,417,000 | |||||||||||||||||||
Allocation: | ||||||||||||||||||||
Trademarks - unamortizable intangible assets | 152,800,000 | |||||||||||||||||||
Goodwill | 29,953,000 | |||||||||||||||||||
Other working capital | 1,264,000 | |||||||||||||||||||
Total | 195,417,000 | |||||||||||||||||||
Unaudited Pro Forma Summary of Operations | ||||||||||||||||||||
Net sales | 32,600,000 | |||||||||||||||||||
Pirate Brands Acquisition | Customer Relationship Intangibles | ||||||||||||||||||||
Allocation: | ||||||||||||||||||||
Amortizable intangible assets | 11,400,000 | |||||||||||||||||||
Pirate Brands Acquisition | Accounts receivable and inventory | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Goodwill and other working capital purchase accounting adjustment | 200,000 | |||||||||||||||||||
New York Style | ||||||||||||||||||||
Purchase Price | ||||||||||||||||||||
Cash paid | 62,517,000 | |||||||||||||||||||
Allocation: | ||||||||||||||||||||
Trademarks - unamortizable intangible assets | 5,700,000 | |||||||||||||||||||
Goodwill | 4,963,000 | |||||||||||||||||||
Other working capital | 3,865,000 | |||||||||||||||||||
Property, Plant and Equipment | 42,889,000 | |||||||||||||||||||
Total | 62,517,000 | |||||||||||||||||||
New York Style | Customer Relationship Intangibles | ||||||||||||||||||||
Allocation: | ||||||||||||||||||||
Amortizable intangible assets | $5,100,000 |
Inventories_Details
Inventories (Details) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
Inventories | ||
Raw materials and packaging | $23,795 | $25,075 |
Finished goods | 82,762 | 76,176 |
Total | $106,557 | $101,251 |
Property_Plant_and_Equipment_n2
Property, Plant and Equipment, net (Details) (USD $) | 12 Months Ended | ||
Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | |
Information related to useful life of property, plant and equipment | |||
Property, Plant and Equipment, Gross | $245,450,000 | $225,059,000 | |
Less: accumulated depreciation | -129,253,000 | -114,685,000 | |
Total | 116,197,000 | 110,374,000 | |
Depreciation expense | 14,700,000 | 14,200,000 | 10,700,000 |
Land | |||
Information related to useful life of property, plant and equipment | |||
Property, Plant and Equipment, Gross | 3,508,000 | 3,512,000 | |
Building and improvements | |||
Information related to useful life of property, plant and equipment | |||
Property, Plant and Equipment, Gross | 55,524,000 | 51,618,000 | |
Machinery and equipment | |||
Information related to useful life of property, plant and equipment | |||
Property, Plant and Equipment, Gross | 165,751,000 | 153,815,000 | |
Office furniture and vehicles | |||
Information related to useful life of property, plant and equipment | |||
Property, Plant and Equipment, Gross | 15,572,000 | 14,319,000 | |
Construction-in-progress | |||
Information related to useful life of property, plant and equipment | |||
Property, Plant and Equipment, Gross | $5,095,000 | $1,795,000 |
Goodwill_and_Other_Intangible_2
Goodwill and Other Intangible Assets (Details) (USD $) | 12 Months Ended | 0 Months Ended | |||
Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | Sep. 27, 2014 | Oct. 07, 2013 | |
Goodwill and Other Intangible Assets | |||||
Amortization expense | $12,692,000 | $9,884,000 | $8,126,000 | ||
Amortizable Intangible Assets | |||||
Gross Carrying Amount | 204,969,000 | 229,369,000 | |||
Accumulated Amortization | 59,275,000 | 50,128,000 | |||
Net Carrying Amount | 145,694,000 | 179,241,000 | |||
Unamortizable Intangible Assets | |||||
Goodwill | 370,424,000 | 319,292,000 | |||
Acquisitions. | |||||
Non-cash gain on change in fair value of contingent consideration | 8,206,000 | ||||
Impairment of intangible assets | 34,154,000 | ||||
Rickland Orchards acquisition | |||||
Unamortizable Intangible Assets | |||||
Goodwill | 23,353,000 | ||||
Acquisitions. | |||||
Original fair value of contingent consideration | 0 | 7,566,000 | |||
Expense recorded due to increase in liability related to contingent consideration | 400,000 | 200,000 | |||
Non-cash gain on change in fair value of contingent consideration | 8,200,000 | ||||
Write-off of certain raw material and finished goods inventory | 4,500,000 | ||||
Trademarks | |||||
Unamortizable Intangible Assets | |||||
Unamortizable intangible assets excluding goodwill | 802,201,000 | 664,900,000 | |||
Trademarks | |||||
Amortizable Intangible Assets | |||||
Gross Carrying Amount | 12,056,000 | 41,800,000 | |||
Accumulated Amortization | 875,000 | 1,031,000 | |||
Net Carrying Amount | 11,181,000 | 40,769,000 | |||
Future amortization expense | |||||
2015 | 10,700,000 | ||||
2016 | 10,700,000 | ||||
2017 | 10,700,000 | ||||
2018 | 10,700,000 | ||||
Trademarks | Rickland Orchards acquisition | |||||
Amortizable Intangible Assets | |||||
Net Carrying Amount | 5,100,000 | ||||
Acquisitions. | |||||
Impairment of intangible assets | 26,900,000 | ||||
Customer Relationship Intangibles | |||||
Amortizable Intangible Assets | |||||
Gross Carrying Amount | 192,913,000 | 187,569,000 | |||
Accumulated Amortization | 58,400,000 | 49,097,000 | |||
Net Carrying Amount | 134,513,000 | 138,472,000 | |||
