Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Billions, except Share data, unless otherwise specified | Dec. 31, 2013 | Feb. 14, 2014 | Jun. 28, 2013 |
Document and Entity Information | ' | ' | ' |
Entity Registrant Name | 'GNC HOLDINGS, INC. | ' | ' |
Entity Central Index Key | '0001502034 | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Amendment Flag | 'false | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Well-known Seasoned Issuer | 'Yes | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Filer Category | 'Large Accelerated Filer | ' | ' |
Entity Public Float | ' | ' | $4.23 |
Entity Common Stock, Shares Outstanding | ' | 94,166,458 | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $226,217 | $158,541 |
Receivables, net | 144,833 | 129,641 |
Inventories (Note 3) | 547,916 | 491,599 |
Prepaids and other current assets | 47,081 | 39,016 |
Total current assets | 966,047 | 818,797 |
Long-term assets: | ' | ' |
Goodwill (Note 5) | 666,346 | 639,915 |
Brands (Note 5) | 720,000 | 720,000 |
Other intangible assets, net (Note 5) | 142,774 | 141,717 |
Property, plant and equipment, net (Note 6) | 206,754 | 199,487 |
Other long-term assets | 38,426 | 32,124 |
Total long-term assets | 1,774,300 | 1,733,243 |
Total assets | 2,740,347 | 2,552,040 |
Current liabilities: | ' | ' |
Accounts payable | 135,164 | 125,165 |
Current portion, long-term debt (Note 8) | 5,443 | 3,817 |
Deferred revenue and other current liabilities (Note 7) | 106,459 | 116,337 |
Total current liabilities | 247,066 | 245,319 |
Long-term liabilities: | ' | ' |
Long-term debt (Note 8) | 1,341,656 | 1,094,745 |
Deferred tax liabilities, net (Note 4) | 282,377 | 283,203 |
Other long-term liabilities | 53,669 | 46,734 |
Total long-term liabilities | 1,677,702 | 1,424,682 |
Total liabilities | 1,924,768 | 1,670,001 |
Commitments and contingencies (Note 11) | ' | ' |
Common stock, $0.001 par value, 300,000 shares authorized: | ' | ' |
Paid-in-capital | 847,886 | 810,094 |
Retained earnings | 700,108 | 492,687 |
Treasury stock, at cost | -734,482 | -423,900 |
Accumulated other comprehensive income | 1,955 | 3,047 |
Total stockholders' equity | 815,579 | 882,039 |
Total liabilities and stockholders' equity | 2,740,347 | 2,552,040 |
Class A Common Stock | ' | ' |
Common stock, $0.001 par value, 300,000 shares authorized: | ' | ' |
Common stock | $112 | $111 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, except Per Share data, unless otherwise specified | ||
Common stock, par value (in dollars per share) | 0.001 | 0.001 |
Common stock, shares authorized | 300,000 | 300,000 |
Common stock, shares outstanding | 94,000 | ' |
Class A Common Stock | ' | ' |
Common stock, shares issued | 112,961 | 111,725 |
Common stock, shares outstanding | 93,989 | 99,244 |
Common stock, shares held in treasury | 18,972 | 12,481 |
Consolidated_Statements_of_Inc
Consolidated Statements of Income (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Consolidated Statements of Income | ' | ' | ' |
Revenue | $2,630,308 | $2,429,983 | $2,072,179 |
Cost of sales, including cost of warehousing, distribution and occupancy | 1,637,181 | 1,500,245 | 1,318,346 |
Gross profit | 993,127 | 929,738 | 753,833 |
Compensation and related benefits | 321,947 | 314,311 | 291,268 |
Advertising and promotion | 67,224 | 62,267 | 52,924 |
Other selling, general and administrative | 131,270 | 123,484 | 113,477 |
Foreign currency (gain) loss | -165 | -90 | 121 |
Transaction and restructuring related costs (Note 2) | 12,353 | 1,926 | 13,536 |
Operating income | 460,498 | 427,840 | 282,507 |
Interest expense, net (Note 8) | 53,029 | 47,556 | 74,903 |
Income before income taxes | 407,469 | 380,284 | 207,604 |
Income tax expense (Note 4) | 142,448 | 140,088 | 75,271 |
Net income | 265,021 | 240,196 | 132,333 |
Income per share - Basic and Diluted: | ' | ' | ' |
Net income | 265,021 | 240,196 | 132,333 |
Preferred stock dividends | ' | ' | -4,726 |
Net income available to common shareholders | $265,021 | $240,196 | $127,607 |
Earnings per share: | ' | ' | ' |
Basic (in dollars per share) | $2.75 | $2.32 | $1.27 |
Diluted (in dollars per share) | $2.72 | $2.29 | $1.24 |
Weighted average common shares outstanding: | ' | ' | ' |
Basic (in shares) | 96,481 | 103,503 | 100,261 |
Diluted (in shares) | 97,383 | 104,911 | 103,010 |
Dividends declared per share | $0.60 | $0.44 | ' |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Consolidated Statements of Comprehensive Income | ' | ' | ' |
Net income | $265,021 | $240,196 | $132,333 |
Other comprehensive (loss) income: | ' | ' | ' |
Unrealized gains on derivatives and qualified as cash flow hedges, net of tax of $2,718 for the year ended December 31, 2011 | ' | ' | 4,751 |
Foreign currency translation adjustments | -1,092 | 323 | -747 |
Other comprehensive (loss) income | -1,092 | 323 | 4,004 |
Comprehensive income | $263,929 | $240,519 | $136,337 |
Consolidated_Statements_of_Com1
Consolidated Statements of Comprehensive Income (Parenthetical) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2011 |
Consolidated Statements of Comprehensive Income | ' |
Unrealized gains on derivatives and qualified as cash flow hedges, tax | $2,718 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Total | Treasury Stock | Paid-in-Capital | Retained Earnings | Accumulated Other Comprehensive Income/(Loss) | Class A Common Stock | Class A Common Stock | Class B Common Stock | Class B Common Stock |
In Thousands, unless otherwise specified | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | Common Stock | Common Stock | ||
USD ($) | USD ($) | ||||||||
Balance at Dec. 31, 2011 | $978,462 | ($65,048) | $741,848 | $298,831 | $2,724 | ' | $105 | ' | $2 |
Balance (in shares) at Dec. 31, 2011 | ' | ' | ' | ' | ' | ' | 102,985 | ' | 2,060 |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Comprehensive income | 240,519 | ' | ' | 240,196 | 323 | ' | ' | ' | ' |
Conversion of Class B stock to Class A stock | ' | ' | ' | ' | ' | ' | 2 | ' | -2 |
Conversion of Class B stock to Class A stock (in shares) | ' | ' | ' | ' | ' | ' | 2,060 | ' | -2,060 |
Purchase of treasury stock | -358,852 | -358,852 | ' | ' | ' | ' | ' | ' | ' |
Purchase of treasury stock (in shares) | ' | ' | ' | ' | ' | ' | -9,477 | ' | ' |
Common stock dividends $0.60 and $0.44 per share for the years ended December 31, 2013 and 2012, respectively | -45,216 | ' | ' | -45,216 | ' | ' | ' | ' | ' |
Conversions to common stock | 63,444 | ' | 63,440 | ' | ' | ' | 4 | ' | ' |
Conversions to common stock (in shares) | ' | ' | ' | ' | ' | ' | 3,676 | ' | ' |
Non-cash stock-based compensation | 4,806 | ' | 4,806 | ' | ' | ' | ' | ' | ' |
Other | -1,124 | ' | ' | -1,124 | ' | ' | ' | ' | ' |
Balance at Dec. 31, 2012 | 882,039 | -423,900 | 810,094 | 492,687 | 3,047 | ' | 111 | ' | ' |
Balance (in shares) at Dec. 31, 2012 | ' | ' | ' | ' | ' | 99,244 | 99,244 | ' | ' |
Balance at Dec. 31, 2010 | 619,483 | -2,277 | 451,728 | 171,224 | -1,280 | ' | 60 | ' | 28 |
Balance (in shares) at Dec. 31, 2010 | ' | ' | ' | ' | ' | ' | 59,199 | ' | 28,169 |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Comprehensive income | 136,337 | ' | ' | 132,333 | 4,004 | ' | ' | ' | ' |
Issuance of common stock | 237,253 | ' | 237,237 | ' | ' | ' | 16 | ' | ' |
Issuance of common stock (in shares) | ' | ' | ' | ' | ' | ' | 16,000 | ' | ' |
Conversion of Class B stock to Class A stock | ' | ' | ' | ' | ' | ' | 26 | ' | -26 |
Conversion of Class B stock to Class A stock (in shares) | ' | ' | ' | ' | ' | ' | 26,109 | ' | -26,109 |
Purchase of treasury stock | -62,771 | -62,771 | ' | ' | ' | ' | ' | ' | ' |
Purchase of treasury stock (in shares) | ' | ' | ' | ' | ' | ' | -2,235 | ' | ' |
Preferred stock dividends | -4,726 | ' | ' | -4,726 | ' | ' | ' | ' | ' |
Conversions to common stock | 48,954 | ' | 48,951 | ' | ' | ' | 3 | ' | ' |
Conversions to common stock (in shares) | ' | ' | ' | ' | ' | ' | 3,912 | ' | ' |
Non-cash stock-based compensation | 3,932 | ' | 3,932 | ' | ' | ' | ' | ' | ' |
Balance at Dec. 31, 2011 | 978,462 | -65,048 | 741,848 | 298,831 | 2,724 | ' | 105 | ' | 2 |
Balance (in shares) at Dec. 31, 2011 | ' | ' | ' | ' | ' | ' | 102,985 | ' | 2,060 |
Balance at Dec. 31, 2012 | 882,039 | -423,900 | 810,094 | 492,687 | 3,047 | ' | 111 | ' | ' |
Balance (in shares) at Dec. 31, 2012 | ' | ' | ' | ' | ' | 99,244 | 99,244 | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Comprehensive income | 263,929 | ' | ' | 265,021 | -1,092 | ' | ' | ' | ' |
Purchase of treasury stock | -310,582 | -310,582 | ' | ' | ' | ' | ' | ' | ' |
Purchase of treasury stock (in shares) | ' | ' | ' | ' | ' | ' | -6,547 | ' | ' |
Common stock dividends $0.60 and $0.44 per share for the years ended December 31, 2013 and 2012, respectively | -57,600 | ' | ' | -57,600 | ' | ' | ' | ' | ' |
Conversions to common stock | 29,958 | ' | 29,957 | ' | ' | ' | 1 | ' | ' |
Conversions to common stock (in shares) | ' | ' | ' | ' | ' | ' | 1,292 | ' | ' |
Non-cash stock-based compensation | 7,835 | ' | 7,835 | ' | ' | ' | ' | ' | ' |
Balance at Dec. 31, 2013 | $815,579 | ($734,482) | $847,886 | $700,108 | $1,955 | ' | $112 | ' | ' |
Balance (in shares) at Dec. 31, 2013 | 94,000 | ' | ' | ' | ' | 93,989 | 93,989 | 0 | ' |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
CASH FLOWS FROM OPERATING ACTIVITIES: | ' | ' | ' |
Net income | $265,021 | $240,196 | $132,333 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ' |
Loss on early extinguishment of debt | 5,712 | 1,343 | 19,855 |
Depreciation and amortization expense | 51,814 | 49,257 | 46,790 |
Amortization of debt costs | 2,507 | 2,439 | 2,756 |
Provision for inventory losses | 18,386 | 13,067 | 18,745 |
Increase in receivables | -16,678 | -18,756 | -13,300 |
Increase in inventory | -69,599 | -77,881 | -56,919 |
(Increase) decrease in prepaids and other current assets | -9,338 | 3,959 | -2,783 |
Increase in accounts payable | 6,628 | 651 | 23,243 |
(Decrease) increase in deferred revenue and other current liabilities | -18,496 | 16,395 | 4,934 |
Other operating activities | 2,147 | -9,454 | -980 |
Net cash provided by operating activities | 238,104 | 221,216 | 174,674 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ' | ' | ' |
Capital expenditures | -50,247 | -41,930 | -43,817 |
Cash paid for acquisitions (net of cash acquired) | -27,562 | ' | -19,840 |
Other investing activities | -1,606 | -1,884 | -1,887 |
Net cash used in investing activities | -79,415 | -43,814 | -65,544 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ' | ' | ' |
Dividends paid to shareholders | -57,437 | -45,216 | ' |
Payments on long-term debt | -3,379 | -2,689 | -1,355,973 |
Proceeds from exercised stock options | 14,588 | 25,972 | 28,550 |
Tax benefit from exercise of stock options | 17,852 | 39,834 | 22,409 |
Repurchase of treasury stock | -310,582 | -359,990 | -61,634 |
Repurchase of Series A preferred stock | ' | ' | -223,107 |
Net proceeds from sale of Class A common stock | ' | ' | 237,253 |
Proceeds from issuance of long-term debt | 249,552 | 199,000 | 1,196,200 |
Deferred financing fees | -2,397 | -1,335 | -17,346 |
Other financing activities | ' | -2,500 | ' |
Net cash used in financing activities | -91,803 | -146,924 | -173,648 |
Effect of exchange rate on cash and cash equivalents | 790 | -375 | -946 |
Net increase (decrease) in cash and cash equivalents | 67,676 | 30,103 | -65,464 |
Beginning balance, cash and cash equivalents | 158,541 | 128,438 | 193,902 |
Ending balance, cash and cash equivalents | 226,217 | 158,541 | 128,438 |
Supplemental Cash Flow Information | ' | ' | ' |
Income taxes paid | 143,573 | 102,335 | 51,088 |
Interest paid | $40,696 | $45,088 | $64,122 |
NATURE_OF_BUSINESS
NATURE OF BUSINESS | 12 Months Ended |
Dec. 31, 2013 | |
NATURE OF BUSINESS | ' |
NATURE OF BUSINESS | ' |
NOTE 1. NATURE OF BUSINESS | |
General Nature of Business. GNC Holdings, Inc., a Delaware corporation ("Holdings," and collectively with its subsidiaries and, unless the context requires otherwise, its and their respective predecessors, the "Company"), is a global specialty retailer of health and wellness products, which include: vitamins, minerals and herbal supplements, sports nutrition products, diet products and other wellness products. | |
The Company is vertically integrated as its operations consist of purchasing raw materials, formulating and manufacturing products and selling the finished products through its three segments: Retail, Franchising, and Manufacturing/Wholesale. Corporate retail store operations are located in the United States, Canada, and Puerto Rico, and in addition the Company offers products domestically through GNC.com, LuckyVitamin.com and www.drugstore.com, and beginning in 2013, the United Kingdom with the acquisition of A1 Sports Limited d/b/a Discount Supplements ("DiscountSupplements.com"). Franchise stores are located in the United States and over 50 international countries (including distribution centers where retail sales are made). The Company operates its primary manufacturing facilities in South Carolina and distribution centers in Arizona, Pennsylvania and South Carolina. The Company manufactures the majority of its branded products, but also merchandises various third-party products. Additionally, the Company licenses the use of its trademarks and trade names. | |
The processing, formulation, packaging, labeling and advertising of the Company's products are subject to regulation by one or more federal agencies, including the Food and Drug Administration (the "FDA"), the Federal Trade Commission (the "FTC"), the Consumer Product Safety Commission, the United States Department of Agriculture and the Environmental Protection Agency. These activities are also regulated by various agencies of the states and localities in which the Company's products are sold. | |
Recent Significant Transactions. In March 2011, General Nutrition Centers, Inc. ("Centers"), a wholly owned subsidiary of Holdings, entered into a senior credit facility, consisting of a $1.2 billion term loan facility (the "Term Loan Facility") and an $80.0 million revolving credit facility (the "Revolving Credit Facility" and, together with the Term Loan Facility, the "Senior Credit Facility"), and utilized the proceeds to repay certain other outstanding indebtedness In August 2012, the Company amended the Term Loan Facility to increase the outstanding borrowings by $200.0 million and in October 2012, Centers amended the Term Loan Facility to adjust the per annum interest rate to the greater of LIBOR and 1.00%, plus an applicable margin of 2.75%. In 2013, the Company amended and restated the Senior Credit Facility to, among other amendments, increase borrowings under the Term Loan Facility by $252.5 million, extend the maturity date of the Term Loan Facility to March 2019, increase the amount available for borrowing under the Revolving Credit Facility to $130.0 million, extend the Revolving Credit Facility maturity date to March 2017, and effect changes to the interest rates applicable to amounts outstanding under the Facility. These transactions are collectively referred to herein as the "Refinancings." See "Note 8: Long-term Debt/Interest Expense" herein for a further description of these items. | |
In April 2011, Holdings consummated an initial public offering (the "IPO") of 25.875 million shares of its Class A common stock, par value $0.001 per share (the "common stock"), at an IPO price of $16.00 per share. The net proceeds from the IPO, together with cash on hand, were used to redeem all outstanding shares of Holdings' Series A preferred stock, par value $0.001 per share (the "Series A preferred stock"), repay approximately $300.0 million of outstanding borrowings under the Term Loan Facility and pay approximately $11.1 million to satisfy obligations under the Management Services Agreement (as defined in Note 18, "Related Party Transactions") and Holdings' Class B common stock, par value $0.001 per share (the "Class B common stock" and, together with the our common stock, the "common stock"). Subsequent to the IPO, certain of Holdings' stockholders completed four registered offerings of our common stock. In conjunction with one of these selling stockholder offerings, in August 2012, the Company repurchased an additional six million shares of our common stock from one of its stockholders as part of a share repurchase program. The IPO, the registered offerings, and the repurchase of the six million shares of our common stock are collectively referred to herein as the "Offerings." | |
On August 31, 2011, the Company acquired substantially all of the assets and assumed certain liabilities of S&G Properties, LLC d/b/a LuckyVitamin.com and What's The Big Deal?, Inc. d/b/a Gary's "World of Wellness" (collectively referred to as "LuckyVitamin.com"), an online retailer of health and wellness products. The aggregate purchase price of LuckyVitamin.com was approximately $19.8 million. | |
On March 19, 2012, Ontario Teachers' Pension Plan ("OTPP") converted all of its shares of Class B common stock into an equal number of shares of common stock. In May 2013, Holding's shareholders approved an amendment to the certificate of incorporation deleting the Class B common stock as no shares of Class B common stock were still outstanding. | |
In February 2013, our board of directors authorized a $250.0 million repurchase program of common stock which was completed in November 2013. Also in November 2013, our board of directors authorized a $500.0 million multi-year share repurchase program of our common stock. | |
On October 2, 2013, the Company acquired DiscountSupplements.com, an online retailer of multi-brand sports nutrition products in the United Kingdom. The aggregate purchase price of DiscountSupplements.com was $33.3 million. | |
BASIS_OF_PRESENTATION_AND_SUMM
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2013 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
NOTE 2. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | |
The accompanying consolidated financial statements and footnotes have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") and with the instructions to Form 10-K and Regulation S-X. The Company's normal reporting period is based on a calendar year. | |
Summary of Significant Accounting Policies | |
Principles of Consolidation. The consolidated financial statements include the accounts of Holdings and all of its subsidiaries. All material intercompany transactions have been eliminated in consolidation. | |
The Company has no relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off balance sheet arrangements, or other contractually narrow or limited purposes. | |
Use of Estimates. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. Accordingly, these estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. On a regular basis, management reviews its estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such reviews and if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. | |
Cash and Cash Equivalents. The Company considers cash and cash equivalents to include all cash and liquid deposits and investments with an original maturity of three months or less. The majority of payments due from banks for third-party credit and debit cards process within 24 to 72 hours, and are classified as cash equivalents. | |
Receivables, net. The Company sells product to its franchisees and, to a lesser extent, various third-party customers. Receivables consist principally of trade receivables of $140.8 million and $126.0 million at December 31, 2013 and 2012, respectively, and include unpaid invoices for product sales, franchisee royalties and lease payments. The Company monitors the financial condition of the Company's franchisees and other third-party customers and establishes an allowance for doubtful accounts for balances estimated to be uncollectible. In addition to considering the aging of receivable balances and assessing the financial condition of the Company's franchisees, the Company considers each domestic franchisees' inventory and fixed assets, which the Company can use as collateral in the event of a default by the franchisee. An allowance for international franchisees is calculated based on unpaid, non-collateralized amounts associated with their receivable balance. The allowance for doubtful accounts was $1.9 million and $2.2 million at December 31, 2013 and 2012, respectively. | |
Inventories. Inventory components consist of raw materials, work-in-process, finished product and packaging supplies. Inventories are stated at the lower of cost or market on a first in/first out basis ("FIFO"). The Company regularly reviews its inventory levels in order to identify slow moving and short dated products, expected length of time for product sell through and future expiring product and adjusts the carrying value for such inventory to estimated net realizable value. | |
Property, Plant and Equipment. Property, plant and equipment expenditures are recorded at cost. The remaining useful lives range from one year to fifteen years across all asset classes with the exception of buildings. Buildings are depreciated over thirty years and building improvements are depreciated over the remaining useful life of the building. Depreciation and amortization are recognized using the straight-line method over the estimated useful life of the property. Fixtures are depreciated over three to fifteen years, and equipment is generally depreciated over ten years. Computer equipment and software costs are generally depreciated over three to five years. Amortization of improvements to retail leased premises is recognized using the straight-line method over the estimated useful life of the improvements, or over the life of the related leases including renewals that are reasonably assured, whichever period is shorter. | |
Expenditures that materially increase the value or clearly extend the useful life of property, plant and equipment are capitalized in accordance with the policies outlined above. Repair and maintenance costs incurred in the normal operations of business are expensed as incurred. Gains/losses from the sale of property, plant and equipment are recognized in current operations. | |
Goodwill and Intangible Assets. Goodwill represents the excess of purchase price over the fair value of identifiable net assets of businesses, including franchisees, acquired by the Company. Goodwill and intangible assets with indefinite useful lives are not amortized, but instead are tested for impairment at least annually. The Company completes its annual impairment test in the fourth quarter. The Company performs a qualitative assessment to determine whether it is "more likely than not" that the fair value of the reporting unit is less than its carrying value. The qualitative factors considered are general macroeconomic conditions, industry specific conditions, historical performance, and future outlooks. If it is concluded that it is "more likely than not" that the fair value of a reporting unit is less than its carrying value, the Company is required to perform a two-step goodwill impairment test. As a result of the Company's annual impairment analysis, no impairment was recorded for the year ended December 31, 2013. See Note 5, "Goodwill, Brands, and Other Intangible Assets, Net." | |
Long-lived Assets. The Company reviews the carrying value of property and equipment and amortizable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. Factors the Company considers important that may trigger an impairment review include significant changes in the manner of its use of assets, significant negative industry or economic trends, underperforming stores and store closings. These reviews may include an analysis of the current operations and capacity utilization, in conjunction with an analysis of the markets in which the businesses are operating. When an impairment review is considered necessary, a comparison is performed of the undiscounted projected cash flows from the use and eventual disposition of the asset group to the net book value of the related asset group. If it is determined that the carrying value of the asset group may not be recoverable, a charge to adjust the carrying value of the long-lived assets to estimated fair value may be required. | |
Revenue Recognition. The Company operates predominantly as a retailer, through company-owned stores, franchise stores and its e-commerce businesses and to a lesser extent through manufacturing and wholesale operations. | |
The Retail segment recognizes revenue at the moment a sale to a customer is recorded. These revenues are recorded via the Company's point of sales system. Gross revenues are netted by actual customer returns and an allowance for expected customer returns. The Company records a reserve for expected customer returns based on management's estimate, which is derived from historical return data and expectations of future return volume. Revenue is deferred on sales of the Company's Gold Cards and subsequently amortized over the 12 month membership period, in order to match the discounts associated with the Gold Card program. During 2013, the Company completed the nationwide rollout of the Gold Card Member Pricing model, which evolved the Gold Card from a 20% discount the first week of the month to an everyday variable discount based on our Member Pricing model, for an annual fee. | |
The Company also sells gift cards to its customers. Revenue from gift cards is recognized when the gift card is redeemed. These gift cards do not have expiration dates. Based upon historical redemption rates, a small percentage of gift cards will never be redeemed, referred to as "breakage." The Company recognizes gift card breakage revenue when the likelihood of redemption becomes remote and amounts are not escheatable. | |
The Franchise segment generates revenues through product sales to franchisees, royalties, franchise fees and interest income on the financing of the franchise locations. See Note 17, "Franchise Revenue." These revenues are netted by actual franchisee returns and an allowance for projected returns. The franchisees purchase a majority of the products they sell from the Company at wholesale prices. Revenue on product sales to franchisees is recognized when risk of loss, title and insurable risks have transferred to the franchisee. Franchise fees are paid in advance, deferred and recognized by the Company at the time of a franchise store opening. Franchise royalties are earned based on a percentage of the franchisees' sales and recognized in the period the franchisees' sales occur. Interest on the financing of franchisee notes receivable is recognized as it becomes due and payable. Gains from the sale of company-owned stores to franchisees are recognized in accordance with the standard on accounting for sales of real estate. This standard requires gains on sales of corporate stores to franchisees to be deferred until certain criteria are satisfied regarding the collectability of the related receivable and the seller's remaining obligations. | |
The Manufacturing/Wholesale segment sells product primarily to the other Company segments and third-party customers. Revenue is recognized when risk of loss, title and insurable risks have transferred to the customer, net of estimated returns and allowances. | |
Cost of Sales. The Company purchases products directly from third-party manufacturers and manufactures its own products. The Company's cost of sales includes product costs, costs of warehousing and distribution and occupancy costs. | |
Vendor Allowances. The Company receives credits as purchase price rebates based on arrangements with certain vendors. The Company also enters into arrangements with certain vendors through which the Company receives rebates for purchases during the year typically based on volume discounts. As the right of offset exists under these arrangements, rebates received under both arrangements are recorded as a reduction in the vendors' accounts payable balances on the balance sheet and represent the estimated amounts due to the Company under the rebate provisions of such contracts. The corresponding rebate income is recorded as a reduction of cost of goods sold based on inventory turnover. The amount recorded as a reduction to cost of goods sold was $92.6 million, $81.5 million and $64.7 million for the years ended December 31, 2013, 2012 and 2011, respectively. | |
Research and Development. Research and development costs arising from internally generated projects are expensed by the Company as incurred. The Company recognized $1.4 million, $1.1 million and $0.6 million for the years ended December 31, 2013, 2012 and 2011, respectively. These costs are included in Other Selling, General, and Administrative costs in the accompanying audited consolidated financial statements. | |
Advertising Expenditures. The Company recognizes advertising, promotion and marketing program costs the first time the advertising takes place, with the exception of the costs of producing advertising, which are expensed as incurred during production. The Company administers national advertising funds on behalf of its franchisees. In accordance with the franchisee contracts, the Company collects advertising fees from the franchisees and utilizes the proceeds to coordinate various advertising and marketing campaigns. The Company recognized advertising expense of $67.2 million, $62.3 million and $52.9 million for the years ended December 31, 2013, 2012 and 2011, respectively, net of approximately $15.4 million, $14.4 million and $12.2 million in 2013, 2012 and 2011 from the national advertising fund derived from the Company's franchisees, respectively. | |
Leases. The Company has various operating leases for company-owned and franchise store locations, distribution centers, and equipment. Leases generally include amounts relating to base rental, percent rent and other charges such as common area maintenance fees and real estate taxes. Periodically, the Company receives varying amounts of reimbursements from landlords to compensate the Company for costs incurred in the construction of stores. These reimbursements are amortized by the Company as an offset to rent expense over the life of the related lease. The Company determines the period used for the straight-line rent expense for leases with option periods and conforms it to the term used for amortizing improvements. | |
The Company leases an approximately 300,000 square foot-facility in Greenville, South Carolina where the majority of its proprietary products are manufactured. The Company also leases a 630,000 square foot complex located in Anderson, South Carolina, for packaging, materials receipt, lab testing, warehousing, and distribution. Both the Greenville and Anderson facilities are leased on a long-term basis pursuant to "fee-in-lieu-of-taxes" arrangements with the counties in which the facilities are located, but the Company retains the right to purchase each of the facilities at any time during the lease for $1.00, subject to a loss of tax benefits. As part of a tax incentive arrangement, the Company assigned the facilities to the counties and leases them back under operating leases. The Company leases the facilities from the counties where located, in lieu of paying local property taxes. Upon exercising its right to purchase the facilities back from the counties, the Company will be subject to the applicable taxes levied by the counties. As a result, the original cost basis of the facilities remains on the balance sheet and continues to be depreciated. | |