Customer Relationship Intangibles | Rickland Orchards acquisition | |||||
Amortizable Intangible Assets | |||||
Net Carrying Amount | 1,100,000 | ||||
Acquisitions. | |||||
Impairment of intangible assets | $7,300,000 |
LongTerm_Debt_Details
Long-Term Debt (Details) (USD $) | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | |||
Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | Jun. 05, 2014 | Dec. 31, 2011 | Jun. 04, 2013 | Oct. 31, 2012 | |
item | |||||||
Information related to long-term debt | |||||||
Total long-term debt, net of unamortized discount | $1,025,857,000 | $870,885,000 | |||||
Current portion of long-term debt | -18,750,000 | -26,250,000 | |||||
Long-term debt, net of unamortized discount and excluding current portion | 1,007,107,000 | 844,635,000 | |||||
Long-term debt | 1,026,500,000 | ||||||
Aggregate contractual maturities of long-term debt | |||||||
Fiscal 2015 | 26,250,000 | ||||||
Fiscal 2016 | 24,375,000 | ||||||
Fiscal 2017 | 76,875,000 | ||||||
Fiscal 2018 | 180,250,000 | ||||||
Thereafter | 700,000,000 | ||||||
Senior secured credit facility | |||||||
Accrued interest | 3,500,000 | 3,300,000 | 600,000 | ||||
Debt related transaction fees and expenses | 8,500,000 | ||||||
Proceeds from Lines of Credit | 252,500,000 | 105,000,000 | |||||
Number of quarters consolidated leverage ratio to be maintained | 4 | ||||||
Number of quarters consolidated interest coverage ratio to be maintained | 4 | ||||||
Information related to senior notes | |||||||
Net deferred debt financing costs | 17,200,000 | 17,800,000 | |||||
Write-off of deferred debt financing costs | 5,400,000 | 500,000 | |||||
Debt financing costs, amortization period | 5 years | ||||||
Prepayments and repurchases of long-term debt | 138,750,000 | 505,154,000 | 116,772,000 | ||||
Write-off of unamortized discount | 300,000 | ||||||
First quarter of 2015 through the fourth quarter of 2015 | |||||||
Information related to long-term debt | |||||||
Maximum permissible consolidated leverage ratio | 6.75 | ||||||
First quarter of 2016 and thereafter | |||||||
Information related to long-term debt | |||||||
Maximum permissible consolidated leverage ratio | 6.5 | ||||||
Fiscal quarter ending June 29, 2013 through the fiscal quarter ending January 3, 2015 | |||||||
Information related to long-term debt | |||||||
Maximum permissible consolidated leverage ratio | 7 | ||||||
Minimum | |||||||
Senior secured credit facility | |||||||
Consolidated interest leverage ratio | 1.75 | ||||||
Revolving credit loans | |||||||
Information related to long-term debt | |||||||
Long-term debt | 34,000,000 | 40,000,000 | 40,000,000 | ||||
Outstanding amount of debt | 34,000,000 | ||||||
Commitment fees (as a percent) | 0.50% | ||||||
Senior secured credit facility | |||||||
Outstanding letters of credit | 46,000,000 | ||||||
Available borrowing capacity | 464,700,000 | 500,000,000 | |||||
Information related to senior notes | |||||||
Principal amount of debt repurchased | 215,000,000 | 215,000,000 | |||||
Deferred financing costs capitalized | 5,600,000 | 400,000 | |||||
Write-off of deferred debt financing costs | 5,400,000 | ||||||
Debt financing costs, amortization period | 5 years | 5 years | 5 years | ||||
Revolving credit loans | Base rate | Minimum | |||||||
Information related to senior notes | |||||||
Interest rate added to variable base rate (as a percent) | 0.50% | ||||||
Revolving credit loans | Base rate | Maximum | |||||||
Information related to senior notes | |||||||
Interest rate added to variable base rate (as a percent) | 1.00% | ||||||
Revolving credit loans | LIBOR | Minimum | |||||||
Information related to senior notes | |||||||
Interest rate added to variable base rate (as a percent) | 1.50% | ||||||
Revolving credit loans | LIBOR | Maximum | |||||||
Information related to senior notes | |||||||
Interest rate added to variable base rate (as a percent) | 2.00% | ||||||
Letters of credit facility | |||||||
Information related to long-term debt | |||||||
Fronting fee (as a percent) | 0.25% | ||||||
Senior secured credit facility | |||||||
Maximum capacity available | 50,000,000 | ||||||
Outstanding letters of credit | 1,300,000 | ||||||
Incremental term loan | Maximum | |||||||
Senior secured credit facility | |||||||
Senior secured leverage ratio after utilization of incremental facility | 4 | ||||||
Tranche A Term Loans due 2016 | |||||||
Information related to long-term debt | |||||||
Long-term debt | 146,200,000 | 130,885,000 | |||||
Unamortized discount | 365,000 | ||||||
Outstanding amount of debt | 292,500,000 | ||||||
Aggregate contractual maturities of long-term debt | |||||||
Fiscal 2014 | 7,500,000 | ||||||
Fiscal 2015 | 18,800,000 | ||||||
Fiscal 2016 | 26,200,000 | ||||||
Fiscal 2017 | 24,400,000 | ||||||
Fiscal 2018 | 76,900,000 | ||||||
Senior secured credit facility | |||||||
Interest rate at period end (as a percent) | 2.16% | ||||||
Information related to senior notes | |||||||
Principal amount of debt repurchased | 121,900,000 | 121,900,000 | |||||
Deferred financing costs capitalized | 2,900,000 | ||||||
Write-off of deferred debt financing costs | 5,400,000 | ||||||
Debt financing costs, amortization period | 5 years | ||||||
Tranche A Term Loans due 2016 | Base rate | Minimum | |||||||
Senior secured credit facility | |||||||
Interest rate at period end (as a percent) | 1.50% | ||||||
Tranche A Term Loans due 2016 | Base rate | Maximum | |||||||
Senior secured credit facility | |||||||
Interest rate at period end (as a percent) | 2.00% | ||||||
Tranche A Term Loans due 2019 | |||||||
Information related to long-term debt | |||||||
Long-term debt | 291,857,000 | ||||||
Unamortized discount | 643,000 | ||||||
Information related to senior notes | |||||||
Principal amount of notes | 300,000,000 | ||||||
Tranche B Term loans due 2018 | |||||||
Aggregate contractual maturities of long-term debt | |||||||
Repayments of Debt and Capital Lease Obligations | 222,200,000 | ||||||
Information related to senior notes | |||||||
Principal amount of debt repurchased | 222,200,000 | ||||||
Debt financing costs, amortization period | 7 years | ||||||
4.625% Senior notes due 2021 | |||||||
Information related to long-term debt | |||||||
Long-term debt | 700,000,000 | 700,000,000 | |||||
Interest rate (as a percent) | 4.63% | 4.63% | |||||
Aggregate contractual maturities of long-term debt | |||||||
Repayments of Debt and Capital Lease Obligations | 248,500,000 | ||||||
Information related to senior notes | |||||||
Principal amount of notes | 700,000,000 | ||||||
Debt issuance price (as a percent) | 100.00% | ||||||
Deferred financing costs capitalized | 12,200,000 | ||||||
Debt financing costs, amortization period | 8 years | ||||||
4.625% Senior notes due 2021 | Redemption period beginning June 1, 2016 | |||||||
Information related to senior notes | |||||||
Redemption price (as a percent) | 103.47% | ||||||
4.625% Senior notes due 2021 | Redemption period on or after June 1, 2019 | |||||||
Information related to senior notes | |||||||
Redemption price (as a percent) | 100.00% | ||||||
4.625% Senior notes due 2021 | Redemption period prior to June 1, 2016 | |||||||
Information related to senior notes | |||||||
Redemption price (as a percent) | 104.63% | ||||||
4.625% Senior notes due 2021 | Maximum | Redemption period prior to June 1, 2016 | |||||||
Information related to senior notes | |||||||
Percentage of principal amount redeemed or which may redeem | 35.00% | ||||||
7.625% Senior notes due 2018 | |||||||
Information related to long-term debt | |||||||
Interest rate (as a percent) | 7.63% | ||||||
Information related to senior notes | |||||||
Principal amount of debt repurchased | 248,500,000 | 101,500,000 | |||||
Write-off of deferred debt financing costs | 8,300,000 | 1,500,000 | |||||
Repurchase premium and other expenses on extinguishment of debt | 20,200,000 | 7,700,000 | |||||
Write-off of unamortized discount | 2,800,000 | 500,000 | |||||
Amended and restated credit agreement | |||||||
Information related to senior notes | |||||||
Write-off of deferred debt financing costs | 400,000 | 400,000 | |||||
Write-off of unamortized discount | 100,000 | ||||||
Debt related other expenses | $200,000 |
LongTerm_Debt_Details_2
Long-Term Debt (Details 2) (USD $) | Jan. 03, 2015 | Jun. 05, 2014 | Dec. 28, 2013 |
Aggregate contractual maturities of long-term debt | |||
2015 | $18,750,000 | ||
2016 | 26,250,000 | ||
2017 | 24,375,000 | ||
2018 | 76,875,000 | ||
2019 | 180,250,000 | ||
Thereafter | 700,000,000 | ||
Total | 1,026,500,000 | ||
Accrued interest | $3,500,000 | $600,000 | $3,300,000 |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | 12 Months Ended | ||||
Jan. 03, 2015 | Dec. 28, 2013 | Oct. 07, 2013 | Jun. 05, 2014 | Jun. 04, 2013 | |
Changes in contingent consideration measured at level 3 | |||||
Contingent consideration accretion expense | ($432,000) | ($208,000) | |||
Gain on change in fair value of contingent consideration | 8,206,000 | ||||
Rickland Orchards acquisition | |||||
Changes in contingent consideration measured at level 3 | |||||
Original fair value of contingent consideration | 0 | 7,566,000 | |||
Gain on change in fair value of contingent consideration | 8,200,000 | ||||
Contingent consideration paid | 400,000 | 200,000 | |||
Maximum consideration payable upon achievement of specified operating results | 15,000,000 | ||||
Level 3 | Rickland Orchards acquisition | |||||
Changes in contingent consideration measured at level 3 | |||||
Balance at beginning of year | 7,774,000 | 7,566,000 | |||
Contingent consideration accretion expense | 432,000 | 208,000 | |||
Gain on change in fair value of contingent consideration | -8,206,000 | ||||
Balance at end of year | 7,774,000 | ||||
Tranche A Term Loans due 2019 | |||||
Financial assets and liabilities at fair value | |||||
Face amount of senior notes | 300,000,000 | ||||
4.625% Senior notes due 2021 | |||||
Financial assets and liabilities at fair value | |||||
Face amount of senior notes | 700,000,000 | ||||
Fair value measured on recurring basis | Tranche A Term Loans due 2016 | |||||
Financial assets and liabilities at fair value | |||||
Face amount of senior notes | 292,500,000 | 131,300,000 | |||