Contingencies. In accordance with the standards on contingencies the Company accrues a loss contingency if it is probable and can be reasonably estimated or a liability had been incurred at the date of the financial statements if those financial statements have not been issued. If both of the conditions above are not met, disclosure of the contingency is made when there is at least a reasonable possibility that a loss or an additional loss may have been incurred. | |
Pre-Opening Expenditures. The Company recognizes the cost associated with the opening of new stores as incurred. These costs are charged to expense and are not material for the periods presented. Franchise store pre-opening costs are incurred by the franchisees. | |
Income Taxes. The Company utilizes the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. It is the Company's policy to recognize interest and penalties related to uncertain tax positions as a component of income tax expense. See Note 4, "Income Taxes." | |
Self-Insurance. The Company has procured insurance for: (1) general liability; (2) product liability; (3) directors and officers liability; and (4) property insurance; (5) workers' compensation insurance; and (6) various other areas. The Company is self-insured for: (1) medical benefits; (2) physical damage to the Company's vehicles for field personnel use; and (3) physical damages that may occur at the corporate store locations. The Company is not insured for certain property and casualty risks due to the Company's assessment of frequency and severity of a loss, the cost of insurance and the overall risk analysis. | |
The Company carries product liability insurance with a retention of $4.0 million per claim with an aggregate cap on retained losses of $10.0 million. The Company carries general liability insurance with retention of $250,000 per claim with an aggregate cap on retained losses of $1.0 million. The majority of the Company's workers' compensation and auto insurance policies are in deductible/retrospective plans. The Company reimburses the applicable insurance company for the workers' compensation and auto liability claims, subject to a $250,000 and $100,000 loss limit per claim, respectively. | |
As part of the medical benefits program, the Company contracts with national service providers to provide benefits to its employees for all medical, dental, vision and prescription drug services. The Company then reimburses these service providers as claims are processed from Company employees. The Company maintains a specific stop loss provision of $500,000 per individual per plan year with a maximum lifetime benefit limit of $2.0 million per individual. The Company has no additional liability once a participant exceeds the $2.0 million ceiling. The Company's liability for medical claims is included as a component of accrued benefits in Note 7, "Deferred Revenue and Other Current Liabilities," and was $2.0 million and $1.9 million as of December 31, 2013 and 2012, respectively. | |
Our self-insurance liabilities, including the estimated loss accruals for claims incurred but not paid, are determined by taking into account historical claims payment results and known trends such as claims frequency and claims severity. Management makes estimates, judgments, and assumptions with respect to the use of these calculations, including but not limited to, estimated lag time to report and pay claims, average cost per claim, network utilization rates, network discount rates, and other factors. | |
Stock-based Compensation. The Company utilizes the Black-Scholes model to calculate the fair value of stock option awards (herein referred to as "option awards"). The grant-date fair value of the Company's restricted stock awards, time vesting restricted stock units, and performance vesting restricted stock units (collectively herein referred to as "stock awards") are based on the closing price for a share of the Company's stock on the New York Stock Exchange (the "NYSE") on the grant date. The resulting compensation cost is recognized in the Company's financial statements over the applicable vesting period for the relevant award. | |
Earnings Per Share. Basic earnings per share is computed by dividing net income available to common shareholders by the weighted average number of shares of common stock outstanding for the period. Diluted earnings per share is computed by dividing net income available to common shareholders by the weighted average number of shares of common stock outstanding adjusted for the additional dilutive effect of unexercised option awards and unvested restricted awards. | |
Foreign Currency. For all foreign operations, the functional currency is the local currency. Assets and liabilities of those operations, denominated in foreign currencies, are translated into U.S. dollars using period-end exchange rates, and income and expenses are translated using the average exchange rates for the reporting period. Gains or losses resulting from foreign currency transactions are included in results of operations. At December 31, 2013 and 2012, foreign currency is the only component of accumulated other comprehensive income. | |
Transaction and restructuring related costs. Restructuring related costs are recorded in the period in which the liability is incurred. Additionally, any change in the expected liability is recorded in the period the change in estimate occurs. In October 2013, the Company transitioned to a third-party pooled carrier product transportation network and moved away from the Company's existing private fleet. The cost related to this transition was $12.2 million, consisting of early lease termination on transportation equipment of $9.8 million and employee severance and other costs of $2.4 million. At December 31, 2013, the Company had an immaterial liability related to these restructuring costs. All remaining costs related to the restructuring are expected to be paid in the first quarter of 2014. | |
The Company recognizes transaction related costs as expense in the period incurred. For the years ended December 31, 2013 and 2012, the Company incurred $0.2 million and $1.9 million in transaction related costs. | |
Financial Instruments and Derivatives. As part of the Company's financial risk management program, it has historically used certain derivative financial instruments to reduce its exposure to market risk for changes in interest rates, primarily in respect of its long term debt obligations. The Company has not historically entered into, and does not intend to enter into, derivative transactions for speculative purposes and holds no derivative instruments for trading purposes. Floating-to-fixed interest rate swap agreements, designated as cash flow hedges of interest rate risk, were entered into from time to time to hedge the Company's exposure to interest rate changes on a portion of the Company's floating rate debt. These interest rate swap agreements converted a portion of the Company's floating rate debt to fixed rate debt. Interest rate floors designated as cash flow hedges involved the receipt of variable-rate amounts from a counterparty if interest rates fell below the strike rate on the contract in exchange for an upfront premium. The Company recorded the fair value of these contracts as an asset or a liability, as applicable, in the balance sheet, with the offset to accumulated other comprehensive income (loss), net of tax. The Company measured hedge effectiveness by assessing the changes in the fair value or expected future cash flows of the hedged item. The ineffective portions, if any, were recorded in interest expense in the current period. | |
During 2011, the Company had interest rate swap agreements outstanding that effectively converted notional amounts of an aggregate $550.0 million of debt from floating to fixed interest rates. The four outstanding agreements were to mature between April 2011 and September 2012. Amounts related to derivatives were reported in accumulated other comprehensive income (loss) and reclassified to interest expense as interest payments were made on the Company's variable-rate debt. In conjunction with the 2011 Refinancing, the Company utilized proceeds of the Senior Credit Facility to repay in full its prior senior credit facility and then-outstanding senior and senior subordinated notes, and the four interest rate swap agreements were settled and terminated for an aggregate cost of $8.7 million, of which $5.8 million was reclassified from accumulated other comprehensive income (loss) to interest expense. No such material derivative instruments are currently outstanding. | |
Reclassifications | |
Certain amounts in the consolidated financial statements of prior year periods have been reclassified to conform to the current period's presentation. These changes were reflected for all periods presented. | |
Recently Issued Accounting Pronouncements | |
In February 2013, the Financial Accounting Standards Board (the "FASB") issued an accounting standard regarding the reclassification of amounts out of accumulated other comprehensive income ("AOCI"). This standard does not change the current requirements for reporting net income or other comprehensive income. However, the standard requires disclosure of amounts reclassified out of AOCI in its entirety, by component, on the face of the statement of operations or in the footnotes to the financial statements. Amounts that are not required to be reclassified in their entirety to net income must be cross-referenced to other disclosures that provide additional detail. This guidance is effective for fiscal years beginning after December 15, 2012. The Company adopted this guidance during the first quarter of 2013. The adoption of this guidance did not have a material impact on the Company's consolidated financial statements. | |
In July 2013, the FASB issued an accounting standard regarding the presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. This standard requires entities to present an unrecognized tax benefit as a reduction of a deferred tax asset for a net operating loss ("NOL") or tax credit carryforward whenever the NOL or tax credit carryforward would be available to reduce the additional taxable income or tax due if the tax position is disallowed. This accounting standard update requires entities to assess whether to net the unrecognized tax benefit with a deferred tax asset as of the reporting date. This guidance is effective for fiscal years beginning after December 15, 2013, with early adoption permitted. The Company will adopt this guidance during the first quarter of 2014, and does not believe this standard will have a material impact on the consolidated financial statements. | |
INVENTORIES_NET
INVENTORIES, NET | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
INVENTORIES, NET | ' | |||||||
INVENTORIES, NET | ' | |||||||
NOTE 3. INVENTORIES, NET | ||||||||
The net carrying value of inventories consisted of the following: | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
(in thousands) | ||||||||
Finished product ready for sale | $ | 458,366 | $ | 415,096 | ||||
Work-in-process, bulk product and raw materials | 81,575 | 70,022 | ||||||
Packaging supplies | 7,975 | 6,481 | ||||||
| | | | | | | | |
Total | $ | 547,916 | $ | 491,599 | ||||
| | | | | | | | |
| | | | | | | | |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
INCOME TAXES | ' | |||||||||||||||||||
INCOME TAXES | ' | |||||||||||||||||||
NOTE 4. INCOME TAXES | ||||||||||||||||||||
Income before income taxes consisted of the following components: | ||||||||||||||||||||
Year ended December 31, | ||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Domestic | $ | 389,459 | $ | 372,669 | $ | 206,971 | ||||||||||||||
Foreign | 18,010 | 7,615 | 633 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Total income before income taxes | $ | 407,469 | $ | 380,284 | $ | 207,604 | ||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
Income tax expense (benefit) for all periods consisted of the following components: | ||||||||||||||||||||
Year ended December 31, | ||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Current: | ||||||||||||||||||||
Federal | $ | 120,137 | $ | 117,332 | $ | 63,130 | ||||||||||||||
State | 15,433 | 21,099 | 13,371 | |||||||||||||||||
Foreign | 8,656 | 5,022 | 4,091 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
144,226 | 143,453 | 80,592 | ||||||||||||||||||
Deferred: | ||||||||||||||||||||
Federal | (363 | ) | (2,238 | ) | (3,310 | ) | ||||||||||||||
State | (955 | ) | (1,222 | ) | (1,351 | ) | ||||||||||||||
Foreign | (460 | ) | 95 | (660 | ) | |||||||||||||||
| | | | | | | | | | | ||||||||||
(1,778 | ) | (3,365 | ) | (5,321 | ) | |||||||||||||||
| | | | | | | | | | | ||||||||||
Income tax expense | $ | 142,448 | $ | 140,088 | $ | 75,271 | ||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
The following table summarizes the differences between the Company's effective tax rate for financial reporting purposes and the federal statutory tax rate: | ||||||||||||||||||||
Year ended | ||||||||||||||||||||
December 31, | ||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||
Percent of pretax earnings: | ||||||||||||||||||||
Statutory federal tax rate | 35 | % | 35 | % | 35 | % | ||||||||||||||
Increase (reduction) resulting from: | ||||||||||||||||||||
State income tax, net of federal tax benefit | 3.1 | % | 3.2 | % | 3 | % | ||||||||||||||
Other permanent differences | 0.1 | % | 0.6 | % | 2 | % | ||||||||||||||
International operations, net of foreign tax credits | 0 | % | (0.1 | )% | (1.6 | )% | ||||||||||||||
Federal tax credits and income deductions | (2.1 | )% | (2.1 | )% | (2.4 | )% | ||||||||||||||
Tax impact of uncertain tax positions and other | (1.1 | )% | 0.2 | % | 0.3 | % | ||||||||||||||
| | | | | | | | | | | ||||||||||
Effective income tax rate | 35 | % | 36.8 | % | 36.3 | % | ||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. | ||||||||||||||||||||
Significant components of the Company's deferred tax assets and liabilities consisted of the following: | ||||||||||||||||||||
December 31, | ||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||
Assets | Liabilities | Net | Assets | Liabilities | Net | |||||||||||||||
(in thousands) | ||||||||||||||||||||
Deferred tax: | ||||||||||||||||||||
Current assets (liabilities): | ||||||||||||||||||||
Operating reserves | $ | 3,345 | $ | — | $ | 3,345 | $ | 4,507 | $ | — | $ | 4,507 | ||||||||
Deferred revenue | 2,871 | — | 2,871 | 2,377 | — | 2,377 | ||||||||||||||
Prepaid expenses | — | (5,699 | ) | (5,699 | ) | — | (3,901 | ) | (3,901 | ) | ||||||||||
Accrued worker compensation | 2,562 | — | 2,562 | 2,436 | — | 2,436 | ||||||||||||||
Other | 3,790 | (3,051 | ) | 739 | 3,028 | (3,182 | ) | (154 | ) | |||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total current | $ | 12,568 | $ | (8,750 | ) | $ | 3,818 | $ | 12,348 | $ | (7,083 | ) | $ | 5,265 | ||||||
Non-current assets (liabilities): | ||||||||||||||||||||
Intangibles | $ | — | $ | (324,606 | ) | $ | (324,606 | ) | $ | — | $ | (318,429 | ) | $ | (318,429 | ) | ||||
Fixed assets | 17,410 | — | 17,410 | 14,809 | — | 14,809 | ||||||||||||||
Stock compensation | 3,111 | — | 3,111 | 2,711 | — | 2,711 | ||||||||||||||
Net operating loss carryforwards | 6,763 | — | 6,763 | 7,020 | — | 7,020 | ||||||||||||||
Long-term rent liabilities | 9,766 | — | 9,766 | 8,141 | — | 8,141 | ||||||||||||||
Other | 5,744 | — | 5,744 | 4,310 | — | 4,310 | ||||||||||||||
Valuation allowance | (565 | ) | — | (565 | ) | (1,765 | ) | — | (1,765 | ) | ||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total non-current | $ | 42,229 | $ | (324,606 | ) | $ | (282,377 | ) | $ | 35,226 | $ | (318,429 | ) | $ | (283,203 | ) | ||||
| | | | | | | | | | | | | | | | | | | | |
Total net deferred taxes | $ | 54,797 | $ | (333,356 | ) | $ | (278,559 | ) | $ | 47,574 | $ | (325,512 | ) | $ | (277,938 | ) | ||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
As of December 31, 2013 and 2012, the Company had deferred tax assets relating to state net operating losses ("NOLs") in the amount of $5.3 million and $5.9 million, respectively. As of December 31, 2012, a valuation allowance was provided for certain NOLs, as the Company currently believes that these NOLs, with lives ranging from five to twenty years, may not have been realizable prior to their expiration. During 2013, 2012 and 2011, the Company recorded a valuation allowance adjustment of $1.2 million, $1.2 million and $1.5 million, respectively, which impacted income tax expense. These valuation allowance adjustments reflect a change in circumstances, including a tax law change, which caused a change in judgment about the realizability of certain deferred tax assets, related to state NOLs. | ||||||||||||||||||||
The Company does not have any material undistributed earnings of international subsidiaries, at December 31, 2013 and 2012, as these subsidiaries are either considered to be branches for United States tax purposes, to have incurred cumulative NOLs, or to have only minimal undistributed earnings. | ||||||||||||||||||||
In addition, at December 31, 2013 and 2012, the Company had a liability of $10.8 million and $12.9 million, respectively, for unrecognized tax benefits. The Company recognizes interest and penalties accrued related to unrecognized tax benefits in income tax expense. Accrued interest and penalties were $4.2 million and $5.7 million as of December 31, 2013 and 2012, respectively. | ||||||||||||||||||||
As of December 31, 2013, the Company is not aware of any positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly increase or decrease within the next 12 months. | ||||||||||||||||||||
Holdings files a consolidated federal tax return and various consolidated and separate tax returns as prescribed by the tax laws of the state, local and international jurisdictions in which it and its subsidiaries operate. The Company's 2010 and 2011 federal income tax returns have been examined by the Internal Revenue Service. The Company has various state and local jurisdiction tax years open to examination (earliest open period 2005), and the Company also has certain state and local jurisdictions currently under audit. As of December 31, 2013, the Company believes that it is appropriately reserved for any potential federal and state income tax exposures. | ||||||||||||||||||||
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | ||||||||||||||||||||
December 31, | ||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Balance of unrecognized tax benefits at beginning of period | $ | 12,882 | $ | 10,574 | $ | 8,720 | ||||||||||||||
Additions for tax positions taken during current period | 873 | 1,215 | 1,104 | |||||||||||||||||
Additions for tax positions taken during prior periods | 1,965 | 4,220 | 750 | |||||||||||||||||
Reductions for tax positions taken during prior periods | (4,068 | ) | (1,439 | ) | — | |||||||||||||||
Settlements | (804 | ) | (1,688 | ) | — | |||||||||||||||
| | | | | | | | | | | ||||||||||
Balance of unrecognized tax benefits at end of period | $ | 10,848 | $ | 12,882 | $ | 10,574 | ||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
At December 31, 2013, the amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate is $10.8 million. While it is often difficult to predict the final outcome or the timing of resolution of any particular uncertain tax position, the Company believes that its unrecognized tax benefits reflect the most likely outcome. The Company adjusts these unrecognized tax benefits, as well as the related interest, in light of changing facts and circumstances. Settlement of any particular position could require the use of cash. Favorable resolution would be recognized as a reduction to its effective income tax rate in the period of resolution. | ||||||||||||||||||||
GOODWILL_BRANDS_AND_OTHER_INTA
GOODWILL, BRANDS, AND OTHER INTANGIBLE ASSETS, NET | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||
GOODWILL, BRANDS, AND OTHER INTANGIBLE ASSETS, NET | ' | ||||||||||||||||||||||
GOODWILL, BRANDS, AND OTHER INTANGIBLE ASSETS, NET | ' | ||||||||||||||||||||||
NOTE 5. GOODWILL, BRANDS, AND OTHER INTANGIBLE ASSETS, NET | |||||||||||||||||||||||
For the years ended December 31, 2013, 2012 and 2011, the Company acquired 16, 29 and 30 franchise stores, respectively. These acquisitions are accounted for utilizing the purchase method of accounting, and the Company records the acquired inventory, fixed assets, franchise rights and goodwill, with an applicable reduction to receivables and cash. For the years ended December 31, 2013, 2012 and 2011, the total purchase prices associated with these acquisitions were $2.9 million, $4.4 million and $3.4 million, respectively, of which $1.7 million, $2.1 million and $1.6 million, respectively, was paid in cash. | |||||||||||||||||||||||
On October 2, 2013, the Company acquired the assets and assumed the liabilities of DiscountSupplements.com, which was accounted for as a business combination. The total purchase price for this acquisition was approximately $33.3 million. Of the purchase price, $24.6 million was allocated to goodwill, $9.6 million to amortizable intangibles, $4.9 million of inventory, $0.5 million of accounts receivable, $0.6 million of property, plant and equipment, $0.2 million to current assets, $2.8 million of accounts payable, $2.4 million of deferred tax liabilities, $1.5 million of other current liabilities, and $6.2 million of other long term liabilities. | |||||||||||||||||||||||
On August 31, 2011, the Company acquired substantially all of the assets and assumed certain liabilities of LuckyVitamin.com, which was accounted for as a business combination. The total purchase price for this acquisition was approximately $19.8 million. Of the purchase price, $11.5 million was allocated to goodwill, $9.6 million was allocated to amortizable intangible assets, $2.6 million was allocated to current assets acquired, $0.7 million was allocated to property and equipment acquired and $3.9 million was allocated to net assumed current liabilities. | |||||||||||||||||||||||
The Company's acquisitions of LuckyVitamin.com and DiscountSupplements.com did not have a material impact on the Company's consolidated financial statements, and therefore pro forma disclosures have not been presented. | |||||||||||||||||||||||
The following table summarizes the Company's goodwill activity: | |||||||||||||||||||||||
Retail | Franchising | Manufacturing/ | Total | ||||||||||||||||||||
Wholesale | |||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Balance at December 31, 2011—Net | $ | 317,733 | $ | 117,303 | $ | 202,841 | $ | 637,877 | |||||||||||||||
| | | | | | | | | | | | | | ||||||||||
| | | | | | | | | | | | | | ||||||||||
Acquired franchise stores | 2,038 | — | — | 2,038 | |||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||
Balance at December 31, 2012—Net | $ | 319,771 | $ | 117,303 | $ | 202,841 | $ | 639,915 | |||||||||||||||
| | | | | | | | | | | | | | ||||||||||
| | | | | | | | | | | | | | ||||||||||
Acquired franchise stores | 1,431 | — | — | 1,431 | |||||||||||||||||||
Acquisition of DiscountSupplements.com | 24,582 | — | — | 24,582 | |||||||||||||||||||
Translation effect of exchange rates | 418 | — | — | 418 | |||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||
Balance at December 31, 2013—Net | $ | 346,202 | $ | 117,303 | $ | 202,841 | $ | 666,346 | |||||||||||||||
| | | | | | | | | | | | | | ||||||||||
| | | | | | | | | | | | | | ||||||||||
Intangible assets other than goodwill consisted of the following: | |||||||||||||||||||||||
Retail | Franchise | Operating | Other | Total | |||||||||||||||||||
Brand | Brand | Agreements | Intangibles | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Balance at December 31, 2011 | $ | 500,000 | $ | 220,000 | $ | 138,970 | $ | 10,619 | $ | 869,589 | |||||||||||||
| | | | | | | | | | | | | | | | | |||||||
| | | | | | | | | | | | | | | | | |||||||
Acquired franchise stores | — | — | — | 701 | 701 | ||||||||||||||||||
Amortization expense | — | — | (6,653 | ) | (1,920 | ) | (8,573 | ) | |||||||||||||||
| | | | | | | | | | | | | | | | | |||||||
Balance at December 31, 2012 | $ | 500,000 | $ | 220,000 | $ | 132,317 | $ | 9,400 | $ | 861,717 | |||||||||||||
| | | | | | | | | | | | | | | | | |||||||
| | | | | | | | | | | | | | | | | |||||||
Acquired franchise stores | — | — | — | 329 | 329 | ||||||||||||||||||
Acquisitions | — | — | — | 9,565 | 9,565 | ||||||||||||||||||
Amortization expense | — | — | (6,652 | ) | (2,347 | ) | (8,999 | ) | |||||||||||||||
Translation effect of exchange rates | — | — | — | 162 | 162 | ||||||||||||||||||
| | | | | | | | | | | | | | | | | |||||||
Balance at December 31, 2013 | $ | 500,000 | $ | 220,000 | $ | 125,665 | $ | 17,109 | $ | 862,774 | |||||||||||||
| | | | | | | | | | | | | | | | | |||||||
| | | | | | | | | | | | | | | | | |||||||
The following table reflects the gross carrying amount and accumulated amortization for each major intangible asset: | |||||||||||||||||||||||
December 31, 2013 | December 31, 2012 | ||||||||||||||||||||||
Weighted- | Cost | Accumulated | Carrying | Cost | Accumulated | Carrying | |||||||||||||||||
Average | Amortization | Amount | Amortization | Amount | |||||||||||||||||||
Life | |||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Brands—retail | — | $ | 500,000 | $ | — | $ | 500,000 | $ | 500,000 | $ | — | $ | 500,000 | ||||||||||
Brands—franchise | — | 220,000 | — | 220,000 | 220,000 | — | 220,000 | ||||||||||||||||
Retail agreements | 30.3 | 31,000 | (7,301 | ) | 23,699 | 31,000 | (6,249 | ) | 24,751 | ||||||||||||||
Franchise agreements | 25 | 70,000 | (19,017 | ) | 50,983 | 70,000 | (16,217 | ) | 53,783 | ||||||||||||||
Manufacturing agreements | 25 | 70,000 | (19,017 | ) | 50,983 | 70,000 | (16,217 | ) | 53,783 | ||||||||||||||
Other intangibles | 8.2 | 20,327 | (3,995 | ) | 16,332 | 10,600 | (2,151 | ) | 8,449 | ||||||||||||||
Franchise rights | 3.7 | 5,463 | (4,686 | ) | 777 | 5,134 | (4,183 | ) | 951 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
Total | 23.5 | $ | 916,790 | $ | (54,016 | ) | $ | 862,774 | $ | 906,734 | $ | (45,017 | ) | $ | 861,717 | ||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
The following table represents future estimated amortization expense of intangible assets with finite lives: | |||||||||||||||||||||||
Years ending December 31, | Estimated | ||||||||||||||||||||||
amortization | |||||||||||||||||||||||
expense | |||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
2014 | $ | 12,952 | |||||||||||||||||||||
2015 | 12,820 | ||||||||||||||||||||||
2016 | 11,987 | ||||||||||||||||||||||
2017 | 9,996 | ||||||||||||||||||||||
2018 | 9,952 | ||||||||||||||||||||||
Thereafter | 85,067 | ||||||||||||||||||||||
| | | | | |||||||||||||||||||
Total | $ | 142,774 | |||||||||||||||||||||
| | | | | |||||||||||||||||||
| | | | | |||||||||||||||||||
Such estimates do not reflect the impact of future foreign exchange rates changes. | |||||||||||||||||||||||
PROPERTY_PLANT_AND_EQUIPMENT_N
PROPERTY, PLANT AND EQUIPMENT, NET | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
PROPERTY, PLANT AND EQUIPMENT, NET | ' | |||||||
PROPERTY, PLANT AND EQUIPMENT, NET | ' | |||||||
NOTE 6. PROPERTY, PLANT AND EQUIPMENT, NET | ||||||||
Property, plant and equipment consisted of the following: | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
(in thousands) | ||||||||
Land, buildings and improvements | $ | 66,851 | $ | 66,119 | ||||
Machinery and equipment | 115,681 | 107,664 | ||||||
Leasehold improvements | 115,815 | 102,902 | ||||||
Furniture and fixtures | 91,113 | 79,747 | ||||||
Software | 34,166 | 29,956 | ||||||
Construction in progress | 3,964 | 1,856 | ||||||
| | | | | | | | |
Total property, plant and equipment | 427,590 | $ | 388,244 | |||||
Less: accumulated depreciation | (220,836 | ) | (188,757 | ) | ||||
| | | | | | | | |
Net property, plant and equipment | $ | 206,754 | $ | 199,487 | ||||
| | | | | | | | |
| | | | | | | | |
The Company recognized depreciation expense of property, plant and equipment of $42.8 million, $40.7 million and $38.8 million for the years ended December 31, 2013, 2012 and 2011, respectively. | ||||||||
DEFERRED_REVENUE_AND_OTHER_CUR
DEFERRED REVENUE AND OTHER CURRENT LIABILITIES | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
DEFERRED REVENUE AND OTHER CURRENT LIABILITIES | ' | |||||||
DEFERRED REVENUE AND OTHER CURRENT LIABILITIES | ' | |||||||
NOTE 7. DEFERRED REVENUE AND OTHER CURRENT LIABILITIES | ||||||||
Other current liabilities consisted of the following: | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
(in thousands) | ||||||||
Deferred revenue | $ | 37,193 | $ | 41,465 | ||||
Accrued payroll | 23,023 | 33,522 | ||||||
Other current liabilities | 46,243 | 41,350 | ||||||
| | | | | | | | |
Total | $ | 106,459 | $ | 116,337 | ||||
| | | | | | | | |
| | | | | | | | |
Deferred revenue consists primarily of Gold Card membership fees and gift card deferrals. Other current liabilities consist of the liabilities related to accrued taxes, benefits, workers compensation, accrued interest and other occupancy. | ||||||||
LONGTERM_DEBT_INTEREST_EXPENSE
LONG-TERM DEBT / INTEREST EXPENSE | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
LONG-TERM DEBT / INTEREST EXPENSE | ' | ||||||||||
LONG-TERM DEBT / INTEREST EXPENSE | ' | ||||||||||
NOTE 8. LONG-TERM DEBT / INTEREST EXPENSE | |||||||||||
Long-term debt consisted of the following: | |||||||||||
December 31, | |||||||||||
2013 | 2012 | ||||||||||
(in thousands) | |||||||||||
2011 Senior Credit Facility | $ | 1,345,987 | $ | 1,096,112 | |||||||
Other | 1,112 | 2,450 | |||||||||
| | | | | | | | ||||
Total Debt | $ | 1,347,099 | $ | 1,098,562 | |||||||
Less: current maturities | (5,443 | ) | (3,817 | ) | |||||||
| | | | | | | | ||||
Long-term Debt | $ | 1,341,656 | $ | 1,094,745 | |||||||
| | | | | | | | ||||
| | | | | | | | ||||
At December 31, 2013, the Company's total debt principal maturities are as follows: | |||||||||||
Years Ending | Senior Credit | Other | Total | ||||||||
December 31, | Facility(a) | ||||||||||
(in thousands) | |||||||||||
2014 | $ | 4,550 | $ | 893 | $ | 5,443 | |||||
2015 | 4,550 | 219 | 4,769 | ||||||||
2016 | 4,550 | — | 4,550 | ||||||||
2017 | 4,550 | — | 4,550 | ||||||||
2018 | 4,550 | — | 4,550 | ||||||||
2019 | 1,327,250 | — | 1,327,250 | ||||||||
| | | | | | | | | | | |
Total | $ | 1,350,000 | $ | 1,112 | $ | 1,351,112 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
(a) | |||||||||||
The Senior Credit Facility includes the original discount of $4.0 million. | |||||||||||
The Company's net interest expense is as follows: | |||||||||||
For the year ended | |||||||||||
December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
Senior Credit Facility: | |||||||||||
Term Loan | 42,020 | 41,216 | 38,356 | ||||||||
Revolver | 680 | 533 | 598 | ||||||||
Early extinguishment of debt | 5,712 | 1,343 | 19,855 | ||||||||
Deferred financing fees amortization | 2,087 | 3,920 | 2,412 | ||||||||
Mortgage and other interest expense | 159 | 168 | 766 | ||||||||
OID amortization | 2,625 | 404 | 344 | ||||||||
Interest income | (254 | ) | (28 | ) | (1,110 | ) | |||||
Senior Notes | — | — | 4,808 | ||||||||
Senior Subordinated Notes | — | — | 3,055 | ||||||||
Termination of interest rate swaps | — | — | 5,819 | ||||||||
| | | | | | | | | | | |
Interest expense, net | 53,029 | 47,556 | 74,903 | ||||||||
| | | | | | | | | | | |
| | | | | | | | | | | |
The following is a summary of the Company's debt: | |||||||||||
Senior Credit Facility. In March 2011, Centers entered into the Senior Credit Facility, consisting of the Term Loan Facility and the Revolving Credit Facility. As of December 31, 2013, the Company believes that it is in compliance with all covenants under the Senior Credit Facility. As of December 31, 2013, $1.1 million of the Revolving Credit Facility was pledged to secure letters of credit. The Senior Credit Facility permits the Company to prepay a portion or all of the outstanding balance without incurring penalties (except London Interbank Offering Rate ("LIBOR") breakage costs). GNC Corporation, the Company's indirect wholly owned subsidiary ("GNC Corporation"), and Centers' existing and future domestic subsidiaries have guaranteed Centers' obligations under the Senior Credit Facility. In addition, the Senior Credit Facility is collateralized by first priority pledges (subject to permitted liens) of substantially all of Centers' assets, including its equity interests and the equity interests of its domestic subsidiaries. | |||||||||||
On August 1, 2012, Centers amended the Senior Credit Facility to, among other amendments, provide additional commitments of $200 million for incremental term loans. | |||||||||||
In October 2012, Centers entered into an amendment to the Senior Credit Facility that included changes to ABR, LIBOR, and Applicable Margin rates. Specifically, as amended, the facility allowed the Company to borrow at a rate per annum equal to (A) the sum of (i) the greatest of (a) the prime rate (as publicly announced by JPMorgan Chase Bank, N.A. as its prime rate in effect), (b) the federal funds effective rate plus 0.50%, (c) one month adjusted LIBOR plus 1.0% and (d) 2.25% with respect to Revolving Credit Facility and 2.00% with respect to Term Loan Facility plus (ii) the applicable margin of 2.0% with respect to Revolving Credit Facility and 1.75% with respect to Term Loan Facility or (B) the sum of (i) the greater of (a) adjusted LIBOR or (b) 1.25% with respect to Revolving Credit Facility and 1.00% with respect to Term Loan Facility plus (ii) an applicable margin of 3.0% for amounts borrowed under the Revolver Credit Facility and 2.75% with respect to amounts outstanding under the Term Loan Facility. As of December 31, 2012, the Company's interest rate on its Senior Credit Facility was 3.75%, as a result of the interest rate minimum requirement as described above. | |||||||||||
During the fourth quarter of 2013, Centers amended and restated the Senior Credit Facility to, among other amendments, increase the size of the Term Loan Facility by $252.5 million, increase the amount available for borrowings under the Revolving Credit Facility from $80 million to $130 million, extend the Revolving Credit Facility maturity date to March 2017, and extend the maturity of the Term Loan Facility to March 2019. The amendment also included changes to ABR, LIBOR, and Applicable Margin rates. Specifically, the Company may, at its option, borrow at a rate per annum equal to (A) the sum of (i) the greatest of (a) the prime rate (as publicly announced by JPMorgan Chase Bank, N.A. as its prime rate in effect), (b) the federal funds effective rate plus 0.50%, (c) one month adjusted LIBOR plus 1.0% and (d) 1.75% with respect to Term Loan Facility plus (ii) the applicable margin of 1.25% with respect to borrowings under the Revolving Credit Facility and 1.5% with respect to amounts outstanding under the Term Loan Facility or (B) the sum of (i) the greater of (a) adjusted LIBOR or (b) 0.75% with respect to amounts outstanding under the Term Loan Facility plus (ii) the applicable margin of 2.25% with respect to borrowings under the Revolving Credit Facility and 2.5% with respect to amounts outstanding under the Term Loan Facility. As of December 31, 2013, the Company's current interest rate on its Senior Credit Facility is 3.25%, as a result of the interest rate minimum requirement as described above. As of December 31, 2013 and 2012, the outstanding letter of credit fee was 2.50% and 3.00%, respectively, and the commitment fee on the undrawn portion of the Revolving Credit Facility was 0.5% at both December 31, 2013 and 2012. | |||||||||||
The Senior Credit Facility contains customary covenants, including incurrence covenants and certain other limitations on the ability of GNC Corporation, Centers, and Centers' subsidiaries to, among other things, make optional payments in respect of other debt instruments, pay dividends or other payments on capital stock, and enter into arrangements that restrict their ability to pay dividends or grant liens. | |||||||||||
In connection with the Refinancing in 2011, Centers used a portion of the net proceeds from the Term Loan Facility to refinance its former indebtedness, including all outstanding indebtedness under the Old Senior Credit Facility, the Senior Notes and the Senior Subordinated Notes. | |||||||||||
FAIR_VALUE_MEASUREMENTS_AND_FI
FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS | ' | |||||||||||||
FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS | ' | |||||||||||||
NOTE 9. FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS | ||||||||||||||
Fair value is defined as a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the standard establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows: | ||||||||||||||
Level 1 | — | observable inputs such as quoted prices in active markets for identical assets and liabilities; | ||||||||||||
Level 2 | — | observable inputs such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, other inputs that are observable, or can be corroborated by observable market data; and | ||||||||||||
Level 3 | — | unobservable inputs for which there are little or no market data, which require the reporting entity to develop its own assumptions. | ||||||||||||
The following table presents the Company's financial assets and liabilities that were accounted for at fair value on a recurring basis as of December 31, 2013 by level within the fair value hierarchy: | ||||||||||||||
Fair Value Measurements Using | ||||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||||
(in thousands) | ||||||||||||||
Cash equivalents | $ | 142,800 | $ | — | $ | — | ||||||||
Other long-term assets | $ | — | $ | 6,124 | $ | — | ||||||||
The following table presents the Company's financial assets and liabilities that were accounted for at fair value on a recurring basis as of December 31, 2012 by level within the fair value hierarchy: | ||||||||||||||
Fair Value Measurements Using | ||||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||||
(in thousands) | ||||||||||||||
Cash equivalents | $ | 85,006 | $ | — | $ | — | ||||||||
Other long-term assets | $ | — | $ | 4,397 | $ | — | ||||||||
Other long-term assets classified as Level 2 consist of assets related to the Company's non-qualified deferred compensation plan. The assets related to this plan are adjusted based on changes in the fair value of the underlying investments. Since the fair value of the investments is based on quoted prices of similar items in active markets, the assets are classified within Level 2 on the fair value hierarchy. | ||||||||||||||
At December 31, 2013 and 2012, the Company's financial instruments consisted of cash and cash equivalents, receivables, franchise notes receivable, accounts payable, and long-term debt. The carrying amount of cash and cash equivalents, receivables, accounts payable and accrued liabilities approximates their respective fair values because of the short maturities of these instruments. Based on the interest rates currently available and their underlying risk, the carrying value of the franchise notes receivable approximates their fair values. These fair values are reflected net of reserves for uncollectable accounts. | ||||||||||||||
As considerable judgment is required to determine these estimates, changes in the assumptions or methodologies may have an effect on these estimates. The Company determined the estimated fair values of its debt by using currently available market information. The fair value of debt would be classified as a Level 2 category on the fair value hierarchy, as defined above. The actual and estimated fair values of the Company's financial instruments are as follows: | ||||||||||||||
December 31, 2013 | December 31, 2012 | |||||||||||||
Carrying | Fair | Carrying | Fair | |||||||||||
Amount | Value | Amount | Value | |||||||||||
(in thousands) | ||||||||||||||
Cash and cash equivalents | $ | 226,217 | $ | 226,217 | $ | 158,541 | $ | 158,541 | ||||||
Receivables, net | 144,833 | 144,833 | 129,641 | 129,641 | ||||||||||
Franchise notes receivable, net | 10,163 | 10,163 | 7,589 | 7,589 | ||||||||||
Accounts payable | 135,164 | 135,164 | 125,165 | 125,165 | ||||||||||
Long-term debt (including current portion) | 1,347,099 | 1,343,732 | 1,098,562 | 1,101,309 |
LONGTERM_LEASE_OBLIGATIONS
LONG-TERM LEASE OBLIGATIONS | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
LONG-TERM LEASE OBLIGATIONS | ' | ||||||||||||||||
LONG-TERM LEASE OBLIGATIONS | ' | ||||||||||||||||
NOTE 10. LONG-TERM LEASE OBLIGATIONS | |||||||||||||||||
The Company enters into operating leases covering its retail store locations. The Company is the primary lessor of the majority of all leased retail store locations and sublets the locations to individual franchisees. The leases generally provide for an initial term of between five and ten years, and may include renewal options for varying terms thereafter. The leases require minimum monthly rental payments and a pro rata share of landlord allocated common operating expenses. Most retail leases also require additional rentals based on a percentage of sales in excess of specified levels. According to the individual lease specifications, real estate taxes, insurance and other related costs may be included in the rental payment or charged in addition to rent. Other lease expenses relate to and include distribution facilities, transportation equipment, data processing equipment and automobiles. | |||||||||||||||||
As the Company is the primary lessee for the majority of the franchise store locations, it is ultimately liable for the lease payments to the landlord. The Company makes the payments to the landlord directly, and then bills the franchisee for reimbursement of this cost. If a franchisee defaults on its sub-lease and its sub-lease is terminated, the Company has in the past converted, and expects in the future to, convert any such franchise store into a corporate store and fulfill the remaining lease obligation. | |||||||||||||||||
The composition of the Company's rental expense included the following components: | |||||||||||||||||
Year ended December 31, | |||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||
(in thousands) | |||||||||||||||||
Retail stores: | |||||||||||||||||
Rent on long-term operating leases, net of sublease income | $ | 137,076 | $ | 126,411 | $ | 120,170 | |||||||||||
Landlord related taxes | 19,552 | 18,399 | 16,940 | ||||||||||||||
Common operating expenses | 34,978 | 33,589 | 31,969 | ||||||||||||||
Percent rent | 23,943 | 23,276 | 20,824 | ||||||||||||||
| | | | | | | | | | | |||||||
Total retail stores rent expense | 215,549 | 201,675 | 189,903 | ||||||||||||||
Truck fleet | 4,491 | 5,350 | 4,979 | ||||||||||||||
Other | 13,484 | 13,401 | 11,883 | ||||||||||||||
| | | | | | | | | | | |||||||
Total | $ | 233,524 | $ | 220,426 | $ | 206,765 | |||||||||||
| | | | | | | | | | | |||||||
| | | | | | | | | | | |||||||
Rent on long-term operating leases is net of sublease income of $37.7 million, $35.7 million and $33.7 million for the years ended December 31, 2013, 2012 and 2011, respectively. | |||||||||||||||||
Minimum future obligations for non-cancelable operating leases with initial or remaining terms of at least one year in effect at December 31, 2013 are as follows: | |||||||||||||||||
Company | Franchise | Other | Sublease | Total | |||||||||||||
Retail | Retail | Income | |||||||||||||||
Stores | Stores | ||||||||||||||||
(in thousands) | |||||||||||||||||
2014 | $ | 127,555 | $ | 27,619 | $ | 6,132 | $ | (27,619 | ) | $ | 133,687 | ||||||
2015 | 108,798 | 23,519 | 5,371 | (23,519 | ) | 114,169 | |||||||||||
2016 | 92,707 | 19,186 | 4,051 | (19,186 | ) | 96,758 | |||||||||||
2017 | 70,412 | 13,735 | 2,956 | (13,735 | ) | 73,368 | |||||||||||
2018 | 44,528 | 7,259 | 1,382 | (7,259 | ) | 45,910 | |||||||||||
Thereafter | 78,228 | 10,783 | 12,985 | (10,783 | ) | 91,213 | |||||||||||
| | | | | | | | | | | | | | | | | |
$ | 522,228 | $ | 102,101 | $ | 32,877 | $ | (102,101 | ) | $ | 555,105 | |||||||
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2013 | |
COMMITMENTS AND CONTINGENCIES. | ' |
COMMITMENTS AND CONTINGENCIES | ' |
NOTE 11. COMMITMENTS AND CONTINGENCIES | |
Litigation | |
The Company is engaged in various legal actions, claims and proceedings arising in the normal course of business, including claims related to breach of contracts, products liabilities, intellectual property matters and employment-related matters resulting from the Company's business activities. | |
The Company records accruals for outstanding legal matters when it believes it is probable that a loss will be incurred and the amount of such loss can be reasonably estimated. The Company evaluates, on a quarterly basis, developments in legal matters that could affect the amount of any accrual and developments that would make a loss contingency both probable and reasonably estimable. If a loss contingency is not both probable and estimable, the Company does not establish an accrued liability. Currently, none of the Company's accruals for outstanding legal matters are material individually or in the aggregate to the Company's financial position. However, if the Company ultimately is required to make a payment in connection with an adverse outcome in any of the matters discussed below, it is possible that it could have a material adverse effect on the Company's business, financial condition, results of operations or cash flows. | |
The Company's contingencies are subject to substantial uncertainties, including for each such contingency the following, among other factors: (i) the procedural status of the case; (ii) whether the case has or may be certified as a class action suit; (iii) the outcome of preliminary motions; (iv) the impact of discovery; (v) whether there are significant factual issues to be determined or resolved; (vi) whether the proceedings involve a large number of parties and/or parties and claims in multiple jurisdictions or jurisdictions in which the relevant laws are complex or unclear; (vii) the extent of potential damages, which are often unspecified or indeterminate; and (viii) the status of settlement discussions, if any, and the settlement posture of the parties. Consequently, except as otherwise noted below with regard to a particular matter, the Company cannot predict with any reasonable certainty the timing or outcome of the legal matters described below, and the Company is unable to estimate a possible loss or range of loss. | |
As a manufacturer and retailer of nutritional supplements and other consumer products that are ingested by consumers or applied to their bodies, the Company has been and is currently subjected to various product liability claims. Although the effects of these claims to date have not been material to the Company, it is possible that current and future product liability claims could have a material adverse effect on its business or financial condition, results of operations or cash flows. The Company currently maintains product liability insurance with a deductible/retention of $4.0 million per claim with an aggregate cap on retained loss of $10.0 million. The Company typically seeks and has obtained contractual indemnification from most parties that supply raw materials for its products or that manufacture or market products it sells. The Company also typically seeks to be added, and has been added, as an additional insured under most of such parties' insurance policies. The Company is also entitled to indemnification by Numico for certain losses arising from claims related to products containing ephedra or Kava Kava sold prior to December 5, 2003. However, any such indemnification or insurance is limited by its terms and any such indemnification, as a practical matter, is limited to the creditworthiness of the indemnifying party and its insurer, and the absence of significant defenses by the insurers. Consequently, the Company may incur material products liability claims, which could increase its costs and adversely affect its reputation, revenue and operating income. | |
Hydroxycut Claims. On May 1, 2009, the FDA issued a warning on several Hydroxycut-branded products manufactured by Iovate Health Sciences U.S.A., Inc. ("Iovate") based on 23 reports of liver injuries from consumers who claimed to have used the products between 2002 and 2009. As a result, Iovate voluntarily recalled 14 Hydroxycut-branded products. | |
Following the recall, the Company was named, among other defendants, in approximately 93 lawsuits related to Hydroxycut-branded products in 14 states. Iovate previously accepted the Company's tender request for defense and indemnification under its purchasing agreement with the Company in these matters. The Company's ability to obtain full recovery in respect of any claims against the Company in connection with products manufactured by Iovate under the indemnity is dependent on Iovate's insurance coverage, the creditworthiness of its insurer, and the absence of significant defenses by such insurer. To the extent the Company is not fully compensated by Iovate's insurer, it can seek recovery directly from Iovate. The Company's ability to fully recover such amounts may be limited by the creditworthiness of Iovate. | |
As of December 31, 2013, there were 73 pending lawsuits related to Hydroxycut in which the Company had been named: 67 individual, largely personal injury claims and six putative class action cases, generally inclusive of claims of consumer fraud, misrepresentation, strict liability and breach of warranty. | |
The United States Judicial Panel on Multidistrict Litigation consolidated pretrial proceedings of many of the pending actions in the Southern District of California (In re: Hydroxycut Marketing and Sales Practices Litigation, MDL No. 2087). The parties in the consolidated class actions reached a settlement, but the Court denied approval of that settlement in October 2013. The parties have since reached a revised settlement, which remains subject to Court approval. The Company is not required to make any payments under the current settlement agreement. | |
In May 2013, the parties to the individual personal injury cases signed a Master Settlement Agreement, under which the Company is not required to make any payments. The Master Settlement Agreement required the individual plaintiffs to sign and deliver a release by September 23, 2013. Certain Plaintiffs failed to comply with this requirement and were afforded additional time to comply by the Court. On February 10, 2014, the Court entered an order to show cause compelling the remaining non-compliant plaintiffs to present evidence as to why their claims should not be dismissed. Once all of the releases have been signed (or the Court has dismissed the claims of any remaining non-compliant plaintiffs), the settlement will be funded and the cases dismissed. The Company currently expects that the dismissals will be entered by the end of March 2014. Following resolution of the individual personal injury cases and the settlement of the consolidated class action suits, all of the Hydroxycut claims currently pending against the Company will be resolved without any payment by the Company. | |
DMAA Claims. Prior to December 2013, we sold products manufactured by third parties that contained derivatives from geranium known as 1.3-dimethylpentylamine/ dimethylamylamine/13-dimethylamylamine, or "DMAA," which were recalled from our stores in November 2013. As of February 14, 2014, we were named in 16 lawsuits involving products containing DMAA, including 13 personal injury cases and three putative class action cases. The proceedings associated with these cases, which generally seek indeterminate money damages, are in the early stages, and any liabilities that may arise from these matters are not probable or reasonably estimable at this time. We are contractually entitled to indemnification by our third-party vendor with regard to these matters, although our ability to obtain full recovery in respect of any such claims against us is dependent upon the creditworthiness of our vendor and/or its insurance coverage and the absence of any significant defenses available to its insurer. | |
California Wage and Break Claim. On November 4, 2008, 98 plaintiffs filed individual claims against the Company in the Superior Court of the State of California for the County of Orange, which was removed to the U.S. District Court, Central District of California on February 17, 2009. Each of the plaintiffs had previously been a member of a purported class in a lawsuit filed against the Company in 2007 and resolved in September 2009. The plaintiffs allege that they were not provided all of the rest and meal periods to which they were entitled under California law, and further allege that the Company failed to pay them split shift and overtime compensation to which they were entitled under California law. The plaintiffs also allege derivative claims for inaccurate wage statements, failure to pay wages due at termination, and penalty claims under the California Labor Code. In June 2013, a trial was conducted with respect to the claims of seven of the plaintiffs. The jury returned a verdict in favor of the Company on all claims submitted to the jury, and the Court entered an order in favor of the Company on the one claim submitted to the Court. The claims of five other plaintiffs have been resolved and the claims of eighty-six plaintiffs remain, with respect to which discovery is ongoing. As any liabilities that may arise from these matters are not probable or reasonably estimable at this time, no liability has been accrued in the accompanying financial statements. | |
On July 21, 2011, Charles Brewer, on behalf of himself and all others similarly situated, sued General Nutrition Corporation in federal court, alleging state and federal wage and hour claims (U.S. District Court, Northern District of California, Case No. 11CV3587). On October 7, 2011, plaintiff filed an eight-count amended complaint alleging, inter alia, meal, rest break and overtime violations. On October 21, 2011, the Company filed a motion to dismiss the complaint and on December 14, 2011 the court dismissed count six (the federal overtime claim) giving plaintiffs an opportunity to amend the complaint within thirty days. On January 13, 2012, plaintiff filed a Second Amended complaint. On September 18, 2012, Plaintiff filed a Motion for Conditional Certification and on January 7, 2013, the Court conditionally certified a Fair Labor Standards Act class with respect to one of Plaintiff's claims. As any liabilities that may arise from these matters are not probable or reasonably estimable at this time, no liability has been accrued in the accompanying financial statements. | |
On February 29, 2012, former Senior Store Manager, Elizabeth Naranjo, individually and on behalf of all others similarly situated sued General Nutrition Corporation in the Superior Court of the State of California for the County of Alameda (Case No. RG 12619626). The complaint contains eight causes of action, alleging, inter alia, meal, rest break, and overtime violations. As any liabilities that may arise from these matters are not probable or reasonably estimable at this time, no liability has been accrued in the accompanying financial statements. | |
FLSA Matters. On June 29, 2010, Dominic Vargas and Anne Hickok, on behalf of themselves and all others similarly situated, sued General Nutrition Corporation and the Company in federal court (U.S. District Court, Western District of Pennsylvania, Case No. 2:05-mc-02025). The two-count complaint alleges, generally, that plaintiffs were required to perform work on an uncompensated basis and that the Company failed to pay overtime for such work. The second count of the complaint alleges the Company retaliated against plaintiffs when they complained about the overtime policy. The Company filed a motion to dismiss count II of the Complaint and on January 6, 2011 the court granted the motion. In fall, 2011, plaintiffs filed their Motion for Class Certification. On August 16, 2012, the Court ruled on the motion, granting in part and denying in part, the motion. Class notice was mailed to putative class members in November 2012 and discovery regarding opt-in plaintiffs is ongoing. As of December 31, 2013, an immaterial liability has been accrued in the accompanying financial statements. | |
Commitments | |
The Company maintains certain purchase commitments with various vendors to ensure its operational needs are fulfilled. As of December 31, 2013, future purchase commitments consisted of $8.2 million. Other commitments related to the Company's business operations cover varying periods of time and are not significant. All of these commitments are expected to be fulfilled with no adverse consequences to the Company's operations of financial condition. | |
Environmental Compliance | |
In March 2008, the South Carolina Department of Health and Environmental Control (the "DHEC") requested that the Company investigate contamination associated with historical activities at its South Carolina facility. These investigations have identified chlorinated solvent impacts in soils and groundwater that extend offsite from the facility. The Company entered into a Voluntary Cleanup Contract with the DHEC regarding the matter on September 24, 2012. Pursuant to such contract, the Company will submit a plan for additional investigations to the DHEC and will implement the plan upon DHEC's approval. After the Company completes the investigations to understand the extent of the chlorinated solvent impacts, the Company will develop appropriate remedial measures for DHEC approval. At this stage of the investigation, however, it is not possible to estimate the timing and extent of any remedial action that may be required, the ultimate cost of remediation, or the amount of the Company's potential liability, therefore no liability is recorded. | |
In addition to the foregoing, the Company is subject to numerous federal, state, local and foreign environmental and health and safety laws and regulations governing its operations, including the handling, transportation and disposal of the Company's non-hazardous and hazardous substances and wastes, as well as emissions and discharges from its operations into the environment, including discharges to air, surface water and groundwater. Failure to comply with such laws and regulations could result in costs for remedial actions, penalties or the imposition of other liabilities. New laws, changes in existing laws or the interpretation thereof, or the development of new facts or changes in their processes could also cause the Company to incur additional capital and operating expenditures to maintain compliance with environmental laws and regulations and environmental permits. The Company is also subject to laws and regulations that impose liability and cleanup responsibility for releases of hazardous substances into the environment without regard to fault or knowledge about the condition or action causing the liability. Under certain of these laws and regulations, such liabilities can be imposed for cleanup of previously owned or operated properties, or for properties to which substances or wastes that were sent in connection with current or former operations at its facilities. The presence of contamination from such substances or wastes could also adversely affect the Company's ability to sell or lease its properties, or to use them as collateral for financing. From time to time, the Company has incurred costs and obligations for correcting environmental and health and safety noncompliance matters and for remediation at or relating to certain of the Company's properties or properties at which the Company's waste has been disposed. However, compliance with the provisions of national, state and local environmental laws and regulations has not had a material effect upon the Company's capital expenditures, earnings, financial position, liquidity or competitive position. The Company believes it has complied with, and is currently complying with, its environmental obligations pursuant to environmental and health and safety laws and regulations and that any liabilities for noncompliance will not have a material adverse effect on its business, financial performance or cash flows. However, it is difficult to predict future liabilities and obligations, which could be material. | |
PREFERRED_STOCK
PREFERRED STOCK | 12 Months Ended |
Dec. 31, 2013 | |
PREFERRED STOCK | ' |
PREFERRED STOCK | ' |
NOTE 12. PREFERRED STOCK | |
Holdings is authorized to issue up to 60.0 million shares of preferred stock, par value $0.001 per share. No shares of preferred stock were outstanding as of December 31, 2013 and 2012. | |
STOCKHOLDERS_EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
STOCKHOLDERS' EQUITY | ' | ||||||||||
STOCKHOLDERS' EQUITY | ' | ||||||||||
NOTE 13. STOCKHOLDERS' EQUITY | |||||||||||
Common Stock | |||||||||||
Holdings has authorized 300.0 million shares of common stock. At December 31, 2013, there were 94.0 million shares of common stock outstanding. | |||||||||||
The Company periodically evaluates various options for the use of its capital, including the issuance of dividends and repurchase of common stock. | |||||||||||
Earnings Per Share | |||||||||||
The following table represents the Company's basic and dilutive weighted average shares: | |||||||||||
Year ended December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
Basic weighted average shares | 96,481 | 103,503 | 100,261 | ||||||||
Effect of dilutive employee stock-based compensation awards | 902 | 1,408 | 2,749 | ||||||||
| | | | | | | | | | | |
Diluted weighted averages shares | 97,383 | 104,911 | 103,010 | ||||||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Unexercised stock options of an immaterial amount, 0.4 million, and 2.0 million shares for the years ended December 31, 2013, 2012 and 2011, respectively, were not included in the computation of diluted earnings per share because the impact of applying the treasury stock method to these options was anti-dilutive. | |||||||||||
STOCKBASED_COMPENSATION_PLANS
STOCK-BASED COMPENSATION PLANS | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
STOCK-BASED COMPENSATION PLANS | ' | |||||||||||||
STOCK-BASED COMPENSATION PLANS | ' | |||||||||||||
NOTE 14. STOCK-BASED COMPENSATION PLANS | ||||||||||||||
The Company has outstanding stock-based compensation awards that were granted by the Compensation Committee (the "Compensation Committee") of Holdings' board of directors under the following two stock-based employee compensation plans: | ||||||||||||||
• | ||||||||||||||
the GNC Holdings, Inc. 2011 Stock and Incentive Plan (the "2011 Stock Plan") adopted in March 2011; and | ||||||||||||||
• | ||||||||||||||
the GNC Acquisition Holdings Inc. 2007 Stock Incentive Plan adopted in March 2007 (as amended, the "2007 Stock Plan"). | ||||||||||||||