Fair value measured on recurring basis | Carrying Value | Revolving credit loans | |||||
Financial assets and liabilities at fair value | |||||
Fair values and carrying amount of revolving credit loans, term loan and senior notes | 34,000,000 | 40,000,000 | |||
Fair value measured on recurring basis | Carrying Value | Tranche A Term Loans due 2016 | |||||
Financial assets and liabilities at fair value | |||||
Fair values and carrying amount of revolving credit loans, term loan and senior notes | 130,885,000 | ||||
Fair value measured on recurring basis | Carrying Value | Tranche A Term Loans due 2019 | |||||
Financial assets and liabilities at fair value | |||||
Fair values and carrying amount of revolving credit loans, term loan and senior notes | 291,857,000 | ||||
Fair value measured on recurring basis | Carrying Value | 4.625% Senior notes due 2021 | |||||
Financial assets and liabilities at fair value | |||||
Fair values and carrying amount of revolving credit loans, term loan and senior notes | 700,000,000 | 700,000,000 | |||
Fair value measured on recurring basis | Fair Value | Revolving credit loans | Level 2 | |||||
Financial assets and liabilities at fair value | |||||
Fair values and carrying amount of revolving credit loans, term loan and senior notes | 34,000,000 | 40,000,000 | |||
Fair value measured on recurring basis | Fair Value | Tranche A Term Loans due 2016 | Level 2 | |||||
Financial assets and liabilities at fair value | |||||
Fair values and carrying amount of revolving credit loans, term loan and senior notes | 131,250,000 | ||||
Fair value measured on recurring basis | Fair Value | Tranche A Term Loans due 2019 | |||||
Financial assets and liabilities at fair value | |||||
Fair values and carrying amount of revolving credit loans, term loan and senior notes | 292,500,000 | ||||
Fair value measured on recurring basis | Fair Value | 4.625% Senior notes due 2021 | |||||
Financial assets and liabilities at fair value | |||||
Fair values and carrying amount of revolving credit loans, term loan and senior notes | $675,500,000 | $672,000,000 |
Pension_Benefits_Details_Q
Pension Benefits (Details) Q (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Components of net periodic pension cost | |||
Service cost-benefits earned during the period | $2,940 | $3,285 | $2,393 |
Interest cost on projected benefit obligation | 2,387 | 2,111 | 2,036 |
Expected return on plan assets | -4,347 | -3,635 | -2,918 |
Amortization of unrecognized prior service cost | 45 | 44 | 45 |
Amortization of unrecognized loss | 815 | 921 | |
Net periodic pension cost | 1,025 | 2,619 | 2,477 |
Amounts in accumulated other comprehensive loss that are expected to be recognized as components of net periodic benefit cost | |||
Prior service cost | 45 | ||
Total | $749 | ||
Weighted-average assumptions | |||
Discount rate (as a percent) | 3.88% | 4.82% | |
Rate of compensation increase (as a percent) | 3.00% | 3.00% | |
Expected long-term rate of return (as a percent) | 6.50% | 7.25% |
Pension_Benefits_Details_2_Q
Pension Benefits (Details 2) Q (USD $) | 12 Months Ended | ||||
Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | Dec. 31, 2011 | Jan. 02, 2016 | |
Pension Benefits | |||||
Employer contributions | $1,750,000 | $4,750,000 | |||
Expected cash flows for pension plan | |||||
Surcharge payable on hours worked applicable for initial critical year of plan (as a percent) | 5.00% | ||||
Surcharge payable on hours worked applicable for succeeding plan years (as a percent) | 10.00% | ||||
Contribution to the multi-employer plan | 1,000,000 | 1,000,000 | 1,000,000 | ||
Maximum contribution to multi-employer plan (as a percent) | 5.00% | 5.00% | |||
Benefit payments for the year 2015 | 1,648,000 | ||||
Benefit payments for the year 2016 | 1,760,000 | ||||
Benefit payments for the year 2017 | 1,987,000 | ||||
Benefit payments for the year 2018 | 2,242,000 | ||||
Benefit payments for the year 2019 | 2,620,000 | ||||
Benefit payments for the years 2020-2024 | 16,799,000 | ||||
Anticipated contribution in fiscal year 2014 | 3,500,000 | ||||
Pension Benefits | |||||
Matching component of contribution by employer to defined contribution plan | 1,000,000 | 1,000,000 | 800,000 | ||
Maximum | |||||
Pension Benefits | |||||
Surcharges paid or expected to be paid | 100,000 | ||||
Fiscal 2015 | Maximum | |||||
Pension Benefits | |||||
Surcharges paid or expected to be paid | $100,000 |
Accumulated_Other_Comprehensiv2
Accumulated Other Comprehensive Loss (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Reclassification from accumulated other comprehensive loss | |||
Amortization of unrecognized prior service cost | $45 | $44 | $45 |
Amortization of unrecognized loss | 815 | 921 | |
Income tax expense | 22,821 | 28,549 | 31,654 |
Net of tax | -28 | -544 | |
Amount Reclassified from AOCL | |||
Reclassification from accumulated other comprehensive loss | |||
Amortization of unrecognized prior service cost | 45 | 44 | |
Amortization of unrecognized loss | 815 | ||
Total before tax | 45 | 859 | |
Income tax expense | -17 | -315 | |
Net of tax | $28 | $544 |
Accumulated_Other_Comprehensiv3