Both plans have provisions that allow for the granting of stock options, restricted stock and other stock based awards and are available to certain eligible employees, directors, consultants or advisors as determined by the Compensation Committee. Stock options under the plans were granted with exercise prices at or above fair market value on the date of grant, typically vest over a four- or five-year period and expire seven or ten years from the date of grant. The Company will not grant any additional awards under the 2007 Stock Plan. No stock appreciation rights, restricted stock, deferred stock or performance shares were granted under the 2007 Stock Plan. | ||||||||||||||
Up to 8.5 million shares of common stock may be issued under the 2011 Stock Plan (subject to adjustment to reflect certain transactions and events specified in the 2011 Stock Plan for any award grant). If any award granted under the 2011 Stock Plan expires, terminates or is cancelled without having been exercised in full, the number of shares underlying such unexercised award will again become available for awards under the 2011 Stock Plan. The total number of shares of common stock available for awards under the 2011 Stock Plan will be reduced by (i) the total number of stock options or stock appreciation rights exercised, regardless of whether any of the shares of common stock underlying such awards are not actually issued to the participant as the result of a net settlement, and (ii) any shares of common stock used to pay any exercise price or tax withholding obligation. In addition, the number of shares of common stock that are subject to restricted stock, performance shares or other stock-based awards that are not subject to the appreciation of the value of a share of common stock ("Full Share Awards") that may be granted under the 2011 Stock Plan is limited by counting shares granted pursuant to such awards against the aggregate share reserve as 1.8 shares for every share granted. If any stock option, stock appreciation right or other stock-based award that is not a Full Share Award is cancelled, expires or terminates unexercised for any reason, the shares covered by such awards will again be available for the grant of awards under the 2011 Stock Plan. If any shares of common stock that are subject to restricted stock, performance shares or other stock-based awards that are Full Share Awards are forfeited for any reason, 1.8 shares of common stock will again be available for the grant of awards under the 2011 Stock Plan. | ||||||||||||||
The Company utilizes the Black Scholes model to calculate the fair value of options under both the 2011 Stock Plan and the 2007 Stock Plan. The resulting compensation cost is recognized in the Company's financial statements over the option vesting period. The Company recognized $7.8 million, $4.8 million and $3.9 million of non-cash stock-based compensation expense for the year ended December 31, 2013, 2012 and 2011, respectively. At December 31, 2013, there was approximately $16.9 million of total unrecognized compensation cost related to non-vested stock-based compensation for all awards previously made that are expected to be recognized over a weighted average period of approximately 1.7 years. | ||||||||||||||
During the year ended December 31, 2013, the total intrinsic value of awards exercised was $44.6 million and the total amount of cash received from the exercise of options was $14.6 million. The total tax impact associated with the exercise of awards for the year ended December 31, 2013 was a benefit of $17.9 million, of which $15.4 was recorded to paid-in-capital. | ||||||||||||||
During the year ended December 31, 2012, the total intrinsic value of awards exercised was $101.8 million and the total amount of cash received from the exercise of options was $26.0 million. The total tax impact associated with the exercise of awards for the year ended December 31, 2012 was a benefit of $39.8 million, of which $37.5 was recorded to paid-in-capital. | ||||||||||||||
During the year ended December 31, 2011, the total intrinsic value of awards exercised was $60.9 million and the total amount of cash received from the exercise of options was $28.5 million. The total tax impact associated with the exercise of awards for the year ended December 31, 2011 was a benefit of $22.4 million, of which $20.4 was recorded to paid-in-capital. | ||||||||||||||
The following table sets forth a summary of stock options under all plans for the year ended December 31, 2013: | ||||||||||||||
Total Options | Weighted | Weighted Average | Aggregate | |||||||||||
Average | Remaining | Intrinsic Value | ||||||||||||
Exercise Price | Contractual Term | (in thousands) | ||||||||||||
(in years) | ||||||||||||||
Outstanding at December 31, 2012 | 3,159,542 | $ | 18.96 | |||||||||||
Granted | 61,485 | 53.54 | ||||||||||||
Exercised | (1,221,632 | ) | 11.87 | |||||||||||
Forfeited | (112,241 | ) | 28.12 | |||||||||||
| | | | | | | | | | | | | | |
Outstanding at December 31, 2013 | 1,887,154 | $ | 24.14 | 5.6 | $ | 64,768 | ||||||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
Exercisable at December 31, 2013 | 576,562 | $ | 21.92 | 5.4 | $ | 21,060 | ||||||||
At December 31, 2013, the weighted average remaining contractual life of exercisable options was 5.4 years. The weighted average fair value of options granted during 2013, 2012 and 2011 was $16.16, $10.38, and $7.23, respectively. | ||||||||||||||
The Black-Scholes model utilizes the following assumptions in determining a fair value: price of underlying stock, award exercise price, expected term, risk-free interest rate, expected dividend yield and expected stock price volatility over the award's expected term. Due to the utilization of these assumptions, the existing models do not necessarily represent the definitive fair value of awards for future periods. As the IPO occurred during the second quarter of 2011, the option term has been estimated by considering both the vesting period, which typically for both plans has been five or four years, and the contractual term, which historically has been either seven or ten years. Prior to the IPO, the fair value of the common stock was estimated based upon the net enterprise value of the Company, discounted to reflect the lack of liquidity and control associated with the stock. Since the consummation of the IPO, the fair value of the stock has been based upon the closing price of the common stock as reported on the NYSE. Volatility is estimated based upon the Company utilizing its current peer group average. | ||||||||||||||
The assumptions used in the Company's Black Scholes valuation related to stock option grants made during each period below were as follows: | ||||||||||||||
Year ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Dividend yield | 1.0%-1.4% | 1.2%-1.4% | 0.00% | |||||||||||
Expected option life | 4.8 years | 4.8-5.0 years | 4.5-7.0 years | |||||||||||
Volatility factor percentage of market price | 35.9%-40.5% | 40.0%-40.7% | 38.5%-39.2% | |||||||||||
Discount rate | 0.7%-1.4% | 0.6%-0.9% | 1.5%-2.9% | |||||||||||
The following table sets forth a summary of restricted stock awards granted under the 2011 Stock Plan and related information for the year ended December 31, 2013: | ||||||||||||||
Restricted | Weighted | |||||||||||||
Stock | Average Grant- | |||||||||||||
Date Fair Value | ||||||||||||||
Outstanding at December 31, 2012 | 123,941 | $ | 24.24 | |||||||||||
Granted | 18,497 | 44.15 | ||||||||||||
Vested | (13,221 | ) | 39.96 | |||||||||||
Forfeited | (14,236 | ) | 28.05 | |||||||||||
| | | | | | | | |||||||
Outstanding at December 31, 2013 | 114,981 | $ | 25.16 | |||||||||||
| | | | | | | | |||||||
| | | | | | | | |||||||
Under the 2011 Stock Plan, the Company granted time vesting and performance vesting restricted stock units. Time vesting restricted stock units vest over a period of three years. Performance vesting restricted stock units vest based on the passage of time, earnings per share, and revenue growth; based on the extent to which the targets are achieved, vested shares may range from 0% to 200% of the original share amount. The unrecognized compensation cost related to the performance vesting restricted stock units is adjusted as necessary to reflect changes in the probability that the vesting criteria will be achieved. | ||||||||||||||
The following table sets forth a summary of restricted stock units and performance stock units granted under the 2011 Stock Plan and related information for the year ended December 31, 2013: | ||||||||||||||
Time Vesting | Weighted | Performance | Weighted | |||||||||||
Restricted | Average Grant- | Vesting | Average Grant- | |||||||||||
Stock Units | Date Fair Value | Restricted | Date Fair Value | |||||||||||
Stock Units | ||||||||||||||
Outstanding at December 31, 2012 | 171,937 | $ | 36.16 | — | $ | — | ||||||||
Granted | 37,744 | 53.44 | 58,226 | 45.76 | ||||||||||
Vested | (56,637 | ) | 35.85 | — | — | |||||||||
Forfeited | (11,746 | ) | 37.24 | (2,860 | ) | 42.19 | ||||||||
| | | | | | | | | | | | | | |
Outstanding at December 31, 2013 | 141,298 | $ | 40.81 | 55,366 | $ | 45.94 | ||||||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
RETIREMENT_PLANS
RETIREMENT PLANS | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
RETIREMENT PLANS | ' | ||||
RETIREMENT PLANS | ' | ||||
NOTE 15. RETIREMENT PLANS | |||||
The Company sponsors a 401(k) defined contribution savings plan covering substantially all employees. Full time employees who have completed 30 days of service and part time employees who have completed 1,000 hours of service are eligible to participate in the plan. The plan provides for employee contributions of 1% to 80% of individual compensation into deferred savings, subject to IRS limitations. The plan provides for Company contributions upon the employee meeting the eligibility requirements. The Company match consists of both a fixed and a discretionary match which is based on a specified financial target for all participants in the plan. The fixed match is 50% on the first 3% of the salary that an employee defers and the discretionary match could be up to an additional 50% match on the 3% deferral. A discretionary match can be approved at any time by the Company. | |||||
An employee becomes vested in the Company match portion as follows: | |||||
Years of Service | Percent | ||||
Vested | |||||
0-1 | 0 | % | |||
2-Jan | 33 | % | |||
3-Feb | 66 | % | |||
3+ | 100 | % | |||
The Company made cash contributions to the 401(k) plan of $1.6 million, $1.5 million and $1.3 million for the years ended December 31, 2013, 2012 and 2011, respectively. In addition, the Company made a discretionary match for the 2011 plan year of $1.3 million in February 2012, for the 2012 plan year of $1.5 million in February 2013, and for the 2013 plan year will make a cash contribution of $0.8 million in February 2014. | |||||
The Company has a Non-qualified Executive Retirement Arrangement Plan that covers key employees. Under the provisions of this plan, certain eligible key employees are granted cash compensation, which in the aggregate was not significant for any year presented. | |||||
The Company has a Non-qualified Deferred Compensation Plan that provides benefits payable to certain qualified key employees upon their retirement or their designated beneficiaries upon death. This plan allows participants the opportunity to defer pretax amounts ranging from 2% to 100% of their base compensation plus bonuses. The plan is funded entirely by elective contributions made by the participants. The Company has elected to finance any potential plan benefit obligations using corporate owned life insurance policies. All assets relating to the non-qualified deferred compensation plan are held in a rabbi trust. | |||||
SEGMENTS
SEGMENTS | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
SEGMENTS | ' | ||||||||||
SEGMENTS | ' | ||||||||||
NOTE 16. SEGMENTS | |||||||||||
The Company has three reportable segments, each of which represents an identifiable component of the Company for which separate financial information is available. This information is utilized by management to assess performance and allocate assets accordingly. The Company's management evaluates segment operating results based on several indicators. The primary key performance indicators are sales and operating income or loss for each segment. Operating income or loss, as evaluated by management, excludes certain items that are managed at the consolidated level, such as distribution and warehousing, impairments and other corporate costs. The following table represents key financial information for each of the Company's reportable segments, identifiable by the distinct operations and management of each: Retail, Franchising, and Manufacturing/Wholesale. The Retail reportable segment includes the Company's corporate store operations in the United States, Canada, Puerto Rico and its websites GNC.com, LuckyVitamin.com, and DiscountSupplements.com. The Franchise reportable segment represents the Company's franchise operations, both domestically and internationally. The Manufacturing/Wholesale reportable segment represents the Company's manufacturing operations in South Carolina and the Wholesale sales business. This segment supplies the Retail and Franchise segments, along with various third parties, with finished products for sale. The Warehousing and Distribution and Corporate costs represent the Company's administrative expenses. The accounting policies of the segments are the same as those described in Note 1, "Basis of Presentation and Summary of Significant Accounting Policies." | |||||||||||
The following table represents key financial information of the Company's segments: | |||||||||||
December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
Revenue: | |||||||||||
Retail | $ | 1,926,770 | $ | 1,785,001 | $ | 1,518,494 | |||||
Franchise | 440,464 | 408,108 | 334,792 | ||||||||
Manufacturing/Wholesale: | |||||||||||
Intersegment revenues | 269,488 | 263,177 | 224,127 | ||||||||
Third Party | 263,074 | 236,874 | 218,893 | ||||||||
| | | | | | | | | | | |
Sub total Manufacturing/Wholesale | 532,562 | 500,051 | 443,020 | ||||||||
Sub total segment revenues | 2,899,796 | 2,693,160 | 2,296,306 | ||||||||
Elimination of intersegment revenues | (269,488 | ) | (263,177 | ) | (224,127 | ) | |||||
| | | | | | | | | | | |
Total revenue | $ | 2,630,308 | $ | 2,429,983 | $ | 2,072,179 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Operating income: | |||||||||||
Retail | $ | 360,156 | $ | 346,420 | $ | 243,506 | |||||
Franchise | 156,035 | 136,463 | 111,261 | ||||||||
Manufacturing/Wholesale | 104,709 | 95,462 | 82,185 | ||||||||
Unallocated corporate and other costs: | |||||||||||
Warehousing and distribution costs | (66,614 | ) | (63,297 | ) | (60,539 | ) | |||||
Corporate costs | (81,435 | ) | (85,282 | ) | (80,370 | ) | |||||
Transaction and restructuring related costs | (12,353 | ) | (1,926 | ) | (13,536 | ) | |||||
| | | | | | | | | | | |
Sub total unallocated corporate and other costs | (160,402 | ) | (150,505 | ) | (154,445 | ) | |||||
| | | | | | | | | | | |
Total operating income | 460,498 | 427,840 | 282,507 | ||||||||
Interest expense, net | 53,029 | 47,556 | 74,903 | ||||||||
| | | | | | | | | | | |
Income before income taxes | 407,469 | 380,284 | 207,604 | ||||||||
Income tax expense | 142,448 | 140,088 | 75,271 | ||||||||
| | | | | | | | | | | |
Net income | $ | 265,021 | $ | 240,196 | $ | 132,333 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
December 31 | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
Depreciation and amortization: | |||||||||||
Retail | $ | 30,769 | $ | 28,309 | $ | 25,982 | |||||
Franchise | 3,004 | 3,052 | 2,873 | ||||||||
Manufacturing / Wholesale | 11,003 | 11,490 | 11,585 | ||||||||
Corporate / Other | 7,038 | 6,406 | 6,350 | ||||||||
| | | | | | | | | | | |
Total depreciation and amortization | $ | 51,814 | $ | 49,257 | $ | 46,790 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Capital expenditures: | |||||||||||
Retail | $ | 34,835 | $ | 27,249 | $ | 29,331 | |||||
Franchise | 229 | 91 | 684 | ||||||||
Manufacturing / Wholesale | 8,464 | 8,032 | 7,534 | ||||||||
Corporate / Other | 6,719 | 6,558 | 6,268 | ||||||||
| | | | | | | | | | | |
Total capital expenditures | $ | 50,247 | $ | 41,930 | $ | 43,817 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Total assets | |||||||||||
Retail | $ | 1,483,075 | $ | 1,412,325 | $ | 1,339,325 | |||||
Franchise | 522,996 | 506,021 | 491,008 | ||||||||
Manufacturing / Wholesale | 423,939 | 417,945 | 410,171 | ||||||||
Corporate / Other | 310,337 | 215,749 | 189,083 | ||||||||
| | | | | | | | | | | |
Total assets | $ | 2,740,347 | $ | 2,552,040 | $ | 2,429,587 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Geographic areas | |||||||||||
Total revenues: | |||||||||||
United States | $ | 2,490,089 | $ | 2,311,832 | $ | 1,972,121 | |||||
Foreign | 140,219 | 118,151 | 100,058 | ||||||||
| | | | | | | | | | | |
Total revenues | $ | 2,630,308 | $ | 2,429,983 | $ | 2,072,179 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Long-lived assets: | |||||||||||
United States | $ | 230,666 | $ | 213,208 | $ | 196,176 | |||||
Foreign | 8,557 | 8,447 | 9,251 | ||||||||
| | | | | | | | | | | |
Total long-lived assets | $ | 239,223 | $ | 221,655 | $ | 205,427 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
The following table represents sales by general product category. The category "Other Wellness Products" includes other wellness products sales from the Company's point of sales system and certain required accounting adjustments of $15.4 million, $8.1 million and $2.2 million for the years ended December 31, 2013, 2012 and 2011, respectively. | |||||||||||
December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
U.S. Retail Product Categories: | |||||||||||
VMHS | $ | 663,625 | $ | 624,647 | $ | 542,575 | |||||
Sports Nutrition Products | 764,908 | 686,208 | 621,751 | ||||||||
Diet Products | 198,834 | 192,335 | 139,612 | ||||||||
Other Wellness Products | 107,488 | 113,930 | 101,957 | ||||||||
| | | | | | | | | | | |
Total U.S. Retail revenues | 1,734,855 | 1,617,120 | 1,405,895 | ||||||||
Other Retail Revenue(1) | 191,915 | 167,881 | 112,599 | ||||||||
| | | | | | | | | | | |
Total Retail Revenue | $ | 1,926,770 | $ | 1,785,001 | $ | 1,518,494 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
-1 | |||||||||||
Included foreign sales that are presented in total and not by category, as product sales for foreign operations are managed in local currency. Also includes LuckyVitamin.com and DiscountSupplements.com sales, as categories are not consistent with the point of sale categories. | |||||||||||
In addition to the Retail product categories discussed above, Franchise revenues are primarily generated from product sales to franchisees, royalties from franchise retail sales and franchise fees, and Manufacturing/Wholesale sales are generated from sales of manufactured products to third parties, primarily in the VMHS product category. | |||||||||||
FRANCHISE_REVENUE
FRANCHISE REVENUE | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
FRANCHISE REVENUE | ' | ||||||||||
FRANCHISE REVENUE | ' | ||||||||||
NOTE 17. FRANCHISE REVENUE | |||||||||||
The Company's Franchise segment generates revenues through product sales to franchisees, royalties, franchise fees and interest income on the financing of the franchise locations. The Company enters into franchise agreements with initial terms of ten years. The Company charges franchisees three types of flat franchise fees associated with stores: initial, transfer and renewal. The initial franchise fee is payable prior to the franchise store opening as consideration for the initial franchise rights and services performed by the Company. Transfer fees are paid as consideration for the same rights and services as the initial fee and occur when a former franchisee transfers ownership of the franchise location to a new franchisee. This is typically a reduced fee compared to the initial franchise fee. The renewal franchise fee is charged to existing franchisees upon renewal of the franchise contract. This fee is similar to, but typically less than, the initial fee. | |||||||||||
Once the franchise store is opened, transferred or renewed, the Company has no further obligations under these fees to the franchisee. Therefore, all initial, transfer and renewal franchise fee revenue is recognized in the period in which a franchise store is opened, transferred or date the contract period is renewed. The Company recognized initial franchise fees of $5.1 million, $4.0 million, and $3.0 million for the years ended December 31, 2013, 2012 and 2011, respectively. | |||||||||||
The following is a summary of the Company's franchise revenue by type: | |||||||||||
Year ended December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
Product sales | $ | 364,500 | $ | 340,574 | $ | 275,026 | |||||
Royalties | 58,247 | 53,047 | 46,507 | ||||||||
Franchise fees | 8,166 | 7,024 | 5,585 | ||||||||
Other | 9,551 | 7,463 | 7,674 | ||||||||
| | | | | | | | | | | |
Total franchise revenue | $ | 440,464 | $ | 408,108 | $ | 334,792 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2013 | |
RELATED PARTY TRANSACTIONS | ' |
RELATED PARTY TRANSACTIONS | ' |
NOTE 18. RELATED PARTY TRANSACTIONS | |
ACOF Management Services Agreement. In connection with the Merger, on March 16, 2007, we entered into a Management Services Agreement (the "Management Services Agreement") with ACOF Operating Manager II, L.P. ("ACOF Operating Manager"), an affiliate of Ares Corporate Opportunities Fund II, L.P. ("Ares"), which was terminated upon the consummation of the IPO. The Management Services Agreement provided for an annual management fee of $0.8 million, payable quarterly and in advance to ACOF Operating Manager, on a pro rata basis, until the tenth anniversary from March 16, 2007 plus any one-year extensions (which extensions occurred automatically on each anniversary date of March 16, 2007), as well as reimbursements for ACOF Operating Manager's, and its affiliates', out-of-pocket expenses in connection with the management services provided under the Management Services Agreement. For the fiscal year ended December 31, 2011, $0.2 million was paid to ACOF Operating Manager in accordance with the terms of the Management Services Agreement. | |
Upon the consummation of the IPO, the Management Services Agreement was terminated and ACOF Operating Manager received, in lieu of quarterly payments of the annual management fee, an automatic fee equal to the net present value of the aggregate annual management fee that would have been payable to ACOF Operating Manager during the remainder of the term of the fee agreement. The amount of such payment was $5.6 million. No further payments will be made pursuant to the Management Services Agreement. | |
Special Dividend. Prior to the consummation of the IPO, OTPP, as the holder of Class B common stock, was entitled to receive ratably an annual special dividend payment equal to an aggregate amount of $0.8 million per year when, as and if declared by the board of directors, for a period of ten years commencing on March 16, 2007 (the "Special Dividend Period"). The special dividend payment was payable in equal quarterly installments on the first day of each quarter commencing on April 1, 2007. For the fiscal year ended December 31, 2011, $0.2 million was paid to OTPP as a special dividend pursuant to the obligations under our Class B common stock. | |
Upon the consummation of the IPO, OTPP's right to receive the special dividend payments was terminated and OTPP received, in lieu of quarterly payments of the special dividend payments, an automatic payment equal to the net present value of the aggregate amount of the special dividend payments that would have been payable to OTPP during the remainder of the Special Dividend Period, calculated in good faith by the board of directors. The amount of such payment was $5.6 million. No further special dividend payments will be made. On March 19, 2012, OTPP converted all of its shares of Class B common stock into an equal number of shares of common stock. There were no shares of Class B common stock outstanding at December 31, 2013. | |
Sponsors. Prior to the IPO, Holdings' outstanding common stock was principally owned by Ares and OTPP. In March 2012, OTPP converted all of its shares of Class B common stock into an equal number of shares of common stock. As of December 31, 2012 Ares did not own any shares of the Company's capital stock and OTPP owned less than 10,000 shares of the Company's common stock, and therefore the sponsors are no longer considered related parties. | |
Lease Agreements. At December 31, 2013, General Nutrition Centres Company, the Company's wholly owned subsidiary, was party, as lessee, to 16 lease agreements with Cadillac Fairview Corporation ("Cadillac Fairview"), as lessor, and 1 lease agreement with Ontrea, Inc. ("Ontrea"), as lessor, with respect to properties located in Canada. Each of Cadillac Fairview and Ontrea is a direct wholly owned subsidiary of OTPP. For the years ended December 31, 2012 and 2011, the Company paid $2.4 million and $2.4 million, respectively, under the lease agreements with Cadillac Fairview, and $0.2 million in each such year under the lease agreement with Ontrea. Each lease was negotiated in the ordinary course of business on an arm's length basis. | |
Share Repurchase. On August 9, 2012, in conjunction with the August 2012 Offering, the Company entered into an agreement to repurchase six million shares of common stock directly from Ares at a price of $38.42 per share. The Company funded this repurchase from borrowings under the Incremental Term Loan, together with cash on hand. | |
QUARTERLY_FINANCIAL_INFORMATIO
QUARTERLY FINANCIAL INFORMATION | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
QUARTERLY FINANCIAL INFORMATION | ' | ||||||||||||||||
QUARTERLY FINANCIAL INFORMATION | ' | ||||||||||||||||
NOTE 19. QUARTERLY FINANCIAL INFORMATION | |||||||||||||||||
The following table summarizes the Company's 2013 and 2012 quarterly results: | |||||||||||||||||
Three months ended (unaudited) | Year ended | ||||||||||||||||
March 31, | June 30, | September 30, | December 31, | December 31, | |||||||||||||
2013 | 2013 | 2013 | 2013 | 2013 | |||||||||||||
($ in thousands, except per share $) | |||||||||||||||||
Total revenue | $ | 664,691 | $ | 676,276 | $ | 675,594 | $ | 613,748 | $ | 2,630,308 | |||||||
Gross profit | 256,137 | 255,892 | 253,945 | 227,152 | 993,127 | ||||||||||||
Operating income | 124,520 | 123,671 | 125,974 | 86,334 | 460,498 | ||||||||||||
Net income | 72,643 | 71,688 | 73,033 | 47,657 | 265,021 | ||||||||||||
Weighted average shares outstanding: | |||||||||||||||||
Basic | 98,997 | 97,428 | 95,183 | 94,636 | 96,481 | ||||||||||||
Diluted | 99,861 | 98,333 | 96,078 | 95,477 | 97,383 | ||||||||||||
Earnings per share: | |||||||||||||||||
Basic | $ | 0.73 | $ | 0.74 | $ | 0.77 | $ | 0.5 | $ | 2.75 | |||||||
Diluted | $ | 0.73 | $ | 0.73 | $ | 0.76 | $ | 0.5 | $ | 2.72 | |||||||
Three months ended (unaudited) | Year ended | ||||||||||||||||
March 31, | June 30, | September 30, | December 31, | December 31, | |||||||||||||
2012 | 2012 | 2012 | 2012 | 2012 | |||||||||||||
($ in thousands, except per share $) | |||||||||||||||||
Total revenue | $ | 624,272 | $ | 619,081 | $ | 621,607 | $ | 565,023 | $ | 2,429,983 | |||||||
Gross profit | 240,709 | 239,437 | 235,214 | 214,377 | 929,738 | ||||||||||||
Operating income | 112,069 | 117,060 | 111,177 | 87,533 | 427,840 | ||||||||||||
Net income | 63,857 | 66,671 | 62,229 | 47,438 | 240,196 | ||||||||||||
Weighted average shares outstanding: | |||||||||||||||||
Basic | 105,805 | 106,517 | 102,541 | 99,205 | 103,503 | ||||||||||||
Diluted | 107,746 | 107,927 | 103,721 | 100,119 | 104,911 | ||||||||||||
Earnings per share: | |||||||||||||||||
Basic | $ | 0.6 | $ | 0.63 | $ | 0.61 | $ | 0.48 | $ | 2.32 | |||||||
Diluted | $ | 0.59 | $ | 0.62 | $ | 0.6 | $ | 0.47 | $ | 2.29 | |||||||
The sum of the quarterly amounts may not equal the annual amounts due to rounding. | |||||||||||||||||
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2013 | |
SUBSEQUENT EVENTS | ' |
SUBSEQUENT EVENTS | ' |
NOTE 20. SUBSEQUENT EVENTS | |
On January 30, 2014, the Company announced that its board of directors authorized and declared a cash dividend for the first quarter of 2014 of $0.16 per share of common stock, payable on or about March 28, 2014 to stockholders of record as of the close of business on March 14, 2014. | |
SCHEDULE_I_CONDENSED_FINANCIAL
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF GNC HOLDINGS, INC. | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF GNC HOLDINGS, INC. | ' | ||||||||||
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF GNC HOLDINGS, INC. | ' | ||||||||||
SCHEDULE I—CONDENSED FINANCIAL INFORMATION OF GNC HOLDINGS, INC. | |||||||||||
GNC HOLDINGS, INC. | |||||||||||
(Parent Company Only) | |||||||||||
Balance Sheets | |||||||||||
(in thousands) | |||||||||||
December 31, | |||||||||||
2013 | 2012 | ||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 282 | $ | 880 | |||||||
Prepaids and other current assets | 285 | 70 | |||||||||
| | | | | | | | ||||
Total current assets | 567 | 950 | |||||||||
Long-term assets: | |||||||||||
Intercompanies | 1,069 | 3,079 | |||||||||
Investment in subsidiaries | 962,469 | 963,883 | |||||||||
| | | | | | | | ||||
Total long-term assets | 963,538 | 966,962 | |||||||||
| | | | | | | | ||||
Total assets | $ | 964,105 | $ | 967,912 | |||||||
| | | | | | | | ||||
| | | | | | | | ||||
Current liabilities: | |||||||||||
Accounts payable | $ | — | $ | 73 | |||||||
Deferred revenue and other current liabilities | 356 | 330 | |||||||||
| | | | | | | | ||||
Total current liabilities | 356 | 403 | |||||||||
| | | | | | | | ||||
Intercompany loan | 148,170 | 85,470 | |||||||||
| | | | | | | | ||||
Total liabilities | 148,526 | 85,873 | |||||||||
Stockholders' equity: | |||||||||||
Class A Common Stock | 112 | 111 | |||||||||
Paid-in-capital | 847,886 | 810,094 | |||||||||
Retained earnings | 700,108 | 492,687 | |||||||||
Treasury stock, at cost | (734,482 | ) | (423,900 | ) | |||||||
Accumulated other comprehensive income | 1,955 | 3,047 | |||||||||
| | | | | | | | ||||
Total stockholders' equity | 815,579 | 882,039 | |||||||||
| | | | | | | | ||||
Total liabilities and stockholders' equity | $ | 964,105 | $ | 967,912 | |||||||
| | | | | | | | ||||
| | | | | | | | ||||
SCHEDULE I—CONDENSED FINANCIAL INFORMATION OF GNC HOLDINGS, INC. | |||||||||||
GNC HOLDINGS, INC. | |||||||||||
(Parent Company Only) | |||||||||||
Statements of Income and Comprehensive Income | |||||||||||
(in thousands, except per share data) | |||||||||||
Year ended December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
Other selling, general and administrative | $ | 749 | $ | 2,076 | $ | 14,037 | |||||
Subsidiary income | (265,522 | ) | (241,492 | ) | (140,359 | ) | |||||
| | | | | | | | | | | |
Operating income | 264,773 | 239,416 | 126,322 | ||||||||
Interest expense, net | 44 | (12 | ) | (254 | ) | ||||||
| | | | | | | | | | | |
Income before income taxes | 264,729 | 239,428 | 126,576 | ||||||||
Income tax expense | (292 | ) | (768 | ) | (5,757 | ) | |||||
| | | | | | | | | | | |
Net income | $ | 265,021 | $ | 240,196 | $ | 132,333 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Comprehensive income | $ | 263,929 | $ | 240,519 | $ | 136,337 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Earning per share: | |||||||||||
Basic | $ | 2.75 | $ | 2.32 | $ | 1.27 | |||||
Diluted | $ | 2.72 | $ | 2.29 | $ | 1.24 | |||||
Dividends declared per share | $ | 0.6 | $ | 0.44 | $ | — | |||||
SCHEDULE I—CONDENSED FINANCIAL INFORMATION OF GNC HOLDINGS, INC. | |||||||||||
GNC HOLDINGS, INC. | |||||||||||
(Parent Company Only) | |||||||||||
Statements of Cash Flow | |||||||||||
(in thousands) | |||||||||||
Year ended December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
NET CASH PROVIDED BY OPERATING ACTIVITIES: | |||||||||||
Net income | $ | 265,021 | $ | 240,196 | $ | 132,333 | |||||
Equity in income of subsidiaries | (265,522 | ) | (241,492 | ) | (140,359 | ) | |||||
Dividends received | 289,300 | 348,000 | 225,000 | ||||||||
Other operating activities | 1,334 | 421 | 7,320 | ||||||||
| | | | | | | | | | | |
Net cash provided by operating activities | 290,133 | 347,125 | 224,294 | ||||||||
| | | | | | | | | | | |
CASH FLOWS FROM INVESTING ACTIVITIES: | — | — | — | ||||||||
| | | | | | | | | | | |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||
Issuance of stock | — | — | 237,253 | ||||||||
Dividend payment | (57,437 | ) | (45,216 | ) | — | ||||||
Loan from a subsidiary | 62,700 | — | 85,470 | ||||||||
Contributed capital | — | — | (301,098 | ) | |||||||
Proceeds from exercise of stock options | 14,588 | 25,972 | 28,550 | ||||||||
Repurchase of treasury stock | (310,582 | ) | (359,990 | ) | (61,634 | ) | |||||
Repurchase of Class A Preferred Stock | — | — | (223,107 | ) | |||||||
| | | | | | | | | | | |
Net cash used in financing activities | (290,731 | ) | (379,234 | ) | (234,566 | ) | |||||
| | | | | | | | | | | |
Net decrease in cash and cash equivalents | (598 | ) | (32,109 | ) | (10,272 | ) | |||||
Beginning balance, cash and cash equivalents | 880 | 32,989 | 43,261 | ||||||||
| | | | | | | | | | | |
Ending balance, cash and cash equivalents | $ | 282 | $ | 880 | $ | 32,989 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
GNC HOLDINGS, INC. | |||||||||||
SCHEDULE I—NOTES TO THE CONDENSED FINANCIAL STATEMENTS (PARENT ONLY) | |||||||||||
NOTE 1. BACKGROUND | |||||||||||
These condensed parent company financial statements and notes of GNC Holdings, Inc. ("the Company") should be read in conjunction with the consolidated statements of GNC Holdings, Inc. and subsidiaries. The Senior Credit Facility of General Nutrition Centers, Inc. ("Centers"), a wholly owned subsidiary of GNC Holdings, Inc., contains customary covenants, including incurrence covenants and certain other limitations on the ability of GNC Corporation, Centers, and Centers' subsidiaries to, among other things, make optional payments in respect of other debt instruments, pay dividends or other payments on capital stock, and enter into arrangements that restrict their ability to pay dividends or grant liens. | |||||||||||
NOTE 2. PUBLIC OFFERINGS | |||||||||||
In April 2011, Holdings completed an initial public offering (the "IPO") of 25.875 million shares of its Class A common stock, par value $0.001 per share (the "common stock"), at an IPO price of $16.00 per share. The net proceeds from the IPO, together with cash on hand, were used to redeem all outstanding shares of Holdings' Series A preferred stock, par value $0.001 per share, repay approximately $300.0 million of outstanding borrowings under the Term Loan Facility and pay approximately $11.1 million to satisfy obligations under the Management Services Agreement (as defined in Note 18, "Related Party Transactions") and Holdings' Class B common stock, par value $0.001 per share. Subsequent to the IPO, certain of Holdings' stockholders completed four registered offerings of our common stock. In conjunction with one of these selling stockholder offerings, in August 2012, the Company repurchased an additional six million shares of our common stock from one of its stockholders as part of a share repurchase program. | |||||||||||
SCHEDULE_II_VALUATION_AND_QUAL
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | ' | ||||||||||
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | ' | ||||||||||
SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS | |||||||||||
GNC Holdings, Inc. and Subsidiaries | |||||||||||
Valuation and Qualifying Accounts | |||||||||||
Allowance for Doubtful Accounts(1) | |||||||||||
Year ended December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
Balance at beginning of period | $ | 2,178 | $ | 2,292 | $ | 1,564 | |||||
Additions—charged to costs and expense | 4,241 | 4,763 | 2,989 | ||||||||
Deductions(2) | (4,529 | ) | (4,877 | ) | (2,261 | ) | |||||
| | | | | | | | | | | |
Balance at end of period | $ | 1,890 | $ | 2,178 | $ | 2,292 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
-1 | |||||||||||
These balances are the total allowance for doubtful accounts for trade accounts receivable and the current and long-term franchise notes receivable. | |||||||||||
-2 | |||||||||||
Deductions for the allowance for doubtful accounts represent: accounts receivable reserve adjustments, resulting from applying our standard policy; reductions to franchise receivable reserves for franchise take-backs and customer product returns; and the collection of previously reserved receivables. | |||||||||||
Tax Valuation Allowances | |||||||||||
Year ended December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
Balance at beginning of period | $ | 1,765 | $ | 2,946 | $ | 4,418 | |||||
Additions—charged to costs and expense | — | 565 | 44 | ||||||||
Deductions | (1,200 | ) | (1,746 | ) | (1,516 | ) | |||||
| | | | | | | | | | | |
Balance at end of period | $ | 565 | $ | 1,765 | $ | 2,946 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
BASIS_OF_PRESENTATION_AND_SUMM1
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
Principles of Consolidation | ' |
Principles of Consolidation. The consolidated financial statements include the accounts of Holdings and all of its subsidiaries. All material intercompany transactions have been eliminated in consolidation. | |
The Company has no relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off balance sheet arrangements, or other contractually narrow or limited purposes. | |
Use of Estimates | ' |
Use of Estimates. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. Accordingly, these estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. On a regular basis, management reviews its estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such reviews and if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. | |
Cash and Cash Equivalents | ' |
Cash and Cash Equivalents. The Company considers cash and cash equivalents to include all cash and liquid deposits and investments with an original maturity of three months or less. The majority of payments due from banks for third-party credit and debit cards process within 24 to 72 hours, and are classified as cash equivalents. | |
Receivables, net | ' |
Receivables, net. The Company sells product to its franchisees and, to a lesser extent, various third-party customers. Receivables consist principally of trade receivables of $140.8 million and $126.0 million at December 31, 2013 and 2012, respectively, and include unpaid invoices for product sales, franchisee royalties and lease payments. The Company monitors the financial condition of the Company's franchisees and other third-party customers and establishes an allowance for doubtful accounts for balances estimated to be uncollectible. In addition to considering the aging of receivable balances and assessing the financial condition of the Company's franchisees, the Company considers each domestic franchisees' inventory and fixed assets, which the Company can use as collateral in the event of a default by the franchisee. An allowance for international franchisees is calculated based on unpaid, non-collateralized amounts associated with their receivable balance. The allowance for doubtful accounts was $1.9 million and $2.2 million at December 31, 2013 and 2012, respectively. | |
Inventories | ' |
Inventories. Inventory components consist of raw materials, work-in-process, finished product and packaging supplies. Inventories are stated at the lower of cost or market on a first in/first out basis ("FIFO"). The Company regularly reviews its inventory levels in order to identify slow moving and short dated products, expected length of time for product sell through and future expiring product and adjusts the carrying value for such inventory to estimated net realizable value. | |
Property, Plant and Equipment | ' |
Property, Plant and Equipment. Property, plant and equipment expenditures are recorded at cost. The remaining useful lives range from one year to fifteen years across all asset classes with the exception of buildings. Buildings are depreciated over thirty years and building improvements are depreciated over the remaining useful life of the building. Depreciation and amortization are recognized using the straight-line method over the estimated useful life of the property. Fixtures are depreciated over three to fifteen years, and equipment is generally depreciated over ten years. Computer equipment and software costs are generally depreciated over three to five years. Amortization of improvements to retail leased premises is recognized using the straight-line method over the estimated useful life of the improvements, or over the life of the related leases including renewals that are reasonably assured, whichever period is shorter. | |
Expenditures that materially increase the value or clearly extend the useful life of property, plant and equipment are capitalized in accordance with the policies outlined above. Repair and maintenance costs incurred in the normal operations of business are expensed as incurred. Gains/losses from the sale of property, plant and equipment are recognized in current operations. | |
Goodwill and Intangible Assets | ' |
Goodwill and Intangible Assets. Goodwill represents the excess of purchase price over the fair value of identifiable net assets of businesses, including franchisees, acquired by the Company. Goodwill and intangible assets with indefinite useful lives are not amortized, but instead are tested for impairment at least annually. The Company completes its annual impairment test in the fourth quarter. The Company performs a qualitative assessment to determine whether it is "more likely than not" that the fair value of the reporting unit is less than its carrying value. The qualitative factors considered are general macroeconomic conditions, industry specific conditions, historical performance, and future outlooks. If it is concluded that it is "more likely than not" that the fair value of a reporting unit is less than its carrying value, the Company is required to perform a two-step goodwill impairment test. As a result of the Company's annual impairment analysis, no impairment was recorded for the year ended December 31, 2013. See Note 5, "Goodwill, Brands, and Other Intangible Assets, Net." | |
Long-lived Assets | ' |
Long-lived Assets. The Company reviews the carrying value of property and equipment and amortizable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. Factors the Company considers important that may trigger an impairment review include significant changes in the manner of its use of assets, significant negative industry or economic trends, underperforming stores and store closings. These reviews may include an analysis of the current operations and capacity utilization, in conjunction with an analysis of the markets in which the businesses are operating. When an impairment review is considered necessary, a comparison is performed of the undiscounted projected cash flows from the use and eventual disposition of the asset group to the net book value of the related asset group. If it is determined that the carrying value of the asset group may not be recoverable, a charge to adjust the carrying value of the long-lived assets to estimated fair value may be required. | |
Revenue Recognition | ' |
Revenue Recognition. The Company operates predominantly as a retailer, through company-owned stores, franchise stores and its e-commerce businesses and to a lesser extent through manufacturing and wholesale operations. | |
The Retail segment recognizes revenue at the moment a sale to a customer is recorded. These revenues are recorded via the Company's point of sales system. Gross revenues are netted by actual customer returns and an allowance for expected customer returns. The Company records a reserve for expected customer returns based on management's estimate, which is derived from historical return data and expectations of future return volume. Revenue is deferred on sales of the Company's Gold Cards and subsequently amortized over the 12 month membership period, in order to match the discounts associated with the Gold Card program. During 2013, the Company completed the nationwide rollout of the Gold Card Member Pricing model, which evolved the Gold Card from a 20% discount the first week of the month to an everyday variable discount based on our Member Pricing model, for an annual fee. | |
The Company also sells gift cards to its customers. Revenue from gift cards is recognized when the gift card is redeemed. These gift cards do not have expiration dates. Based upon historical redemption rates, a small percentage of gift cards will never be redeemed, referred to as "breakage." The Company recognizes gift card breakage revenue when the likelihood of redemption becomes remote and amounts are not escheatable. | |
The Franchise segment generates revenues through product sales to franchisees, royalties, franchise fees and interest income on the financing of the franchise locations. See Note 17, "Franchise Revenue." These revenues are netted by actual franchisee returns and an allowance for projected returns. The franchisees purchase a majority of the products they sell from the Company at wholesale prices. Revenue on product sales to franchisees is recognized when risk of loss, title and insurable risks have transferred to the franchisee. Franchise fees are paid in advance, deferred and recognized by the Company at the time of a franchise store opening. Franchise royalties are earned based on a percentage of the franchisees' sales and recognized in the period the franchisees' sales occur. Interest on the financing of franchisee notes receivable is recognized as it becomes due and payable. Gains from the sale of company-owned stores to franchisees are recognized in accordance with the standard on accounting for sales of real estate. This standard requires gains on sales of corporate stores to franchisees to be deferred until certain criteria are satisfied regarding the collectability of the related receivable and the seller's remaining obligations. | |
The Manufacturing/Wholesale segment sells product primarily to the other Company segments and third-party customers. Revenue is recognized when risk of loss, title and insurable risks have transferred to the customer, net of estimated returns and allowances. | |
Cost of Sales | ' |
Cost of Sales. The Company purchases products directly from third-party manufacturers and manufactures its own products. The Company's cost of sales includes product costs, costs of warehousing and distribution and occupancy costs. | |
Vendor Allowances | ' |
Vendor Allowances. The Company receives credits as purchase price rebates based on arrangements with certain vendors. The Company also enters into arrangements with certain vendors through which the Company receives rebates for purchases during the year typically based on volume discounts. As the right of offset exists under these arrangements, rebates received under both arrangements are recorded as a reduction in the vendors' accounts payable balances on the balance sheet and represent the estimated amounts due to the Company under the rebate provisions of such contracts. The corresponding rebate income is recorded as a reduction of cost of goods sold based on inventory turnover. The amount recorded as a reduction to cost of goods sold was $92.6 million, $81.5 million and $64.7 million for the years ended December 31, 2013, 2012 and 2011, respectively. | |
Research and Development | ' |
Research and Development. Research and development costs arising from internally generated projects are expensed by the Company as incurred. The Company recognized $1.4 million, $1.1 million and $0.6 million for the years ended December 31, 2013, 2012 and 2011, respectively. These costs are included in Other Selling, General, and Administrative costs in the accompanying audited consolidated financial statements. | |
Advertising Expenditures | ' |
Advertising Expenditures. The Company recognizes advertising, promotion and marketing program costs the first time the advertising takes place, with the exception of the costs of producing advertising, which are expensed as incurred during production. The Company administers national advertising funds on behalf of its franchisees. In accordance with the franchisee contracts, the Company collects advertising fees from the franchisees and utilizes the proceeds to coordinate various advertising and marketing campaigns. The Company recognized advertising expense of $67.2 million, $62.3 million and $52.9 million for the years ended December 31, 2013, 2012 and 2011, respectively, net of approximately $15.4 million, $14.4 million and $12.2 million in 2013, 2012 and 2011 from the national advertising fund derived from the Company's franchisees, respectively. | |
Leases | ' |
Leases. The Company has various operating leases for company-owned and franchise store locations, distribution centers, and equipment. Leases generally include amounts relating to base rental, percent rent and other charges such as common area maintenance fees and real estate taxes. Periodically, the Company receives varying amounts of reimbursements from landlords to compensate the Company for costs incurred in the construction of stores. These reimbursements are amortized by the Company as an offset to rent expense over the life of the related lease. The Company determines the period used for the straight-line rent expense for leases with option periods and conforms it to the term used for amortizing improvements. | |
The Company leases an approximately 300,000 square foot-facility in Greenville, South Carolina where the majority of its proprietary products are manufactured. The Company also leases a 630,000 square foot complex located in Anderson, South Carolina, for packaging, materials receipt, lab testing, warehousing, and distribution. Both the Greenville and Anderson facilities are leased on a long-term basis pursuant to "fee-in-lieu-of-taxes" arrangements with the counties in which the facilities are located, but the Company retains the right to purchase each of the facilities at any time during the lease for $1.00, subject to a loss of tax benefits. As part of a tax incentive arrangement, the Company assigned the facilities to the counties and leases them back under operating leases. The Company leases the facilities from the counties where located, in lieu of paying local property taxes. Upon exercising its right to purchase the facilities back from the counties, the Company will be subject to the applicable taxes levied by the counties. As a result, the original cost basis of the facilities remains on the balance sheet and continues to be depreciated. | |
Contingencies | ' |
Contingencies. In accordance with the standards on contingencies the Company accrues a loss contingency if it is probable and can be reasonably estimated or a liability had been incurred at the date of the financial statements if those financial statements have not been issued. If both of the conditions above are not met, disclosure of the contingency is made when there is at least a reasonable possibility that a loss or an additional loss may have been incurred. | |
Pre-Opening Expenditures | ' |
Pre-Opening Expenditures. The Company recognizes the cost associated with the opening of new stores as incurred. These costs are charged to expense and are not material for the periods presented. Franchise store pre-opening costs are incurred by the franchisees. | |
Income Taxes | ' |
Income Taxes. The Company utilizes the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. It is the Company's policy to recognize interest and penalties related to uncertain tax positions as a component of income tax expense. See Note 4, "Income Taxes." | |
Self-Insurance | ' |
Self-Insurance. The Company has procured insurance for: (1) general liability; (2) product liability; (3) directors and officers liability; and (4) property insurance; (5) workers' compensation insurance; and (6) various other areas. The Company is self-insured for: (1) medical benefits; (2) physical damage to the Company's vehicles for field personnel use; and (3) physical damages that may occur at the corporate store locations. The Company is not insured for certain property and casualty risks due to the Company's assessment of frequency and severity of a loss, the cost of insurance and the overall risk analysis. | |
The Company carries product liability insurance with a retention of $4.0 million per claim with an aggregate cap on retained losses of $10.0 million. The Company carries general liability insurance with retention of $250,000 per claim with an aggregate cap on retained losses of $1.0 million. The majority of the Company's workers' compensation and auto insurance policies are in deductible/retrospective plans. The Company reimburses the applicable insurance company for the workers' compensation and auto liability claims, subject to a $250,000 and $100,000 loss limit per claim, respectively. | |
As part of the medical benefits program, the Company contracts with national service providers to provide benefits to its employees for all medical, dental, vision and prescription drug services. The Company then reimburses these service providers as claims are processed from Company employees. The Company maintains a specific stop loss provision of $500,000 per individual per plan year with a maximum lifetime benefit limit of $2.0 million per individual. The Company has no additional liability once a participant exceeds the $2.0 million ceiling. The Company's liability for medical claims is included as a component of accrued benefits in Note 7, "Deferred Revenue and Other Current Liabilities," and was $2.0 million and $1.9 million as of December 31, 2013 and 2012, respectively. | |
Our self-insurance liabilities, including the estimated loss accruals for claims incurred but not paid, are determined by taking into account historical claims payment results and known trends such as claims frequency and claims severity. Management makes estimates, judgments, and assumptions with respect to the use of these calculations, including but not limited to, estimated lag time to report and pay claims, average cost per claim, network utilization rates, network discount rates, and other factors. | |
Stock-based Compensation | ' |
Stock-based Compensation. The Company utilizes the Black-Scholes model to calculate the fair value of stock option awards (herein referred to as "option awards"). The grant-date fair value of the Company's restricted stock awards, time vesting restricted stock units, and performance vesting restricted stock units (collectively herein referred to as "stock awards") are based on the closing price for a share of the Company's stock on the New York Stock Exchange (the "NYSE") on the grant date. The resulting compensation cost is recognized in the Company's financial statements over the applicable vesting period for the relevant award. | |
Earnings Per Share | ' |
Earnings Per Share. Basic earnings per share is computed by dividing net income available to common shareholders by the weighted average number of shares of common stock outstanding for the period. Diluted earnings per share is computed by dividing net income available to common shareholders by the weighted average number of shares of common stock outstanding adjusted for the additional dilutive effect of unexercised option awards and unvested restricted awards. | |
Foreign Currency | ' |
Foreign Currency. For all foreign operations, the functional currency is the local currency. Assets and liabilities of those operations, denominated in foreign currencies, are translated into U.S. dollars using period-end exchange rates, and income and expenses are translated using the average exchange rates for the reporting period. Gains or losses resulting from foreign currency transactions are included in results of operations. At December 31, 2013 and 2012, foreign currency is the only component of accumulated other comprehensive income. | |
Transaction and restructuring related costs | ' |
Transaction and restructuring related costs. Restructuring related costs are recorded in the period in which the liability is incurred. Additionally, any change in the expected liability is recorded in the period the change in estimate occurs. In October 2013, the Company transitioned to a third-party pooled carrier product transportation network and moved away from the Company's existing private fleet. The cost related to this transition was $12.2 million, consisting of early lease termination on transportation equipment of $9.8 million and employee severance and other costs of $2.4 million. At December 31, 2013, the Company had an immaterial liability related to these restructuring costs. All remaining costs related to the restructuring are expected to be paid in the first quarter of 2014. | |
The Company recognizes transaction related costs as expense in the period incurred. For the years ended December 31, 2013 and 2012, the Company incurred $0.2 million and $1.9 million in transaction related costs. | |
Financial Instruments and Derivatives | ' |
Financial Instruments and Derivatives. As part of the Company's financial risk management program, it has historically used certain derivative financial instruments to reduce its exposure to market risk for changes in interest rates, primarily in respect of its long term debt obligations. The Company has not historically entered into, and does not intend to enter into, derivative transactions for speculative purposes and holds no derivative instruments for trading purposes. Floating-to-fixed interest rate swap agreements, designated as cash flow hedges of interest rate risk, were entered into from time to time to hedge the Company's exposure to interest rate changes on a portion of the Company's floating rate debt. These interest rate swap agreements converted a portion of the Company's floating rate debt to fixed rate debt. Interest rate floors designated as cash flow hedges involved the receipt of variable-rate amounts from a counterparty if interest rates fell below the strike rate on the contract in exchange for an upfront premium. The Company recorded the fair value of these contracts as an asset or a liability, as applicable, in the balance sheet, with the offset to accumulated other comprehensive income (loss), net of tax. The Company measured hedge effectiveness by assessing the changes in the fair value or expected future cash flows of the hedged item. The ineffective portions, if any, were recorded in interest expense in the current period. | |
During 2011, the Company had interest rate swap agreements outstanding that effectively converted notional amounts of an aggregate $550.0 million of debt from floating to fixed interest rates. The four outstanding agreements were to mature between April 2011 and September 2012. Amounts related to derivatives were reported in accumulated other comprehensive income (loss) and reclassified to interest expense as interest payments were made on the Company's variable-rate debt. In conjunction with the 2011 Refinancing, the Company utilized proceeds of the Senior Credit Facility to repay in full its prior senior credit facility and then-outstanding senior and senior subordinated notes, and the four interest rate swap agreements were settled and terminated for an aggregate cost of $8.7 million, of which $5.8 million was reclassified from accumulated other comprehensive income (loss) to interest expense. No such material derivative instruments are currently outstanding. | |
Reclassifications | ' |
Reclassifications | |
Certain amounts in the consolidated financial statements of prior year periods have been reclassified to conform to the current period's presentation. These changes were reflected for all periods presented. | |
Recently Issued Accounting Pronouncements | ' |
Recently Issued Accounting Pronouncements | |
In February 2013, the Financial Accounting Standards Board (the "FASB") issued an accounting standard regarding the reclassification of amounts out of accumulated other comprehensive income ("AOCI"). This standard does not change the current requirements for reporting net income or other comprehensive income. However, the standard requires disclosure of amounts reclassified out of AOCI in its entirety, by component, on the face of the statement of operations or in the footnotes to the financial statements. Amounts that are not required to be reclassified in their entirety to net income must be cross-referenced to other disclosures that provide additional detail. This guidance is effective for fiscal years beginning after December 15, 2012. The Company adopted this guidance during the first quarter of 2013. The adoption of this guidance did not have a material impact on the Company's consolidated financial statements. | |
In July 2013, the FASB issued an accounting standard regarding the presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. This standard requires entities to present an unrecognized tax benefit as a reduction of a deferred tax asset for a net operating loss ("NOL") or tax credit carryforward whenever the NOL or tax credit carryforward would be available to reduce the additional taxable income or tax due if the tax position is disallowed. This accounting standard update requires entities to assess whether to net the unrecognized tax benefit with a deferred tax asset as of the reporting date. This guidance is effective for fiscal years beginning after December 15, 2013, with early adoption permitted. The Company will adopt this guidance during the first quarter of 2014, and does not believe this standard will have a material impact on the consolidated financial statements. | |
INVENTORIES_NET_Tables
INVENTORIES, NET (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
INVENTORIES, NET | ' | |||||||
Schedule of net carrying value of inventories | ' | |||||||
December 31, | ||||||||
2013 | 2012 | |||||||
(in thousands) | ||||||||
Finished product ready for sale | $ | 458,366 | $ | 415,096 | ||||
Work-in-process, bulk product and raw materials | 81,575 | 70,022 | ||||||
Packaging supplies | 7,975 | 6,481 | ||||||
| | | | | | | | |
Total | $ | 547,916 | $ | 491,599 | ||||
| | | | | | | | |
| | | | | | | | |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
INCOME TAXES | ' | |||||||||||||||||||
Summary of income before income taxes | ' | |||||||||||||||||||
Year ended December 31, | ||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Domestic | $ | 389,459 | $ | 372,669 | $ | 206,971 | ||||||||||||||
Foreign | 18,010 | 7,615 | 633 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Total income before income taxes | $ | 407,469 | $ | 380,284 | $ | 207,604 | ||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
Summary of income tax expense (benefit) | ' | |||||||||||||||||||
Year ended December 31, | ||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Current: | ||||||||||||||||||||
Federal | $ | 120,137 | $ | 117,332 | $ | 63,130 | ||||||||||||||