Accumulated Other Comprehensive Loss (Details 2) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Changes in accumulated other comprehensive loss | |||
Beginning balance | ($2,471) | ($11,095) | |
Other comprehensive loss before reclassifications | -8,591 | 8,080 | |
Amounts reclassified from AOCL | 28 | 544 | |
Other comprehensive (loss) income | -8,563 | 8,624 | -665 |
Ending balance | -11,034 | -2,471 | -11,095 |
Defined benefit pension plan | |||
Changes in accumulated other comprehensive loss | |||
Beginning balance | -2,340 | -11,036 | |
Other comprehensive loss before reclassifications | -8,475 | 8,152 | |
Amounts reclassified from AOCL | 28 | 544 | |
Other comprehensive (loss) income | -8,447 | 8,696 | |
Ending balance | -10,787 | -2,340 | |
Foreign Currency Translation Adjustments | |||
Changes in accumulated other comprehensive loss | |||
Beginning balance | -131 | -59 | |
Other comprehensive loss before reclassifications | -116 | -72 | |
Other comprehensive (loss) income | -116 | -72 | |
Ending balance | ($247) | ($131) |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Components of income before income tax expense | |||
U.S. | $63,233 | $80,291 | $90,646 |
Foreign | 545 | 601 | 268 |
Income before income tax expense | 63,777 | 80,892 | 90,914 |
Current | |||
Federal | 7,993 | 6,853 | 15,024 |
State | 820 | 728 | 1,260 |
Foreign | 153 | 168 | 75 |
Subtotal | 8,966 | 7,749 | 16,359 |
Deferred | |||
Federal | 13,330 | 20,200 | 15,438 |
State | 525 | 600 | -143 |
Subtotal | 13,855 | 20,800 | 15,295 |
Income tax expense | $22,821 | $28,549 | $31,654 |
Income_Taxes_Details_2
Income Taxes (Details 2) (USD $) | 12 Months Ended | ||
Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | |
Income Taxes | |||
U.S. federal income tax rate (as a percent) | 35.00% | 35.00% | 35.00% |
Income tax expense difference arising due to provision for income taxes at company's income tax rate to the provision for income taxes at the U.S. federal income tax rate | |||
State income taxes, net of federal income tax benefit (as a percent) | 1.80% | 1.80% | 1.80% |
Impact on deferred taxes from changes in state tax rates (as a percent) | -0.40% | -0.90% | |
Foreign income taxes (as a percent) | 0.10% | ||
Permanent differences (as a percent) | -1.00% | -1.10% | -1.20% |
Total (as a percent) | 35.80% | 35.30% | 34.80% |
Tax benefit resulting from changes in state tax laws | $100,000 | $300,000 | $900,000 |
Deferred tax assets | |||
Accounts receivable, principally due to allowance | 37,000 | 37,000 | |
Inventories, principally due to additional costs capitalized for tax purposes | 1,050,000 | 1,088,000 | |
Accruals and other liabilities | 5,196,000 | 301,000 | |
Net operating loss and tax credit carry forwards | 1,157,000 | ||
Other liabilities | 76,000 | ||
Total gross deferred tax assets | 7,440,000 | 1,502,000 | |
Deferred tax liabilities | |||
Plant and equipment | -13,060,000 | -9,908,000 | |
Goodwill and other intangible assets | -194,406,000 | -135,341,000 | |
Prepaid expense | -906,000 | -1,077,000 | |
Total gross deferred tax liabilities | -208,372,000 | -146,326,000 | |
Net deferred tax liability | -200,932,000 | -144,824,000 | |
Valuation allowance | 0 | 0 | |
Value of intangibles for tax purposes, which are amortizable through 2029 | $651,500,000 |
Capital_Stock_Details
Capital Stock (Details) (USD $) | 1 Months Ended | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Oct. 31, 2013 | Oct. 31, 2012 | Dec. 29, 2012 | Jan. 03, 2015 |
item | ||||
Capital Stock disclosures | ||||
Number of votes to which holders of common shares are entitled for each share held | 1 | |||
Common Stock Offering | ||||
Common stock issued partial consideration for Rickland Orchards acquisition (in shares) | 572,546 | |||
Value of common stock issued partial consideration for Rickland Orchards acquisition | $20,100 | |||
Shares issued in public offering | 4,173,540 | |||
Common stock price per share (in dollars per share) | $30.25 | |||
Proceeds from issuance of common stock after deducting underwriting discounts, commissions and other expenses | $120,400 | $120,355 | ||
7.625% Senior notes due 2018 | ||||
Common Stock Offering | ||||
Interest rate (as a percent) | 7.63% |
Pension_Benefits_Details
Pension Benefits (Details) (USD $) | 12 Months Ended | ||
Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | |
item | |||
Pension Benefits | |||
Number of defined benefit pension plans | 3 | ||
Change in projected benefit obligation | |||
Projected benefit obligation at beginning of year | $50,679,000 | $54,549,000 | |
Actuarial loss (gain) | 12,365,000 | -7,672,000 | |
Service cost | 2,940,000 | 3,285,000 | 2,393,000 |
Interest cost | 2,387,000 | 2,111,000 | 2,036,000 |
Benefits paid | -1,644,000 | -1,594,000 | |
Projected benefit obligation at end of year | 66,727,000 | 50,679,000 | 54,549,000 |
Change in plan assets | |||
Fair value of plan assets at beginning of year | 59,701,000 | 47,709,000 | |
Actual gain on plan assets | 3,356,000 | 8,836,000 | |
Employer contributions | 1,750,000 | 4,750,000 | |
Benefits paid | -1,644,000 | -1,594,000 | |