State | 15,433 | 21,099 | 13,371 | |||||||||||||||||
Foreign | 8,656 | 5,022 | 4,091 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
144,226 | 143,453 | 80,592 | ||||||||||||||||||
Deferred: | ||||||||||||||||||||
Federal | (363 | ) | (2,238 | ) | (3,310 | ) | ||||||||||||||
State | (955 | ) | (1,222 | ) | (1,351 | ) | ||||||||||||||
Foreign | (460 | ) | 95 | (660 | ) | |||||||||||||||
| | | | | | | | | | | ||||||||||
(1,778 | ) | (3,365 | ) | (5,321 | ) | |||||||||||||||
| | | | | | | | | | | ||||||||||
Income tax expense | $ | 142,448 | $ | 140,088 | $ | 75,271 | ||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
Summary of differences between the Company's effective tax rate and the federal statutory tax rate | ' | |||||||||||||||||||
Year ended | ||||||||||||||||||||
December 31, | ||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||
Percent of pretax earnings: | ||||||||||||||||||||
Statutory federal tax rate | 35 | % | 35 | % | 35 | % | ||||||||||||||
Increase (reduction) resulting from: | ||||||||||||||||||||
State income tax, net of federal tax benefit | 3.1 | % | 3.2 | % | 3 | % | ||||||||||||||
Other permanent differences | 0.1 | % | 0.6 | % | 2 | % | ||||||||||||||
International operations, net of foreign tax credits | 0 | % | (0.1 | )% | (1.6 | )% | ||||||||||||||
Federal tax credits and income deductions | (2.1 | )% | (2.1 | )% | (2.4 | )% | ||||||||||||||
Tax impact of uncertain tax positions and other | (1.1 | )% | 0.2 | % | 0.3 | % | ||||||||||||||
| | | | | | | | | | | ||||||||||
Effective income tax rate | 35 | % | 36.8 | % | 36.3 | % | ||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
Summary of significant components of the Company's deferred tax assets and liabilities | ' | |||||||||||||||||||
December 31, | ||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||
Assets | Liabilities | Net | Assets | Liabilities | Net | |||||||||||||||
(in thousands) | ||||||||||||||||||||
Deferred tax: | ||||||||||||||||||||
Current assets (liabilities): | ||||||||||||||||||||
Operating reserves | $ | 3,345 | $ | — | $ | 3,345 | $ | 4,507 | $ | — | $ | 4,507 | ||||||||
Deferred revenue | 2,871 | — | 2,871 | 2,377 | — | 2,377 | ||||||||||||||
Prepaid expenses | — | (5,699 | ) | (5,699 | ) | — | (3,901 | ) | (3,901 | ) | ||||||||||
Accrued worker compensation | 2,562 | — | 2,562 | 2,436 | — | 2,436 | ||||||||||||||
Other | 3,790 | (3,051 | ) | 739 | 3,028 | (3,182 | ) | (154 | ) | |||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total current | $ | 12,568 | $ | (8,750 | ) | $ | 3,818 | $ | 12,348 | $ | (7,083 | ) | $ | 5,265 | ||||||
Non-current assets (liabilities): | ||||||||||||||||||||
Intangibles | $ | — | $ | (324,606 | ) | $ | (324,606 | ) | $ | — | $ | (318,429 | ) | $ | (318,429 | ) | ||||
Fixed assets | 17,410 | — | 17,410 | 14,809 | — | 14,809 | ||||||||||||||
Stock compensation | 3,111 | — | 3,111 | 2,711 | — | 2,711 | ||||||||||||||
Net operating loss carryforwards | 6,763 | — | 6,763 | 7,020 | — | 7,020 | ||||||||||||||
Long-term rent liabilities | 9,766 | — | 9,766 | 8,141 | — | 8,141 | ||||||||||||||
Other | 5,744 | — | 5,744 | 4,310 | — | 4,310 | ||||||||||||||
Valuation allowance | (565 | ) | — | (565 | ) | (1,765 | ) | — | (1,765 | ) | ||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total non-current | $ | 42,229 | $ | (324,606 | ) | $ | (282,377 | ) | $ | 35,226 | $ | (318,429 | ) | $ | (283,203 | ) | ||||
| | | | | | | | | | | | | | | | | | | | |
Total net deferred taxes | $ | 54,797 | $ | (333,356 | ) | $ | (278,559 | ) | $ | 47,574 | $ | (325,512 | ) | $ | (277,938 | ) | ||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Summary of reconciliation of the beginning and ending amount of unrecognized tax benefits | ' | |||||||||||||||||||
December 31, | ||||||||||||||||||||
2013 | 2012 | 2011 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Balance of unrecognized tax benefits at beginning of period | $ | 12,882 | $ | 10,574 | $ | 8,720 | ||||||||||||||
Additions for tax positions taken during current period | 873 | 1,215 | 1,104 | |||||||||||||||||
Additions for tax positions taken during prior periods | 1,965 | 4,220 | 750 | |||||||||||||||||
Reductions for tax positions taken during prior periods | (4,068 | ) | (1,439 | ) | — | |||||||||||||||
Settlements | (804 | ) | (1,688 | ) | — | |||||||||||||||
| | | | | | | | | | | ||||||||||
Balance of unrecognized tax benefits at end of period | $ | 10,848 | $ | 12,882 | $ | 10,574 | ||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
GOODWILL_BRANDS_AND_OTHER_INTA1
GOODWILL, BRANDS, AND OTHER INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||
GOODWILL, BRANDS, AND OTHER INTANGIBLE ASSETS, NET | ' | ||||||||||||||||||||||
Summary of goodwill activity | ' | ||||||||||||||||||||||
Retail | Franchising | Manufacturing/ | Total | ||||||||||||||||||||
Wholesale | |||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Balance at December 31, 2011—Net | $ | 317,733 | $ | 117,303 | $ | 202,841 | $ | 637,877 | |||||||||||||||
| | | | | | | | | | | | | | ||||||||||
| | | | | | | | | | | | | | ||||||||||
Acquired franchise stores | 2,038 | — | — | 2,038 | |||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||
Balance at December 31, 2012—Net | $ | 319,771 | $ | 117,303 | $ | 202,841 | $ | 639,915 | |||||||||||||||
| | | | | | | | | | | | | | ||||||||||
| | | | | | | | | | | | | | ||||||||||
Acquired franchise stores | 1,431 | — | — | 1,431 | |||||||||||||||||||
Acquisition of DiscountSupplements.com | 24,582 | — | — | 24,582 | |||||||||||||||||||
Translation effect of exchange rates | 418 | — | — | 418 | |||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||
Balance at December 31, 2013—Net | $ | 346,202 | $ | 117,303 | $ | 202,841 | $ | 666,346 | |||||||||||||||
| | | | | | | | | | | | | | ||||||||||
| | | | | | | | | | | | | | ||||||||||
Summary of intangible asset activity | ' | ||||||||||||||||||||||
Retail | Franchise | Operating | Other | Total | |||||||||||||||||||
Brand | Brand | Agreements | Intangibles | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Balance at December 31, 2011 | $ | 500,000 | $ | 220,000 | $ | 138,970 | $ | 10,619 | $ | 869,589 | |||||||||||||
| | | | | | | | | | | | | | | | | |||||||
| | | | | | | | | | | | | | | | | |||||||
Acquired franchise stores | — | — | — | 701 | 701 | ||||||||||||||||||
Amortization expense | — | — | (6,653 | ) | (1,920 | ) | (8,573 | ) | |||||||||||||||
| | | | | | | | | | | | | | | | | |||||||
Balance at December 31, 2012 | $ | 500,000 | $ | 220,000 | $ | 132,317 | $ | 9,400 | $ | 861,717 | |||||||||||||
| | | | | | | | | | | | | | | | | |||||||
| | | | | | | | | | | | | | | | | |||||||
Acquired franchise stores | — | — | — | 329 | 329 | ||||||||||||||||||
Acquisitions | — | — | — | 9,565 | 9,565 | ||||||||||||||||||
Amortization expense | — | — | (6,652 | ) | (2,347 | ) | (8,999 | ) | |||||||||||||||
Translation effect of exchange rates | — | — | — | 162 | 162 | ||||||||||||||||||
| | | | | | | | | | | | | | | | | |||||||
Balance at December 31, 2013 | $ | 500,000 | $ | 220,000 | $ | 125,665 | $ | 17,109 | $ | 862,774 | |||||||||||||
| | | | | | | | | | | | | | | | | |||||||
| | | | | | | | | | | | | | | | | |||||||
Schedule of the gross carrying amount and accumulated amortization for each major intangible asset | ' | ||||||||||||||||||||||
December 31, 2013 | December 31, 2012 | ||||||||||||||||||||||
Weighted- | Cost | Accumulated | Carrying | Cost | Accumulated | Carrying | |||||||||||||||||
Average | Amortization | Amount | Amortization | Amount | |||||||||||||||||||
Life | |||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Brands—retail | — | $ | 500,000 | $ | — | $ | 500,000 | $ | 500,000 | $ | — | $ | 500,000 | ||||||||||
Brands—franchise | — | 220,000 | — | 220,000 | 220,000 | — | 220,000 | ||||||||||||||||
Retail agreements | 30.3 | 31,000 | (7,301 | ) | 23,699 | 31,000 | (6,249 | ) | 24,751 | ||||||||||||||
Franchise agreements | 25 | 70,000 | (19,017 | ) | 50,983 | 70,000 | (16,217 | ) | 53,783 | ||||||||||||||
Manufacturing agreements | 25 | 70,000 | (19,017 | ) | 50,983 | 70,000 | (16,217 | ) | 53,783 | ||||||||||||||
Other intangibles | 8.2 | 20,327 | (3,995 | ) | 16,332 | 10,600 | (2,151 | ) | 8,449 | ||||||||||||||
Franchise rights | 3.7 | 5,463 | (4,686 | ) | 777 | 5,134 | (4,183 | ) | 951 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
Total | 23.5 | $ | 916,790 | $ | (54,016 | ) | $ | 862,774 | $ | 906,734 | $ | (45,017 | ) | $ | 861,717 | ||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Schedule of future estimated amortization expense of other intangible assets, net, with definite lives | ' | ||||||||||||||||||||||
Years ending December 31, | Estimated | ||||||||||||||||||||||
amortization | |||||||||||||||||||||||
expense | |||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
2014 | $ | 12,952 | |||||||||||||||||||||
2015 | 12,820 | ||||||||||||||||||||||
2016 | 11,987 | ||||||||||||||||||||||
2017 | 9,996 | ||||||||||||||||||||||
2018 | 9,952 | ||||||||||||||||||||||
Thereafter | 85,067 | ||||||||||||||||||||||
| | | | | |||||||||||||||||||
Total | $ | 142,774 | |||||||||||||||||||||
| | | | | |||||||||||||||||||
| | | | | |||||||||||||||||||
PROPERTY_PLANT_AND_EQUIPMENT_N1
PROPERTY, PLANT AND EQUIPMENT, NET (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
PROPERTY, PLANT AND EQUIPMENT, NET | ' | |||||||
Summary of property, plant and equipment | ' | |||||||
December 31, | ||||||||
2013 | 2012 | |||||||
(in thousands) | ||||||||
Land, buildings and improvements | $ | 66,851 | $ | 66,119 | ||||
Machinery and equipment | 115,681 | 107,664 | ||||||
Leasehold improvements | 115,815 | 102,902 | ||||||
Furniture and fixtures | 91,113 | 79,747 | ||||||
Software | 34,166 | 29,956 | ||||||
Construction in progress | 3,964 | 1,856 | ||||||
| | | | | | | | |
Total property, plant and equipment | 427,590 | $ | 388,244 | |||||
Less: accumulated depreciation | (220,836 | ) | (188,757 | ) | ||||
| | | | | | | | |
Net property, plant and equipment | $ | 206,754 | $ | 199,487 | ||||
| | | | | | | | |
| | | | | | | | |
DEFERRED_REVENUE_AND_OTHER_CUR1
DEFERRED REVENUE AND OTHER CURRENT LIABILITIES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
DEFERRED REVENUE AND OTHER CURRENT LIABILITIES | ' | |||||||
Summary of deferred revenue and other current liabilities | ' | |||||||
December 31, | ||||||||
2013 | 2012 | |||||||
(in thousands) | ||||||||
Deferred revenue | $ | 37,193 | $ | 41,465 | ||||
Accrued payroll | 23,023 | 33,522 | ||||||
Other current liabilities | 46,243 | 41,350 | ||||||
| | | | | | | | |
Total | $ | 106,459 | $ | 116,337 | ||||
| | | | | | | | |
| | | | | | | | |
LONGTERM_DEBT_INTEREST_EXPENSE1
LONG-TERM DEBT / INTEREST EXPENSE (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
LONG-TERM DEBT / INTEREST EXPENSE | ' | ||||||||||
Schedule of long-term debt | ' | ||||||||||
December 31, | |||||||||||
2013 | 2012 | ||||||||||
(in thousands) | |||||||||||
2011 Senior Credit Facility | $ | 1,345,987 | $ | 1,096,112 | |||||||
Other | 1,112 | 2,450 | |||||||||
| | | | | | | | ||||
Total Debt | $ | 1,347,099 | $ | 1,098,562 | |||||||
Less: current maturities | (5,443 | ) | (3,817 | ) | |||||||
| | | | | | | | ||||
Long-term Debt | $ | 1,341,656 | $ | 1,094,745 | |||||||
| | | | | | | | ||||
| | | | | | | | ||||
Schedule of total debt principal maturities | ' | ||||||||||
Years Ending | Senior Credit | Other | Total | ||||||||
December 31, | Facility(a) | ||||||||||
(in thousands) | |||||||||||
2014 | $ | 4,550 | $ | 893 | $ | 5,443 | |||||
2015 | 4,550 | 219 | 4,769 | ||||||||
2016 | 4,550 | — | 4,550 | ||||||||
2017 | 4,550 | — | 4,550 | ||||||||
2018 | 4,550 | — | 4,550 | ||||||||
2019 | 1,327,250 | — | 1,327,250 | ||||||||
| | | | | | | | | | | |
Total | $ | 1,350,000 | $ | 1,112 | $ | 1,351,112 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
(a) | |||||||||||
The Senior Credit Facility includes the original discount of $4.0 million. | |||||||||||
Schedule of net interest expense | ' | ||||||||||
For the year ended | |||||||||||
December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
Senior Credit Facility: | |||||||||||
Term Loan | 42,020 | 41,216 | 38,356 | ||||||||
Revolver | 680 | 533 | 598 | ||||||||
Early extinguishment of debt | 5,712 | 1,343 | 19,855 | ||||||||
Deferred financing fees amortization | 2,087 | 3,920 | 2,412 | ||||||||
Mortgage and other interest expense | 159 | 168 | 766 | ||||||||
OID amortization | 2,625 | 404 | 344 | ||||||||
Interest income | (254 | ) | (28 | ) | (1,110 | ) | |||||
Senior Notes | — | — | 4,808 | ||||||||
Senior Subordinated Notes | — | — | 3,055 | ||||||||
Termination of interest rate swaps | — | — | 5,819 | ||||||||
| | | | | | | | | | | |
Interest expense, net | 53,029 | 47,556 | 74,903 | ||||||||
| | | | | | | | | | | |
| | | | | | | | | | | |
FAIR_VALUE_MEASUREMENTS_AND_FI1
FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS | ' | |||||||||||||
Schedule of financial assets and liabilities accounted for at fair value on a recurring basis | ' | |||||||||||||
The following table presents the Company's financial assets and liabilities that were accounted for at fair value on a recurring basis as of December 31, 2013 by level within the fair value hierarchy: | ||||||||||||||
Fair Value Measurements Using | ||||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||||
(in thousands) | ||||||||||||||
Cash equivalents | $ | 142,800 | $ | — | $ | — | ||||||||
Other long-term assets | $ | — | $ | 6,124 | $ | — | ||||||||
The following table presents the Company's financial assets and liabilities that were accounted for at fair value on a recurring basis as of December 31, 2012 by level within the fair value hierarchy: | ||||||||||||||
Fair Value Measurements Using | ||||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||||
(in thousands) | ||||||||||||||
Cash equivalents | $ | 85,006 | $ | — | $ | — | ||||||||
Other long-term assets | $ | — | $ | 4,397 | $ | — | ||||||||
Schedule of carrying amount and estimated fair values of the financial instruments | ' | |||||||||||||
December 31, 2013 | December 31, 2012 | |||||||||||||
Carrying | Fair | Carrying | Fair | |||||||||||
Amount | Value | Amount | Value | |||||||||||
(in thousands) | ||||||||||||||
Cash and cash equivalents | $ | 226,217 | $ | 226,217 | $ | 158,541 | $ | 158,541 | ||||||
Receivables, net | 144,833 | 144,833 | 129,641 | 129,641 | ||||||||||
Franchise notes receivable, net | 10,163 | 10,163 | 7,589 | 7,589 | ||||||||||
Accounts payable | 135,164 | 135,164 | 125,165 | 125,165 | ||||||||||
Long-term debt (including current portion) | 1,347,099 | 1,343,732 | 1,098,562 | 1,101,309 |
LONGTERM_LEASE_OBLIGATIONS_Tab
LONG-TERM LEASE OBLIGATIONS (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
LONG-TERM LEASE OBLIGATIONS | ' | ||||||||||||||||
Schedule of components of the Company's rental expense | ' | ||||||||||||||||
Year ended December 31, | |||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||
(in thousands) | |||||||||||||||||
Retail stores: | |||||||||||||||||
Rent on long-term operating leases, net of sublease income | $ | 137,076 | $ | 126,411 | $ | 120,170 | |||||||||||
Landlord related taxes | 19,552 | 18,399 | 16,940 | ||||||||||||||
Common operating expenses | 34,978 | 33,589 | 31,969 | ||||||||||||||
Percent rent | 23,943 | 23,276 | 20,824 | ||||||||||||||
| | | | | | | | | | | |||||||
Total retail stores rent expense | 215,549 | 201,675 | 189,903 | ||||||||||||||
Truck fleet | 4,491 | 5,350 | 4,979 | ||||||||||||||
Other | 13,484 | 13,401 | 11,883 | ||||||||||||||
| | | | | | | | | | | |||||||
Total | $ | 233,524 | $ | 220,426 | $ | 206,765 | |||||||||||
| | | | | | | | | | | |||||||
| | | | | | | | | | | |||||||
Schedule of minimum future obligations for non-cancelable operating leases | ' | ||||||||||||||||
Company | Franchise | Other | Sublease | Total | |||||||||||||
Retail | Retail | Income | |||||||||||||||
Stores | Stores | ||||||||||||||||
(in thousands) | |||||||||||||||||
2014 | $ | 127,555 | $ | 27,619 | $ | 6,132 | $ | (27,619 | ) | $ | 133,687 | ||||||
2015 | 108,798 | 23,519 | 5,371 | (23,519 | ) | 114,169 | |||||||||||
2016 | 92,707 | 19,186 | 4,051 | (19,186 | ) | 96,758 | |||||||||||
2017 | 70,412 | 13,735 | 2,956 | (13,735 | ) | 73,368 | |||||||||||
2018 | 44,528 | 7,259 | 1,382 | (7,259 | ) | 45,910 | |||||||||||
Thereafter | 78,228 | 10,783 | 12,985 | (10,783 | ) | 91,213 | |||||||||||
| | | | | | | | | | | | | | | | | |
$ | 522,228 | $ | 102,101 | $ | 32,877 | $ | (102,101 | ) | $ | 555,105 | |||||||
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
STOCKHOLDERS_EQUITY_Tables
STOCKHOLDERS' EQUITY (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
STOCKHOLDERS' EQUITY | ' | ||||||||||
Schedule of the Company's basic and dilutive weighted average shares | ' | ||||||||||
Year ended December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
Basic weighted average shares | 96,481 | 103,503 | 100,261 | ||||||||
Effect of dilutive employee stock-based compensation awards | 902 | 1,408 | 2,749 | ||||||||
| | | | | | | | | | | |
Diluted weighted averages shares | 97,383 | 104,911 | 103,010 | ||||||||
| | | | | | | | | | | |
| | | | | | | | | | | |
STOCKBASED_COMPENSATION_PLANS_
STOCK-BASED COMPENSATION PLANS (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
STOCK-BASED COMPENSATION PLANS | ' | |||||||||||||
Summary of stock options under all plans | ' | |||||||||||||
Total Options | Weighted | Weighted Average | Aggregate | |||||||||||
Average | Remaining | Intrinsic Value | ||||||||||||
Exercise Price | Contractual Term | (in thousands) | ||||||||||||
(in years) | ||||||||||||||
Outstanding at December 31, 2012 | 3,159,542 | $ | 18.96 | |||||||||||
Granted | 61,485 | 53.54 | ||||||||||||
Exercised | (1,221,632 | ) | 11.87 | |||||||||||
Forfeited | (112,241 | ) | 28.12 | |||||||||||
| | | | | | | | | | | | | | |
Outstanding at December 31, 2013 | 1,887,154 | $ | 24.14 | 5.6 | $ | 64,768 | ||||||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
Exercisable at December 31, 2013 | 576,562 | $ | 21.92 | 5.4 | $ | 21,060 | ||||||||
Schedule of assumptions used in valuation related to stock option grants made during the period | ' | |||||||||||||
Year ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Dividend yield | 1.0%-1.4% | 1.2%-1.4% | 0.00% | |||||||||||
Expected option life | 4.8 years | 4.8-5.0 years | 4.5-7.0 years | |||||||||||
Volatility factor percentage of market price | 35.9%-40.5% | 40.0%-40.7% | 38.5%-39.2% | |||||||||||
Discount rate | 0.7%-1.4% | 0.6%-0.9% | 1.5%-2.9% | |||||||||||
Restricted Stock | ' | |||||||||||||
Stock-based compensation plans | ' | |||||||||||||
Summary of stock awards (restricted stock and RSU's) granted under the 2011 Stock Plan and related information | ' | |||||||||||||
Restricted | Weighted | |||||||||||||
Stock | Average Grant- | |||||||||||||
Date Fair Value | ||||||||||||||
Outstanding at December 31, 2012 | 123,941 | $ | 24.24 | |||||||||||
Granted | 18,497 | 44.15 | ||||||||||||
Vested | (13,221 | ) | 39.96 | |||||||||||
Forfeited | (14,236 | ) | 28.05 | |||||||||||
| | | | | | | | |||||||
Outstanding at December 31, 2013 | 114,981 | $ | 25.16 | |||||||||||
| | | | | | | | |||||||
| | | | | | | | |||||||
Restricted Stock Units | ' | |||||||||||||
Stock-based compensation plans | ' | |||||||||||||
Summary of stock awards (restricted stock and RSU's) granted under the 2011 Stock Plan and related information | ' | |||||||||||||
Time Vesting | Weighted | Performance | Weighted | |||||||||||
Restricted | Average Grant- | Vesting | Average Grant- | |||||||||||
Stock Units | Date Fair Value | Restricted | Date Fair Value | |||||||||||
Stock Units | ||||||||||||||
Outstanding at December 31, 2012 | 171,937 | $ | 36.16 | — | $ | — | ||||||||
Granted | 37,744 | 53.44 | 58,226 | 45.76 | ||||||||||
Vested | (56,637 | ) | 35.85 | — | — | |||||||||
Forfeited | (11,746 | ) | 37.24 | (2,860 | ) | 42.19 | ||||||||
| | | | | | | | | | | | | | |
Outstanding at December 31, 2013 | 141,298 | $ | 40.81 | 55,366 | $ | 45.94 | ||||||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
RETIREMENT_PLANS_Tables
RETIREMENT PLANS (Tables) | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
RETIREMENT PLANS | ' | ||||
Schedule of vesting percentage of Company based on employees match | ' | ||||
Years of Service | Percent | ||||
Vested | |||||
0-1 | 0 | % | |||
2-Jan | 33 | % | |||
3-Feb | 66 | % | |||
3+ | 100 | % |
SEGMENTS_Tables
SEGMENTS (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
SEGMENTS | ' | ||||||||||
Schedule of key financial information of the segments | ' | ||||||||||
December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
Revenue: | |||||||||||
Retail | $ | 1,926,770 | $ | 1,785,001 | $ | 1,518,494 | |||||
Franchise | 440,464 | 408,108 | 334,792 | ||||||||
Manufacturing/Wholesale: | |||||||||||
Intersegment revenues | 269,488 | 263,177 | 224,127 | ||||||||
Third Party | 263,074 | 236,874 | 218,893 | ||||||||
| | | | | | | | | | | |
Sub total Manufacturing/Wholesale | 532,562 | 500,051 | 443,020 | ||||||||
Sub total segment revenues | 2,899,796 | 2,693,160 | 2,296,306 | ||||||||
Elimination of intersegment revenues | (269,488 | ) | (263,177 | ) | (224,127 | ) | |||||
| | | | | | | | | | | |
Total revenue | $ | 2,630,308 | $ | 2,429,983 | $ | 2,072,179 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Operating income: | |||||||||||
Retail | $ | 360,156 | $ | 346,420 | $ | 243,506 | |||||
Franchise | 156,035 | 136,463 | 111,261 | ||||||||
Manufacturing/Wholesale | 104,709 | 95,462 | 82,185 | ||||||||
Unallocated corporate and other costs: | |||||||||||
Warehousing and distribution costs | (66,614 | ) | (63,297 | ) | (60,539 | ) | |||||
Corporate costs | (81,435 | ) | (85,282 | ) | (80,370 | ) | |||||
Transaction and restructuring related costs | (12,353 | ) | (1,926 | ) | (13,536 | ) | |||||
| | | | | | | | | | | |
Sub total unallocated corporate and other costs | (160,402 | ) | (150,505 | ) | (154,445 | ) | |||||
| | | | | | | | | | | |
Total operating income | 460,498 | 427,840 | 282,507 | ||||||||
Interest expense, net | 53,029 | 47,556 | 74,903 | ||||||||
| | | | | | | | | | | |
Income before income taxes | 407,469 | 380,284 | 207,604 | ||||||||
Income tax expense | 142,448 | 140,088 | 75,271 | ||||||||
| | | | | | | | | | | |
Net income | $ | 265,021 | $ | 240,196 | $ | 132,333 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
December 31 | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
Depreciation and amortization: | |||||||||||
Retail | $ | 30,769 | $ | 28,309 | $ | 25,982 | |||||
Franchise | 3,004 | 3,052 | 2,873 | ||||||||
Manufacturing / Wholesale | 11,003 | 11,490 | 11,585 | ||||||||
Corporate / Other | 7,038 | 6,406 | 6,350 | ||||||||
| | | | | | | | | | | |
Total depreciation and amortization | $ | 51,814 | $ | 49,257 | $ | 46,790 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Capital expenditures: | |||||||||||
Retail | $ | 34,835 | $ | 27,249 | $ | 29,331 | |||||
Franchise | 229 | 91 | 684 | ||||||||
Manufacturing / Wholesale | 8,464 | 8,032 | 7,534 | ||||||||
Corporate / Other | 6,719 | 6,558 | 6,268 | ||||||||
| | | | | | | | | | | |
Total capital expenditures | $ | 50,247 | $ | 41,930 | $ | 43,817 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Total assets | |||||||||||
Retail | $ | 1,483,075 | $ | 1,412,325 | $ | 1,339,325 | |||||
Franchise | 522,996 | 506,021 | 491,008 | ||||||||
Manufacturing / Wholesale | 423,939 | 417,945 | 410,171 | ||||||||
Corporate / Other | 310,337 | 215,749 | 189,083 | ||||||||
| | | | | | | | | | | |
Total assets | $ | 2,740,347 | $ | 2,552,040 | $ | 2,429,587 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Geographic areas | |||||||||||
Total revenues: | |||||||||||
United States | $ | 2,490,089 | $ | 2,311,832 | $ | 1,972,121 | |||||
Foreign | 140,219 | 118,151 | 100,058 | ||||||||
| | | | | | | | | | | |
Total revenues | $ | 2,630,308 | $ | 2,429,983 | $ | 2,072,179 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Long-lived assets: | |||||||||||
United States | $ | 230,666 | $ | 213,208 | $ | 196,176 | |||||
Foreign | 8,557 | 8,447 | 9,251 | ||||||||
| | | | | | | | | | | |
Total long-lived assets | $ | 239,223 | $ | 221,655 | $ | 205,427 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Schedule of sales by general product category | ' | ||||||||||
December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
U.S. Retail Product Categories: | |||||||||||
VMHS | $ | 663,625 | $ | 624,647 | $ | 542,575 | |||||
Sports Nutrition Products | 764,908 | 686,208 | 621,751 | ||||||||
Diet Products | 198,834 | 192,335 | 139,612 | ||||||||
Other Wellness Products | 107,488 | 113,930 | 101,957 | ||||||||
| | | | | | | | | | | |
Total U.S. Retail revenues | 1,734,855 | 1,617,120 | 1,405,895 | ||||||||
Other Retail Revenue(1) | 191,915 | 167,881 | 112,599 | ||||||||
| | | | | | | | | | | |
Total Retail Revenue | $ | 1,926,770 | $ | 1,785,001 | $ | 1,518,494 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
-1 | |||||||||||
Included foreign sales that are presented in total and not by category, as product sales for foreign operations are managed in local currency. Also includes LuckyVitamin.com and DiscountSupplements.com sales, as categories are not consistent with the point of sale categories. | |||||||||||
FRANCHISE_REVENUE_Tables
FRANCHISE REVENUE (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
FRANCHISE REVENUE | ' | ||||||||||
Summary of franchise revenue by type | ' | ||||||||||
Year ended December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
Product sales | $ | 364,500 | $ | 340,574 | $ | 275,026 | |||||
Royalties | 58,247 | 53,047 | 46,507 | ||||||||
Franchise fees | 8,166 | 7,024 | 5,585 | ||||||||
Other | 9,551 | 7,463 | 7,674 | ||||||||
| | | | | | | | | | | |
Total franchise revenue | $ | 440,464 | $ | 408,108 | $ | 334,792 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
QUARTERLY_FINANCIAL_INFORMATIO1
QUARTERLY FINANCIAL INFORMATION (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
QUARTERLY FINANCIAL INFORMATION | ' | ||||||||||||||||
Summary of quarterly results: | ' | ||||||||||||||||
Three months ended (unaudited) | Year ended | ||||||||||||||||
March 31, | June 30, | September 30, | December 31, | December 31, | |||||||||||||
2013 | 2013 | 2013 | 2013 | 2013 | |||||||||||||
($ in thousands, except per share $) | |||||||||||||||||
Total revenue | $ | 664,691 | $ | 676,276 | $ | 675,594 | $ | 613,748 | $ | 2,630,308 | |||||||
Gross profit | 256,137 | 255,892 | 253,945 | 227,152 | 993,127 | ||||||||||||
Operating income | 124,520 | 123,671 | 125,974 | 86,334 | 460,498 | ||||||||||||
Net income | 72,643 | 71,688 | 73,033 | 47,657 | 265,021 | ||||||||||||
Weighted average shares outstanding: | |||||||||||||||||
Basic | 98,997 | 97,428 | 95,183 | 94,636 | 96,481 | ||||||||||||
Diluted | 99,861 | 98,333 | 96,078 | 95,477 | 97,383 | ||||||||||||
Earnings per share: | |||||||||||||||||
Basic | $ | 0.73 | $ | 0.74 | $ | 0.77 | $ | 0.5 | $ | 2.75 | |||||||
Diluted | $ | 0.73 | $ | 0.73 | $ | 0.76 | $ | 0.5 | $ | 2.72 | |||||||
Three months ended (unaudited) | Year ended | ||||||||||||||||
March 31, | June 30, | September 30, | December 31, | December 31, | |||||||||||||
2012 | 2012 | 2012 | 2012 | 2012 | |||||||||||||
($ in thousands, except per share $) | |||||||||||||||||
Total revenue | $ | 624,272 | $ | 619,081 | $ | 621,607 | $ | 565,023 | $ | 2,429,983 | |||||||
Gross profit | 240,709 | 239,437 | 235,214 | 214,377 | 929,738 | ||||||||||||
Operating income | 112,069 | 117,060 | 111,177 | 87,533 | 427,840 | ||||||||||||
Net income | 63,857 | 66,671 | 62,229 | 47,438 | 240,196 | ||||||||||||
Weighted average shares outstanding: | |||||||||||||||||
Basic | 105,805 | 106,517 | 102,541 | 99,205 | 103,503 | ||||||||||||
Diluted | 107,746 | 107,927 | 103,721 | 100,119 | 104,911 | ||||||||||||
Earnings per share: | |||||||||||||||||
Basic | $ | 0.6 | $ | 0.63 | $ | 0.61 | $ | 0.48 | $ | 2.32 | |||||||
Diluted | $ | 0.59 | $ | 0.62 | $ | 0.6 | $ | 0.47 | $ | 2.29 |
NATURE_OF_BUSINESS_Details
NATURE OF BUSINESS (Details) (USD $) | 1 Months Ended | 12 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, except Share data, unless otherwise specified | Apr. 30, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Aug. 31, 2012 | Apr. 30, 2011 | Apr. 30, 2011 | Apr. 30, 2011 | Aug. 01, 2012 | Oct. 31, 2012 | Apr. 30, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Mar. 31, 2011 | Dec. 31, 2013 | Mar. 31, 2011 |
item | Minimum | Class A Common Stock | Class A Common Stock | Class B Common Stock | Series A | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Revolving Credit Facility | Revolving Credit Facility | |||
item | item | |||||||||||||||
General nature of business and recent significant transactions | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of primary segments | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of international countries in which franchise stores are located | ' | ' | ' | 50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Recent Significant Transactions | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1,200 | $130 | $80 |
Increase in outstanding borrowings | ' | ' | ' | ' | ' | ' | ' | ' | 200 | ' | ' | 252.5 | 252.5 | ' | ' | ' |
Description of variable interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'LIBOR | ' | ' | 'LIBOR | ' | ' | ' |
Interest rate floor (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.00% | ' | ' | ' | ' | ' | ' |
Applicable margin (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.75% | ' | 2.75% | 2.75% | ' | ' | ' |
Issuance of common stock (in shares) | ' | ' | ' | ' | ' | 25,875,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock, par value (in dollars per share) | ' | $0.00 | $0.00 | ' | ' | $0.00 | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
IPO price of share (in dollars per share) | ' | ' | ' | ' | ' | $16 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred stock, par value (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' |
Repayment of outstanding borrowings from the net proceeds of the IPO | 300 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 300 | ' | ' | ' | ' | ' |
Payment made to satisfy obligations under the Management Services Agreement | $11.10 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of registered offerings of common stock completed by stockholders | ' | 4 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares repurchased | ' | ' | ' | ' | 6,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of stockholders from whom stock is repurchased | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
NATURE_OF_BUSINESS_Details_2
NATURE OF BUSINESS (Details 2) (USD $) | 1 Months Ended | ||||||
In Millions, except Share data in Thousands, unless otherwise specified | Nov. 30, 2013 | Feb. 28, 2013 | Dec. 31, 2013 | Aug. 31, 2011 | Oct. 02, 2013 | Dec. 31, 2013 | 31-May-13 |
LuckyVitamin.com | Discount Supplements | Class B Common Stock | Class B Common Stock | ||||
Recent Significant Transactions | ' | ' | ' | ' | ' | ' | ' |
Aggregate purchase price of acquisition | ' | ' | ' | $19.80 | $33.30 | ' | ' |
Common stock outstanding | ' | ' | 94,000 | ' | ' | 0 | 0 |
Amount of shares authorized to repurchase | $500 | $250 | ' | ' | ' | ' | ' |
BASIS_OF_PRESENTATION_AND_SUMM2
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Receivables, net | ' | ' |
Receivables | $140.80 | $126 |
Allowance for doubtful accounts | 1.9 | 2.2 |
Goodwill and Intangible Assets | ' | ' |
Impairment recorded | $0 | ' |
All asset classes except building | Minimum | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '1 year | ' |