Fair value of plan assets at end of year | 63,163,000 | 59,701,000 | 47,709,000 |
Net amount recognized | |||
Other assets | 804,000 | 9,022,000 | |
Other long-term liabilities | -4,368,000 | ||
Funded status at the end of the year | 3,564,000 | 9,022,000 | |
Amount recognized in accumulated other comprehensive loss (income) | |||
Prior service cost | -126,000 | -171,000 | |
Actuarial loss | -16,875,000 | -3,518,000 | |
Deferred taxes | 6,214,000 | 1,349,000 | |
Accumulated other comprehensive loss | -10,787,000 | -2,340,000 | |
Accumulated benefit obligations related to one plan | 58,900,000 | ||
Fair value of plan assets related to one plan | 44,900,000 | ||
Defined Benefit Plan, Accumulated Benefit Obligation | $5,665,000 |
Pension_Benefits_Details_2
Pension Benefits (Details 2) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Amounts in accumulated other comprehensive loss that are expected to be recognized as components of net periodic benefit cost | |||
Prior service cost | $45 | ||
Actuarial loss | 704 | ||
Total | 749 | ||
Weighted-average assumptions | |||
Discount rate (as a percent) | 3.88% | 4.82% | |
Rate of compensation increase (as a percent) | 3.00% | 3.00% | |
Expected long-term rate of return (as a percent) | 6.50% | 7.25% | |
Components of net periodic pension cost | |||
Service cost-benefits earned during the period | 2,940 | 3,285 | 2,393 |
Interest cost on projected benefit obligation | 2,387 | 2,111 | 2,036 |
Expected return on plan assets | -4,347 | -3,635 | -2,918 |
Amortization of unrecognized prior service cost | 45 | 44 | 45 |
Amortization of unrecognized loss | 815 | 921 | |
Net periodic pension cost | $1,025 | $2,619 | $2,477 |
Pension_Benefits_Details_3
Pension Benefits (Details 3) | 12 Months Ended | |
Jan. 03, 2015 | Dec. 28, 2013 | |
Pension Benefits | ||
Percentage of Plan Assets at Year End | 100.00% | 100.00% |
Equity securities | ||
Pension Benefits | ||
Target Allocation (as a percent) | 75.00% | |
Percentage of Plan Assets at Year End | 80.00% | 79.00% |
Fixed income securities | ||
Pension Benefits | ||
Target Allocation (as a percent) | 25.00% | |
Percentage of Plan Assets at Year End | 15.00% | 17.00% |
Other | ||
Pension Benefits | ||
Percentage of Plan Assets at Year End | 5.00% | 4.00% |
Pension_Benefits_Details_4
Pension Benefits (Details 4) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Pension Benefits | |||
Fair value of pension plan assets | $63,163,000 | $59,701,000 | $47,709,000 |
U.S. common stock in investment portfolio | 33,200,000 | 17,800,000 | |
U.S. common stocks invested in B&G Foods, Inc | 4,900,000 | 5,500,000 | |
Level 1 | |||
Pension Benefits | |||
Fair value of pension plan assets | 63,163,000 | 59,701,000 | |
Cash | Level 1 | |||
Pension Benefits | |||
Fair value of pension plan assets | 2,934,000 | 2,480,000 | |
U.S. mutual funds | Level 1 | |||
Pension Benefits | |||
Fair value of pension plan assets | 12,409,000 | 25,921,000 | |
Foreign mutual funds | Level 1 | |||
Pension Benefits | |||
Fair value of pension plan assets | 2,542,000 | ||
Common Stock | Level 1 | |||
Pension Benefits | |||
Fair value of pension plan assets | 33,228,000 | 17,832,000 | |
Foreign common stocks | Level 1 | |||
Pension Benefits | |||
Fair value of pension plan assets | 2,414,000 | 3,374,000 | |
U.S. mutual funds | Level 1 | |||
Pension Benefits | |||
Fair value of pension plan assets | $9,636,000 | $10,094,000 |
Pension_Benefits_Details_5
Pension Benefits (Details 5) (USD $) | 12 Months Ended | ||||
Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | Dec. 31, 2011 | Jan. 02, 2016 | |
Expected cash flows for pension plan | |||||
Benefit payments for the year 2015 | $1,648,000 | ||||
Benefit payments for the year 2016 | 1,760,000 | ||||
Benefit payments for the year 2017 | 1,987,000 | ||||
Benefit payments for the year 2018 | 2,242,000 | ||||
Benefit payments for the year 2019 | 2,620,000 | ||||
Benefit payments for the years 2020-2024 | 16,799,000 | ||||
Anticipated contribution in fiscal year 2014 | 3,500,000 | ||||
Matching component of contribution by employer to defined contribution plan | 1,000,000 | 1,000,000 | 800,000 | ||
Multi-Employer Defined Benefit Pension Plan | |||||
Surcharge payable on hours worked applicable for initial critical year of plan (as a percent) | 5.00% | ||||
Surcharge payable on hours worked applicable for succeeding plan years (as a percent) | 10.00% | ||||
Maximum contribution to multi-employer plan (as a percent) | 5.00% | 5.00% | |||
Contribution to the multi-employer plan | 1,000,000 | 1,000,000 | 1,000,000 | ||
Maximum | |||||
Pension Benefits | |||||
Surcharges paid or expected to be paid | 100,000 | ||||
Fiscal 2015 | Maximum | |||||
Pension Benefits | |||||
Surcharges paid or expected to be paid | $100,000 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (USD $) | 12 Months Ended | ||
Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | |
Operating Leases | |||
Total rental expense | $7,300,000 | $6,400,000 | $5,500,000 |
Future minimum lease payments under non-cancelable operating leases | |||
2015 | 7,350,000 | ||
2016 | 7,289,000 | ||