All asset classes except building | Maximum | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '15 years | ' |
Building | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '30 years | ' |
Fixtures | Minimum | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '3 years | ' |
Fixtures | Maximum | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '15 years | ' |
Equipment | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '10 years | ' |
Computer equipment and software | Minimum | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '3 years | ' |
Computer equipment and software | Maximum | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '5 years | ' |
BASIS_OF_PRESENTATION_AND_SUMM3
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Vendor Allowances | ' | ' | ' |
Rebate income reducing cost of goods sold | $92.60 | $81.50 | $64.70 |
Research and Development | ' | ' | ' |
Research and development costs | 1.4 | 1.1 | 0.6 |
Advertising Expenditures | ' | ' | ' |
Advertising, promotion and marketing program costs | 67.2 | 62.3 | 52.9 |
National advertising fund | $15.40 | $14.40 | $12.20 |
Retail | ' | ' | ' |
Revenue Recognition | ' | ' | ' |
Amortization period of deferred revenue | '12 months | ' | ' |
Discount on Gold Cards (as a percent) | 20.00% | ' | ' |
BASIS_OF_PRESENTATION_AND_SUMM4
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 3) (USD $) | 12 Months Ended |
Dec. 31, 2013 | |
sqft | |
Leases | ' |
Price at which facility can be purchased | 1 |
Greenville, South Carolina | ' |
Leases | ' |
Facility leased | 300,000 |
Anderson, South Carolina | ' |
Leases | ' |
Facility leased | 630,000 |
BASIS_OF_PRESENTATION_AND_SUMM5
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 4) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Self-Insurance | ' | ' |
Accrued benefits | $46,243,000 | $41,350,000 |
Self-Insurance | ' | ' |
Self-Insurance | ' | ' |
Product liability insurance with retention | 4,000,000 | ' |
Aggregate cap on retained losses | 10,000,000 | ' |
General liability insurance with retention | 250,000 | ' |
Aggregate cap on retained losses | 1,000,000 | ' |
Reimbursement of workers compensation liability | 250,000 | ' |
Reimbursement of auto liability | 100,000 | ' |
Annual medical benefit maximum per individual | 500,000 | ' |
Lifetime medical benefit maximum per individual | 2,000,000 | ' |
Accrued benefits | $2,000,000 | $1,900,000 |
BASIS_OF_PRESENTATION_AND_SUMM6
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 5) (USD $) | 0 Months Ended | 12 Months Ended | 12 Months Ended | ||
In Millions, unless otherwise specified | Oct. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2011 |
Senior Credit Facility, outstanding Senior Notes and outstanding Senior Subordinated Notes, and the four agreements | |||||
item | |||||
Transaction and restructuring related costs | ' | ' | ' | ' | ' |
Restructuring costs | $12.20 | ' | ' | ' | ' |
Early lease termination on transportation equipment | 9.8 | ' | ' | ' | ' |
Employee severance and other costs | 2.4 | ' | ' | ' | ' |
Transaction Related Costs | ' | 0.2 | 1.9 | ' | ' |
Financial Instruments and Derivatives | ' | ' | ' | ' | ' |
Number of derivative instruments held for trading purposes | ' | 0 | ' | ' | ' |
Converted notional amounts of Debt | ' | ' | ' | 550 | ' |
Outstanding agreements | ' | ' | ' | ' | 4 |
Number of interest rate swap agreements settled and terminated | ' | ' | ' | ' | 4 |
Repayment of facility | ' | ' | ' | ' | 8.7 |
Reclassification of gain (loss) from accumulated other comprehensive income (loss) to interest expense | ' | ' | ' | ' | 5.8 |
Derivative instruments outstanding amount | ' | $0 | ' | ' | ' |
INVENTORIES_NET_Details
INVENTORIES, NET (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
INVENTORIES, NET | ' | ' |
Finished product ready for sale | $458,366 | $415,096 |
Work-in-process, bulk product and raw materials | 81,575 | 70,022 |
Packaging supplies | 7,975 | 6,481 |
Total | $547,916 | $491,599 |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income before income taxes | ' | ' | ' |
Domestic | $389,459 | $372,669 | $206,971 |
Foreign | 18,010 | 7,615 | 633 |
Income before income taxes | 407,469 | 380,284 | 207,604 |
Current: | ' | ' | ' |
Federal | 120,137 | 117,332 | 63,130 |
State | 15,433 | 21,099 | 13,371 |
Foreign | 8,656 | 5,022 | 4,091 |
Total | 144,226 | 143,453 | 80,592 |
Deferred: | ' | ' | ' |
Federal | -363 | -2,238 | -3,310 |
State | -955 | -1,222 | -1,351 |
Foreign | -460 | 95 | -660 |
Total | -1,778 | -3,365 | -5,321 |
Income tax expense | 142,448 | 140,088 | 75,271 |
Percent of pretax earnings: | ' | ' | ' |
Statutory federal tax rate (as a percent) | 35.00% | 35.00% | 35.00% |
Increase (reduction) resulting from, State income tax, net of federal tax benefit (as a percent) | 3.10% | 3.20% | 3.00% |
Increase (reduction) resulting from, Other permanent differences (as a percent) | 0.10% | 0.60% | 2.00% |
Increase (reduction) resulting from, International operations, net of foreign tax credits (as a percent) | 0.00% | -0.10% | -1.60% |
Increase (reduction) resulting from, Federal tax credits and income deductions (as a percent) | -2.10% | -2.10% | -2.40% |
Increase (reduction) resulting from, Tax impact of uncertain tax positions and other (as a percent) | -1.10% | 0.20% | 0.30% |
Effective income tax rate (as a percent) | 35.00% | 36.80% | 36.30% |
Current assets: | ' | ' | ' |
Operating reserves | 3,345 | 4,507 | ' |
Deferred revenue | 2,871 | 2,377 | ' |
Accrued worker compensation | 2,562 | 2,436 | ' |
Other assets | 3,790 | 3,028 | ' |
Total current assets | 12,568 | 12,348 | ' |
Current liabilities: | ' | ' | ' |
Prepaid expenses | -5,699 | -3,901 | ' |
Other liabilities | -3,051 | -3,182 | ' |
Total current liabilities | -8,750 | -7,083 | ' |
Current assets (liabilities): | ' | ' | ' |
Operating reserves | 3,345 | 4,507 | ' |
Deferred revenue | 2,871 | 2,377 | ' |
Prepaid expenses | -5,699 | -3,901 | ' |
Accrued worker compensation | 2,562 | 2,436 | ' |
Other net | 739 | -154 | ' |
Total current | 3,818 | 5,265 | ' |
Non-current assets: | ' | ' | ' |
Fixed assets | 17,410 | 14,809 | ' |
Stock compensation | 3,111 | 2,711 | ' |
Net operating loss carryforwards | 6,763 | 7,020 | ' |
Long-term rent liabilities | 9,766 | 8,141 | ' |
Other assets | 5,744 | 4,310 | ' |
Valuation allowance | -565 | -1,765 | ' |
Total non-current assets | 42,229 | 35,226 | ' |
Non-current liabilities: | ' | ' | ' |
Intangibles | -324,606 | -318,429 | ' |
Total non-current liabilities | -324,606 | -318,429 | ' |
Non-current assets (liabilities): | ' | ' | ' |
Intangibles | -324,606 | -318,429 | ' |
Fixed assets | 17,410 | 14,809 | ' |
Stock compensation | 3,111 | 2,711 | ' |
Net operating loss carryforwards | 6,763 | 7,020 | ' |
Long-term rent liabilities | 9,766 | 8,141 | ' |
Other | 5,744 | 4,310 | ' |
Valuation allowance | -565 | -1,765 | ' |
Total non-current | -282,377 | -283,203 | ' |
Total deferred tax assets | 54,797 | 47,574 | ' |
Total Deferred tax liabilities | -333,356 | -325,512 | ' |
Total net deferred taxes | ($278,559) | ($277,938) | ' |
INCOME_TAXES_Details_2
INCOME TAXES (Details 2) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Valuation allowance | ' | ' | ' |
State operating losses | $5,300,000 | $5,900,000 | ' |
Valuation allowance adjustment | 1,200,000 | 1,200,000 | 1,500,000 |
Interest and penalties accrued related to unrecognized tax benefits | 4,200,000 | 5,700,000 | ' |
Reconciliation of the beginning and ending amount of unrecognized tax benefits | ' | ' | ' |
Balance of unrecognized tax benefits at beginning of period | 12,882,000 | 10,574,000 | 8,720,000 |
Additions for tax positions taken during current period | 873,000 | 1,215,000 | 1,104,000 |
Additions for tax positions taken during prior periods | 1,965,000 | 4,220,000 | 750,000 |
Reductions for tax positions taken during prior periods | -4,068,000 | -1,439,000 | ' |
Settlements | -804,000 | -1,688,000 | ' |
Balance of unrecognized tax benefits at end of period | 10,848,000 | 12,882,000 | 10,574,000 |
Unrecognized tax benefits that would affect the effective tax rate | $10,800,000 | $12,900,000 | ' |
Minimum | ' | ' | ' |
Valuation allowance | ' | ' | ' |
Period of realization prior to expiration | '5 years | ' | ' |
Maximum | ' | ' | ' |
Valuation allowance | ' | ' | ' |
Period of realization prior to expiration | '20 years | ' | ' |
GOODWILL_BRANDS_AND_OTHER_INTA2
GOODWILL, BRANDS, AND OTHER INTANGIBLE ASSETS, NET (Details) (USD $) | 12 Months Ended | ||||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Aug. 31, 2011 | Oct. 02, 2013 |
Franchise stores | Franchise stores | Franchise stores | LuckyVitamin.com | Discount Supplements | |
store | store | store | |||
Acquisitions | ' | ' | ' | ' | ' |
Number of franchise stores acquired | 16 | 29 | 30 | ' | ' |
Total purchase prices associated with acquisitions | $2.90 | $4.40 | $3.40 | $19.80 | $33.30 |
Cash paid | 1.7 | 2.1 | 1.6 | ' | ' |
Purchase price allocated to goodwill | ' | ' | ' | 11.5 | 24.6 |
Purchase price allocated to amortizable intangible assets | ' | ' | ' | 9.6 | 9.6 |
Purchase price allocated to inventory | ' | ' | ' | ' | 4.9 |
Purchase price allocated to accounts receivable | ' | ' | ' | ' | 0.5 |
Purchase price allocated to property and equipment acquired | ' | ' | ' | 0.7 | 0.6 |
Purchase price allocated to current assets acquired | ' | ' | ' | 2.6 | 0.2 |
Purchase price allocated to accounts payable assumed | ' | ' | ' | ' | 2.8 |
Purchase price allocated to deferred tax liabilities assumed | ' | ' | ' | ' | 2.4 |
Purchase price allocated to other current liabilities assumed | ' | ' | ' | ' | 1.5 |
Purchase price allocated to other long term liabilities assumed | ' | ' | ' | ' | 6.2 |
Purchase price allocated to net assumed current liabilities | ' | ' | ' | $3.90 | ' |
GOODWILL_BRANDS_AND_OTHER_INTA3
GOODWILL, BRANDS, AND OTHER INTANGIBLE ASSETS, NET (Details 2) (USD $) | 12 Months Ended | 12 Months Ended | 12 Months Ended | |||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Franchise stores | Franchise stores | Discount Supplements | Retail | Retail | Retail | Retail | Retail | Franchising | Franchising | Franchising | Manufacturing/Wholesale | Manufacturing/Wholesale | Manufacturing/Wholesale | |||
Franchise stores | Franchise stores | Discount Supplements | ||||||||||||||
Changes in amount of goodwill during the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period | $639,915 | $637,877 | ' | ' | ' | $319,771 | $317,733 | ' | ' | ' | $117,303 | $117,303 | $117,303 | $202,841 | $202,841 | $202,841 |
Acquired during period | ' | ' | 1,431 | 2,038 | 24,582 | ' | ' | 1,431 | 2,038 | 24,582 | ' | ' | ' | ' | ' | ' |
Translation effect of exchange rates | 418 | ' | ' | ' | ' | 418 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the end of the period (unaudited) | $666,346 | $637,877 | ' | ' | ' | $346,202 | $317,733 | ' | ' | ' | $117,303 | $117,303 | $117,303 | $202,841 | $202,841 | $202,841 |
GOODWILL_BRANDS_AND_OTHER_INTA4
GOODWILL, BRANDS, AND OTHER INTANGIBLE ASSETS, NET (Details 3) (USD $) | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Operating Agreements | Operating Agreements | Retail agreements | Retail agreements | Franchise agreements | Franchise agreements | Manufacturing agreements | Manufacturing agreements | Other Intangibles Including Franchise Rights | Other Intangibles Including Franchise Rights | Other intangibles | Other intangibles | Franchise Rights | Franchise Rights | Retail Brand | Retail Brand | Retail Brand | Franchise Brand | Franchise Brand | Franchise Brand | |||
Changes in amount of indefinite lived intangible assets during the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period | $720,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $500,000,000 | $500,000,000 | $500,000,000 | $220,000,000 | $220,000,000 | $220,000,000 |
Balance at the end of the period | 720,000,000 | 720,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 500,000,000 | 500,000,000 | 500,000,000 | 220,000,000 | 220,000,000 | 220,000,000 |
Changes in amount of finite lived intangible assets during the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period | ' | ' | 132,317,000 | 138,970,000 | 24,751,000 | ' | 53,783,000 | ' | 53,783,000 | ' | 9,400,000 | 10,619,000 | 8,449,000 | ' | 951,000 | ' | 500,000,000 | 500,000,000 | ' | 220,000,000 | 220,000,000 | ' |
Acquisitions | 9,565,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 329,000 | 701,000 | 9,565,000 | ' | 329,000 | 701,000 | ' | ' | ' | ' | ' | ' |
Amortization expense | -8,999,000 | -8,573,000 | -6,652,000 | -6,653,000 | ' | ' | ' | ' | ' | ' | -2,347,000 | -1,920,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the end of the period | 142,774,000 | ' | 125,665,000 | 132,317,000 | 23,699,000 | ' | 50,983,000 | ' | 50,983,000 | ' | 17,109,000 | 9,400,000 | 16,332,000 | ' | 777,000 | 951,000 | 500,000,000 | 500,000,000 | ' | 220,000,000 | 220,000,000 | ' |
Changes in amount of intangible assets during the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total at the beginning of the period | 861,717,000 | 869,589,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisitions | 9,565,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 329,000 | 701,000 | 9,565,000 | ' | 329,000 | 701,000 | ' | ' | ' | ' | ' | ' |
Amortization expense | -8,999,000 | -8,573,000 | -6,652,000 | -6,653,000 | ' | ' | ' | ' | ' | ' | -2,347,000 | -1,920,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Translation effect of exchange rates | 162,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 162,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total at the end of the period | 862,774,000 | 861,717,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets, net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted Average Life | '23 years 6 months | ' | ' | ' | '30 years 3 months 18 days | ' | '25 years | ' | '25 years | ' | ' | ' | '8 years 2 months 12 days | ' | '3 years 8 months 12 days | ' | ' | ' | ' | ' | ' | ' |
Brands | 720,000,000 | 720,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 500,000,000 | 500,000,000 | 500,000,000 | 220,000,000 | 220,000,000 | 220,000,000 |
Cost | ' | ' | ' | ' | 31,000,000 | 31,000,000 | 70,000,000 | 70,000,000 | 70,000,000 | 70,000,000 | ' | ' | 20,327,000 | 10,600,000 | 5,463,000 | 5,134,000 | ' | ' | ' | ' | ' | ' |
Accumulated Amortization | -54,016,000 | -45,017,000 | ' | ' | -7,301,000 | -6,249,000 | -19,017,000 | -16,217,000 | -19,017,000 | -16,217,000 | ' | ' | -3,995,000 | -2,151,000 | -4,686,000 | -4,183,000 | ' | ' | ' | ' | ' | ' |
Carrying Amount | 142,774,000 | ' | 125,665,000 | 132,317,000 | 23,699,000 | ' | 50,983,000 | ' | 50,983,000 | ' | 17,109,000 | 9,400,000 | 16,332,000 | ' | 777,000 | 951,000 | 500,000,000 | 500,000,000 | ' | 220,000,000 | 220,000,000 | ' |
Total Cost | 916,790,000 | 906,734,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total Carrying Amount | 862,774,000 | 861,717,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Future estimated amortization expense of other intangible assets, net, with definite lives | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | 12,952,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2015 | 12,820,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2016 | 11,987,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2017 | 9,996,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2018 | 9,952,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Thereafter | 85,067,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total | $142,774,000 | ' | $125,665,000 | $132,317,000 | $23,699,000 | ' | $50,983,000 | ' | $50,983,000 | ' | $17,109,000 | $9,400,000 | $16,332,000 | ' | $777,000 | $951,000 | $500,000,000 | $500,000,000 | ' | $220,000,000 | $220,000,000 | ' |
PROPERTY_PLANT_AND_EQUIPMENT_N2
PROPERTY, PLANT AND EQUIPMENT, NET (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Property, plant and equipment | ' | ' | ' |
Total property, plant and equipment | $427,590,000 | $388,244,000 | ' |
Less: accumulated depreciation | -220,836,000 | -188,757,000 | ' |
Net property, plant and equipment | 206,754,000 | 199,487,000 | ' |
Depreciation expense | 42,800,000 | 40,700,000 | 38,800,000 |
Land, buildings and improvements | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Total property, plant and equipment | 66,851,000 | 66,119,000 | ' |
Machinery and equipment | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Total property, plant and equipment | 115,681,000 | 107,664,000 | ' |
Leasehold improvements | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Total property, plant and equipment | 115,815,000 | 102,902,000 | ' |
Furniture and fixtures | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Total property, plant and equipment | 91,113,000 | 79,747,000 | ' |
Software | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Total property, plant and equipment | 34,166,000 | 29,956,000 | ' |
Construction in progress | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Total property, plant and equipment | $3,964,000 | $1,856,000 | ' |
DEFERRED_REVENUE_AND_OTHER_CUR2
DEFERRED REVENUE AND OTHER CURRENT LIABILITIES (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Deferred revenue and other current liabilities | ' | ' |
Deferred revenue | $37,193 | $41,465 |
Accrued payroll | 23,023 | 33,522 |
Other current liabilities | 46,243 | 41,350 |
Total | $106,459 | $116,337 |
LONGTERM_DEBT_INTEREST_EXPENSE2
LONG-TERM DEBT / INTEREST EXPENSE (Details) (USD $) | 12 Months Ended | 12 Months Ended | 0 Months Ended | 1 Months Ended | 3 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | |||||||||||||||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2013 | Dec. 31, 2012 | Aug. 01, 2012 | Dec. 31, 2010 | Dec. 31, 2010 | Aug. 01, 2012 | Oct. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Mar. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Mar. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | |
Senior credit facility | Senior credit facility | Senior credit facility | Senior credit facility | Senior credit facility | Senior credit facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Term Loan Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Letter of credit | Letter of credit | Other | Other | Mortgage and other interest expense | Mortgage and other interest expense | Mortgage and other interest expense | Senior Notes | Senior Subordinated Notes | Repricing to the senior credit facility | Repricing to the senior credit facility | Repricing to the senior credit facility | Repricing to the senior credit facility | Repricing to the senior credit facility | Repricing to the senior credit facility | ||||
Federal funds effective rate | Adjusted LIBOR | Adjusted LIBOR | Option One | Option One | Option One | Option One | Option Two | Option Two | Option Two | Option Two | Adjusted LIBOR | Option One | Option One | Option One | Option Two | Option Two | Option Two | Option One | Option One | Option One | Option Two | ||||||||||||||||||||||||||||||
Fixed rate | Fixed rate | Fixed rate | Fixed rate | Fixed rate | Fixed rate | Federal funds effective rate | One month adjusted LIBOR | Adjusted LIBOR | |||||||||||||||||||||||||||||||||||||||||||
Long-term Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total Debt | $1,347,099,000 | $1,098,562,000 | ' | ' | $1,350,000,000 | $1,096,112,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1,112,000 | $2,450,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Less: current maturities | -5,443,000 | -3,817,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long-term debt | 1,341,656,000 | 1,094,745,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total debt principal maturities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | 5,443,000 | ' | ' | ' | 4,550,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 893,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2015 | 4,769,000 | ' | ' | ' | 4,550,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 219,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2016 | 4,550,000 | ' | ' | ' | 4,550,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2017 | 4,550,000 | ' | ' | ' | 4,550,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2018 | 4,550,000 | ' | ' | ' | 4,550,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2019 | 1,327,250,000 | ' | ' | ' | 1,327,250,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total Debt | 1,347,099,000 | 1,098,562,000 | ' | ' | 1,350,000,000 | 1,096,112,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,112,000 | 2,450,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Original issue discount | ' | ' | ' | ' | 4,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 42,020,000 | 41,216,000 | 38,356,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 680,000 | 533,000 | 598,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 159,000 | 168,000 | 766,000 | 4,808,000 | 3,055,000 | ' | ' | ' | ' | ' | ' |
Early extinguishment of debt | 5,712,000 | 1,343,000 | 19,855,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred financing fees amortization | 2,507,000 | 2,439,000 | 2,756,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
OID amortization | 2,625,000 | 404,000 | 344,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest income | -254,000 | -28,000 | -1,110,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Termination of interest rate swaps | ' | ' | 5,819,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense, net | 53,029,000 | 47,556,000 | 74,903,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revolving Credit Facility pledged to secure letters of credit | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in outstanding balance | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in outstanding borrowings | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000,000 | ' | 252,500,000 | 252,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,200,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 130,000,000 | ' | ' | 80,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basis of interest rate (as a percent) | ' | ' | ' | 'Prime Rate | ' | ' | ' | 'Federal funds effective rate | 'Adjusted LIBOR | ' | 'LIBOR | ' | 'LIBOR | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'Prime Rate | 'Federal funds effective rate | 'One month adjusted LIBOR | 'Adjusted LIBOR |
Interest rate margin (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.75% | 2.75% | 2.75% | ' | ' | ' | 2.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.50% | 1.00% | ' |
Fixed interest rate base (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.75% | 2.00% | ' | ' | 0.75% | 1.00% | ' | ' | ' | ' | ' | ' | ' | 2.25% | ' | ' | 1.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional interest margin added to fixed and variable rates (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.50% | 1.75% | ' | ' | 2.50% | 2.75% | ' | ' | ' | ' | ' | ' | ' | 1.25% | 2.00% | ' | 2.25% | 3.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in cash dividends to parent | ' | ' | ' | ' | ' | ' | 50,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basket used to make dividends to parent | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $75,000,000 | ' | ' | ' | ' | ' |
Current interest rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.25% | 3.75% | ' | ' | ' | ' |
Fee for letters of credit to lenders (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.50% | 3.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Commitment fee respect of unutilized revolving loan commitments (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.50% | 0.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
FAIR_VALUE_MEASUREMENTS_AND_FI2
FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Financial assets and liabilities accounted for at fair value on a recurring basis | ' | ' |
Other long-term assets | $38,426 | $32,124 |
Recurring basis | Level 1 | ' | ' |
Financial assets and liabilities accounted for at fair value on a recurring basis | ' | ' |
Cash equivalents | 142,800 | 85,006 |
Recurring basis | Level 2 | ' | ' |
Financial assets and liabilities accounted for at fair value on a recurring basis | ' | ' |
Other long-term assets | $6,124 | $4,397 |
FAIR_VALUE_MEASUREMENTS_AND_FI3
FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS (Details 2) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Carrying Amount | ' | ' |
Actual and estimated fair values of the financial instruments | ' | ' |
Cash and cash equivalents | $226,217 | $158,541 |
Receivables, net | 144,833 | 129,641 |
Franchise notes receivable, net | 10,163 | 7,589 |
Accounts payable | 135,164 | 125,165 |
Long-term debt (including current portion) | 1,347,099 | 1,098,562 |
Fair Value | ' | ' |
Actual and estimated fair values of the financial instruments | ' | ' |
Cash and cash equivalents | 226,217 | 158,541 |
Receivables, net | 144,833 | 129,641 |
Franchise notes receivable, net | 10,163 | 7,589 |
Accounts payable | 135,164 | 125,165 |
Long-term debt (including current portion) | $1,343,732 | $1,101,309 |
LONGTERM_LEASE_OBLIGATIONS_Det
LONG-TERM LEASE OBLIGATIONS (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Long - term lease obligations | ' | ' | ' |
Total truck fleet rental expense | $4,491,000 | $5,350,000 | $4,979,000 |
Total other rental expense | 13,484,000 | 13,401,000 | 11,883,000 |
Total | 233,524,000 | 220,426,000 | 206,765,000 |
Minimum future obligations | ' | ' | ' |
2014 | 133,687,000 | ' | ' |
2015 | 114,169,000 | ' | ' |
2016 | 96,758,000 | ' | ' |
2017 | 73,368,000 | ' | ' |
2018 | 45,910,000 | ' | ' |
Thereafter | 91,213,000 | ' | ' |
Total | 555,105,000 | ' | ' |
Sublease income | ' | ' | ' |
2014 | -27,619,000 | ' | ' |
2015 | -23,519,000 | ' | ' |
2016 | -19,186,000 | ' | ' |
2017 | -13,735,000 | ' | ' |
2018 | -7,259,000 | ' | ' |
Thereafter | -10,783,000 | ' | ' |
Total | -102,101,000 | ' | ' |
Minimum | ' | ' | ' |
Long - term lease obligations | ' | ' | ' |
Initial term of lease | '5 years | ' | ' |
Maximum | ' | ' | ' |
Long - term lease obligations | ' | ' | ' |
Initial term of lease | '10 years | ' | ' |
Retail stores | ' | ' | ' |
Retail stores: | ' | ' | ' |
Rent on long-term operating leases, net of sublease income | 137,076,000 | 126,411,000 | 120,170,000 |
Landlord related taxes | 19,552,000 | 18,399,000 | 16,940,000 |
Common operating expenses | 34,978,000 | 33,589,000 | 31,969,000 |
Percent rent | 23,943,000 | 23,276,000 | 20,824,000 |
Total retail stores rent expense | 215,549,000 | 201,675,000 | 189,903,000 |
Sublease income | 37,700,000 | 35,700,000 | 33,700,000 |
Company Retail Stores | ' | ' | ' |
Minimum future obligations | ' | ' | ' |
2014 | 127,555,000 | ' | ' |
2015 | 108,798,000 | ' | ' |
2016 | 92,707,000 | ' | ' |
2017 | 70,412,000 | ' | ' |
2018 | 44,528,000 | ' | ' |
Thereafter | 78,228,000 | ' | ' |
Total | 522,228,000 | ' | ' |
Franchise Retail Stores | ' | ' | ' |
Minimum future obligations | ' | ' | ' |
2014 | 27,619,000 | ' | ' |
2015 | 23,519,000 | ' | ' |
2016 | 19,186,000 | ' | ' |
2017 | 13,735,000 | ' | ' |
2018 | 7,259,000 | ' | ' |
Thereafter | 10,783,000 | ' | ' |
Total | 102,101,000 | ' | ' |
Other | ' | ' | ' |
Minimum future obligations | ' | ' | ' |
2014 | 6,132,000 | ' | ' |
2015 | 5,371,000 | ' | ' |
2016 | 4,051,000 | ' | ' |
2017 | 2,956,000 | ' | ' |
2018 | 1,382,000 | ' | ' |
Thereafter | 12,985,000 | ' | ' |
Total | $32,877,000 | ' | ' |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | 12 Months Ended | 0 Months Ended | 1 Months Ended | 12 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Dec. 31, 2013 | Feb. 14, 2014 | Dec. 14, 2011 | Nov. 04, 2008 | Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 |
DMAA Claims | California Wage and Break Claim | California Wage and Break Claim | California Wage and Break Claim | California Wage and Break Claim | 98 plaintiffs | 98 plaintiffs | Charles Brewer, on behalf of himself and all others | Charles Brewer, on behalf of himself and all others | Naranjo, individually and on behalf of all others | Naranjo, individually and on behalf of all others | Product liability | Product liability | ||
Subsequent event | item | claim | item | California Wage and Break Claim | California Wage and Break Claim | California Wage and Break Claim | California Wage and Break Claim | California Wage and Break Claim | California Wage and Break Claim | Hydroxycut Claims | ||||
claim | item | lawsuit | report | |||||||||||
lawsuit | product | |||||||||||||
action | state | |||||||||||||
lawsuit | ||||||||||||||
action | ||||||||||||||
claim | ||||||||||||||
Commitments and contingencies | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deductible/retention per claim out of total product liability insurance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $4 | ' |
Aggregate cap on retained loss for deductible/retention per claim out of total product liability insurance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10 | ' |
Number of reports of liver injuries | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 23 |
Number of Hydroxycut-branded products recalled | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14 |
Number of lawsuits filed against the company | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 93 |
Number of states in which lawsuits against the company are filed | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14 |
Number of pending lawsuits in which company is named | ' | 16 | ' | ' | ' | 86 | ' | ' | ' | ' | ' | ' | ' | 73 |
Number of individual, largely personal injury claims pending | ' | 13 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 67 |
Number of putative class action cases pending against the company | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6 |
Accrued contingent liability | ' | ' | ' | ' | ' | ' | 0 | 0 | 0 | 0 | 0 | 0 | ' | ' |
Number of plaintiffs who filed individual claims against the company | ' | ' | ' | 98 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of plaintiffs whose claim trial conducted | ' | ' | ' | ' | 7 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of claims against which the order is entered in favor of the entity | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of plaintiffs whose claims have been resolved | ' | ' | ' | ' | ' | 5 | ' | ' | ' | ' | ' | ' | ' | ' |
Period within which plaintiffs can amend the complaint | ' | ' | '30 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of future purchase commitments | 8.2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Liability related to environmental loss contingency recorded | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
PREFERRED_STOCK_Details
PREFERRED STOCK (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, except Per Share data, unless otherwise specified | ||
PREFERRED STOCK | ' | ' |
Series A Preferred Stock authorized | 60 | 60 |
Par value of Series A Preferred Stock (in dollars per share) | $0.00 | $0.00 |
Outstanding Series A Preferred Stock | 0 | 0 |
STOCKHOLDERS_EQUITY_Details
STOCKHOLDERS' EQUITY (Details) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Common Stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Authorized common stock | 300,000,000 | ' | ' | ' | 300,000,000 | ' | ' | ' | 300,000,000 | 300,000,000 | ' |
Common stock outstanding | 94,000,000 | ' | ' | ' | ' | ' | ' | ' | 94,000,000 | ' | ' |
Earnings Per Share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic weighted average shares | 94,636,000 | 95,183,000 | 97,428,000 | 98,997,000 | 99,205,000 | 102,541,000 | 106,517,000 | 105,805,000 | 96,481,000 | 103,503,000 | 100,261,000 |