2017 | 4,947,000 | ||
2018 | 4,910,000 | ||
2019 | 4,981,000 | ||
Thereafter | 4,945,000 | ||
Total | 34,422,000 | ||
Legal Proceedings | |||
Gain on legal settlement included in selling, general and administrative expenses | $1,500,000 | ||
Pirate Brands Acquisition | |||
Legal Proceedings | |||
Number of duplicative putative class actions | 6 | ||
Number of duplicative putative class actions filed prior to ownership of acquisition | 2 |
Commitments_and_Contingencies_2
Commitments and Contingencies (Details 2) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
item | item | |
Information related to Ortega and Las Palmas recall | ||
Insurance recoveries | $5 | |
Cost impact of recall, net of expected insurance recoveries | 12.8 | |
Reduction of net sales | 4.1 | |
Cost of sales | 8.2 | |
Administrative costs | 0.5 | |
Accounts receivable reserves | 4 | |
Accrued Expenses | $0.60 | |
Number of executive officers with employment agreements | 7 | |
Number of employees covered under collective bargaining agreements | ||
Information related to Ortega and Las Palmas recall | ||
Number of employees | 327 | |
Percentage of total employees covered under collective bargaining agreements | 34.00% | |
Total number of employees | ||
Information related to Ortega and Las Palmas recall | ||
Number of employees | 956 | |
Number of collective bargaining agreements expiring within one year | ||
Information related to Ortega and Las Palmas recall | ||
Collective bargaining agreements expiration period | 1 year | |
Number of other collective bargaining agreements expiring within one year | 0 | |
Number of employees covered under collective bargaining agreements expiring with next 12 months | ||
Information related to Ortega and Las Palmas recall | ||
Number of employees | 95 | |
Collective bargaining agreements expiration period | 12 months |
Incentive_Plans_Details
Incentive Plans (Details) (USD $) | 12 Months Ended | ||
Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | |
Incentive Plans | |||
Annual bonus accrual | $4,700,000 | ||
Weighted Average Grant Date Fair Value | |||
Total shares of common stock issued | 217,787 | 312,599 | 687,093 |
Excess tax benefit recorded to additional paid in capital | 9,394 | ||
Other disclosure | |||
Excess tax benefit recorded to additional paid in capital | 2,356,000 | 4,192,000 | 8,031,000 |
Compensation expense recognized for share-based payments | 2,235,000 | 3,935,000 | 3,777,000 |
Cost of Sales | |||
Other disclosure | |||
Compensation expense recognized for share-based payments | 1,075,000 | 855,000 | 772,000 |
Selling, General and Administrative Expenses | |||
Other disclosure | |||
Compensation expense recognized for share-based payments | 1,160,000 | 3,080,000 | 3,005,000 |
Non-Employee Directors | |||
Weighted Average Grant Date Fair Value | |||
Total shares of common stock issued | 14,010 | 14,592 | 17,436 |
2008 Omnibus Incentive Compensation Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Total number of shares of common stock authorized for awards | 4,500,000 | ||
Shares of common stock available for future awards | 2,689,645 | ||
Performance share long Term incentive awards | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Performance period | 3 years | ||
Percentage of target number of shares that may be earned, minimum | 50.00% | ||
Percentage of target number of shares that may be earned scenario 1, maximum | 200.00% | ||
Number of Shares | |||
Balance at the beginning of the period (in shares) | 611,819 | ||
Granted (in shares) | 174,834 | ||
Vested (in shares) | -342,576 | -512,885 | -1,124,205 |
Forfeited (in shares) | -63,099 | ||
Balance at the end of the period (in shares) | 380,978 | 611,819 | |
Weighted Average Grant Date Fair Value | |||
Balance at the beginning of the period (in dollars per share) | $17.05 | ||
Granted (in dollars per share) | $27.54 | ||
Vested (in dollars per share) | $11.78 | ||
Forfeited (in dollars per share) | $27.75 | ||
Balance at the end of the period (in dollars per share) | $24.82 | $17.05 | |
Number of performance shares vested | 342,576 | 512,885 | 1,124,205 |
Shares withheld to fund statutory minimum tax withholding | 138,799 | 214,878 | 463,942 |
Total shares of common stock issued | 203,777 | 298,007 | 660,263 |
Other disclosure | |||
Excess tax benefit recorded to additional paid in capital | 2,356,000 | 4,192,000 | 8,031,000 |
Share based compensation expense related to long-term incentive plans | |||
Unrecognized compensation expense | 700,000 | ||
Period over which unrecognized compensation expense is expected to be recognized | 2 years | ||
Stock Option | |||
Share based compensation expense related to long-term incentive plans | |||
Unrecognized compensation expense | 2,500,000 | ||
Period over which unrecognized compensation expense is expected to be recognized | 3 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | |||
Expected volatility period | 5 years | ||
Weighted average grant date fair value | $6.74 | ||
Expected volatility | 34.80% | ||
Expected term | 6 years 6 months | ||
Risk-free interest rate(in percent) | 1.90% | ||
Dividend yield | 4.40% | ||