Effect of dilutive employee stock-based compensation awards | ' | ' | ' | ' | ' | ' | ' | ' | 902,000 | 1,408,000 | 2,749,000 |
Diluted weighted averages shares | 95,477,000 | 96,078,000 | 98,333,000 | 99,861,000 | 100,119,000 | 103,721,000 | 107,927,000 | 107,746,000 | 97,383,000 | 104,911,000 | 103,010,000 |
Antidilutive shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unexercised stock options not included in the computation of diluted earnings per share because of anti-dilutive impact | ' | ' | ' | ' | ' | ' | ' | ' | 400,000 | 400,000 | 2,000,000 |
Holdings | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Authorized common stock | 300,000,000 | ' | ' | ' | ' | ' | ' | ' | 300,000,000 | ' | ' |
STOCKBASED_COMPENSATION_PLANS_1
STOCK-BASED COMPENSATION PLANS (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
plan | |||
Stock-based compensation plans | ' | ' | ' |
Number of stock-based employee compensation plans | 2 | ' | ' |
Non-cash stock-based compensation expense | $7,800,000 | $4,800,000 | $3,900,000 |
Total unrecognized compensation cost related to non-vested stock awards | 16,900,000 | ' | ' |
Weighted average period over which compensation cost is expected to be recognized | '1 year 8 months 12 days | ' | ' |
Stock option | ' | ' | ' |
Stock-based compensation plans | ' | ' | ' |
Total intrinsic value of awards exercised | 44,600,000 | 101,800,000 | 60,900,000 |
Total amount of cash received from the exercise of options | 14,600,000 | 26,000,000 | 28,500,000 |
Tax benefit associated with the exercise of awards | 17,900,000 | 39,800,000 | 22,400,000 |
Tax benefit associated with the exercise of awards recorded to paid-in-capital | 15,400,000 | 37,500,000 | 20,400,000 |
Total Options | ' | ' | ' |
Outstanding at the beginning of the period (in shares) | 3,159,542 | ' | ' |
Granted (in shares) | 61,485 | ' | ' |
Exercised (in shares) | -1,221,632 | ' | ' |
Forfeited (in shares) | -112,241 | ' | ' |
Outstanding at the end of the period (in shares) | 1,887,154 | 3,159,542 | ' |
Exercisable at the end of the period (in shares) | 576,562 | ' | ' |
Weighted Average Exercise Price | ' | ' | ' |
Outstanding at the beginning of the period (in dollars per share) | $18.96 | ' | ' |
Granted (in dollars per share) | $53.45 | ' | ' |
Exercised (in dollars per share) | $11.87 | ' | ' |
Forfeited (in dollars per share) | $28.12 | ' | ' |
Outstanding at the end of the period (in dollars per share) | $24.14 | $18.96 | ' |
Exercisable at the end of the period (in dollars per share) | $21.92 | ' | ' |
Weighted Average Remaining Contractual Term (In Years) | ' | ' | ' |
Outstanding at the end of the period | '5 years 7 months 6 days | ' | ' |
Exercisable at the end of the period | '5 years 4 months 24 days | ' | ' |
Aggregate Intrinsic Value | ' | ' | ' |
Outstanding at the end of the period | 64,768,000 | ' | ' |
Exercisable at the end of the period | $21,060,000 | ' | ' |
Weighted average date fair value per share of options granted (in dollars per share) | $16.16 | $10.38 | $7.23 |
Stock option | Minimum | ' | ' | ' |
Stock-based compensation plans | ' | ' | ' |
Vesting period | '4 years | ' | ' |
Expiration period | '7 years | ' | ' |
Stock option | Maximum | ' | ' | ' |
Stock-based compensation plans | ' | ' | ' |
Vesting period | '5 years | ' | ' |
Expiration period | '10 years | ' | ' |
2011 Stock Plan | ' | ' | ' |
Stock-based compensation plans | ' | ' | ' |
Number of shares authorized for issuance | 8,500,000 | ' | ' |
Number of shares reserved for every share granted that are Full Share Awards | 1.8 | ' | ' |
Number of shares available for grant for every share forfeited that are Full Share Awards | 1.8 | ' | ' |
2007 Stock Plan | ' | ' | ' |
Stock-based compensation plans | ' | ' | ' |
Granted (in shares) | 0 | ' | ' |
STOCKBASED_COMPENSATION_PLANS_2
STOCK-BASED COMPENSATION PLANS (Details 2) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Stock option | ' | ' | ' |
Assumptions used in valuation related to stock option grants | ' | ' | ' |
Dividend yield (as a percent) | ' | ' | 0.00% |
Expected option life | '4 years 9 months 18 days | ' | ' |
Minimum volatility factor percentage of market price | 35.90% | 40.00% | 38.50% |
Maximum volatility factor percentage of market price | 40.50% | 40.70% | 39.20% |
Stock option | Minimum | ' | ' | ' |
Assumptions used in valuation related to stock option grants | ' | ' | ' |
Dividend yield (as a percent) | 1.00% | 1.20% | ' |
Expected option life | ' | '4 years 9 months 18 days | '4 years 6 months |
Discount rate (as a percent) | 0.70% | 0.60% | 1.50% |
Weighted Average Grant-Date Fair Value | ' | ' | ' |
Vesting period | '4 years | ' | ' |
Stock option | Maximum | ' | ' | ' |
Assumptions used in valuation related to stock option grants | ' | ' | ' |
Dividend yield (as a percent) | 1.40% | 1.40% | ' |
Expected option life | ' | '5 years | '7 years |
Discount rate (as a percent) | 1.40% | 0.90% | 2.90% |
Weighted Average Grant-Date Fair Value | ' | ' | ' |
Vesting period | '5 years | ' | ' |
2011 Stock Plan | Restricted Stock | ' | ' | ' |
Restricted stock and restricted stock units | ' | ' | ' |
Outstanding at the beginning of the period (in shares) | 123,941 | ' | ' |
Granted (in shares) | 18,497 | ' | ' |
Vested (in shares) | -13,221 | ' | ' |
Forfeited (in shares) | -14,236 | ' | ' |
Outstanding at the end of the period (in shares) | 114,981 | ' | ' |
Weighted Average Grant-Date Fair Value | ' | ' | ' |
Outstanding at the beginning of the period (in dollars per share) | 24.24 | ' | ' |
Granted (in dollars per share) | 44.15 | ' | ' |
Vested (in dollars per share) | 39.96 | ' | ' |
Forfeited (in dollars per share) | 28.05 | ' | ' |
Outstanding at the end of the period (in dollars per share) | 25.16 | ' | ' |
2011 Stock Plan | Time Vesting Restricted Stock Units | ' | ' | ' |
Restricted stock and restricted stock units | ' | ' | ' |
Outstanding at the beginning of the period (in shares) | 171,937 | ' | ' |
Granted (in shares) | 37,744 | ' | ' |
Vested (in shares) | -56,637 | ' | ' |
Forfeited (in shares) | -11,746 | ' | ' |
Outstanding at the end of the period (in shares) | 141,298 | ' | ' |
Weighted Average Grant-Date Fair Value | ' | ' | ' |
Outstanding at the beginning of the period (in dollars per share) | 36.16 | ' | ' |
Granted (in dollars per share) | 53.44 | ' | ' |
Vested (in dollars per share) | 35.85 | ' | ' |
Forfeited (in dollars per share) | 37.24 | ' | ' |
Outstanding at the end of the period (in dollars per share) | 40.81 | ' | ' |
Vesting period | '3 years | ' | ' |
2011 Stock Plan | Performance Vesting Restricted Stock Units | ' | ' | ' |
Restricted stock and restricted stock units | ' | ' | ' |
Granted (in shares) | 58,226 | ' | ' |
Forfeited (in shares) | -2,860 | ' | ' |
Outstanding at the end of the period (in shares) | 55,366 | ' | ' |
Weighted Average Grant-Date Fair Value | ' | ' | ' |
Granted (in dollars per share) | 45.76 | ' | ' |
Forfeited (in dollars per share) | 42.19 | ' | ' |
Outstanding at the end of the period (in dollars per share) | 45.94 | ' | ' |
2011 Stock Plan | Performance Vesting Restricted Stock Units | Minimum | ' | ' | ' |
Weighted Average Grant-Date Fair Value | ' | ' | ' |
Vesting percentage | 0.00% | ' | ' |
2011 Stock Plan | Performance Vesting Restricted Stock Units | Maximum | ' | ' | ' |
Weighted Average Grant-Date Fair Value | ' | ' | ' |
Vesting percentage | 200.00% | ' | ' |
RETIREMENT_PLANS_Details
RETIREMENT PLANS (Details) (USD $) | 1 Months Ended | 12 Months Ended | |||
In Millions, unless otherwise specified | Feb. 28, 2013 | Feb. 28, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Retirement plans | ' | ' | ' | ' | ' |
Eligibility for matching contribution for full time employees, period of service | ' | ' | '30 days | ' | ' |
Eligibility for matching contribution for part time employees, period of service | ' | ' | '1000 hours | ' | ' |
Employer match of employee contributions of first 3% of eligible compensation (as a percent) | ' | ' | 50.00% | ' | ' |
Percentage of eligible compensation, matched 50% by employer | ' | ' | 3.00% | ' | ' |
Percentage of discretionary contribution made by employer | ' | ' | 50.00% | ' | ' |
Percentage of deferral salary contributed by employee | ' | ' | 3.00% | ' | ' |
Cash contribution made | ' | ' | $1.60 | $1.50 | $1.30 |
Discretionary match amount | 1.5 | 1.3 | ' | ' | ' |
Cash contributions for next fiscal year | ' | ' | $0.80 | ' | ' |
0-1 | ' | ' | ' | ' | ' |
Retirement plans | ' | ' | ' | ' | ' |
Percent Vested | ' | ' | 0.00% | ' | ' |
2-Jan | ' | ' | ' | ' | ' |
Retirement plans | ' | ' | ' | ' | ' |
Percent Vested | ' | ' | 33.00% | ' | ' |
3-Feb | ' | ' | ' | ' | ' |
Retirement plans | ' | ' | ' | ' | ' |
Percent Vested | ' | ' | 66.00% | ' | ' |
3+ | ' | ' | ' | ' | ' |
Retirement plans | ' | ' | ' | ' | ' |
Percent Vested | ' | ' | 100.00% | ' | ' |
Minimum | ' | ' | ' | ' | ' |
Retirement plans | ' | ' | ' | ' | ' |
Employee contributions (as a percent) | ' | ' | 1.00% | ' | ' |
Minimum | 0-1 | ' | ' | ' | ' | ' |
Retirement plans | ' | ' | ' | ' | ' |
Years of Service | ' | ' | '0 years | ' | ' |
Minimum | 1-2 | ' | ' | ' | ' | ' |
Retirement plans | ' | ' | ' | ' | ' |
Years of Service | ' | ' | '1 year | ' | ' |
Minimum | 2-3 | ' | ' | ' | ' | ' |
Retirement plans | ' | ' | ' | ' | ' |
Years of Service | ' | ' | '2 years | ' | ' |
Minimum | 3+ | ' | ' | ' | ' | ' |
Retirement plans | ' | ' | ' | ' | ' |
Years of Service | ' | ' | '3 years | ' | ' |
Maximum | ' | ' | ' | ' | ' |
Retirement plans | ' | ' | ' | ' | ' |
Employee contributions (as a percent) | ' | ' | 80.00% | ' | ' |
Maximum | 0-1 | ' | ' | ' | ' | ' |
Retirement plans | ' | ' | ' | ' | ' |
Years of Service | ' | ' | '1 year | ' | ' |
Maximum | 1-2 | ' | ' | ' | ' | ' |
Retirement plans | ' | ' | ' | ' | ' |
Years of Service | ' | ' | '2 years | ' | ' |
Maximum | 2-3 | ' | ' | ' | ' | ' |
Retirement plans | ' | ' | ' | ' | ' |
Years of Service | ' | ' | '3 years | ' | ' |
RETIREMENT_PLANS_Details_2
RETIREMENT PLANS (Details 2) | 12 Months Ended |
Dec. 31, 2013 | |
Minimum | ' |
Non-qualified Deferred Compensation Plan | ' |
Employee's contribution (as a percent) | 2.00% |
Maximum | ' |
Non-qualified Deferred Compensation Plan | ' |
Employee's contribution (as a percent) | 100.00% |
SEGMENTS_Details
SEGMENTS (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
item | |||||||||||
SEGMENTS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of reportable segments | ' | ' | ' | ' | ' | ' | ' | ' | 3 | ' | ' |
Segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenue | ' | ' | ' | ' | ' | ' | ' | ' | $2,630,308 | $2,429,983 | $2,072,179 |
Subtotal segment revenues | ' | ' | ' | ' | ' | ' | ' | ' | 2,899,796 | 2,693,160 | 2,296,306 |
Operating income | 86,334 | 125,974 | 123,671 | 124,520 | 87,533 | 111,177 | 117,060 | 112,069 | 460,498 | 427,840 | 282,507 |
Transaction and restructuring related costs | ' | ' | ' | ' | ' | ' | ' | ' | -12,353 | -1,926 | -13,536 |
Interest expense, net | ' | ' | ' | ' | ' | ' | ' | ' | 53,029 | 47,556 | 74,903 |
Income before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 407,469 | 380,284 | 207,604 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | 142,448 | 140,088 | 75,271 |
Net income | 47,657 | 73,033 | 71,688 | 72,643 | 47,438 | 62,229 | 66,671 | 63,857 | 265,021 | 240,196 | 132,333 |
Depreciation and amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | 51,814 | 49,257 | 46,790 |
Capital expenditures | ' | ' | ' | ' | ' | ' | ' | ' | 50,247 | 41,930 | 43,817 |
Total assets | 2,740,347 | ' | ' | ' | 2,552,040 | ' | ' | ' | 2,740,347 | 2,552,040 | 2,429,587 |
Long-lived assets | 239,223 | ' | ' | ' | 221,655 | ' | ' | ' | 239,223 | 221,655 | 205,427 |
United States | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenue | ' | ' | ' | ' | ' | ' | ' | ' | 2,490,089 | 2,311,832 | 1,972,121 |
Long-lived assets | 230,666 | ' | ' | ' | 213,208 | ' | ' | ' | 230,666 | 213,208 | 196,176 |
Foreign | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenue | ' | ' | ' | ' | ' | ' | ' | ' | 140,219 | 118,151 | 100,058 |
Long-lived assets | 8,557 | ' | ' | ' | 8,447 | ' | ' | ' | 8,557 | 8,447 | 9,251 |
Retail | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenue | ' | ' | ' | ' | ' | ' | ' | ' | 1,926,770 | 1,785,001 | 1,518,494 |
Third Party | ' | ' | ' | ' | ' | ' | ' | ' | 1,926,770 | 1,785,001 | 1,518,494 |
Operating income | ' | ' | ' | ' | ' | ' | ' | ' | 360,156 | 346,420 | 243,506 |
Depreciation and amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | 30,769 | 28,309 | 25,982 |
Capital expenditures | ' | ' | ' | ' | ' | ' | ' | ' | 34,835 | 27,249 | 29,331 |
Total assets | 1,483,075 | ' | ' | ' | 1,412,325 | ' | ' | ' | 1,483,075 | 1,412,325 | 1,339,325 |
Retail | United States | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Third Party | ' | ' | ' | ' | ' | ' | ' | ' | 1,734,855 | 1,617,120 | 1,405,895 |
Retail | Foreign | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Third Party | ' | ' | ' | ' | ' | ' | ' | ' | 191,915 | 167,881 | 112,599 |
Franchise | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenue | ' | ' | ' | ' | ' | ' | ' | ' | 440,464 | 408,108 | 334,792 |
Operating income | ' | ' | ' | ' | ' | ' | ' | ' | 156,035 | 136,463 | 111,261 |
Depreciation and amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | 3,004 | 3,052 | 2,873 |
Capital expenditures | ' | ' | ' | ' | ' | ' | ' | ' | 229 | 91 | 684 |
Total assets | 522,996 | ' | ' | ' | 506,021 | ' | ' | ' | 522,996 | 506,021 | 491,008 |
Manufacturing/Wholesale | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intersegment revenues | ' | ' | ' | ' | ' | ' | ' | ' | 269,488 | 263,177 | 224,127 |
Third Party | ' | ' | ' | ' | ' | ' | ' | ' | 263,074 | 236,874 | 218,893 |
Subtotal segment revenues | ' | ' | ' | ' | ' | ' | ' | ' | 532,562 | 500,051 | 443,020 |
Operating income | ' | ' | ' | ' | ' | ' | ' | ' | 104,709 | 95,462 | 82,185 |
Depreciation and amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | 11,003 | 11,490 | 11,585 |
Capital expenditures | ' | ' | ' | ' | ' | ' | ' | ' | 8,464 | 8,032 | 7,534 |
Total assets | 423,939 | ' | ' | ' | 417,945 | ' | ' | ' | 423,939 | 417,945 | 410,171 |
Elimination of intersegment revenues | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intersegment revenues | ' | ' | ' | ' | ' | ' | ' | ' | -269,488 | -263,177 | -224,127 |
Warehousing and distribution | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warehousing and distribution costs | ' | ' | ' | ' | ' | ' | ' | ' | -66,614 | -63,297 | -60,539 |
Unallocated corporate and other costs: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Corporate costs | ' | ' | ' | ' | ' | ' | ' | ' | -81,435 | -85,282 | -80,370 |
Transaction and restructuring related costs | ' | ' | ' | ' | ' | ' | ' | ' | -12,353 | -1,926 | -13,536 |
Subtotal unallocated corporate and other costs | ' | ' | ' | ' | ' | ' | ' | ' | -160,402 | -150,505 | -154,445 |
Corporate / Other | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Depreciation and amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | 7,038 | 6,406 | 6,350 |
Capital expenditures | ' | ' | ' | ' | ' | ' | ' | ' | 6,719 | 6,558 | 6,268 |
Total assets | $310,337 | ' | ' | ' | $215,749 | ' | ' | ' | $310,337 | $215,749 | $189,083 |
SEGMENTS_Details_2
SEGMENTS (Details 2) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Retail | ' | ' | ' |
Sales by general product category | ' | ' | ' |
Third Party | $1,926,770,000 | $1,785,001,000 | $1,518,494,000 |
Retail | United States | ' | ' | ' |
Sales by general product category | ' | ' | ' |
Third Party | 1,734,855,000 | 1,617,120,000 | 1,405,895,000 |
Retail | Other | ' | ' | ' |
Sales by general product category | ' | ' | ' |
Third Party | 191,915,000 | 167,881,000 | 112,599,000 |
VMHS | Retail | United States | ' | ' | ' |
Sales by general product category | ' | ' | ' |
Third Party | 663,625,000 | 624,647,000 | 542,575,000 |
Sports Nutrition Products | Retail | United States | ' | ' | ' |
Sales by general product category | ' | ' | ' |
Third Party | 764,908,000 | 686,208,000 | 621,751,000 |
Diet Products | Retail | United States | ' | ' | ' |
Sales by general product category | ' | ' | ' |
Third Party | 198,834,000 | 192,335,000 | 139,612,000 |
Other Wellness Products | ' | ' | ' |
Sales by general product category | ' | ' | ' |
Accounting adjustments | 15,400,000 | 8,100,000 | 2,200,000 |
Other Wellness Products | Retail | United States | ' | ' | ' |
Sales by general product category | ' | ' | ' |
Third Party | $107,488,000 | $113,930,000 | $101,957,000 |
FRANCHISE_REVENUE_Details
FRANCHISE REVENUE (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
item | |||
FRANCHISE REVENUE | ' | ' | ' |
Initial term of agreements | '10 years | ' | ' |
Types of flat franchise fees charged | 3 | ' | ' |
Initial franchise fees recognized | $5,100,000 | $4,000,000 | $3,000,000 |
Franchise revenue | ' | ' | ' |
Franchise revenue | 440,464,000 | 408,108,000 | 334,792,000 |
Product sales | ' | ' | ' |
Franchise revenue | ' | ' | ' |
Franchise revenue | 364,500,000 | 340,574,000 | 275,026,000 |
Royalties | ' | ' | ' |
Franchise revenue | ' | ' | ' |
Franchise revenue | 58,247,000 | 53,047,000 | 46,507,000 |
Franchise fees | ' | ' | ' |
Franchise revenue | ' | ' | ' |
Franchise revenue | 8,166,000 | 7,024,000 | 5,585,000 |
Other | ' | ' | ' |
Franchise revenue | ' | ' | ' |
Franchise revenue | $9,551,000 | $7,463,000 | $7,674,000 |
RELATED_PARTY_TRANSACTIONS_Det
RELATED PARTY TRANSACTIONS (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2013 | 31-May-13 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Mar. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2011 | Aug. 09, 2012 | Mar. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2011 |
In Millions, except Share data, unless otherwise specified | Class B Common Stock | Class B Common Stock | Cadillac Fairview | Cadillac Fairview | Cadillac Fairview | Ontrea | Ontrea | Ontrea | OTPP | OTPP | OTPP | OTPP | Ares | ACOF Operating Manager | ACOF Operating Manager | ACOF Operating Manager | |
item | item | Maximum | Class B Common Stock | Class B Common Stock | |||||||||||||
Related party transaction | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of annual management fee, payable on a quarterly basis | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.80 | ' |
Period up to which quarterly payment of annual management fee to be made from the date of merger | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' |
Period of extension for payment of management fee after tenth anniversary from date of merger | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' |
Amount of management fee paid | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.2 |
Net present value of management fee paid on consummation of IPO | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.6 | ' | ' |
Amount of annual special dividend payable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.8 | ' | ' | ' | ' | ' |
Special Dividend Period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' |
Amount of special dividend paid | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.2 | ' | ' | ' | ' |
Net present value of special dividend paid on consummation of IPO | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.6 | ' | ' | ' | ' | ' | ' | ' |
Common stock, shares outstanding | 94,000,000 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares of common stock owned by related party | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000 | ' | ' | ' | ' | ' | ' |
Number of lease agreements entered into by the company | ' | ' | ' | ' | ' | 16 | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount paid under lease agreements | ' | ' | ' | $2.40 | $2.40 | ' | $0.20 | $0.20 | $0.20 | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares authorized to be repurchased | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,000,000 | ' | ' | ' |
Repurchase price per share (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $38.42 | ' | ' | ' |
QUARTERLY_FINANCIAL_INFORMATIO2
QUARTERLY FINANCIAL INFORMATION (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Quarterly results: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenue | $613,748 | $675,594 | $676,276 | $664,691 | $565,023 | $621,607 | $619,081 | $624,272 | $2,630,308 | $2,429,983 | $2,072,179 |
Gross profit | 227,152 | 253,945 | 255,892 | 256,137 | 214,377 | 235,214 | 239,437 | 240,709 | 993,127 | 929,738 | 753,833 |
Operating income | 86,334 | 125,974 | 123,671 | 124,520 | 87,533 | 111,177 | 117,060 | 112,069 | 460,498 | 427,840 | 282,507 |
Net income | $47,657 | $73,033 | $71,688 | $72,643 | $47,438 | $62,229 | $66,671 | $63,857 | $265,021 | $240,196 | $132,333 |
Weighted average shares outstanding: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in shares) | 94,636 | 95,183 | 97,428 | 98,997 | 99,205 | 102,541 | 106,517 | 105,805 | 96,481 | 103,503 | 100,261 |
Diluted (in shares) | 95,477 | 96,078 | 98,333 | 99,861 | 100,119 | 103,721 | 107,927 | 107,746 | 97,383 | 104,911 | 103,010 |
Earnings per share: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in dollars per share) | $0.50 | $0.77 | $0.74 | $0.73 | $0.48 | $0.61 | $0.63 | $0.60 | $2.75 | $2.32 | $1.27 |
Diluted (in dollars per share) | $0.50 | $0.76 | $0.73 | $0.73 | $0.47 | $0.60 | $0.62 | $0.59 | $2.72 | $2.29 | $1.24 |
SUBSEQUENT_EVENTS_Details
SUBSEQUENT EVENTS (Details) (USD $) | 12 Months Ended | 0 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | Jan. 30, 2014 | |
Subsequent event | |||
Dividend declared | |||
Class A Common Stock | |||
Subsequent events | ' | ' | ' |
Dividends declared per share: (in dollars per share) | $0.60 | $0.44 | $0.16 |
SCHEDULE_I_CONDENSED_FINANCIAL1
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF GNC HOLDINGS, INC. (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
In Thousands, unless otherwise specified | ||||
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | $226,217 | $158,541 | $128,438 | $193,902 |
Prepaids and other current assets | 47,081 | 39,016 | ' | ' |
Total current assets | 966,047 | 818,797 | ' | ' |
Long-term assets: | ' | ' | ' | ' |
Total long-term assets | 1,774,300 | 1,733,243 | ' | ' |
Total assets | 2,740,347 | 2,552,040 | 2,429,587 | ' |
Current liabilities: | ' | ' | ' | ' |
Accounts payable | 135,164 | 125,165 | ' | ' |
Deferred revenue and other current liabilities | 106,459 | 116,337 | ' | ' |
Total current liabilities | 247,066 | 245,319 | ' | ' |
Total liabilities | 1,924,768 | 1,670,001 | ' | ' |
Stockholders' equity: | ' | ' | ' | ' |
Paid-in-capital | 847,886 | 810,094 | ' | ' |
Retained earnings | 700,108 | 492,687 | ' | ' |
Treasury stock, at cost | -734,482 | -423,900 | ' | ' |
Accumulated other comprehensive income | 1,955 | 3,047 | ' | ' |
Total stockholders' equity | 815,579 | 882,039 | 978,462 | 619,483 |
Total liabilities and stockholders' equity | 2,740,347 | 2,552,040 | ' | ' |
Class A Common Stock | ' | ' | ' | ' |
Stockholders' equity: | ' | ' | ' | ' |
Common stock | 112 | 111 | ' | ' |
Parent Company | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | 282 | 880 | 32,989 | 43,261 |
Prepaids and other current assets | 285 | 70 | ' | ' |
Total current assets | 567 | 950 | ' | ' |
Long-term assets: | ' | ' | ' | ' |
Intercompanies | 1,069 | 3,079 | ' | ' |
Investment in subsidiaries | 962,469 | 963,883 | ' | ' |
Total long-term assets | 963,538 | 966,962 | ' | ' |
Total assets | 964,105 | 967,912 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Accounts payable | ' | 73 | ' | ' |
Deferred revenue and other current liabilities | 356 | 330 | ' | ' |
Total current liabilities | 356 | 403 | ' | ' |
Intercompany Loan | 148,170 | 85,470 | ' | ' |
Total liabilities | 148,526 | 85,873 | ' | ' |
Stockholders' equity: | ' | ' | ' | ' |
Paid-in-capital | 847,886 | 810,094 | ' | ' |
Retained earnings | 700,108 | 492,687 | ' | ' |
Treasury stock, at cost | -734,482 | -423,900 | ' | ' |
Accumulated other comprehensive income | 1,955 | 3,047 | ' | ' |
Total stockholders' equity | 815,579 | 882,039 | ' | ' |
Total liabilities and stockholders' equity | 964,105 | 967,912 | ' | ' |
Parent Company | Class A Common Stock | ' | ' | ' | ' |
Stockholders' equity: | ' | ' | ' | ' |
Common stock | $112 | $111 | ' | ' |
SCHEDULE_I_CONDENSED_FINANCIAL2
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF GNC HOLDINGS, INC. (Details 2) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Statements of Income and Comprehensive Income | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other selling, general and administrative | ' | ' | ' | ' | ' | ' | ' | ' | $131,270 | $123,484 | $113,477 |
Operating income | 86,334 | 125,974 | 123,671 | 124,520 | 87,533 | 111,177 | 117,060 | 112,069 | 460,498 | 427,840 | 282,507 |
Interest expense, net | ' | ' | ' | ' | ' | ' | ' | ' | 53,029 | 47,556 | 74,903 |
Income before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 407,469 | 380,284 | 207,604 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | 142,448 | 140,088 | 75,271 |
Net income | 47,657 | 73,033 | 71,688 | 72,643 | 47,438 | 62,229 | 66,671 | 63,857 | 265,021 | 240,196 | 132,333 |
Comprehensive income | ' | ' | ' | ' | ' | ' | ' | ' | 263,929 | 240,519 | 136,337 |
Earnings per share: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in dollars per share) | $0.50 | $0.77 | $0.74 | $0.73 | $0.48 | $0.61 | $0.63 | $0.60 | $2.75 | $2.32 | $1.27 |
Diluted (in dollars per share) | $0.50 | $0.76 | $0.73 | $0.73 | $0.47 | $0.60 | $0.62 | $0.59 | $2.72 | $2.29 | $1.24 |
Dividends declared per share | ' | ' | ' | ' | ' | ' | ' | ' | $0.60 | $0.44 | ' |
Parent Company | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Statements of Income and Comprehensive Income | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other selling, general and administrative | ' | ' | ' | ' | ' | ' | ' | ' | 749 | 2,076 | 14,037 |
Subsidiary income | ' | ' | ' | ' | ' | ' | ' | ' | -265,522 | -241,492 | -140,359 |
Operating income | ' | ' | ' | ' | ' | ' | ' | ' | 264,773 | 239,416 | 126,322 |
Interest expense, net | ' | ' | ' | ' | ' | ' | ' | ' | 44 | -12 | -254 |
Income before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 264,729 | 239,428 | 126,576 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | -292 | -768 | -5,757 |
Net income | ' | ' | ' | ' | ' | ' | ' | ' | 265,021 | 240,196 | 132,333 |
Comprehensive income | ' | ' | ' | ' | ' | ' | ' | ' | $263,929 | $240,519 | $136,337 |
Earnings per share: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | $2.75 | $2.32 | $1.27 |
Diluted (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | $2.72 | $2.29 | $1.24 |
Dividends declared per share | ' | ' | ' | ' | ' | ' | ' | ' | $0.60 | $0.44 | ' |
SCHEDULE_I_CONDENSED_FINANCIAL3
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF GNC HOLDINGS, INC. (Details 3) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
NET CASH PROVIDED BY OPERATING ACTIVITIES: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income | $47,657 | $73,033 | $71,688 | $72,643 | $47,438 | $62,229 | $66,671 | $63,857 | $265,021 | $240,196 | $132,333 |
Other operating activities | ' | ' | ' | ' | ' | ' | ' | ' | 2,147 | -9,454 | -980 |
Net cash provided by operating activities | ' | ' | ' | ' | ' | ' | ' | ' | 238,104 | 221,216 | 174,674 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 237,253 |
Dividends payment | ' | ' | ' | ' | ' | ' | ' | ' | -57,437 | -45,216 | ' |
Proceeds from exercise of stock options | ' | ' | ' | ' | ' | ' | ' | ' | 14,588 | 25,972 | 28,550 |
Repurchase of treasury stock | ' | ' | ' | ' | ' | ' | ' | ' | -310,582 | -359,990 | -61,634 |
Repurchase of Class A Preferred Stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -223,107 |
Net cash used in financing activities | ' | ' | ' | ' | ' | ' | ' | ' | -91,803 | -146,924 | -173,648 |
Net increase (decrease) in cash and cash equivalents | ' | ' | ' | ' | ' | ' | ' | ' | 67,676 | 30,103 | -65,464 |
Beginning balance, cash and cash equivalents | ' | ' | ' | 158,541 | ' | ' | ' | 128,438 | 158,541 | 128,438 | 193,902 |
Ending balance, cash and cash equivalents | 226,217 | ' | ' | ' | 158,541 | ' | ' | ' | 226,217 | 158,541 | 128,438 |
Holdings | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
NET CASH PROVIDED BY OPERATING ACTIVITIES: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income | ' | ' | ' | ' | ' | ' | ' | ' | 265,021 | 240,196 | 132,333 |
Equity in income of subsidiaries | ' | ' | ' | ' | ' | ' | ' | ' | -265,522 | -241,492 | -140,359 |
Dividends received | ' | ' | ' | ' | ' | ' | ' | ' | 289,300 | 348,000 | 225,000 |
Other operating activities | ' | ' | ' | ' | ' | ' | ' | ' | 1,334 | 421 | 7,320 |
Net cash provided by operating activities | ' | ' | ' | ' | ' | ' | ' | ' | 290,133 | 347,125 | 224,294 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 237,253 |
Dividends payment | ' | ' | ' | ' | ' | ' | ' | ' | -57,437 | -45,216 | ' |
Loan from a subsidiary | ' | ' | ' | ' | ' | ' | ' | ' | 62,700 | ' | 85,470 |
Contributed capital | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -301,098 |
Proceeds from exercise of stock options | ' | ' | ' | ' | ' | ' | ' | ' | 14,588 | 25,972 | 28,550 |
Repurchase of treasury stock | ' | ' | ' | ' | ' | ' | ' | ' | -310,582 | -359,990 | -61,634 |
Repurchase of Class A Preferred Stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -223,107 |
Net cash used in financing activities | ' | ' | ' | ' | ' | ' | ' | ' | -290,731 | -379,234 | -234,566 |
Net increase (decrease) in cash and cash equivalents | ' | ' | ' | ' | ' | ' | ' | ' | -598 | -32,109 | -10,272 |
Beginning balance, cash and cash equivalents | ' | ' | ' | 880 | ' | ' | ' | 32,989 | 880 | 32,989 | 43,261 |
Ending balance, cash and cash equivalents | $282 | ' | ' | ' | $880 | ' | ' | ' | $282 | $880 | $32,989 |
SCHEDULE_I_CONDENSED_FINANCIAL4
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF GNC HOLDINGS, INC. (Details 4) (USD $) | 1 Months Ended | 1 Months Ended | |||||
In Millions, except Share data, unless otherwise specified | Apr. 30, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Aug. 31, 2012 | Apr. 30, 2011 | Apr. 30, 2011 | Apr. 30, 2011 |
Class A Common Stock | Class A Common Stock | Class B Common Stock | Series A | ||||
item | |||||||
PUBLIC OFFERINGS | ' | ' | ' | ' | ' | ' | ' |
Issuance of common stock (in shares) | ' | ' | ' | ' | 25,875,000 | ' | ' |
Common stock, par value (in dollars per share) | ' | $0.00 | $0.00 | ' | $0.00 | $0.00 | ' |
IPO price of share (in dollars per share) | ' | ' | ' | ' | $16 | ' | ' |
Preferred stock, par value (in dollars per share) | ' | ' | ' | ' | ' | ' | $0.00 |
Repayment of outstanding borrowings from the net proceeds of the IPO | $300 | ' | ' | ' | ' | ' | ' |
Payment made to satisfy obligations under the Management Services Agreement | $11.10 | ' | ' | ' | ' | ' | ' |
Number of shares repurchased | ' | ' | ' | 6,000,000 | ' | ' | ' |
Number of stockholders from whom stock is repurchased | ' | ' | ' | 1 | ' | ' | ' |
SCHEDULE_II_VALUATION_AND_QUAL1
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Allowance for Doubtful Accounts | ' | ' | ' |
Movement in valuation and qualifying accounts | ' | ' | ' |
Balance at beginning of period | $2,178 | $2,292 | $1,564 |
Additions-charged to costs and expense | 4,241 | 4,763 | 2,989 |
Deductions | -4,529 | -4,877 | -2,261 |
Balance at end of period | 1,890 | 2,178 | 2,292 |
Tax Valuation Allowances | ' | ' | ' |
Movement in valuation and qualifying accounts | ' | ' | ' |
Balance at beginning of period | 1,765 | 2,946 | 4,418 |
Additions-charged to costs and expense | ' | 565 | 44 |
Deductions | -1,200 | -1,746 | -1,516 |
Balance at end of period | $565 | $1,765 | $2,946 |