Share-based Compensation Arrangement by Share-based Payment Award, Stock Option Activity [Abstract] | |||
Granted ( in shares) | 418,158 | 0 | 0 |
Outstanding at end of fiscal (in shares) | 418,158 | 0 | 0 |
Granted ( in dollars per share) | $30.94 | ||
Outstanding at end of fiscal (in dollar per share) | $30.94 | ||
Outstanding at end of fiscal | 9 years 9 months 18 days | ||
Outstanding at end of fiscal | 0 | ||
Outstanding at end of fiscal | $0 |
Net_Sales_by_Brand_Details
Net Sales by Brand (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | Sep. 28, 2013 | Jun. 29, 2013 | Mar. 30, 2013 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Fiscal Year | |||||||||||
Number of weeks in fiscal year | 371 days | 364 days | 364 days | ||||||||
Net Sales by Brand | |||||||||||
Net sales | $237,990 | $208,998 | $202,889 | $198,140 | $211,547 | $181,350 | $160,882 | $171,194 | $848,017 | $724,973 | $633,812 |
Ortega | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 134,374 | 137,192 | 135,147 | ||||||||
Pirate Brands Acquisition | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 82,563 | 32,545 | |||||||||
Maple Grove Farms of Vermont | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 79,177 | 77,084 | 74,846 | ||||||||
Mrs. Dash | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 64,105 | 61,846 | 62,089 | ||||||||
Cream of Wheat | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 62,494 | 65,202 | 64,850 | ||||||||
Bear Creek Country Kitchens | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 41,432 | ||||||||||
Polaner | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 36,136 | 37,036 | 38,394 | ||||||||
Las Palmas | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 35,121 | 34,486 | 35,541 | ||||||||
New York Style | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 28,075 | 32,995 | 5,910 | ||||||||
Bloch & Guggenheimer | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 26,889 | 26,988 | 28,746 | ||||||||
Spring Tree | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 15,183 | ||||||||||
TrueNorth | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 21,635 | 13,045 | |||||||||
Rickland Orchards | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 21,343 | 12,867 | |||||||||
B&M | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 19,958 | 21,210 | 23,061 | ||||||||
Underwood | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 19,603 | 19,996 | 21,348 | ||||||||
Ac'cent | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | 18,899 | 18,824 | 19,326 | ||||||||
All other brands | |||||||||||
Net Sales by Brand | |||||||||||
Net sales | $141,030 | $133,657 | $124,554 |
Quarterly_Financial_Data_unaud2
Quarterly Financial Data (unaudited) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | Sep. 28, 2013 | Jun. 29, 2013 | Mar. 30, 2013 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Quarterly Financial Data (unaudited) | |||||||||||
Net sales | $237,990 | $208,998 | $202,889 | $198,140 | $211,547 | $181,350 | $160,882 | $171,194 | $848,017 | $724,973 | $633,812 |
Gross profit | 57,013 | 63,062 | 63,027 | 64,669 | 67,148 | 61,266 | 55,697 | 58,812 | 247,771 | 242,923 | 223,343 |
Net (loss) income | $11,454 | ($4,413) | $16,138 | $17,777 | $18,792 | $15,350 | ($1,433) | $19,634 | $40,956 | $52,343 | $59,260 |
Basic and diluted earnings (loss) per share (in dollars per share) | $0.21 | ($0.08) | $0.30 | $0.33 | $0.35 | $0.29 | ($0.03) | $0.37 | |||
Cash dividends declared per share (in dollars per share) | $0.34 | $0.34 | $0.34 | $0.34 | $0.33 | $0.32 | $0.29 | $0.29 | $1.36 | $1.23 | $1.10 |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | 1 Months Ended | 0 Months Ended | 12 Months Ended | |
Oct. 31, 2013 | Oct. 07, 2013 | Jan. 03, 2015 | Oct. 04, 2013 | |
Related party transactions | ||||
Equity issued | $20,100,000 | |||
Rickland Orchards acquisition | ||||
Related party transactions | ||||
Cash paid | 37,376,000 | |||
Equity issued | 20,124,000 | |||
Maximum consideration payable upon achievement of specified operating results | 15,000,000 | |||
Rickland Orchards acquisition | Natural Instincts LLC | ||||
Related party transactions | ||||
Cash paid | 57,500,000 | |||
Closing Price (in dollars per share) | $35.15 | |||
Mr. Cohen | Natural Instincts LLC | ||||
Related party transactions | ||||
Related party ownership percentage | 40.00% | |||
Mr. Sands | Natural Instincts LLC | ||||
Related party transactions | ||||
Related party ownership percentage | 1.50% | |||
Replenish Capital LLC | ||||
Related party transactions | ||||
Monthly fees for strategic advisor services | $20,000 |
Schedule_II_Schedule_of_Valuat1
Schedule II Schedule of Valuation and Qualifying Accounts (Details) (Allowance for doubtful accounts and discounts, USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Allowance for doubtful accounts and discounts | |||
Changes in Valuation and Qualifying Accounts | |||
Balance at beginning of period | $1,081 | $831 | $723 |
Charged to costs and expenses | 21 | 257 | 142 |
Deductions describe | 97 | 7 | 34 |
Balance at end of period | $1,005 | $1,081 | $831 |